Which of the following is not a situation in which strict liability applies? Multiple Choice Aimee manufactures snack cakes that are sold in small grocery stores. Faye owns a business in which she regularly uses explosives. Amanda owns a pet tiger that she keeps in her home in a suburban neighborhood. T.J. manufactures cheap clothing that falls apart after minimal use.

Answers

Answer 1

Answer:

The correct answer is the last option: T.J. manufactures cheap clothing that falls apart after minimal use.

Explanation:

To begin with, the term known as "Strict Liability", in criminal and civil law, refers to the situation in which a person is legally responsible for the consequences flowing from an activity that it also applies even in those cases where there is an absence of fault or criminal intent from the figure of the defendant under court. Therefore that in the situations that are presented the one in where the strict liability does not applies is the case of T.J manufacturing cheap clothes because the person knows what the product is worth.

Answer 2

The following is not a situation in which strict liability applies is :

D) T.J. manufactures cheap clothing that falls apart after minimal use.

Strict Liability Applies

The following is not a situation in which strict liability applies is that T.J. manufactures cheap clothing that falls apart after minimal use.

The strict liability exists when a litigant is at risk for committing an activity, notwithstanding of what his/her aim or mental state was when committing the activity.

In criminal law, ownership violations and statutory assault are both cases of strict risk offenses.

Therefore, that in the circumstances that are displayed the one in where the strict obligation does not applies is the case of T.J fabricating cheap dress since the individual knows what the item is worth.

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Related Questions

Internal rate of return method The internal rate of return method is used by Testerman Construction Co. in analyzing a capital expenditure proposal that involves an investment of $149,630 and annual net cash flows of $45,000 for each of the six years of its useful life. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the question below. Open spreadsheet Determine the internal rate of return for the proposal.

Answers

Answer:

Testerman Construction Co.

Internal rate of return method in analyzing capital expenditure:

Present value of expenditure = $149,630

Present of cash inflows annuity = $149,630 (using 20% discount rate and present value annuity factor of 3.3251 x $45,000)

NPV = $0 (PV of cash outflow - PV of cash inflow)

Therefore, the IRR = 20%

Explanation:

a) Data and Calculations:

Investment cost = $149,630

Annual net cash flows = $45,000

Investment period = 6 years

Annuity of future cash flows = 3.3251

b) Testerman’s IRR (Internal Rate of Return) is a capital budgeting and analysis tool which determines the discount rate that makes the present value of future inflows equal to the present value of outflows from a project.  This IRR helps the managers to determine the projects that add value and are worth undertaking.  IRR is based on assumptions.  Similar projects with the same IRR will differ in returns due to the differences in timing and the size of the cash, the amount of debts and equity used  to generate the returns, and the assumption of a constant reinvestment may which IRR makes.

ABC Corporation, after many profitable years, declares a one-time special cash dividend of $10.00 per share. After the announcement, the stock is trading at $100 per share. Your customer holds 1 ABC Jan 110 Call. As of the ex date, the customer will have:

Answers

Answer:

1 ABC Jan 100 Call

Explanation:

Although the OCC does not usually adjust the strike price of listed options for regular quarterly cash dividends. This is because they are known quantity that are segmented by the market into options premium.

For special cash dividends, they are not a frequent event hence market does not recognize them. This special cash dividend is $10 per share × 100 shares = $1,000 value per contract. It therefore means that the $1,000 value per contract will be adjusted.

The new strike price will be

= 110 - 10 cash dividend

= 100. It also means that the number of shares covered by the contract does not change.

Community attitudes, zoning restrictions, and quality of labor force are likely to be considered in which of the following location decision methods?
a. simulation
b. factor-rating method
c. transportation method
d. locational cost volume analysis
e. center-of-gravity method

Answers

Answer:

b. factor-rating method.

Explanation:

Community attitudes, zoning restrictions, and quality of labor force are likely to be considered in factor-rating method of a location decision.

A factor-rating method can be defined as a strategic process which involves analyzing location alternatives or routes by comparing their weighted average point. Basically, a factor-rating method involves evaluating both qualitative and quantitative factors in location decision.

Hence, in this approach to location decision, each factors are assigned a weight which must all total 1.0.

