Answer:
Correct Answer:
invest in the minimum standard deviation portfolio and, in addition, only in risky securities.
Explanation:
For an investor aiming to invest in a portfolio so that, his minimum standard deviation would lie towards the optimal right, he or she would need to invest in extremely risky securities. And, also, there will be need to maintain minimum standard deviation portfolio.
The income statements for Federer Sports Apparel for 2022 and 2021 are presented below.
FEDERER SPORTS APPAR
Income Statement
For the Years Ended December 31
Year Increase Decrease
2019 2018 Amount %
Net sales 18,800,000 15,500,000
Cost of goods 13,200,000 7,000,000
Gross prof 5,600,000 8,500,000
Operating expenses 1,600,000 1,200,000
Depreciation expense 1,000,000 1,000,000
Inventory write-down 200,000 0
Loss (litigation) 1,500,000 300,000
Required:
Prepare a horizontal analysis for 2022 using 2021 as the base year.
Answer and Explanation:
The Preparation of horizontal analysis for 2022 using 2021 as the base year is prepared with the help of a spreadsheet.
Horizontal analysis is a method for the analysis of financial statements that indicates fluctuations in the amount of the related products over a period of time. It is a valuable instrument for determining trend situations.
So, with the help of the spreadsheet, we will be able to find the net income by using the formulas.
The horizontal analysis of the Income Statement is the analytical form of preparing the income statement to determine the accurate amount and percentage of changes in each item of the income statement.
The horizontal income statement is attached below.
The horizontal analysis determines the change in the amounts of each account. The percentage change is the division of a change in amount by the base amount of the base year.
In this case, the base year was 2021.
Therefore, the change in amounts will be determined based upon the figures of the base year.
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Waterway has a standard of 2 hours of labor per unit, at $12 per hour. In producing 3800 units, Waterway used 7350 hours of labor at a total cost of $89670. Waterway's labor quantity variance is
Answer:
Direct labor time (efficiency) variance= $3,000 favorable
Explanation:
Giving the following information:
Standard= 2 hours of labor per unit, at $12 per hour.
In producing 3800 units, Waterway used 7350 hours of labor.
To calculate the direct labor quantity variance, we need to use the following formula:
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Standard quantity= 2*3,800= 7,600 hours
Direct labor time (efficiency) variance= (7,600 - 7,350)*12
Direct labor time (efficiency) variance= $3,000 favorable
Suppose an item sells for $125 in the United States and for 62,500 pesos in Chile. According to the law of one price, the nominal exchange rate (pesos/dollar) should be ________.
Answer:
$1 = 500 Pesos
1 Pesos = $0.002
Explanation:
$125 = 62,500 Pesos
$1 = 62,500 / 125
$1 = 500 Pesos
$1 = 500 Pesos
1 Pesos = $1 / 500
1 Pesos = $0.002
Assuming you are a rational investor, the amount you should be willing to pay for a 20-year ordinary annuity that makes payments of $4,000 per year and you require a 6% rate of return per year is closest to:
Answer:
PV= $45,879.68
Explanation:
Giving the following information:
Cash flow= $4,000 annually
n= 20
i= 6% compunded annually
The maximum that an investor should pay is the present value (PV).
First, we need to calculate the future value using the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual cash flow
FV= {4,000*[(1.06^20) - 1]} / 0.06
FV= $147,142.36
Now, we can calculate the present value, we need to use the following formula:
PV= FV/(1+i)^n
PV= 147,142.36/(1.06^20)
PV= $45,879.68
Which of the following is considered a source of general revenue in the Government-wide Statement of Activities?
A) Charges for Services
B) Operating Grants
C) Sales Tax
Answer:
C) Sales Tax
Explanation:
The Government-wide Statement of Activities shows the revenues and expenses of the government and the general revenues indicate all the taxes, aid received from other governments and earnings from investments. According to that, the answer is that the option that is considered a source of general revenue in the Government-wide Statement of Activities is sales tax.
It costs your company $240 to produce pens and pencils together. To produce the same amount of pens and pencils separately costs $100 for the pens and $120 for the pencils. The production of pens and pencils exhibits:_______
a. diseconomies of scope
b. economies of scope.
c. increasing returns to scale.
d. constant returns to scale.
