Answer:
Pargo Company
1. Sales Budget
Quarterly sales 1st 2nd 3rd 4th 2021
Sales 22% 27% 25% 26%
Sales in quantity 418,000 513,000 475,000 494,000 459,800
Sales price $40 $40 $40 $45 $45
Sales value ('000) $16,720 $20,520 $19,000 $22,2300 $20,691
2. Production Budget
Quarterly production 1st 2nd 3rd 4th 2021
Sales in quantity 418,000 513,000 475,000 494,000 459,800
Ending inventory 128,250 118,750 123,500 114,950
Beginning inventory 0 128,250 118,750 123,500
Total Production 546,250 503,500 479,750 485,450
3. Direct Materials Budget
Quarterly production 1st 2nd 3rd 4th
Total Production (units) 546,250 503,500 479,750 485,450
Materials per unit (pounds)1,092,500 1,007,000 959,500 970,900
Ending Inventory 100,700 95,950 97,090 49,500
Beginning Inventory 109,250 100,700 95,950 97,090
Purchases 1,083,950 1,002,250 960,640 923,310
Cost of purchases $11,923,450 $11,024,750 $10,567,040$10,156,410
Explanation:
a) Data and Calculations:
Expected sales = 1,900,000
Quarterly sales 1st 2nd 3rd 4th 2021
Sales 22% 27% 25% 26%
Sales in quantity 418,000 513,000 475,000 494,000 459,800
Sales price $40 $40 $40 $45 $45
Sales value ('000) $16,720 $20,520 $19,000 $22,2300 $20,691
Ending inventory 128,250 118,750 123,500 114,950 units
An individual has $2000 in physical assets, and $600 in cash initially. This person faces the following loss distribution to the wealth. Full insurance is available at $600
Probability Loss
0.5 0
0.1 200
0.2 400
0.1 1000
0.1 2000
The Individual can also buy partial insurance with i. a $200 deductible, or ii. 75% coinsurance, or iii. Upper limit on coverage, with the limit being $1000. The premium on each partial coverage policy is $450.
Required:
Provide a ranking of the four types of policies for the individual, in terms of preference if the preference function is given by U(FW) = LN(1+FW), where FW is final wealth of the individual.
Answer with Explanation:
Probability Expected Loss Loss Forecast
0.5 0 0
0.1 200 20
0.2 400 80
0.1 1000 100
0.1 2000 200
1.00 Total 400
Now,
A. Final Wealth with no Insurance = Physical Assets of the person + Cash Assets - Total Loss Forecast
By putting values, we have:
Final Wealth with no Insurance = $2,000 + $600 - $400 = $2,200
B. For Full insurance, we will not consider expected loss because we will receive Insurance Premium instead:
Final Wealth with Full Insurance = Physical Assets + Cash Assets - Insurance Premium
By putting values, we have:
Final Wealth with Full Insurance = $2,000 + $600 - $600 = $2,000
C. Final Wealth with Partial Insurance and $200 deductibles = Physical Assets + Cash Assets - Insurance Premium For Partial Coverage - Deductible
By putting values, we have:
Final Wealth with Partial Insurance and $200 deductibles = $2,000 + $600 - $450 - $200 = $1,950
D. Final Wealth with 75% Co-insurance = Physical Assets + Cash Assets - Insurance Premium - Co-payment
By putting values, we have:
Final Wealth with 75% Co-Insurance = $2,000 + $600 - $450 - (75% * $400)
= $1,850
E. Final Wealth with Partial Insurance and $1,000 Upper Limit = Physical Assets + Cash Assets - Insurance Premium - Maximum Loss Expected
By putting values, we have:
= $2,000 + $600 - $450 - (Probability 0.1 * $2,000) = $1950
From the above, we can say that the best option here in descending order is as under:
1. A. Final Wealth with no Insurance
2. B. With Full insurance
3. C. Final Wealth with Partial Insurance and $200 deductibles & E. Final Wealth with Partial Insurance and $1,000 Upper Limit
4. E. Final Wealth with Partial Insurance and $1,000 Upper Limit
• What are the advantages and disadvantages of owning versus outsourcing for each of these components (staff, computer servers, software licensing, and data storage)?
Answer:
Explanation below
Explanation:
Outsourcing simply involves the act of contracting our certain business activities and processes to third-party providers.
Staff
When you outsource your staff, you can be able to save cots and use the freed capital for other things but the disadvantage would certainly be around the issue of confidentiality of business information.
When you outsource computer servers, software licensing, and data storage, you would gain access to world-class capabilities because the third-party providers would likely provide them to meet their customers.