Usually, the decision to notify parties outside the client’s organization regarding noncompliance with laws and regulations is the responsibility of the

Answers

Answer:

Management

Explanation:

Sometimes in the course of discharging his duties, an auditor might discover a case of non-compliance with laws and regulations. In such situations, he is expected to report the issue to the governing body or management of the organization who in turn notify parties outside the client's organization. This might imply reporting to the appropriate law enforcement agencies who now investigate the matter.

The auditor should ensure that he is keeping to the code of confidentiality before proceeding on such a case. The management is expected to review the report to determine if the action was indeed non-compliant with the laws before proceeding on the next call of action.

Manufacturing produces​ self-watering planters for use in upscale retail establishments. Sales projections for the first five months of the upcoming year show the estimated unit sales of the planters each month to be as​ follows:


Inventory at the start of the year was 975 planters. The desired inventory of planters at the end of each month should be equal to 25% of the following month's budgeted sales. Each planter requires four pounds of polypropylene (a type of plastic). The company wants to have 30% of the polypropylene required for next month's production on hand at the end of each month. The polypropylene costs $0.20 per pound.

Number of planters to be sold
January 3900
February 3200
March 3700
April 4400
May 4900

Required:
Prepare a production budget for each month in the first quarter of the year, including production in units for each month and for the quarter.

Answers

Answer:

              Production budget for the first quarter of 202x

Particulars               January     February     March         Total

Expected sales        3,900        3,200          3,700          10,800

Required ending      800           925             1,100           2,825

inventory

Less beginning        975            800             925            2,700

inventory

Required number    3,725          3,325          3,875         10,925

of units to be produced

The production budget for the first quarter includes the months of January, February and March. It doesn't include any materials, since they are included in the materials purchase budget.

Good strategy execution involves Multiple Choice making choices among broad or narrow low cost and differentiation strategies to compete against rivals. selecting a capable management team. team participation to perform strategy-critical activities in light of prevailing circumstances. only senior-level managers to be accomplished on a timely basis. continuous improvements in the value chain in order to maximize operating efficiency.

Answers

Answer:

The answer is: team participation to perform strategy-critical activities in light of prevailing circumstances.

Explanation:

The good execution of the strategy is mainly related to the ability of managers to involve all operational areas and all employees in the process of participating in the strategic actions that were developed to achieve the goals and objectives of the organization.

Therefore, managers have an essential role in exercising control, coordination and monitoring of the teams, so that the execution of the strategy takes place in an effective and active manner, being shared as a responsibility and efforts of the entire team.

Advertising department expenses of $42,800 and purchasing department expenses of $32,100 of Cozy Bookstore are allocated to operating departments on the basis of dollar sales and purchase orders, respectively. Information about the allocation bases for the three operating departments follows.
Department Sales Purchase Orders
Books $ 180,000 1,170
Magazines 108,000 520
Newspapers 112,000 910
Total $ 400,000 2,600
Complete the following table by allocating the expenses of the two service departments (advertising and purchasing) to the three operating departments. (Amounts to be deducted should be indicated with minus sign.)

Answers

Answer:

Cozy Bookstore

Allocation of Service Departments' Overheads to the Operating Departments:

                                 Books      Magazines       Newspapers   Total

Allocation of:

Advertising Dept.  $19,260     $11,556             $11,984       $42,800

(Dollar Sales)

Purchasing Dept.  $14,445      $6,420             $11,235       $32,100

(Purchase Orders)

Total                     $33,705     $17,976            $23,219      $74,900

Explanation:

a) Data and Calculations:

1. Allocation Basis:

Department               Sales                      Purchase Orders

Books                       $ 180,000 (45%)              1,170  (45%)

Magazines                  108,000 (27%)               520  (20%)

Newspapers               112,000 (28%)                910  (35%)

Total                      $ 400,000                      2,600

2. Allocation of Advertising Department expenses of $42,800 on the basis of dollar sales:

Books = 45% of $42,800 = $19,260

Magazines = 27% of $42,800 = $11,556

Newspapers = 28% of $42,800 = $11,984

3. Allocation of Purchasing Department expenses of $32,100 on the basis of  Purchase orders:

Books = 45% of $32,100 = $14,445

Magazines = 20% of $32,100 = $6,420

Newspapers = 35% of $32,100 = $11,235

4. The allocation of overheads for the service departments of Advertising and Purchase of Cozy Bookstore was done using the direct method.  This method allocates the overheads directly to each operating unit of either Books, Magazines, or Newspapers.  This is a straightforward method.  Other methods exists for the allocation.  They include the step method and the reciprocal method; details of their discussions are not included in this class.