Answer:
b
Explanation:
Digby's turnover rate for this year is 6.33%. This rate is projected to remain the same next year and no further downsizing will occur from automating. What would the total recruiting cost be for Digby, assuming it spends the same amount extra above the $1,000 recruiting base as they did this year?
Answer:
Total recruitment cost = $316.5
Explanation:
Note:
Given question is incomplete,
The number of employees = 5,000
Given:
Turnover rate for this year = 6.33%
Find:
Total recruitment cost
Computation:
Total recruitment cost = Turnover rate for this year × The number of employees
Total recruitment cost = 5,000 × 6.33%
Total recruitment cost = $316.5
The total recruiting cost will be $316.5 for Digby.
Given information
Assumed the number of employees is 5,000
Turnover rate for this year = 6.33%
Total recruitment cost = Turnover rate for this year * The number of employees
Total recruitment cost = 5,000 * 6.33%
Total recruitment cost = $316.5
Therefore, the total recruiting cost will be $316.5 for Digby.
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A corporation is attempting to sell additional shares to its existing shareholders through a rights distribution. A shareholder who wishes to subscribe must send the purchase amount with the rights certificate to the:
Answer:
Right agent.
Explanation:
A rights agent is said to be a correlative junction, serve and also seen to be an obedient mediator and right assistance between his client and any form of third party organisation or also other clients. A right agent is sometimes seen to be reliable to a principal when he/she acts without actual authority, but with apparent authority. He is also held responsible for indemnify and also principal loss or damage resulting from his/her act. He is also keen and careful in his advise and dealing on behalf of his client is he owes certain contractual duties to his/her agent as he protect him also from wrong claims, expenses that are not worthwhile, liabilities etc.
The issue of _____ concerns how often a particular project will be repeated and what its lifespan will be.
Full question reads;
The issue of _____ concerns how often a particular project will be repeated and what its lifespan will be.
a. frequency
b. consumption
c. pressures
d. rules
Answer:
a. frequency
Explanation:
Indeed, no particular human project can last forever, so there is a need to ascertain the frequency of a project, detailing how often the project would be repeated so as to also determine what the project's lifespan will be.
For example, a road construction project may take into account how often the road would be used, which provides insight into the frequency of road repairs and the overall lifetime of the car.
The issue of _____ concerns how often a particular project will be repeated and what its lifespan will be.
Salud Company reports the following information. Use the indirect method to prepare only the operating activities section of its statement of cash flows for the year ended December 31, 2017. (Amounts to be deducted should be indicated with a minus sign.)
Selected 2017 Income Statement Data Selected Year-End 2017
Net income $455,000 Accounts receivable increase $52,800
Depreciation expense 95,500 Prepaid expenses decrease 17,400
Gain on sale of machinery 26,300 Accounts payable increase 6,200
Wages payable decrease 2,100
Answer:
Cash flow from Operating Activities
Net income $455,000
Adjustments for non-cash items :
Depreciation expense $95,500
Gain on sale of machinery ($26,300)
Adjustment for Changes in Working Capital :
Increase in Accounts receivable ($52,800)
Decrease in Prepaid expenses $17,400
Increase in Accounts payable $6,200
Decrease in Wages payable $2,100
Net Cash from Operating Activities $497,100
Explanation:
The Indirect method adjusts the Profit before tax with the following items :
Non-cash items previously added or deducted from net incomeChanges in Working CapitalIf an investor's aversion to risk increased, would the risk premium on a high beta stock increase by more or less than that of a low-beta stock? Explain.
Answer:
risk premium increases by more of the low - beta stock
A risk averse investor is an investor that avoids risk. if risk aversion increases, it means that the investor is more wary of risky investment.
Beta measures the volatility of a portfolio. the higher the volatility, the more risky the portfolio is.
risk premium measures the rate of return in excess of the risk free rate.
According to CAPM :
risk free rate + (beta x stock risk premium)
Beta is a multiplier of stock risk premium, so the higher the beta, the more there would be an increase in the stock risk premium
If a risk averse investor invests in a high beta stock, he would want extra or higher compensation for holding such a volatile stock. this extra compensation would be in the form of a higher risk premium.
Explanation:
What term means managing the entire organization so that it excels on all dimensions of products and services that are important to customers?
