Answer:
Debit : Machine $58,430
Debit : Insurance expense $510
Debit : Sales tax $5,050
Credit : Cash $63,990
Being Cost of machine recognized as well as other expenses on the machine
Explanation:
The cost of the machine includes the purchase price plus any costs directly incurred in putting the asset in the location and condition indented by the management.
Cost of Machine is calculated as :
Purchase price $56,000
Shipment of machine $810
Installation of machine $1,620
Total $58,430
Other Costs are recognized as expenses in the income statement and not as part of the asset.
Bluebird, Inc., does not provide its employees with any tax-exempt fringe benefits. The company is considering adopting a hospital and medical benefits insurance plan that will cost approximately $9,000 per employee. To adopt this plan, the company may have to reduce salaries and/or lower future salary increases. Bluebird is in the 25% (combined Federal and state rates) bracket. Bluebird also is responsible for matching the Social Security and Medicare taxes withheld on employees' salaries (at the full 7.65% rate). The hospital and medical benefits insurance plan will not be subject to the Social Security and Medicare taxes, and the company is not eligible for the small business credit for health insurance. The employees generally fall into two marginal tax rate (MTR) groups.
Income Tax Social Security and Medicare Tax Total
0.15 0.0765 0.2265
0.35 0.0145 0.3645
The company has asked you to assist in its financial planning for the hospital and medical benefits insurance plan by computing the following:
Required:
a. How much taxable compensation is the equivalent of $9,000 of exempt compensation for each of the two classes of employees?
b. What is the company’s after-tax cost of the taxable compensation computed in part (a)?
c. What is the company’s after-tax cost of the exempt compensation?
d. Briefly explain your conclusions from the preceding analysis.
Answer:
a. The Before Tax Compensation for each of the two classes of employees are as follows:
Low (0.15) = $11,635.42
High (0.35) = $14,162.08
b. The Employer's after tax cost of taxable compensation for each of the two classes of employees are as follows:
Low (0.15) = $9,394.15
High (0.35) = $10,775.57
c. The Employer's after tax cost of exempt benefit for each of the two classes of employees are as follows:
Low (0.15) = $6,750
High (0.35) = $6,750
d. The cost in employer's after tax cost of exempt benefit will be less than employer's after tax cost of taxable compensation.
Explanation:
a. How much taxable compensation is the equivalent of $9,000 of exempt compensation for each of the two classes of employees?
Note: See part a of the attached excel file for the calculation of Before Tax Compensation for each of the two classes of employees.
From part a of the attached excel, the Before Tax Compensation for each of the two classes of employees are as follows:
Low (0.15) = $11,635.42
High (0.35) = $14,162.08
b. What is the company’s after-tax cost of the taxable compensation computed in part (a)?
Note: See part b of the attached excel file for the calculation of Employer's after tax cost of taxable compensation.
From part b of the attached excel, the Employer's after tax cost of taxable compensation for each of the two classes of employees are as follows:
Low (0.15) = $9,394.15
High (0.35) = $10,775.57
c. What is the company’s after-tax cost of the exempt compensation?
Note: See part c of the attached excel file for the calculation of Employer's after tax cost of exempt benefit.
From part c of the attached excel, the Employer's after tax cost of exempt benefit for each of the two classes of employees are as follows:
Low (0.15) = $6,750
High (0.35) = $6,750
d. Briefly explain your conclusions from the preceding analysis.
Comparing employer's after tax cost of exempt benefit in comparison and employer's after tax cost of taxable compensation, it can be seen that cost in employer's after tax cost of exempt benefit will be less than employer's after tax cost of taxable compensation.
On January 1, Mitzu Co. pays a lump-sum amount of $2,750,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $671,000, with a useful life of 20 years and a $75,000 salvage value. Land Improvements 1 is valued at $579,500 and is expected to last another 19 years with no salvage value. The land is valued at $1,799,500. The company also incurs the following additional costs.
Cost to demolish Building 1 $345,000
Cost of additional land grading 195,000
Cost to construct new building (Building 3), having a useful life of 25 years and a $402,000 salvage value 2,242,000
Cost of new land improvement (Land Improvements 2) near Building 2 having a 20-year useful life and no salvage value 173,000
Allocate the costs incurred by Mitzu to the appropriate columns and total each column.