On December 31 of the current​ year, Jerome Company has an accounts receivable balance of before any year end adjustments. The Allowance for Doubtful Accounts has a credit balance. The company prepares the following aging schedule for accounts​ receivable: Total Balance 130 days 3160 days 6190 days over 90 days Percent uncollectible ​1% ​2% ​% ​% What is the Allowance for Uncollectible Accounts at December 31 of the current year after​ adjustments

Answers

Answer:

I looked for the missing information and found the following:

Total Balance     1-30 days    31-60 days    61-90 days    over 90 days

$329,000          $160,000      $90,000         $51,000           $28,000

% uncollectible        1%                2%                   3%                   20%

Allowance for Doubtful Accounts has a $1,100 credit balance before any adjustment.

total bad debt expense = $1,600 + $1,800 + $1,530 + $5,600 = $10,530

adjusting entry = $10,530 - $1,100 = $9,430

adjusting entry:

December 31, 202x, bad debt expense

Dr Bad debt expense 9,430

    Cr Allowance for doubtful accounts 9,430

You just won the lottery, which promises you $260,000 per year for the next 20 years, starting today (annuity due). If your discount rate is 7%, what is the present value of your winnings?

Answers

Answer:

the present value of your winnings will be $2,947,254.76.

Explanation:

The Present Value, PV of the Annuity due can be calculated as follows :

Pmt = $260,000

P/yr = 1

n = 20

r = 7%

Fv = $0

Pv = ?

Using a financial Calculator, the Present Value, PV of the Annuity due is $2,947,254.76

Which one of the following conditions is not a requirement for an item to be recorded as a liability on a company's balance sheet?
a) It involves a probable future sacrifice of economic resources by the company.
b) It reduces the market value of the company.
c) It involves a probable future sacrifice to another entity.
d) It a present obligation, arising from a past transaction or event.

Answers

Answer:

c) It involves a probable future sacrifice to another entity.

Explanation:

A Liability is defined by the Conceptual Framework as Present Obligation of the entity as a result of past event, the settlement of which will result in the outflow of future economic benefits from the entity.

Additionally liabilities are meant to reduce the market value of the company.

The failure to record a purchase of mer chandise on account even though the goods are properly included in the physical inven tory results in

Answers

Answer: D. an understatement of expenses and an overstatement of owners' equity

Explanation:

If a purchase of merchandise was not recorded, it would mean that Purchases being an expense that contributes to the Cost of Goods sold would be understated.

This understatement would mean that the the Net income is overstated because the purchase expenses were never deducted from it. Net Income is part of owners' equity so if it is overstated, so is owners' equity .

Calculate the monthly implicit costs for a business owner who devotes 200 hours per month to his business that could be spent working at $50/hour for someone else.

Answers

Answer:

Implicit cost = $10,000

Explanation:

Implicit cost is the opportunity cost of using resources a business already owns.

This business owner passes this income by being in a business for himself

200 hours per month multiplied by $50/hour

200 x 50

= 10000

Implicit cost = $10,000

Bond X is a premium bond making semiannual payments. The bond pays a coupon rate of 9 percent, has a YTM of 7 percent, and has 15 years to maturity. Bond Y is a discount bond making semiannual payments. This bond pays a coupon rate of 7 percent, has a YTM of 9 percent, and also has 15 years to maturity. The bonds have a $1,000 par value. What is the price of each bond today

Answers

Answer:

Bond Price today

Bond X = $1183.920454 rounded off to $1183.92

Bond Y = $837.1111146 rounded off to $837.11

Explanation:

To calculate the price of the bond, we need to first calculate the coupon payment per period. We assume that the interest rate provided is stated in annual terms. As the bond is a semi annual bond, the coupon payment, number of periods and semi annual YTM will be,

For Bond X

Coupon Payment (C) = 0.09 * 1/2 * 1000 = $45

Total periods (n)= 15 * 2 = 30

r or YTM = 7% * 1/2 = 3.5% or 0.035

The formula to calculate the price of the bonds today is attached.

