Answer:
B. $10.1M
Explanation:
The capitalized cost of this investment is the present value of the cost that has just been incurred as well as the present of the replacement asset every 50 years.
The present value of cost incurred is the same as the amount incurred since it is stated in today's terms i.e $10M
The present value of replacement asset=replacement cost/50 year effective interest rate
In 50 years' time, the old sewage line would be sold for $2M and another bought of $10M, effectively replacement is $8M($10M-$2M)
the effective interest rate for 50 years=(1+9%)^50-1=7335.75%
capitalized cost of the sewage line=$10+$8/7335.75%
capitalized cost of the sewage line=$10.1M
A company issues $15,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2020. Interest is paid on June 30 and December 31. The proceeds from the bonds are $14,703,108. Using effective-interest amortization, what will be the approximate carrying value of the bonds on Dec 31, 2020 balance sheet?
a. $14, 709, 481.
b. $15,000,000.
c. $14, 718, 844.
d. $14, 706, 232.
Answer:
Using effective-interest amortization, the approximate carrying value of the bonds on Dec 31, 2020 balance sheet is:
a. $14, 709, 481.
Explanation:
a) Data and Calculations:
Face value of bonds = $15,000,000
Bonds price = 14,703,108
Bonds discount = $296,892
Coupon interest rate = 7.8%
Effective interest rate = 8%
Interest payments on June 30 and December 31
June 30, 2020:
Interest expense = $588,124 ($14,703,108 * 4%)
Cash payment = $585,000 ($15,000,000 * 3.9%)
Amortization of discount = $3,124 ($588,124 - $585,000)
Bonds payable = $14,706,232 ($14,703,108 + $3,124)
December 31, 2020:
Interest expense = $588,249 ($14,706,232 * 4%)
Cash payment = $585,000 ($15,000,000 * 3.9%)
Amortization of discount = $3,249 ($588,249 - $585,000)
Bonds payable = $14,709,481 ($14,706,232 + $3,249)
ME company sold 200 units of its goods for $5 each. The COGS is $3 each. Prepare journal entries
for the transactions.
i) 10 days later, customer returned 50 units of goods
ii) 10 days later, customer wanted to return 50 defective units of goods, the company agreed to
reduce price to $3, so that the customer accepted the goods and not returned.
Answer:
Explanation:
Sales Returns and Allowances 250
Accounts Receivable 250
Sales Returns and Allowances 600
Accounts Receivable 600
A product returned to the seller by a customer is known as a sales return. Usually, a return is made as a result of defective or overage merchandise being ordered, shipped, or received.
What is a sale and sale return?A retailer pays only for the goods they sell and returns the unsold inventory to the wholesaler or manufacturer under a sale or return arrangement. The retailer can return unsold products under a sale or return arrangement, preventing write-offs.
Following are the necessary journal entries required to pass.
Particular Debit Credit
Sale Return A/c $250
1 Accounts Receivable A/C $250
(Being 50 units of defective goods return at $5)
2 Sale Return A/c $600
Accounts Receivable A/C $600
(Being 200 units of defective goods return at $3)
When goods are returned, the sales returns and allowances account is debited to lower sales, while accounts receivable or cash are credited to give refunds or lower what the consumer owes. To credit the inventory with the returned items, a second entry debiting inventory must be created.
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Gross Domestic Product equals $1.2 trillion. If consumption equals $690 billion, investment equals $200 billion, and government spending equals $260 billion, then:
Answer:
imports exceed exports by $50 billion.
Explanation:
Calculation to determine how much imports exceed exports
Gross Domestic Product $1.2 trillion
Less Consumption ($690 billion)
Less Investment ($200 billion)
Less Government spending ($260 billion)
($1.2 trillion-$690 billion-$200 billion-$260 billion)
Then:imports exceed exports by $50 billion
The chart shows the lowest price of the Microsoft stock over the last year and the highest price. If you had purchased the stock at the low point and sold it as the high point, what percent increase (to the nearest whole percent) in the price of the stock would you have experienced
Answer:
The percent increase (to the nearest whole percent) in the price of the stock you would have experienced is 34%.