Allocation of Purchase Price Appraised Value Percent of Total x Total Cost of Acquisition = Apportioned Cost
Land $1,952,000 x $2,750,000 =
Building 2 $732,000 x $2,750,000 =
Land Improvements 1 $366,000 12% x $2,750,000 = 330,000
Totals $1,952,000 12% x = 330,000
Question Completion:
2. Prepare a single journal entry to record all the incurred costs assuming they are paid in cash on January 1.
Answer:
Mitzu Co.
1. Allocation of Appraised Value Percent x Total Cost = Apportioned
Purchase Price of Total of Acquisition Cost
Land $1,799,500 59% x $2,750,000 = $1,622,500
Building 2 $671,000 22% x $2,750,000 = 605,000
Land Improve-
ments 1 $579,500 19% x $2,750,000 = 522,500
Totals $3,050,000 100% = $2750,000
2. Journal Entry:
January 1:
Debit Land (demolishing Building 1) $345,000
Debit Land (additional land grading) $195,000
Debit Building 3 $2,242,000
Debit Land Improvements 2 $173,000
Credit Cash $2,955,000
To record the payment of additional costs incurred.
Explanation:
a) Data and Calculations:
Lump-sum amount paid $2,750,000
Additional costs incurred:
Land (demolishing Building 1) $345,000
Land (additional land grading) $195,000
Building 3 $2,242,000, having a useful life of 25 years and a $402,000 salvage value
Land Improvements 2 $173,000 near Building 2 having a 20-year useful life and no salvage value
____ is the measure of how much money you can make off each sale.
Answer:
Profit or net profit is the answer.
Explanation:
_______regulation applies to specific industries, whereas _______economic social regulation applies to businesses throughout the economy. Governments commonly regulate the prices and quality of services provided by electric, gas, and other utilities, which traditionally have been considered____technological oligopolistic geographic natural monopolies. Governments also single out various nonmonopolistic industries, such as the financial and transportation industries, for special forms of ______ economic social regulation. Among the common forms of ____ economic social regulation covering all industries are the occupational, health, and safety rules that federal and state governments impose on producers.
Answer:
Economic; social; natural; economic; social.
Explanation:
Generally, economic regulation are only applicable to business firms or organizations in a specific industry while social regulation is generally applicable to all of the business firms established throughout the economy or country.
A monopoly is a market structure which is typically characterized by a single-seller who sells a unique product in the market by dominance. This ultimately implies that, it is a market structure wherein the seller has no competitor because he is solely responsible for the sale of unique products without close substitutes. Any individual that deals with the sales of unique products in a monopolistic market is generally referred to as a monopolist.
For example, a public power company is an example of a monopoly because they serve as the only source of power utility provider to the general public in a society.
Governments commonly regulate the prices and quality of services provided by natural monopolies.
The Occupational Safety and Health Administration (OSHA) is a federal agency saddled with the responsibility of assuring and ensuring safe and healthy working conditions for employees by setting and enforcing standards, providing education, trainings and assistance to various organizations.
Waterways has a sales mix of sprinklers, valves, and controllers as follows.
Annual expected sales:
Sale of sprinklers 460,000 units at $26.50
Sale of valves 1,480,000 units at $11.20
Sale of controllers 60,000 units at $42.50
Variable manufacturing cost per unit
Sprinklers $13.96
Valves $7.95
Controllers $29.75
Fixed manufacturing overhead cost (total) $760,000
Variable selling and administrative expenses per unit:
Sprinklers $1.30
Valves $0.50
Controllers $3.41
Fixed selling and administrative expenses (total) $1,600,000
A) Determine the sales mix based on unit sales for each product.
B) Using the annual expected sales for these products, determine the weighted-average unit contribution margin for these three products.
C) Assuming the sales mix remains the same, what is the break-even point in units for these products?
Answer:
A.
Sales Mix is 23 : 74 : 3
B.