Bond Price = 45 * [( 1 - (1+0.035)^-30) / 0.035]  +  1000 / (1+0.035)^30

Bond Price = $1183.920454 rounded off to $1183.92

For Bond Y

Coupon Payment (C) = 0.07 * 1/2 * 1000 = $35

Total periods (n)= 15 * 2 = 30

r or YTM = 9% * 1/2 = 4.5% or 0.045

Bond Price = 35 * [( 1 - (1+0.045)^-30) / 0.045]  +  1000 / (1+0.045)^30

Bond Price = $837.1111146 rounded off to $837.11

A draft is issued by the exporter's bank, ordering the importer's bank to pay for the merchandise and thus guaranteeing payment once it is accepted by the importer's bank.

a. True
b. False

Answers

Answer:

A. True

Explanation:

Answer: A. True

Explanation: The process of bank loans.

On August 1, 2010, a company issues bonds with a par value of $600,000. The bonds mature in 10 years and pay 6% annual interest, payable each February 1 and August 1. The bonds sold at $592,000. The company uses the straight-line method of amortizing bond discounts. The company's year-end is December 31. Prepare the general journal entry to record the interest accrued at December 31, 2010.

Answers

Answer:

Dr Discount on BP 8,000

Cr Cash 592,000

Cr Bond payable 600,000

Dr Interest expense 15,333.33

Cr Interest payable 15,000

Cr Discount on BP 333.33

Dr Interest payable 15,000

Dr interest expense 3,066.67

Cr Cash 18,000

Cr Discount on BP 333.33

Explanation:

Preparation of the general journal entry to record the interest accrued at December 31, 2010.

Based on the information given we were told that the company issues bonds with a par value of the amount of $600,000 in which the bonds mature in 10 years with a 6% annual interest and sold at the amount of $592,000 this means that the transaction will be recorded as:

Dr Discount on BP 8,000

(600,000-592,000)

Cr Cash 592,000

Cr Bond payable 600,000

(To record issuance of the bonds)

Dr Interest expense 15,333.33

Cr Interest payable 15,000 (600,000 x 6% x 5/12 )

Cr Discount on BP 333.33

(8,000 / (10years* 2 payment =400*5/6=333.33)

(To record year end adjustment entry)

Dr Interest payable 15,000

(600,000 x 6% x 5/12 )

Dr interest expense 3,066.67

(600,000 x 6% x 1/12=3,000)

(400 - 333.33= 66.67)

(3,000+66.67=3,066.67)

Cr Cash 18,000

(600,000 x 6% x 6/12)

Cr Discount on BP 333.33

(8,000 / (10years* 2 payment =400*5/6=333.33)

(To record first interest payment to bondholders)

A divisional manager receives a bonus based on 10% of the residual income from the division. During the current year, the division reported revenues of $1,000,000 and expenses of $500,000. The division had $2,000,000 in average operating assets. The minimum required rate of return for the division was 15%. What was the amount of the manager's bonus

Answers

Answer:

The amount of the manager's bonus is $20,000

Explanation:

Residual income =  Net income - ( average operating assets * minimum rate of return)

Net income= Revenues - Expenses  = $1,000,000 - $500,000

Net income = $500,000

Residual income = 500,000 - (2,000,000 * 15%)

= 500,000 - $300,000

= $200,000

Managers bonus = $200,000 * 10%

Managers bonus = $20,000

Tom and Lynda also inform you that the monthly individual membership fee is $100and that the monthly family membership fee is $160. Hercules offers a 10% discount if amember pays the entire year’s fee in a lump sum. About 180 individuals and 60 families takeadvantage of this offer – these numbers are spread evenly throughout the year. Herculespays for 60% of its purchases during the month of the purchase, and the remainder thenext month. Other variable costs (paid in cash) amount to $25 per month for each individualmembership and $45 per month for each family membership. Hercules also incurs$41,000 (which includes $12,500 in depreciation) toward fixed costs each month. Finally,Tom and Lynda inform you that they have to pay $20,000 toward the purchase of newequipment in September, and that they take out $15,000 each month as their profit. Finally,Hercules began September with a cash balance of $6,000.Required:What is Hercules’ cash budget for September?

Answers

Answer:

Net Cash $2,170

Explanation:

Cash Budget for September:

Beginning Balance $6,000

Individual membership fee revenue $1,350

Family membership fee revenue $720

Less:Variable Cost Individual  ($25 * 15) $375

Less:Variable Cost Family  ($25 * 5) $125

Less:Purchase of Machine $20,000

Less:Fixed cost $41,000

Net Cash $2,170

Individual membership fee revenue

$100 * 90% * 180 = 16,200 per year

16,200 / 12 = 1,350 per month.