Answer:
Total Quality Management
Explanation:
Total Quality Management is an approach in which all the employees of the company work to improve the entire process to offer a good customer experience. According to this, the answer is that the term that means managing the entire organization so that it excels on all dimensions of products and services that are important to customers is Total Quality Management.
Employees in a department are considered a team only when they directly interact and coordinate work activities with each other.
a. True
b. False
Answer:
True
Explanation:
Team can be defined as way in which group of people or individuals come together in one accord in order to carryout a task or an assignment for the purpose of achieving their aim,goals or objectives, which is why working together as a team either in a company or an organisation is vital and paramount because it help to create unity among employees and to enable the employees to interact and effectively coordinate their work activities with one another which will lead to the growth and success of the organisation or company.
Brunette Company is contemplating investing in a new piece of manufacturing machinery. The amount to be invested is $180,000. The present value of the future cash flows generated by the project is $163,000. Should they invest in this project?
Answer:
No, as the net present value comes in negative
Explanation:
As we know that
Net present value = Present value of cash inflows - Initial investment
where,
Present value os $163,000
And, the initial investment is $180,000
Now placing these values to the above formula
So, the net present value is
= $163,000 - $180,000
= -$17,000
Therefore the company should not accept the project as net present value is in negative that is -$17,000
According to the CAPM, what is the market risk premium given an expected return on a security of 15.8%, a stock beta of 1.1, and a risk-free interest rate of 7%? Multiple Choice 7.70% 6.05% 7.00% 8.00%
Answer:
The risk premium on market is 8%
Explanation:
The CAPM or Capital Asset Pricing Model is used to calculate the required rate of return on a stock which is the minimum return that is expected or required by the investors to invest in a stock based on its systematic risk as measured by the beta of the stock.
The formula to calculate r under the CAPM is,
r = rRF + Beta * rpM
Where,
rRF is the risk free raterpM is the risk premium on marketTo calculate the risk premium on market, we will input the available values for r, rRF and beta in the equation above.
0.158 = 0.07 + 1.1 * rpM
0.158 - 0.07 = 1.1 * rpM
0.088 / 1.1 = rpM
rpM = 0.08 or 8%
So, the risk premium on market is 8%
The following data has been collected about Keller Company's stockholders' equity accounts: Common stock $10 par value 21,000 shares authorized and 10,500 shares issued, 1,100 shares outstanding $105,000 Paid-in capital in excess of par value, common stock 51,000 Retained earnings 26,000 Treasury stock 12,760 Assuming the treasury shares were all purchased at the same price, the number of shares of treasury stock is:
Answer:
9,400 shares
Explanation:
Treasury stock is the difference between issued shares and outstanding shares.
Number of treasure shares = Number of issued shares - Number of outstanding shares
Number of treasure shares = 10,500 - 1,100
Number of treasure shares = 9,400 shares
Therefore, number of treasury shares is 9,400
A firm has net working capital of $2,715, net fixed assets of $22,407, sales of $31,350, and current liabilities of $3,908. How many dollars' worth of sales are generated from every $1 in total assets
Answer:
So, from every $1 of total assets, $1.08 worth of sales are generated.
Explanation:
To calculate how many dollars worth of sales are generated by $1 of total assets, we use the total assets turnover ratio. It is an accounting measure that measures the efficiency of the company's assets in generating sales. It calculates the dollar values of sales generated by each $1 of total assets. The formula for total assets turnover is,
Total Assets Turnover = Sales / Average Total Assets
We already know the level of sales. We need to determine the value of total assets first.
Total Assets = Fixed assets + Current Assets
As we know that net working capital = current assets - current liabilities,
So, the current assets are,
2715 = Current assets - 3908
2715 + 3908 = Current assets
Current assets = $6623
Total assets = 6623 + 22407
Total assets = $29030
Total Assets Turnover = 31350 / 29030
Total assets turnover = 1.0799 rounded off to 1.08
So, from every $1 of total assets, $1.08 worth of sales are generated.
The development manager is required to choose between two projects. Project A has an IRR of 25% and project B has an IRR of 30%. Which of the following statements is correct? A. If she can invest only in one project, the manager will choose project B B. None of the statements above is correct C. If she can invest only in one project, the manager will choose project A D. If she can invest in both projects, the manager will choose both projects A and B
Answer:
A
D
Explanation:
Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.