Explanation:
Note: This question is not complete as the Chart is not included. To complete the question, the chart is therefore provided before answering the question. See the attached image for the chart.
The explanation of the answer is now provided as follows:
From the chart, we can identify the following:
52 week range 55.61 - 74.42
The above implies that:
The low point = 55.61
The high point = 74.42
Therefore, we have:
Percent increase in the price of the stock = ((The high point - The low point) / The low point) * 100 = ((74.42 - 55.61) / 55.61) * 100 = 34%
Therefore, the percent increase (to the nearest whole percent) in the price of the stock you would have experienced is 34%.
Which of the following is an example of a divisional organizational structure?
Answer: b
Explanation:
The CPA Practice Advisor reports that the mean preparation fee for 2017 federal income tax returns was $273. Use this price as the population mean and assume the population standard deviation of preparation fees is $100. Use z-table.
a. What is the probability that the mean price for a sample of 30 federal income tax returns is within $16 of the population mean?
Answer:
The CPA Practice Advisor
The probability that the mean price for a sample of 30 federal income tax returns is within $16 of the population mean is:
= 56%
Explanation:
a) Data and Calculations:
Population mean (preparation fee for 2017 federal income tax returns) = $273
Population standard deviation of preparation fees = $100
Mean price for a sample of 30 federal income tax returns = $257 (which is within $16 of the population mean)
z = (x-μ)/σ
z = standard score
x = observed value
μ = mean of the sample
σ = standard deviation of the sample
Z = ($273 - $257)/$100
= 0.16
Using the z-table
P = 0.5636
Sommers Co.'s bonds currently sell for $1,080 and have a par value of $1,000. They pay a $100 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,125. What is their yield to maturity (YTM)
Answer:
9.01%
Explanation:
Calculation to determine their yield to maturity (YTM)
We would be using financial calculation to determine their yield to maturity (YTM)
N =15 years
PV=$1,080
PMT=$100
FV=$1,000
Hence,
I/YR=YTM=9.01%
Therefore their yield to maturity (YTM) is 9.01%
A1 Consulting Services (A1CS) provides various types of consulting services throughout Fiji. It
uses job costing system to accumulate the cost of client projects.
Traceable costs are charged directly to individual clients.
Other costs incurred by A1CS, but not identifiable with specific clients, are charged to jobs by
using a predetermined overhead rate.
Clients are billed for directly chargeable costs, overhead and a markup for the profit margin.
The following costs have been anticipated for the coming year:
Cost Percentage of cost directly
traceable to clients
Professional staff salaries $3 000 000 85%
Administrative support staff 800 000 60%
Travel 400 000 80%
Photocopying 90 000 90%
Other operating costs 200 000 75%
Total $4 490 000. A1CS’s management wishes to make a profit of $1 250 000 for the firm and plans to add
percentage markup on total cost to achieve that figure.
On 23 May, A1CS completed work on a project for Mango Manufacturing. The following costs
were incurred:
Cost
Professional staff salaries $55 000
Administrative support staff 5 000
Travel 6 000
Photocopying 1 200
Other operating costs 2 800
Note: If rounding off is required, round off your figures to 2 d.p.
Required:
1. Determine A1CS’s total traceable costs for the coming year and the firm’s total
anticipated overhead. (4 marks)
2. Calculate the predetermined overhead rate, assuming the cost driver is traceable costs.
(3 marks)
3. What percentage of cost will A1CS add to each job to achieve its profit target? (3 marks)
4. Determine the total cost of the Mango Manufacturing project. (5 marks)
5. How much Mango Manufacturing would be billed for the services performed? (5 marks)
6. Compare the approach used in requirement 5 with client billing system described in
Topic 8. (4 marks)
7. Only 75 per cent of A1CS’s other operating cost is directly traceable to specific client
projects. Identify three costs that would be included in other operating costs and would
be difficult to trace to clients. (3 marks)
8. 85 per cent of the professional staff cost is directly traceable to specific client projects.