Memberships per month = 180/12 = 15

Family membership fee revenue

$160 * 90% * 60 = 8,640 per year

8,640 / 12 = 720 per month.

Memberships per month = 60/12 = 5

After analyzing its own resources and unique abilities, a company is now trying to determine what group of customers it can satisfy with a good or service. It is in the process of choosing a

Answers

Answer: target market

Explanation: A target market is simply a group of people whose needs and preferences match the product range of a company and to whom those products are marketed, often times actively. As such, when the resources and unique abilities of a firm has been analysed, and is now in the process of determining what group of customers it can satisfy with a good or service, then it is in the process of choosing a target market.

A customer buys a new issue municipal bond with a dated date of January 1st, settling on February 1st. The first interest payment is due March 1st. How many days of accrued interest must the customer pay to the underwriter

Answers

Answer: 30 days

Explanation:

The accrued interest is to be paid for the period beginning from the date of issue till the date of settlement. However, the date of settlement is not included which means interest will not be paid for the 1st of February.

That leave the 31 days of January for payment. With Municipal Bonds however, accrued interest is calculated assuming only 30 days in a month so January will have 30 days in terms of accrued interest.

30 days is the number of days that accrued interest must be paid to the underwriter.

Carter & Carter is considering setting up a regional lockbox system to speed up collections. The company sells to customers all over the U.S., and all receipts come in to its headquarters in San Francisco. The firm's average accounts receivable balance is $2.5 million, and they are financed by a bank loan at an 11% annual interest rate. The firm believes this new lockbox system would reduce receivables by 20%. If the annual cost of the system is $15,000, what pre-tax net annual savings would be realized? a. $32,400 b. $29,160 c. $40,000 d. $44,000 e. $36,000

Answers

Answer:

c. $40,000

Explanation:

Reduction in Account Receivables          $500,000

($2,500,000 * 20%)

* Interest rate                                               11%          

Annual saving                                             $55,000

Less: Annual cost of system                     -$15,000

Pretax Net annual savings                         $40,000

The management of Advanced Alternative Power Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows:

Year Wind Turbines Biofuel Equipment
1 $280,000 $300,000
2 280,000 300,000
3 280,000 300,000
4 280,000 300,000

The wind turbines require an investment of $887,600, while the biofuel equipment requires an investment of $911,100. No residual value is expected from either project.

Year 6% 10% 12% 15% 20%
1 0.943 0.909 0.893 0.870 0.833
2 1.833 1.736 1.690 1.626 1.528
3 2.673 2.487 2.402 2.283 2.106
4 3.465 3.170 3.037 2.855 2.589
5 4.212 3.791 3.605 3.353 2.991
6 4.917 4.355 4.111 3.785 3.326
7 5.582 4.868 4.564 4.160 3.605
8 6.210 5.335 4.968 4.487 3.837
9 6.802 5.759 5.328 4.772 4.031
10 7.360 6.145 5.650 5.019 4.192

Required:
a. Compute the net present value for each project. Use a rate of 6% and the present value of an annuity of $1 in the table above. If required, round to the nearest dollar.
b. Compute a present value index for each project.
c. Determine the internal rate of return for each project by (a) computing a present value factor for an annuity of $1 and (b) using the present value of an annuity of $1 in the table above. If required, round your present value factor answers to three decimal places and internal rate of return to the nearest percent.

Answers

Answer:

A. Wind Turbines  = $82,629.57

Biofuel Equipment = $128,431.68

B. Wind Turbines  = 1 + ($82,629.57 /  $887,600) = 1.093

Biofuel Equipment = 1 + ($128,431.68 / $911,100) = 1.141

C. Wind Turbines  = 10%

Biofuel Equipment = 12%

Explanation:

Net present value is the present value of after tax cash flows from an investment less the amount invested.  

Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested

NPV and IRR can be calculated using a financial calculator  

Wind Turbines

Cash flow in year 0 = $-887,600,

Cash flow each year from year 1 to 4 = $280,000

I = 6%

NPV = $82,629.57

IRR = 10%

Biofuel Equipment

Cash flow in year 0 =  $-911,100

Cash flow each year from year 1 to 4 = $300,000

I = 6%

NPV = $128,431.68

IRR = 12%

present value index = 1 + (NPV / Initial investment)

Wind Turbines  = 1 + ($82,629.57 /  $887,600) = 1.093

Biofuel Equipment = 1 + ($128,431.68 / $911,100) = 1.141

To find the NPV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

To find the IRR using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button

Capitalism is an economic system in which private property, markets, and firms play an important role. Based on this definition, which of the following statements is correct?
A. An economic system is a way of organising the production and distribution of goods and services in an entire economy.
B. The knowledge you attain from the CORE program is a private property.
C. Forced labor where the workers receive some daily allowance is a market.
D. Employee owned cooperatives are not firms.

Answers

Answer:

Correct Answer:

A. An economic system is a way of organizing the production and distribution of goods and services in an entire economy.

Explanation:

Capitalism, which is an economic system  in which a country's trade and industry are controlled by private owners for profit, rather than by the state helps in ensuring the adequate running of the country. It is a method whereby goods and services are organized in an entire economy through private investments and firms.

Jolly Company produces hula hoops. Jolly Company has the following sales projections for the upcoming​ year: First quarter budgeted hula hoop sales in units Second quarter budgeted hula hoop sales in units Third quarter budgeted hula hoop sales in units Fourth quarter budgeted hula hoop sales in units Jolly Company wants to have ​% of the next​ quarter's sales in units on hand at the end of each quarter. Inventory at the beginning of the year was hula hoops. How many hula hoops should Jolly Company produce during the first​ quarter?

Answers

Answer:  27,200 units

Explanation:

The ending inventory is calculated as;

Desired Ending Inventory = Beginning Inventory + Inventory produced - Sales in the quarter

(40,000 * 20%) = 3,600 + Inventory produced - 22,800

Inventory produced = 8,000 - 3,600 + 22,800

Inventory Produced = 27,200 units

34. Pension gains related to plan assets occur when: A. The return on plan assets is higher than expected. B. The vested benefit obligation is less than expected. C. Retiree benefits paid out are less than expected. D. The accumulated benefit obligation is more than expected.

Answers

Answer: A. The return on plan assets is higher than expected

Explanation:

Pension gains related to plan assets is said to occur when the return on plan assets is higher than expected. In a situation whereby an individual or a firm expect a certain return on an asset and when the asset's return was eventually more than the expected return on it, this means that there is a pension gains related to plan assets.

Which of the following choices below lists all accounts that have a normal debit balance? Multiple Choice Supplies, Accounts Payable, Service Revenue Equipment, Unearned Revenue, and Sales

Answers

Answer:

The answer is supplies and equipment

Explanation:

To be in debit side, there must be:

1. Increase in asset

2. Increase in expense

3. Decrease in liability

4. Decrease in equity

5. Decrease in sales or revenue

And to be in credit side, there must be:

1. Decrease in asset

2. Decrease in expense

3. Increase in liability

4. Increase in equity

5. Increase in sales or revenue

So the account that will have normal debit balance is Supplies(expense) and equipment (asset)

Company X's current assets increased by $40 million from 2007 to 2008, while the company's current liabilities increased by $25 million over the same period. The cash impact of the change in working capital was:

a. A decrease of $15 million
b. An increase of $15 million
c. An increase of $40 million
d. An increase of $25 million

Answers

Answer:

b. An increase of $15 million

Explanation:

The computation of the cash impact of the change in working capital is shown below:

As we know that

Working capital = Current assets - current liabilities

So, the change in working capital is

= Increase in current assets  - increased in current liabilities

= $40 million - $25 million

= $15 million

Hence, the b option is correct

Who should do the actual appraising of employees in an organization? Give your reasons for the choice you would make.

Answers

Answer:

It is the manager who supervises and assigns tasks to the employees who should undertake the appraisal of her employees.  The manager can achieve an objective appraisal system that motivates her employees if she can demonstrative high-level objectivity and fairness.

Explanation:

Performance appraisal is an important managerial tool which managers used to align individual employee's performance with the achievement of corporate objectives.  It is often done annually and involves a series of processes that culminates with either praise for work well done or a reprimand or caution issued to ensure that the concerned employees rediscover their purpose for being at the workplace.

Suppose selected comparative statement data for the giant bookseller Barnes & Noble are presented here. All balance sheet data are as of the end of the fiscal year (in millions).