There would also be shared risks as part of the benefits. The disadvantages could include loss of control. People who discourage outsourcing of these functions are of the opinion that third-party vendor cannot be able to match the level of responsiveness and levels of services that could be offered by an in-house team
Analyzing Unearned Revenue Disclosures
The following disclosures (excerpted) are from the August 28, 2016, annual report of Costco Wholesale Corporation.
Revenue Recognition: We generally recognize sales, net of estimated returns, at the time the member takes possession of merchandise or receives services. When we collect payment from customers prior to the transfer of ownership of merchandise or the performance of services, the amount recieved is generally recorded as deferred revenue on the consolidated balance sheets until the sales or service is completed. Membership fee revenue represents annual membership fees paid by our memberships. We account for membership fee revenue, net of estimated refunds, on a deferred basis, whereby revenue is recognized ratably over the one-year membership period.
Revenue
($ millions) August 28, 2016 August 30, 2015 August 31, 2014
Net Sales $116,073 $113,666 $110,212
Membership fees 2,646 2,533 2,428
Total revenue $118,719 $116,199 $112,640
Current Liabilities ($ millions) August 28, 2016 August 30, 2015
Accounts payable $7,612 $9,011
Current portion of long-term debt 1,100 1,283
Accrued salaries and benefits 2,629 2,468
Accured member rewards 869 813
Deferred membership fees 1,362 1,269
Other current liabilities 2,003 1,695
Total current liabilities $15,575 $16,539
(a) Which of the following statements best explains in layman terms how Costco accounts for the cash received for its membership fees?
Because Costco does not know how many of its members will continue to the end of the year, cash received from members is recorded as a liability and recognized as revenue only at year-end.
When it receives cash, the company records it as a current liability. Then, it recognizes revenue evenly over the year.
The company records revenue when the cash is received.
Because Costco has a refund policy, the company records revenue when the cash is received, less an allowance for expected membership terminations.
Mark 1.00 out of 1.00
(b) Use the balance sheet information on Costco's Deferred Membership Fees liability account and its income statement revenues related to Membership Fees earned during 2016 to compute the cash that Costco received during 2016 for membership fees.
Total cash received (in $ millions) = $Answer
(c) Use the financial statement effects template to show the effect of the cash Costco received during 2016 for membership fees and the recognition of membership fees revenue for 2016.
Use negative signs with answers, when appropriate.
Balance Sheet
Transaction ($ millions)
Cash Asset + Noncash Assets = Liabilities + Contributed Capital + Earned Capital
Receive cash in advance for membership fees Answer Answer Answer Answer Answer
Recognized membership fees earned Answer Answer Answer Answer Answer
Income Statement
Revenue - Expenses = Net Income
Answer Answer Answer
Answer Answer Answer
Feedback
You have correctly selected 15.
Partially correct
Marks for this submission: 15.00/18.00.
Your company has sales of this year and cost of goods sold of . You forecast sales to increase to next year. Using the percent of sales method, forecast next year's cost of goods sold. The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career.
The forecasted cost of goods sold (COGS) is $________
Complete question :
Your company has sales of $101,500 this year and cost of goods sold of $66,300. You forecast sales to increase to $118,900 next year. Using the percent of sales method, forecast next year's cost of goods sold. The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career The forecasted cost of goods sold (COGS) is $ ___________ (Round to the nearest dollar.)
Answer:
$77,666
Explanation:
Given the following :
Sales for the year = $101,500
Cost of goods sold =$66,300
Forecasted increase in sales for next year = $118,900
Forecasted cost of goods sold for next year =?
Percentage cost of goods sold for this year:
Cost of goods sold / sales for this year
$66300/$101500
= 0.6532019
Forecasted cost of goods sold for next year:
(Forecasted increase in next year's sale * % cost of goods sold for this year)
= 118,900 * 0.6532019
= $77665.714
= $77666 ( nearest dollar)
Deferred tax liability $ 355,000 $ 463,000 The income statement reported tax expense for Year 2 in the amount of $580,000. Required: 1. What was the amount of income taxes payable for Year 2
Answer: $472,000
Explanation:
Deferred Tax Liability arises as a result of the different accounting methods used by Companies and by the Government for taxation.
Deferred tax liabilities are taxes that are owed to the Government due to the company using the Accrual system but as the Government uses the Cash basis, they have not yet recognised this tax.
The Tax Payable in Year 2 is;
= Reported Tax Expense - increase in Deferred Tax liability
= 580,000 - (463,000 - 355,000)
= $472,000
Which of the following changes in retained earnings during a period will be reported in the financing activities section of the statement of cash flows? Declaration and payment of a cash dividend during the period. Net income for the period.