$567.17
C.
sprinklers = 95,726 units
valves = 303,826 units
controllers = 12,486 units
Explanation:
the sales mix based on unit sales for each product
sprinklers = 460,000 units
valves = 1,480,000 units
controllers = 60,000 units
this can then be expressed as :
460,000 : 1,480,000 : 60,000
expressed in lowest terms as :
23 : 74 : 3
the weighted-average unit contribution margin for these three products.
weighted-average unit contribution margin is the sum of contribution per units with the mix applied to each contribution margin.
unit contribution margin are
sprinklers = $12.54
valves = $3.25
controllers = $12.75
weighted-average unit contribution margin = $12.54 x 23 + $3.25 x 74 + $12.75 x 3 = $567.17
the break-even point in units for these products
break-even point in units = Fixed Cost ÷ Contribution per unit
= ($760,000 + $1,600,000) ÷ $567.17
= 4,162 units
Multiplying this with each mix we have :
sprinklers = 95,726 units
valves = 303,826 units
controllers = 12,486 units
In the open economy macroeconomic model, the amount of dollars demanded in the market for foreign-currency exchange at a given real exchange rate increases if a. either U.S. imports or exports increase. b. either U.S. imports or exports decrease. c. either U.S. imports increase or U.S. exports decrease. d. either U.S. imports decrease or U.S. exports increase.
Answer:
d. either U.S. imports decrease or U.S. exports increase
Explanation:
International trade occurs when countries buy and sell between themselves. This results from one country's comparative advantage in producing a good over other countries.
As a result when a country exports a lot of goods it's currency is in high demand. This is because the other country has to buy in the home country's currency, so large volume of export means large demand for the country's currency.
It also follows that when it's imports decreases it's currency will also be in high demand since less of it is being given to buy foreign goods.
Tamarisk Corporation had the following activities in 2020. 1. Payment of accounts payable $711,000 4. Collection of note receivable $93,000 2. Issuance of common stock $247,000 5. Issuance of bonds payable $522,000 3. Payment of dividends $335,000 6. Purchase of treasury stock $49,000 Compute the amount Tamarisk should report as net cash provided (used) by financing activities in its 2020 statement of cash flows. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) Net cash select an option by financing activities $enter a dollar amount
Answer:
the Net Cash flow provided by financing activities is $385,000
Explanation:
The computation of the amount that should be reported as net cash provided or used by financing activities is shown below:
Cash flow from financing activities
Issuance of common stock $247,000
Issuance of bonds payable $522,000
Less: Payment of dividends -$335,000
Less: Purchase of treasury stock -$49,000
Net Cash flow provided by financing activities $385,000
Hence, the Net Cash flow provided by financing activities is $385,000
Hinck Corporation reported net cash provided by operating activities of $361,200, net cash used by investing activities of $150,800 (including cash spent for capital assets of $206,000), and net cash provided by financing activities of $78,900. Dividends of $126,900 were paid.
Answer:
$28,300
Explanation:
Missing word: "Calculate free cash flow."
Free cash flow = Operating cash flow - Capital expenditures - Dividends
Free cash flow = $361,200 - $206,000 - $126,900
Free cash flow = $28,300
So, the Free cash flow of Hinck Corporation is $28,300.
Other things equal, an appreciation of the U.S. dollar would Multiple Choice increase productivity and increase aggregate supply. decrease net exports and decrease aggregate demand. increase the prices of imported resources and decrease aggregate supply. decrease the supply of money and decrease aggregate demand.
Answer:
Other things equal, an appreciation of the U.S. dollar would:
decrease net exports and decrease aggregate demand.
Explanation:
The immediate effect of an appreciation of U.S. dollars is the decrease of net exports to other countries because the importers will find that importing goods from the U.S. is more expensive than importing from some other countries. This drop caused by decreased exports also decreases aggregate demand of U.S. goods. Therefore, excess inventory of U.S. goods in producers' warehouses will result, thus, reducing national productivity and GDP.
Other things equal, an appreciation of the U.S. dollar would decrease net exports and decrease aggregate demand. Thus, Option (B) is correct.
When the U.S. dollar appreciates, it becomes stronger compared to other currencies. This means that goods and services produced in the United States become relatively more expensive for foreign buyers.
As a result, U.S. exports become less competitive in the international market, leading to a decrease in the quantity of goods and services exported. A decline in exports reduces the net exports component of aggregate demand, as net exports are the difference between exports and imports.