Because the IRR of both projects are positive, both projects are acceptable.
If the manager can only choose one project, she should choose the one with the higher IRR because it would be more profitable.
Quality improvement teams are groups of people from various work areas who define, analyze, and solve common production problems.
a. True
b. False
Answer: True
Explanation:
The quality improvement teams are groups of employees that are from various departments who come together and meet regularly in order to define, analyze, and then solve common production problems.
The aim of the quality improvement team is to improve the production process. This is achievable by them working on their methods.
On January 1, a company issued and sold a $300,000, 5%, 10-year bond payable, and received proceeds of $293,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The carrying value of the bonds immediately after the first interest payment is:
Answer: $293,350
Explanation:
The carrying value of the bonds immediately after the first interest payment will be the addition of the received proceed and the ammortized discount. This will be:
= $293,000 + $350
= $293,350
Note that the ammortized discount was calculated as:
= ($300000 - $293000)/20
= $7000/20
= $350
Open space arrangements in workstations increase communication and potentially decrease noise, distractions, and loss of privacy.
a. true
b. false
Answer:
false
Explanation:
while open space arrangement increases communication, it also increases noise, distractions, and loss of privacy.
Answer:
b. False
Explanation:
Although open space arrangement in a workstation increases communication , yet such communication would eventually lead to an increase noise, distractions and loss of privacy. This is the reason why modern organizations preferred the use of cubicle in demarcating spaces allocated to their employees.
The advantage of using cubicle as demarcation is that there will be less noise and distractions hence leads to increase in productivity . An employee would also have his or her privacy unlike an open space arrangement.
Lilliput is a country that has closed borders and does not import or export any goods or services; hence, they do not worry about trade with other countries.
Total spending for the federal government of Lilliput for the last fiscal year was $1.06 billion. The country collected $1.05 billion in taxes during this same fiscal year. Assume government transfers were zero. Based on this information, what is Lilliput's budget balance? In the last fiscal year, Lilliput was running:______.
a. a budget surplus.
b. a balanced budget.
c. a budget deficit.
Answer: budget deficit
Explanation:
From the question, we are informed that the total spending for the federal government of Lilliput for the last fiscal year was $1.06 billion and that the country collected $1.05 billion in taxes during this same fiscal year.
Since the expenditure of $1.06 billion is more than the revenue of $1.05 billion, this show that there was a budget deficit.
Which of these does NOT describe a friction that might prevent firms from choosing the optimal level of capital? A. Making too big of a change can be more expensive than making a few smaller changes. B. A firm might not be able to borrow enough to pay for the investments it wants to make. C. The firm likes its workers and doesn’t want to replace some jobs with machinery. D. Some capital is very specialized and cannot be re-sold in cases of economic downturns.
Answer:
C. The firm likes its workers and doesn’t want to replace some jobs with machinery.
Explanation:
Optimal level of capital simply refers to an ideal strategy used by a firm to raise capital. For example, a firm may decide between debt financing or equity financing, depending on the company's desired level of capital.
So, an already operational firm with that likes its workers and doesn’t want to replace some jobs with machinery has no direct relationship with its level of capital.
It is always necessary for an agent to disclose the identity of the principal to any third person with whom he is contracting; otherwise the contract becomes void.
a. True
b. False
The _________ price is the price at which a dealer is willing to sell a security. A. bid B. ask C. clearing D. settlement
Answer: B. ask
Explanation:
The ask also known as the offer price is the price at which seller is willing to sell a security after which the buyer must have stated a bid price of how much he or she wants to pay for the security. The bid price is known to be always lower than the ask price , of which the difference between both prices is called a bid-ask spread.
For example, if an investor wants to buy a security, he or she will first determine how much the seller is willing to sell it for, which is the ask price--- least price the seller is willing to sell the security for. However on the other hand, the seller in order to sell his or her security will first determine the highest price at which a buyer would be willing to pay for the security.
I have question with it can you help me please??
Answer:
Pick-up Later:
Set a pickup date
Process the transaction
Place all the items in the pickup area near the front of the store
Place a note on the items indicating they are sold.