Answer:
Net income for the period.
Explanation:
the statement of cash flow is a financial statement which gives a summary of amount of money or money equivalents that are going into a company and also going out of the company. it gives a measurement of how well the cash position is being managed by the company. the net income for the period is going to be reported in the section called financing activities.
As of June 30, Year 1, the bank statement showed an ending balance of $17,616. The unadjusted Cash account balance was $16,893. The following information is available: 1. Deposit in transit, $2,785. 2. Credit memo in bank statement for interest earned in June, $10. 3. Outstanding check, $3,504. 4. Debit memo for service charge. $6. Required Determine the true cash balance by preparing a bank reconciliation as of June 30, Year 1, using the preceding information, (Negative amounts should be indicated with minus sign.)
Bank Reconciliation
Unadjusted bank balance 6/30/Year 1
True cash balance 6/30/Year 1
Unadjusted book balance 6/30/Year 1
True cash balance 6/30/Year 1
Answer:
cash account reconciliation:
cash account balance $16,893
+ earned interest $10
- bank fees ($6)
reconciled cash account $16,897
bank account reconciliation:
bank account balance $17,616
+ deposits in transit $2,785
- outstanding check ($3,504)
reconciled bank account $16,897
After the accounts have been reconciled, both must have the same balance. If not, then you must check your answer and recalculate until both match.
On January 1, 2021, Jasperse Corporation leased equipment under a finance lease designed to earn the lessor a 10% rate of return for providing long-term financing. The lease agreement specified ten annual payments of $90,000 beginning January 1, and each December 31 thereafter through 2029. A 10-year service agreement was scheduled to provide maintenance of the equipment as required for a fee of $5,000 per year. Insurance premiums of $4,000 annually are related to the equipment. Both amounts were to be paid by the lessor and lease payments reflect both expenditures (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
At what amount will Jasperse record a right-of-use asset?
PV factors based on
Table or Calculator function: PVAD of $1
Lease Payment
n = 10
i = 12%
Right-of-use asset
Answer:
$574,517
Explanation:
Calculation for the amount that Jasperse will record a right-of-use asset
Annual payments = $90,000
Annual maintenance = $5,000 per year
Rate of interest = 10%
Period, n = 10 years
Right of use asset =(90,000 – 5,000) x PVAD, 10%, 10
Right of use asset= 85,000 ×6.75902
Right of use asset= $574,517
Therefore Right-of-use asset will be $574,517
QUESTION 4 / 10
Which of the following statements is TRUE?
A. Applying for several credit cards in one year can help
increase your credit score.
B. People with low credit scores are usually low-risk
borrowers.
C. The longer you use credit responsibly, the higher your
credit score will be.
D. Paying off your entire credit card balance can lower
your credit score.
Answer:
C. The longer you use credit responsibly, the higher your
credit score will be.
Explanation:
A credit card allows its user to access a short term loan. Every payment made via a credit card is considered a loan. The loan attracts interest monthly. Defaulting on credit card payments is similar to defaulting on any other loan type.
Responsible use of a credit card entails using it only when necessary. It means making prompt payments to clear monthly bills.
Credit card history is important information when tabulating an individual's credit score. Anyone who uses their credit card responsibly ends up with a good credit score.
Cheyenne Company has decided to expand its operations. The bookkeeper recently completed the following balance sheet in order to obtain additional funds for expansion.
CHEYENNE COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
Current assets
Cash $237,000
Accounts receivable (net) 347,000
Inventory (lower-of-average-cost-or-market) 408,000
Equity investments (marketable)-at cost (fair value $127,000) 147,000
Property, plant, and equipment Buildings (net) 577,000
Equipment (net) 167,000
Land held for future use 182,000
Intangible assets Goodwill 87,000
Cash surrender value of life insurance 97,000
Prepaid expenses 19,000
Current liabilities Accounts payable 142,000
Notes payable (due next year) 132,000
Pension obligation 89,000
Rent payable 56,000
Premium on bonds payable 60,000
Long-term liabilities Bonds payable 507,000
Stockholders’ equity Common stock, $1.00 par, authorized 400,000 shares, issued 297,000 297,000
Additional paid-in capital 167,000 Retained earnings.
Required:
Prepare a revised balance sheet given the available information.