A decrease in net exports directly contributes to a decrease in aggregate demand, as aggregate demand is the sum of consumption, investment, government spending, and net exports.
Thus, Option (B) accurately describes what happens when there is an appreciation of the U.S. dollar.
Learn more about the appreciation here:
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Newberry, Inc., whose reporting currency is the U.S. dollar ($), has a subsidiary in Argentina, whose functional currency also is the $. The subsidiary acquires inventory on credit on November 1, 2017, for 230,000 pesos that is sold on January 17, 2018, for 267,000 pesos. The subsidiary pays for the inventory on January 31, 2018. Currency exchange rates are as follows:
November 1, 2017 $0.20
December 31, 2017 0.65
January 17, 2018 0.66
January 31, 2018 0.67
1. What amount does Newberry’s consolidated balance sheet report for this inventory at December 31, 2017?
a. $120,600.
b. $115,200.
c. $117,000.
d. $118,800.
2. What amount does Newberry’s consolidated income statement report for cost of goods sold for the year ending December 31, 2018?
a. $115,200.
b. $118,800.
c. $120,600.
d. $117,000.
Answer:
1. $46,000
2.$46,000
Explanation:
According to the scenario, computation of the given data are as follows,
Inventory price = 230,000 pesos
1. Consolidated balance sheet amount = Inventory price × Rate on November 1, 2017
= 230,000 × $0.20
= $46,000
2. Consolidated statement cost of goods sold for the year ending December 31, 2018 = Inventory price × Rate on November 1, 2017
= 230,000 × $0.20
= $46,000
Explain why the following scenario fails to meet the definition of a staff position.
Situation: Carmen helps manufacture auto parts for a company that supplies a manufacturer. She is talking to her operations manager.
Carmen: "I created several designs and have chosen the best one. Here is a prototype. I can make as many as needed."
Answer:
They are the person who ships out already made designs and not ones who are supposed to make new design, that is usually done by a higher up staff manager.
Explanation:
i cant say for certain its correct but i would assume since she is only staff she wouldnt be able to make her own ones.
WellWheats, Inc. produces breakfast cereal and sells each box, or unit, for $7. The company is projecting sales of 1,000 units for the month of March. There are 30 units in the beginning inventory. Each unit requires 20 ounces of raw materials and 0.20 direct labor hours to make. The company's policy is to keep ending finished goods inventory of 10% of the current month's sales. Selling and administrative expenses for the month have been budgeted at $2,000. If the direct labor cost per hour is $0.75, calculate the budgeted direct labor cost for the month of March.
A. $214.00
B. $160.50
C. $802.50
D. $236.00
Answer:
b. . $160.50
Explanation:
Projected Sales 1,000 units
Desired ending inventory = 10%*1,000 = 100 units
Beginning Inventory = 30 units
Required production = Projected Sales + Desired ending inventory - Beginning Inventory
Required production = 1,000 units + (10%*1,000 units) - 30 units
Required production = 1,000 units + 100 units - 30 units
Required production = 1,070 units
Labor hours per unit = 0.20
Cost per labor hour = $0.75
Budgeted labor cost for March = Required production*Labor hours per unit*Cost per labor hour
Budgeted labor cost for March = 1,070 units*$0.20*$0.75
Budgeted labor cost for March = $160.50
Hence, the budgeted labor cost for March is $160.50.
how can technological innovation help a company become globalised
Answer: Technology is the vital force in the modern form of business globalization. ... Technology has helped us in overcoming the major hurdles of globalization and international trade such as trade barrier, lack of common ethical standard, transportation cost and delay in information exchange, thereby changing the market place.
Explanation:
You are in charge of reordering gasoline for your company car fleet. You have decided to use a periodic inventory control system, and calculated your economic order quantity (EOQ) to be 4800 gallons. Your company is open 50 weeks per year and you look back at historic demand and find that you have averaged using 160 gallons per day with a standard deviation of demand of 35 gallons per day. The lead time from when you place an order until when it is delivered is 2 weeks. Assume the company operates 7 days per week. What should be the optimal time between orders (P) based on the economic ord
Answer:
The answer is "30 days".