Give two reasons that would explain why this figure isn’t 100 per cent. (3 marks)
Answer:
A1 Consulting Services (A1CS)
1. A1CS's total traceable costs for the coming year = $3,581,000 and
Total anticipated overhead = $909,000
2. Predetermined overhead rate = $0.254 per traceable cost.
3. The percentage of cost that A1CS will add to each job to achieve its profit target is:
= 27.8%
4. The total cost of the Mano Manufacturing project is:
= $87,780
5. Mango Manufacturing would be billed $112,183.
6. The approach in requirement 5 is the markup approach, which is based on a percentage added to the total costs. It is different from a margin approach, which adds a percentage of the selling price to the total costs.
7. Other operating costs may include Supervisor's salaries, Equipment depreciation expenses, and Factory property taxes.
8. There may be other professional staff who work on the general projects, whose costs cannot be directly traceable to specific client projects.
Some costs incurred under professional staff may be indirect costs, for example, training of professional staff.
Explanation:
a) Data and Calculations:
Cost Percentage of cost directly
traceable to clients
Professional staff salaries $3 000 000 85% $2,550,000 ($3m*85%)
Administrative support staff 800 000 60% 480,000 ($.8m*60%)
Travel 400 000 80% 320,000 ($.4m*80%)
Photocopying 90 000 90% 81,000 ($90,000*90%)
Other operating costs 200 000 75% 150,000 ($0.2m*75%)
Total $4 490 000
Total traceable costs $3,581,000
Total anticipated overhead = $909,000 ($4,490,000 - $3,581,000)
Predetermined overhead rate = $909,000/$3,581,000 = $0.254
Target profit = $1,250,000
Percentage of cost to add to achieve target profit = 27.8% ($1,250,000/$4,490,000 * 100)
Costs incurred for a project for Mango Manufacturing:
Professional staff salaries $55 000
Administrative support staff 5 000
Travel 6 000
Photocopying 1 200
Other operating costs 2 800
Total traceable costs $70,000
Overhead costs ($0.254) 17,780
Total costs = $87,780
Markup (27.8%) = 24,403
Total billing for services $112,183
The WACC is used to _______ the expected cash flows when the firm has ____________. Select one: a. decrease; short term financing on the balance sheet b. discount; short term financing on the balance sheet c. discount; debt and equity in the capital structure d. increase; debt and equity in the capital structure
Answer:
c
Explanation:
WACC = weight of equity x cost of equity + weight of debt x cost of debt x (1 - tax rate)
weight of debt = D / (D + E)
It is used to discount the expected cash flows when the firm has debt and equity in the capital structure. It is suitable because in the calculation of WACC, debt and equity are included
For Team Andrews calculate both Market Capitalization and Earnings per Share (EPS) in the last round. Show calculations. In the next round, what would EPS be for Team Andrews be if Profits increased by 10% relative to this year and Andrews bought back 679,391 shares
Answer:
$14.32
Explanation:
Note: See below for attached picture for the question
Market Capitalization = Total outstanding shares * Last closing price of share
Market Capitalization = 2,679,391*$86.73
Market Capitalization = $232,383,581.43
Earning Per share = Profit after tax and Dividend / Total outstanding shares
Earning Per share = $26,054,226 / 2,679,391
Earning Per share = $9.72
The EPS when profits are increased by 10% ans shares are bought back is calculated as follows:
New profits = $26,054,226 + (10%*$26,054,226)
New profits = $26,054,226 + $2,605,422.60
New profits = $28,659,648.60
Total outstanding shares = 2,679,391 - 679,391
Total outstanding shares = 2,000,000
EPS = New profits / Total outstanding shares
EPS = $28,659,648.60/2,000,000
EPS = $14.32
The idea of rational expectations suggests that :_________
a) It is unrealistic for Congress to balance the federal budget during a recession.
b) Discretionary policies and fine-tuning can move the economy to full employment.
c) Economic policies are ineffective if the policies are anticipated.
Answer:C
Explanation:The theory believes that because people make decisions based on the available information at hand combined with their past experiences, most of the time their decisions will be correct.
Here are incomplete financial statements for Cullumber Company. Calculate the missing amounts.