Answer:
Cheyenne Company
CHEYENNE COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
ASSETS
Current assets :
Cash $237,000
Accounts receivable (net) 347,000
Inventory (LCM) 408,000
Marketable Investments 127,000
Cash surrender
value of life insurance 97,000
Prepaid expenses 19,000
Total current assets $1,235,000 $1,235,000
Property, plant, and
equipment Buildings (net) 577,000
Equipment (net) 167,000
Land held for future use 182,000
Intangible assets Goodwill 87,000
Total long-term assets $1,013,000 $1,013,000
Total assets $2,248,000
LIABILITIES & EQUITY
Current liabilities:
Accounts payable 142,000
Notes payable (short-term) 132,000
Pension obligation 89,000
Rent payable 56,000
Premium on bonds payable 60,000
Total current liabilities $479,000 $479,000
Long-term liabilities
Bonds payable 507,000 $507,000
Total liabilities $986,000
Stockholders’ equity
Common stock, $1.00 par,
authorized 400,000 shares,
issued 297,000 297,000
Additional paid-in capital 167,000
Retained earnings 798,000
Total Equity $1,262,000 $1,262,000
Total liabilities & Stockholders' equity $2,248,000
Explanation:
CHEYENNE COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
Current assets
Cash $237,000
Accounts receivable (net) 347,000
Inventory (LCM) 408,000
Marketable Investments 127,000
Cash surrender
value of life insurance 97,000
Prepaid expenses 19,000
Property, plant, and
equipment Buildings (net) 577,000
Equipment (net) 167,000
Land held for future use 182,000
Intangible assets Goodwill 87,000
Current liabilities
Accounts payable 142,000
Notes payable (short-term) 132,000
Pension obligation 89,000
Rent payable 56,000
Premium on bonds payable 60,000
Long-term liabilities
Bonds payable 507,000
Stockholders’ equity
Common stock, $1.00 par,
authorized 400,000 shares,
issued 297,000 297,000
Additional paid-in capital 167,000
Retained earnings ?
Total assets - Liabilities = Total Equity
= 2,248,000 - 986,000
= 1,262,000
Retained Earnings = Total Equity - (Common Stock + APIC)
= 1,262,000 - (297,000 + 167,000)
= $798,000
when pysical changes in materials happened, there is?
I. Formation of new product or material
II. No formation of new product or material
III. Formation of new shape
IV. Formation of new color
A. I, III and IV
B. II only
C. III and IV
D. II, III and IV
Cari created a list of ways to reduce her spending. Which activity should she omit from her list? Choose the correct answer below. use less expensive places for services such as haircuts wear items of clothing for an extra season buy store brands instead of name brands for food and other items rely on friends to treat me when I am out of money
Answer:
b
Explanation:
The Belmont principle of beneficence requires that:
Answer:
The Belmont principle of beneficence requires that both protecting individual subject against risk of harm and consideration of not only the benefits for the individual,but also the societal benefits that might be gained from the research.
Major improvements in computer information technology in the 1990s fueled an increase in investment demand in the United States (a large open economy). Graphically illustrate the effect of an increase of U.S. investment using the Large Open Economy Model. Clearly label the axes and curves in each of your graphs in the model. Clearly indicate the direction of any shifts in the curves.
Answer and Explanation:
Please find attached
According to Mintzberg, managers averaged ____ written and _____ verbal contacts per day with most of these activities lasting less than ____ minutes. Group of answer choices
Answer:
1. 36
2. 16
3. 9
Explanation:
According to Henry Mintzberg, a who is known as a professor of Management of Studies. In his model commonly referred to as organizational configurations framework, he concluded that, managers averaged THIRTY SIX written and SIXTEEN verbal contacts per day with most of these activities lasting less than NINE minutes.
Hence, in this case, the correct answer is 36 : 16 : 9
Ming borrows X for 10 years at an annual effective interest rate of 8%. If he pays the principal and accumulated interest in one lump sum at the end of 10 years, he would pay 468.05 more in interest than if he repaid the loan with 10 level payments at the end of each year. Calculate X.
Answer:
X = $700
Explanation:
the future value of X = X · (1 + 8%)¹⁰ = 2.158925X
X = annual payment · 6.7101 (PV annuity factor, 8%, 10 periods)
annual payment = X / 6.7101
2.158925X = 10 annual payments + 468.05
2.158925X = 10X/6.7101 + 468.05
2.158925X = 1.490291X + 468.05
0.668634X = 468.05
X = 468.05 / 0.668634 = $700
if you payback the loan in one lump sum at the end of 10 years, you will pay = $700 x 2.158925 = $1,511.25
or you could make 10 annual payments = $700 / 6.7101 = $104.32, in total you would pay $1,043.20
the difference between both = $1,511.25 - $1,043.20 = $468.05
A small nation of 10 people idolizes the TV show The Voice. All they produce and consume are karaoke machines and CDs, in the following amounts:
Karaoke Machines CDs
Quantity Price(Dollars) Quantity Price (Dollars)
2020 20 50 60 5
2021 21 70 80 6
Using a method similar to that used to calculate the consumer price index, the percentage change in the overall price level is_____________ . (Note: Use 2020 as the base year, and fix the basket at 2 karaoke machines and 6 CDs.) Using a method similar to that used to calculate the GDP deflator, the percentage change of the overall price level is_____________ . (Note: Again, use 2020 as the base year.) Which of the following statements is correct? Check all that apply.
a. The inflation rate in 2021 is not the same using the two methods.
b. The CPI allows the basket of goods and services to change.
c. The GDP deflator holds the basket of goods and services constant.