Explanation:
Please find the complete question in the attached file.
per period demand [tex]d=160[/tex]
per year periods [tex]o=350[/tex]
Annual demand
Order quantity
Orders per year
The time between orders
Bonita Company has a factory machine with a book value of $87,800 and a remaining useful life of 5 years. It can be sold for $32,000. A new machine is available at a cost of $455,100. This machine will have a 5-year useful life with no salvage value. The new machine will lower annual variable manufacturing costs from $624,400 to $524,400. Prepare an analysis showing whether the old machine should be retained or replaced.
Answer: Old machine should be replaced.
Explanation:
The variable manufacturing cost will reduce by:
= 624,000 - 524,000
= $100,000
Over a period of 5 years this will be:
= 100,000 * 5
= $500,000
Selling the old machine would bring in $32,000:
= 500,000 + 32,000
= $532,000
The cost of the new machine would reduce this gross benefit by:
= 532,000 - 455,100
= $76,900
Net income will increase by a total of $76,900 over the 5 year period if the new machine is bought so it should be bought.
Using relevant examples discuss the five most important variables that may cause the market for
demand curve for labor to shift?
I will give brainliest
Answer:
An increase or decrease in the quantity demanded is shown as movement along the demand curve and is due to a change in price as shown in the graph on the prior page. An increase or decrease in demand is shown by a shift in the demand curve. A change in the demand of a good or service is caused by something other than a change in the price of a good or service.
Explanation:
When the demand curve shifts upward and to the right, it is indicative of an increase in demand
When the demand curve shifts downward and to the left, it is indicative of an increase or decrease in demand.
Demand: Demand Explanation
increases or decreases?
Population increases I There are more opportunities to buy
and sell.
Population decreases D There are fewer opportunities to
buy and sell.
Increase in most people I When income goes up, people have a s’ income greater ability to buy.
Decrease in most peoples’ D When income goes down, people have a
income diminished ability to buy.
Price of substitute increases I As the price of a substitute increases,
the demand for the product under study
increases. (If consumers have substituted
fish for meat, and the price of fish goes
up, the demand for meat will increase.)
How do you do this journal entry for accounting?
- Now record the estimated cost of the returns. Estimated sales returns of $1,040, with cost of $333.
Answer:
Journal Entries:
1. Debit Sales Returns & Allowance $1,040
Credit Accounts Receivable $1,040
To record the estimated cost of returns.
2. Debit Inventory $333
Credit Cost of goods sold $333
To record the estimated cost of the goods returned.
Explanation:
a) Data and Analysis:
1. Sales returns and Allowances $1,040 Accounts receivable $1,040
2. Inventory $333 Cost of goods sold $333
The first journal entry records the estimated returns to be made by the customers by debiting the Sales returns account (a contra account to the sales revenue account). The corresponding credit entry in the Accounts receivable shows that a part of the accounts has been cancelled as a result of the estimated sales returns.
The second journal entry records the estimated cost of the goods to be returned by debiting the Inventory account and crediting the Cost of goods sold account. This cancels earlier records.
The demand function is given by
D = 20 - p-p2 where D =
demand and p = price. Find the
elasticity of demand w.r.t. price
when price is 2
Answer:
Q=120−4P
Explanation:
putting P = 20 we get
q= 40
we know that elasticity is quantity demanded / price
20
40
=2
hence the correct option: D
Lifecycle Motorcycle Company is expected to pay a dividend in year 1 of $2, a dividend in year 2 of $3, and a dividend in year 3 of $4. After year 3, dividends are expected to grow at the rate of 7% per year. An appropriate required return for the stock is 12% (for both stages). Using the multistage DDM, the stock should be worth __________ today. Group of answer choices
Answer:
$67.95
Explanation:
Calculation to determine how much should the stock should be worth today.