Explanation:
The purpose of the above procedure is to enable the customer to take delivery of purchased goods hitch-free. The pick-up area needs to be covered against rain so that the mulch and topsoil do not degrade. It is assumed that the customer's contact information and payment have been secured before the arrangement for pick-up later.
Fed is open to changing bond policy Fed policymakers signaled for the first time that they could increase or decrease stimulation of the economy in the future, but not now. Source: Los Angeles Times, May 1, 2013 What are the ripple effects and time lags that the Fed must consider in deciding when to increase or decrease stimulation of the economy?
Answer:
When the Fed raises the federal funds rate, the inflation rate decreases about two years later.
Explanation:
When trying to stimulate the economy either by increasing or decreasing, policymakers have to take into consideration how it would effect interest rate, amount of money available in the economy, loans that would be acquired by banks and the behavior of interest rate.
Interest rate can be impacted quickly even though the period of time it would take for such action to have a reflection on what quantity of money is available in the economy. Then also a period of 2 years would be taken for this action to take effect on inflation.
Therefore
When the Fed raises the federal funds rate, the inflation rate decreases about two years later.
A benevolent social planner would prefer that the output of good x be decreased from its current level if, at the current level of output of good x_________
a. social cost = private cost = private value < social value.
b. private cost < social cost = private value = social value.
c. social value = private value = private cost < social cost.
d. social cost = private cost = private value = social value.
Answer:
c
Explanation:
social value = private value = private cost < social cost.
A benevolent social planner would prefer that the output of good x be decreased from its current level if, at the current level of output of good x social value = private value = private cost < social cost. Thus, option (c) is correct.
What is the cost?
The term cost refers to the actual money are spent on the manufacturing of the product. The product are manufacture to spend on money are raw material, transportation, wages, salary, and other expenses add. The all expenses are added to identify the cost.
According to the system composed, the primary impact of the output of goods are the multiplied by the reduced from its present state are the primary effect of the output of products are the calculation where the social value equals the societal value. The private cost is lower than the societal cost.
As a result, the significance of the social cost are the aforementioned. Therefore, option (c) is correct.
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Chester currently has $17,624 (000) in cash and management has decided to issue stocks and bonds worth an additional $8,000 (000). Assuming that cash from operations will be the same for each of the following activities, which activity exposes this company to the most risk of being issued an emergency loan?
a) purchasing $18,000 (000) worth of plant and equiptment
b) liquidate the new inventory
c) retiring the oldest bond
d) a $5 dividend
Answer: a) purchasing $18,000 (000) worth of plant and equipment
Explanation:
Of the 4 options listed, liquidating the new inventory would lead to a cash inflow and so is not going to lead to an emergency loan.
Retiring the oldest bond is something that would probably have been budgeted for so it will be less probable to cause Chester to seek emergency funding.
The activity that poses the greatest threat to Chester in terms of loan solicitation would be the purchase of plant and equipment. This would have less chance of being budgeted for and is a significant amount to leave the company which is even larger than the company's current cash amount. It has a higher chance of causing Chester to seek emergency loan funding.
Leslie works as customer service representative for Lighthouse Point Lanterns. Her job is to fulfill customer orders and answer any questions that the customer may have. In order to ensure the best service possible, Lighthouse Point Lanterns makes test phone calls to their customer service representatives and rates their ability to correctly answer customer calls. If Leslie properly handles 80% of the test calls, she will receive a 20% bonus in her next pay check. This is an example of:_________.
Answer:
a performance reward.
Explanation:
A performance reward is a type of employee reward system. Companies generally reward employees in an attempt to motivate them to work more, harder or more efficiently. E.g. a company may reward salespeople that close 100 sales per week, regardless of the type of sales made. This type of reward is based on the gross amount of work carried out by the employee.
In Leslie's case, she is being rewarded for being an efficient employee. The parameter for measuring her efficiency is that 80% of the test calls that she makes are handed properly. She is not rewarded on the number of test calls, but instead on how she handled them.
This is an example of a performance reward if Leslie is going to be rewarded with a 20% bonus for handling 80% of the test calls.
A performance reward is a reward that a customer receives in an organization which is based on how well they have performed in the business.
The reward system here has stated that if Leslie is able to meet up with the target that the business has placed for her to reach she would be rewarded with a bonus of 20% when she receives her next salary.
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