CULLUMBER COMPANY
Balance Sheet
Assets
Cash $ 14,000 Inventory 17,000 Buildings 38,000 Total assets $69,000 Liabilities and Stockholders' Equity Liabilities Accounts payable $ 5,600 Stockholders' Equity Common stock enter a dollar amount
(a) Retained earnings enter a dollar amount
(b) Total liabilities and stockholders' equity $69,000 CULLUMBER COMPANY Income Statement Revenues $85,400 Cost of goods sold enter a dollar amount
(c) Salaries and wages expense 10,270 Net income $enter a dollar amount
(d) CULLUMBER COMPANY Retained Earnings Statement Beginning retained earnings $19,000 Add: Net income enter a dollar amount
(e) Less: Dividends 4,770 Ending retained earnings $34,000
Answer:
(a) Common Stock = $29,400. (b) Retained earnings = $34,000, (c) Cost of goods sold = $55,360, (d) Net Income = $19,770, (e) Net Income =$19,770
Explanation:
Note: See organized question as attached below to aid understanding
Net income = Ending retained earnings + Dividends - Beginning retained earnings
Net income = $34,000 + $4,770 - $19,000
Net income = $19,770
Net income = Revenue - Cost of goods sold - Salaries and wages expense
$19,770 = $85,400 - Cost of goods sold - $10,270
Cost of goods sold = $85,400 - $19,770 - $10,270
Cost of goods sold = $55,360
Total liabilities and stockholders equity = Accounts payable + Common stock + Retained earnings
$69,000 = $5,600 + Common stock + $34,000
Common stock = $69,000 - $5,600 - $34,000
Common stock = $29,400
Missing amounts :
Common Stock = $29,400
Retained earnings = $34,000,
Cost of goods sold = $55,360
Net Income = $19,770
Net Income = $19,770
Net income
= Ending retained earnings + Dividends - Beginning retained earnings
= $34,000 + $4,770 - $19,000
= $19,770
Net income
= Revenue - Cost of goods sold - Salaries and wages expense
$19,770 = $85,400 - Cost of goods sold - $10,270
Cost of goods sold
= $85,400 - $19,770 - $10,270
= $55,360
Total liabilities and stockholders equity
= Accounts payable + Common stock + Retained earnings
$69,000 = $5,600 + Common stock + $34,000
= $69,000 - $5,600 - $34,000
= $29,400
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A bank has an 8 percent reserve requirement, $10,000 in deposits, and has loaned out all it can, given the reserve requirement. a. It has $1,250 in reserves and $8,750 in loans. b. It has $8,000 in reserves and $2,000 in loans. c. It has $800 in reserves and $9,200 in loans. d. It has $80 in reserves and $9,920 in loans.
Answer:
c. It has $800 in reserves and $9,200 in loans.
Explanation:
Calculation to determine the given reserve requirement
Reserves=8%*$10,000
Reserves=$800
Loans=$10,000-$800
Loans=$9,200
Therefore given the reserve requirement It has $800 in reserves and $9,200 in loans.
The following persons own Schlecht Corporation, a non-U.S.entity.
Jim, U.S. individual 35%
Gina, U.S. individual 15%
Marina, U.S. individual 8%
Pedro, U.S. individual 12%
Chee, non-U.S. individual 30%
None of the shareholders are related. Subpart F income for the tax year is $300,000. No distributions are made. Which of the following statements is correct?
a. Schlecht is not a CFC.
b. Chee includes $90,000 in gross income.
c. Marina is not a U.S. shareholder for purposes of determining whether Schlecht is a CFC.
d. Marina includes $24,000 in gross income.
Answer: Marina is not a U.S. shareholder for purposes of determining whether Schlecht is a CFC.
Explanation:
From the options given, the correct statement is that "Marina is not a U.S. shareholder for purposes of determining whether Schlecht is a CFC".
A controlled foreign corporation (CFC) refers to a corporate entity which is duly registered and then conducts business in a different country than where it was registered and where the controlling owners lives.
A controlled foreign corporation (CFC) is a foreign corporation whereby more than 50% of the total voting power is owned by the person.