First step is to calculate the dividend per year;
D4= D3(1+g) = 4(1.07) = $4.28
Second step is to calculate the PV of each dividend
PV (D1) =2 / (1.12)
PV (D1) = 1.7857
PV (D2) = 3/ (1.12²)
PV (D2) = 2.3916
PV (D3) = 4/ (1.12³)
PV (D3) = 2.8471
Fourth Step is to calculate the Value of Perp. at t=3
=[(4(1.07))/(.12-.07)]/1.12^3
=85.6/1.4049
=60.9296
Now let calculate how much should the stock should be worth today
Worth today = 1.7857+ 2.3916 + 2.8471 + 60.9296
Worth today=$67.95
Therefore Using the multistage DDM, the stock should be worth $67.95 today
Multiple Choice Question 47 Tidwell Industries has the following overhead costs and cost drivers. Direct labor hours are estimated at 100000 for the year. Activity Cost Pool Cost Driver Est. Overhead Cost Driver Activity Ordering and Receiving Orders $ 105000 500 orders Machine Setup Setups 283500 450 setups Machining Machine hours 1462500 125000 MH Assembly Parts 1170000 1000000 parts Inspection Inspections 285000 500 inspections If overhead is applied using traditional costing based on direct labor hours, the overhead application rate is
Answer:
Predetermined overhead rate= $22.53 per direct labor hour
Explanation:
Giving the following information:
Direct labor hours are estimated at 100,000 for the year.
Total estimated overhead for the period= (105,000 + 283,500 + 1,462,500 + 117,000 + 285,000) = $2,253,000
To calculate the predetermined overhead rate, we need to use the following formula:
Predetermined overhead rate= total estimated overhead / total amount of allocation rate
Predetermined overhead rate= 2,253,000 / 100,000
Predetermined overhead rate= $22.53 per direct labor hour
In the balance sheet at the end of its first year of operations, Dinty Inc. reported an allowance for uncollectible accounts of $82,000. During the year, Dinty wrote off $32,000 of accounts receivable it had attempted to collect and failed. Credit sales for the year were $2,200,000, and cash collections from credit customers totaled $1,950,000. What accounts receivable balance would Dinty report in its first year-end balance sheet?
Answer:
$218,000
Explanation:
Account receivable balance = Credit sales - Cash collection - Wrote-offs
Account receivable balance = $2,200,000 - $1,950,000 - $32,000
Account receivable balance = $218,000
So, the accounts receivable balance would Dinty report in its first year-end balance sheet is $218,000
Chesapeake Inc. acquired a registered trademark for $600,000. The trademark has a remaining legal life of 5 years but can be renewed every 10 years for a nominal fee. Chesapeake does not expect to renew the acquired trademark when the legal life is over. What amount of amortization expense should Chesapeake record for the trademark in the current year?
a. $0
b. $15,000
c. $40,000
d. $120,000
Answer:
d. $120,000
Explanation:
Amortization expense = Cost ÷ Estimated useful life
therefore
Amortization expense = $600,000 ÷ 5 = $120,000
Note ; In this case the legal life is the same as the useful life.
Following is information on two alternative investments being considered by Jolee Company. The company requires a 6% return from its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1). (Use appropriate factor(s) from the tables provided.)
Project A Project B
Initial investment $ (174,325 ) $ (152,960 )
Expected net cash flows in year:
1 41,000 44,000
2 60,000 53,000
3 72,295 68,000
4 87,400 81,000
5 59,000 30,000
For each alternative project compute the net present value.
Project A
Initial Investment $174,325
Chart values are based on:
i =
Year Cash inflow x Table factor = Present Value
1 =
2 =
3 =
4 =
5 =
Project B
Initial Investment $152,960
Year Cash inflow x Table factor = Present Value
1 =
2 =
3 =
4 =
5 =
For each alternative project compute the profitability index.
Choose Numerator: / Choose Denominator: = Profitability index
/ = Profitability index
Project A
Project B
2. Assume If the company can only select one project, which should it choose?
Project A or Project B
Answer:
Project A
NPV = $91,771.53
PI = 1.53
Project B
NPV = $79,390.69
PI = 1.52
Project A should be chosen because it has the higher NPV
Explanation:
Net present value is the present value of after-tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator
Only projects with a positive NPV should be accepted. A project with a negative NPV should not be chosen because it isn't profitable.
When choosing between positive NPV projects, choose the project with the highest NPV first because it is the most profitable.