2020 2019
Net sales $5,200 $5,500
Cost of goods sold 3,484 3,830
Net income 78 123
Accounts receivable 82 103
Inventory 1,146 1,262
Total assets 2,990 3,510
Total common stockholders’ equity 992 1,031

Required:
Compute the following ratios for 2020.

Answers

Answer:

Profit margin = net profit / total sales = $78 / $5,200 = 1.5%  

Asset turnover = total sales / average total assets = $5,200 / ($2,990 + $3,510) = 1.6

Return on assets = net income / average total assets = $78 / $3,250 = 2.4%  

Return on common stockholders’ equity =  net income / average stockholders' equity = $78 / ($992 + $1,031) = 7.71%  

Gross profit rate = gross profit / total sales = $1,716 / $5,200 = 33%

Suppose a good has a downward-sloping, straight-line demand curve. If the price elasticity of demand is 2.5 when the price is $10 per unit, then the price elasticity of demand when the price is $7 per unit could be a. approaching infinity. b. 2.7. c. 2.5. d. 1.7.

Answers

Answer:

c. 2.5

Explanation:

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.

Price elasticity of demand = percentage change in quantity demanded / percentage change in price

If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.  

the price elasticity would not change as a result of the change

A developer is proposing to build and operate an 8 store strip mall. Each unit would rent for $3,500 per month. It is expected that vacancy would run at 15% and that the expenses would be 17.5%. The loan is to be 75% of the capitalized value. The developer has an MARR of 12.5%, the bank is charging 8.5% interest, and the Long Term Debt Service is a constant 9%. To assess the financial worth of this endeavor, determine the following:

a. CAP Rate
b. Capitalized value
c. Loan amount
d. Debt Service Coverage Ratio
e. Loan per unit

Answers

Answer:

Requirement A: CAP Rate is 12.5%

Requirement B: Capitalized Value of the Property is $1,884,960

Requirement C: Loan Amount is $1,413,720

Requirement D: Debt Service Coverage Ratio is 1.85

Requirement E: Loan per unit is $176,715 Per Unit

Explanation:

Requirement A: Find the CAP Rate

The CAP Rate will be calculated using the following formula:

CAP Rate = Annual Net Operating Income (NOI) (Step1) / Property Capitalized Value (Step2)

Here

Operating Income is $235,620 (Step1)

Property Capitalized Value (Step2)

Now, by putting values we have:

CAP Rate = $235,620 / $1,884,960 = 12.5%

Step1: Find Annual Net Operating Income (NOI)

As we know that:

Operating Income = Expected Revenue - Operating Expense

Here

Expected Revenue from 8 Strip Malls = Rent / Month * 12 Months * (1 - Vacancy Ratio) * 8 Strips Malls

= $3,500 * 12 * (1 - 15%) * 8

= $285,600

Operating Expenses = Expected Revenue * 17.5%

= $285,600 * 17.5% = $49,980

Now by putting value in the above Operating Income equation, we have:

Annual Operating Income = $285,600 - $49,980 = $235,620

Step2: Find Property Capitalized Value (It is also Requirement B)

Property Capitalized Value = Annual Operating Income / Minimum Accepted Rate of Return (MARR)

Here

Annual Operating Income is $235,620 from Step1

MARR is 12.5%

By putting values, we have:

Capitalized Value of the Property = $235,620 / 12.5% = $1,884,960

Requirement C. Find Loan Amount

It is given in the question that the Loan Amount is 75% of Property Capitalized Cost. This implies:

Loan Amount = $1,884,960 * 75% = $1,413,720

Requirement D. Debt Service Coverage Ratio

Debt Service Coverage Ratio (DSCR) = Annual Net Operating Income / Total Debt Service for the Year

Here

Annual Net Operating Income is $235,620 from Step1

Total Debt Service for the Year $127,235 (See Step3 below)

By putting values, we have:

Debt Service Coverage Ratio = $235,620 / $127,235 = 1.85

Step3: Total Debt Service for the year

Total Debt Service for the year = Loan Amount * Debt Service Rate

Here

Loan Amount is $1,413,720

Debt Service Rate is 9%

By putting values, we have:

Total Debt Service for the year = $1,413,720 * 9% = $127,235

Requirement E. Find Loan Amount

We can find loan per unit by simply dividing the loan amount by number of strip mall. Here total number of strip mall are 8. This implies that:

Loan Per Unit = $1,413,720 / 8 Units = $176,715 Per Unit

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