Roy Micky wants to open a new nakamal (kava bar) in port villa. He knows he is entering a highly competitive market but is determined to give it a ago as it is something his family have always wanted.
There are 96 other Nakamals in port vila that Roy will have to compete with. In addition to this, he does not have an established presence in the market. There are just 2 of his concerns. The others are required to come from you.
1) List and justify (from an operations perspective) 5 key things that he should consider in setting up his business. In answering this question, this of the different chapters that have ccomprised this course - you should get a point from each chapter. 20 marks
NB : This question is asking for 5 points of concern - each carries 4 marks.
Answer:
a) The financial return on investment
b) Demand curve, Is the demand of nakamal is rising or is constant
c) Develop a strategy to create a customer base
d) Devise marketing strategy
e) Value addition in his product and service in order to stand out of others.
Explanation:
a) The financial return on investment
b) Demand curve, Is the demand of nakamal is rising or is constant
c) Develop a strategy to create a customer base
d) Devise marketing strategy
e) Value addition in his product and service in order to stand out of others.
roles of competition policy authorities in south Africa
Answer:
I hope you understand please follow me
On January 2013, Pennington Bancorp acquired $100,000 of marketable securities and classified them as Available for Sale. On March 31, 2013, Pennington prepared its 10-Q and marked the securities down to their market value of $85,000. On April 4, 2013, Pennington sold the securities for $93,000 cash. Which of the following items would be increased by the sale of the marketable securities?
a. Cash from Financing Activities
b. Net Income
c. Marketable Securities
d. Accumulated Other Comprehensive Income
e. Cash from Investing Activities
Answer:
b. Net Income
e. Cash from Investing Activities
Explanation:
Calculation to determine Which of the following items would be increased by the sale of the marketable securities
Using this formula
Gain from investment = Selling price of the security - Value of the security
Let plug in the formula
Gain from investment= $93,000 - $85,000
Gain from investment= $8,000
Based on the above calculation The sell of marketable security will INCREASE CASH which means that CASH FROM INVESTING ACTIVITIES will increase and NET INCOME will increase.
Therefore the items that would be increased by the sale of the marketable securities are :
b. Net Income
e. Cash from Investing Activities
1. A manufacturer has 750 meters of cotton and 1000 meters of polyester. Production of a sweatshirt requires 1 meter of cotton and 2 meters of polyester, while production of a shirt requires 1.5 meters of cotton and 1 meter of polyester. The sale prices of a sweatshirt and a shirt are $30 and $24, respectively. How many of each type need to be sold to maximize sales
Answer:
500 units of sweatshirt and zero unit of shirt need to be sold to maximize sales.
Explanation:
Note: See the attached excel file for the calculation of the total revenue of each type.
From the attached excel file, we have:
Highest units of sweatshirt that can be sold = 500Highest units of shirt that can be sold = 500The highest total revenue is $15,000 (in bod red color) and this occurred when 500 units of sweatshirt is sold and zero units of shirt is sold.Therefore, 500 units of sweatshirt and zero units of shirt need to be sold to maximize sales.
Phil Morris holds an executive position at The Martin Group. Phil has improved the quality of the data gathered by the organization and has also created a model to decrease the cost of managing data while increasing the value of the data gathered. Based on this description, what position does Phil hold at The Martin Group
Answer:
chief data officer (CDO)
Explanation:
A chief data officer is a person in an organisation that uses information as an asset through various practices like analysis, data processing, data mining, or information trading.
He is responsible for data governance within an organisation.
Valuable insights that will be profitable to the organisation are made by the Chief Data Officer.
In the given instance Phil has improved the quality of the data gathered by the organization and has also created a model to decrease the cost of managing data while increasing the value of the data gathered.