Project A
Cash flow in year 0 = $ (174,325)
Cash flow in year 1 = 41,000
Cash flow in year 2 = 60,000
Cash flow in year 3 = 72,295
Cash flow in year 4 = 87,400
Cash flow in year 5 = 59,000
I = 6%
NPV = $91,771.53
Project B
Cash flow in year 0 = (152,960 )
Cash flow in year 1 = 44,000
Cash flow in year 2 = 53,000
Cash flow in year 3 = 68,000
Cash flow in year 4 = 81,000
Cash flow in year 5 = 30,000
I = 6%
NPV = $ $79,390.69
profitability index = 1 + (NPV / Initial investment)
Project A = 1 +( $91,771.53 /$174,325) = 1.53
Project B = 1 + ( $79,390.69 / 152,960 = 1.52
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
How to account for this $45,000? I think, this could be as Salary or dividend.
When Scott and Allison are in the store, they are the only ones who operate the register. Scott admits that, because he is in too much of a hurry, he sometimes puts the cash in his pocket rather than take the time to ring up the sale. Having cash in hand allows him to pay his babysitter and other personal expenses. Though it was difficult for him to be certain, Scott estimated that transactions worth about $45,000 each year have been handled in this way. Scott confirmed that he has not filed a personal tax return since he started GPP because he has not taken a salary.
Answer:
Scott should file Personal tax return since he is running his expenses through the money he takes in hand.
Explanation:
Scott will have to file the tax return because he is taking $45,000 as a salary. It does not matter that the salary is run through bank account or through cash but personal tax return filing is necessary. He uses the money to fund his routine expenses and this is to be reported in personal tax filing.
Robb Industries Inc. (RII) developed standard costs for direct material and direct labor. In 20X4, RII estimated the following standard costs for one of their major products, the 10-gallon plastic container.
Budgeted quantity Budgeted price
Direct materials 0.10 pounds $30 per pound
Direct labor 0.05 hours $15 per hour
During June RII produced and sold 5,000 containers using 490 pounds of direct materials at an average cost per pound of $32 and 250 direct manufacturing labor-hours at an average wage of $15.25 per hour.
a. What is June’s direct material price variance?
standard price 30 acutal quantity 490
actual price 32 direct material 980 unfavorable
b. What is June’s direct material efficiency variance?
standard price 30 actual quantity 490
standard quality 500 direct material 300 favorable
c. What is June’s direct labor rate variance?
standard rate 15 actual hours 450
actual rate 15.25 manufactoring labor variance 62.50 unfavorable
d. What is June’s direct labor efficiency variance?
standard hours 250 standard rate 15
actual hours 250 maunfaturing varience 0
Answer:
A. 980 unfavorable
B. 300 favorable
C. 62.50 unfavorable
D. 0
Explanation:
A. Calculation to determine June’s direct material price variance
Using this formula
Direct material price variance=Actual quantity(Standard price -Actual price)
Let plug in the formula
Direct material price variance=490 ($32 - $30) Direct material price variance=980 U
B. Calculation to determine June’s direct material efficiency variance
Using this formula
Direct material efficiency variance=Standard price (Actual quantity-Standard quality)
Let plug in the formula
Direct material efficiency variance=$30 (490 – 500)
Direct material efficiency variance= 300 F
C. Calculation to determine June’s direct labor rate variance
Using this formula
Direct labor rate variance=standard hours(actual rate -standard rate )
Let plug in the formula
Direct labor rate variance =250 dlh ($15.25 - $15.00)
Direct labor rate variance = $62.50 U
D. Calculation to determine June’s direct manufacturing labor efficiency variance
Direct manufacturing labor efficiency variance=[250 dlh - (5,000 x 0.05)] x $15
Direct manufacturing labor efficiency variance = 0
Hubert lives in San Diego and runs a business that sells boats. In an average year, he receives $851,000 from selling boats. Of this sales revenue, he must pay the manufacturer a wholesale cost of $476,000; he also pays wages and utility bills totaling $281,000. He owns his showroom; if he chooses to rent it out, he will receive $71,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Hubert does not operate this boat business, he can work as an accountant, receive an annual salary of $34,000 with no additional monetary costs, and rent out his showroom at the $71,000 per year rate. No other costs are incurred in running this boat business.