Perggy's Bakes, a bakery in New Orleans that exclusively sells its confectionery products online, makes its products only when it receives an order. The bakery produces the products as per the order and delivers to the customer's homes. It does not produce any excess products. In the given scenario, the price associated with the demand and supply of the products at Perggy's Bakes reflects the _____. a. equilibrium price b. skimmed price c. grounded price d. parity price
Answer:
A)equilibrium price
Explanation:
From the question we are informed about Perggy's Bakes, a bakery in New Orleans that exclusively sells its confectionery products online, makes its products only when it receives an order. The bakery produces the products as per the order and delivers to the customer's homes. It does not produce any excess products. In the given scenario, the price associated with the demand and supply of the products at Perggy's Bakes reflects the equilibrium price. The equilibrium price can be reffered to as only price in which both desires of consumers and that of producers agree, this can be explained as a situation where by quantity demanded is been equal to quantity supplied. The theory stressed that movement of market tends toward this price, it can also be regarded as "market-clearing price"
Are executive pay levels unreasonable? Why or why not
Answer:
In my opinion, some corporate salaries for high-ranking executives are excessively high for the functions that these people have in these companies and the impact that their work has on their economy and on the well-being of society as a whole.
It is that, although we live in a capitalist, free and democratic society in which everyone has the right to earn the sum of money that their employer is willing to pay, the truth is that in certain cases (or in most cases ) Said salaries are not justified based on the contributions that said executives make in their day-to-day work.
When Elle's Espresso Bar increased its price by 10 percent, the quantity of coffee that Elle sold decreased by 40 percent.
When Elle and all her competitors cut their prices by 10 percent, the quantity of coffee sold by Elle increased by only 4 percent.
The price elasticity of demand for Elle's Espresso Bar coffee is
nothing.
Answer:
4
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
40 / 10 = 4
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.
Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one
Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.
Infinitely elastic demand is perfectly elastic demand. Demand falls to zero when price increases
Perfectly inelastic demand is demand where there is no change in the quantity demanded regardless of changes in price.
Expense A is a fixed cost; expense B is a variable cost. During the current year the activity level has increased, but is still within the relevant range. In terms of cost per unit of activity, we would expect that
Answer:
b) Expense B has decreased.
Explanation:
a) Expense A has remained unchanged.
b) Expense B has decreased.
c) Expense A has decreased.
d) Expense B has increased.
Fixed costs are costs that do not vary with output. e,g, rent, mortgage payments
If production is zero or if production is a million, Mortgage payments do not change - it remains the same no matter the level of output.
Hourly wage costs and payments for production inputs are variable costs
Variable costs are costs that vary with production
If a producer decides not to produce any output, there would be no need to hire labour and thus no need to pay hourly wages.
Let assume fixed cost is 100 pounds when output is 10 units
Fixed cost per unit = fixed cost / output
100 / 10 = 10
Fixed cost per output when output increases to 20 units is
100 / 20 = 5
fixed cost per unit falls as output increases
Janitor Supply produces an industrial cleaning powder that requires 50 grams of material at $0.40 per gram and 0.15 direct labor hours at $14.00 per hour. Overhead is applied at the rate of $18 per direct labor hour. What is the total standard cost for one unit of product that would appear on a standard cost card?
a. $7.00.
b. $8.50.
c. $11.50.
d. $7.50.
e. $25.00.
Answer:
e. $25
Explanation:
Given the above information,
The first step is to calculate the cost of direct materials
Cost of direct materials = Material × Per gram rate
= 50 × $0.40
= $20
The next step is to compute the direct labor cost
Direct labor cost
= Direct labor rate × Direct labor hours
= $14 × 0.15
= $2.1
Then,
Overhead per unit cost = Overhead labor cost × labor hours
= $18 × 0.15
= $2.7
Now, add up the above costs
Total standard cost for one unit = $20 + $2.1 + $2.7
= $24.8
= $25
You're trying to save to buy a new $200,000 Ferrari. You have $45,000 today that can be invested at your bank. The bank pays 5.0 percent annual interest on its accounts. How long will it be before you have enough to buy the car
Answer:
n= 30.57 years
Explanation:
Giving the following information:
Future Value (FV)= $200,000
Present value (PV)= $45,000
Interest rate (i)= 5%
To calculate the number of years required to reach the objective, we need to use the following formula:
n= ln(FV/PV) / ln(1+i)
n= ln(200,000 / 45,000) / ln(1.05)
n= 30.57 years
The College Bookstore sells a unique calculator to college students. The demand for this calculator is constant at 20 units per day. The lead time for this calculator is variable at an average of 9 days with a standard deviation of 2 days. Compute the statistical reorder point that results in a 95 percent in-stock probability. Choose the closest answer.