Identify each of Bob's costs in the following table as either an implicit cost or an explicit cost of selling boats.
a. The salary Bob could earn if he worked as an accountant
b. The wholesale cost for the boats that Bob pays the manufacturer
c. The rental income Bob could receive if he chose to rent out his showroom
d. The wages and utility bills that Bob pays
Answer:
(a). Implicit cost
(b) Explicit cost
(c) Implicit cost
(d) Explicit cost
Explanation:
Implicit cost are the cost which a person can earn in a period.
Explicit cost are the cost which a person pays in same period for other work.
So by this, we can clearly determine explicit and implicit cost for the following statements.
(a). Implicit cost (Because salary is an earning for Bob.)
(b) Explicit cost ( Because Bob pays an amount for different work)
(c) Implicit cost (Because rental is an earning for Bob.)
(d) Explicit cost ( Because Bob pays an amount for wages and utility)
The Smith family wants to relocate to a neighborhood with better schools before their three-year-old goes to kindergarten. They talked with Byron about properties he has for sale in neighborhoods they would like to live in. They also mentioned to Byron that they both work and may need someone to help with in-home care for their child. Byron gave them Taylor’s name to call about childcare. The Smiths also said they were having a hard time getting loan approval, so Byron suggested that they call Travis. Which best describes the jobs performed by Byron, Taylor, and Travis?
a) Byron is a Customer Service Representative, Taylor is a Child Care Worker, and Travis is a Loan Counselor.
b) Byron is a Real Estate Manager, Taylor is a Nanny, and Travis is a Loan Counselor.
c) Byron is a Real Estate Manager, Taylor is a Preschool Teacher, and Travis is a Customer Service Representative.
d) Byron is a Home Counselor, Taylor is a Nanny, and Travis is a Property Manager.
Answer:
the correct answer is B)
Explanation:
Given that they spoke to Byron about properties that he wants to sell, that means he is a Real Estate Manager. Taylor came up because they needed in-home care. That makes Taylor a Nanny because Nannies are professionals who take care of babies in their own homes.
Loan counselors have no other major business besides advising people on issues relating to taking up a loan. Therefore that makes Travis a loan Counselor.
Cheers
advantages and disadvantages of proxemics
Answer:
Advantage::
it allows people to understand how different communities organise there Town and homes
Data for Divisions A, B, C, D, and E are as follows:
Div.
Sales
Income from
Operations
Inv.
Assets
Rate of
Return
on Inv.
Profit
Margin
Invest.
Turnover
A
(1)
$35,000
$200,000
(2)
(3)
1.6
B
$455,000
(4)
$284,375
16%
(5)
(6)
C
$525,000
$73,500
(7)
(8)
(9)
1.2
D
$800,000
(10)
(11)
(12)
13.0%
2.5
E
(13)
(14)
$250,000
(15)
16.0%
2.0
(a) Determine the missing items, identifying each by number.
(b) Which division is most profitable in terms of income from operations?
(c) Which division is most profitable in terms of rate of return on investment?
Round percentage values to one decimal point.
Answer:
1. A
2. B WHICH DIVISONS IS MUST PROFITABLE IN TERM OF RACE OF TURN ON ENVRONMENT
A company is considering replacing an old piece of machinery, which cost $597,600 and has $351,400 of accumulated depreciation to date, with a new machine that has a purchase price of $483,600. The old machine could be sold for $64,900. The annual variable production costs associated with the old machine are estimated to be $157,400 per year for eight years. The annual variable production costs for the new machine are estimated to be $99,300 per year for eight years.
Required:
a. Prepare a differential analysis dated April 29 to determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine.
b. What is the sunk cost in this situation?
Solution :
Differential Analysis : April 29
Continue old machine Replace old Differential
machine effect on income
Revenue : (Alternative 1) (Alternative 2) (Alternative 2)
Proceeds from
sale of old machine 0 64,900 64,900
Cost :
Purchase price 0 -483,600 -483,600
Variable
manufacturing cost -1,259,200 - 794,400 464800
Total cost -1,259,200 -1278000 -18800
Income (loss) -1,259,200 -12131000 46100
So the company should replace the sold machine.
The sunk cost is = 597,000 - 351,400
= $245,600