a. 182 units
b. 226 units
c. 246 units
d. 26 units
e. 46 units
Answer:
c. 246 units
Explanation:
Daily demand, d = 20 units
Service Level = 95 % = 0.95. Z (according to Standardized Normal Curve) = 1.65
Average Lead Time, LT-bar = 9 days
Standard deviation of Lead Time, σLT = 2 days
Reorder Point = Expected Demand during Lead time + Safety Stock
Reorder Point = d*LT-bar + z*d*σLT
Reorder Point = (20*9) + (1.65*20*2)
Reorder Point = 180 + 66
Reorder Point = 246 units
Classified stock differentiates various classes of common stock, and using it is one way companies can meet special needs such as when owners of a start-up firm need additional equity capital but don't want to relinquish voting control.A. TrueB. False
Answer: True
Explanation:
Classified stocks are referred to as the stocks of a publicly-traded company which possess different classes of stocks. Classified shares typically has some special privileges, like the dividend rights and the enhanced voting rights.
The use of classified stock allows the founders of a company to have control over the company despite not having to own the majority of the common stock. Therefore, the correct option is True.
Effects of recognizing accrued interest on financial statements LO 9-1
Bill Darby started Darby Company on January 1, Year 1. The company experienced the following events during its first year of operation:
1. Earned $1,300 of cash revenue.
2. Borrowed $2,400 cash from the bank.
3. Adjusted the accounting records to recognize accrued interest expense on the bank note. The note, issued on September 1, Year 1, had a one-year term and an 10 percent annual interest rate.
Required:
a. What is the amount of interest payable at December 31, Year 12?
b. What is the amount of interest expense in Year?
c. What is the amount of interest paid in Year?
d. Use a horizontal statements model to show how each event affects the balance sheet income statement, and statement of cash flows.
Answer:
Darby Company
a. The amount of the interest payable at December 31, Year 1 is $80.
b. The amount of the interest expense in Year 1 is $80.
c. The amount of interest paid in Year 1 is $0.
d. Horizontal Statements Model:
Balance Sheet Income Statement Statement of
Cash Flows
Assets = Liabilities + Equity Income = Revenue - Expenses
1. +$1,300 = 0 + $1,300 $1,300 = $1,300 OA cash inflow
2. +$2,400 = $2,400+ 0 FA cash inflow
3. 0 = $80 + ($80) ($80) = 0 - ($80) None
$3,700 = $2,480 + $1,220 $1,220 = $1,300 - $80
Explanation:
a) Data and Calculations:
1. Cash $1,300 Revenue $1,300
2. Cash$2,400 10% Bank Note Payable $2,400
3. Interest Expense $80 Interest Payable $80 )$2,400 * 10% * 4/12)
What is Walmart's Times Interest Earned Ratio for the year of 2018 (round it to 3 numbers after the decimal point -> 0.581)
Answer:
17.10 times
Explanation:
Complete word "Walmart's reported the following amounts on its 2018 income statement E(Click the icon to view the amounts.) What is Walmart's times-interest-earned ratio for 2018? (Round to two decimals.) Times-interest-earned ratio X Data Table Year Ended December 31, 2018 42,000 Net income 6,300 Income tax expense 3,000 Interest expense Print Done"
EBIT = Net Income + Interest expenses + Income tax expense
EBIT = $42,000 + $3,000 + $6,300
EBIT = $51,300
Times Interest Earned Ratio = EBIT / Interest Expenses
Times Interest Earned Ratio = $51,300 / $3,000
Times Interest Earned Ratio = 17.10 times.
Explain why production and logistics decisions are of central importance to many multinational businesses.
Explanation:
This is due to the fact that the MNC must choose where to manufacture products in order to get the optimum mix of productivity and transportation costs. Firms must decide which nation or countries they will produce in. They must, however, consider the difficulties of transporting commodities from one nation to another.