Answer:
The inflation rate is different using the two methods as the rate of inflation calculated by the CPI holds basket of goods and services constant while the GDP deflator allows it to change.
Explanation:
i. Value of market basket of the good in 2020 = ($50*2) + ($5*6) = $130
Value of market basket of the good in 2021 = ($70*2) + ($6*6) = $176
CPI in 2020 = ($130 / $130) * 100 = 100
CPI in 2021 = ($176 / $130) * 100 = 135.38
Thus, The percentage change in overall price level is = [(135.38 - 100) / 100) * 100 = 35.38%
ii. Nominal GDP in 2020 = ($50 * 20) + ($5 * 60) = $1300
Nominal GDP in 2021 = ($70 * 21) + ($6 * 80) = $1950
Real GDP in 2020 = ($50 * 20) + ($5 * 60) = $1300
Real GDP in 2021 = ($50 * 21) + ($5 * 80) = $1450
GDP deflator in 2020 = (Nominal GDP in 2107 / Nominal GDP in 2107) * 100 = ($1300 / $1300) * 100 = 100
GDP deflator in 2021 = (Nominal GDP in 2108 / Nominal GDP in 2108) * 100 = ($1950 / $1450) * 100 = 134.48
Thus, the percentage change in overall price level is = [(134.48 - 100) / 100) * 100 = 34.48%
There are 3 factories on the Momiss River. Each emits 2 types of pollutants, labeled P1 and P2, into the river. If the waste from each factory is processed, the pollution in the river can be reduced. It costs $1500 to process a ton of factory 1 waste, and each ton processed reduces the amount of P1 by 0.10 ton and the amount of P2 by 0.45 ton. It costs $1000 to process a ton of factory 2 waste, and each ton processed reduces the amount of P1 by 0.20 ton and the amount of P2 by 0.25 ton. It costs $2000 to process a ton of factory 3 waste, and each ton processed reduces the amount of P1 by 0.40 ton and the amount of P2 by 0.30 ton. The state wants to reduce the amount of P1 in the river by at least 30 tons and the amount of P2 by at least 40 tons.
Required:
Formulate an LP that will minimize the cost of reducing pollution by the desired amounts. Do you think that the LP assumptions (Proportionality, Additivity, Divisibility, and Certainty) are reasonable for this problem?
Answer:
Kindly check explanation
Explanation:
Using table for our evaluation :
____________POLLUTANT
Factories___P1 ______P2 ____COST
__1_______0.1______ 0.45 ___ 1500
__2______ 0.2 _____ 0.25 ____1000
__3 ______0.40 ____ 0.30 ____2000
_________ ≥ 30 ____ ≥ 40 _____ z
Let amount of waste produced by Factories 1, 2 and 3 equal f1, f2 and f3 respectively.
Linear Program that will minimize the cost of reducing pollution by the desired amounts
Min cost:
min z = 1500f1 + 1000f2 + 2000f3
0.1f1 + 0.2f2 + 0.4f3 ≥ 30
0.45f1 + 0.25f2 + 0.3f3 ≥ 40
f1, f2, f3 ≥ 0
On January 1, 2020 Herald acquires 100% of Tribune and will operate Tribune as a wholly owned subsidiary. Herald's purchase price was less than the fair value of the net assets of Tribune. How is this handled
Answer:
When the purchase price is lower than the fair market value, accountants generally refer to this as negative goodwill. All negative goodwill must be reported as a gain.
Another way to refer to this type of situation is a bargain purchase (lower price than FMV).
On May 31, the Cash account of Teasel had a normal balance of $5,700. During May, the account was debited for a total of $12,900 and credited for a total of $12,200. What was the balance in the Cash account at the beginning of May
Answer:
$6,400
Explanation:
Cash Account
Debit :
Beginning Balance $5,700
Receipts $12,900
Totals $18,600
Credit :
Payments $12,200
Ending Balance (Balancing figure) $6,400
Totals $18,600
The city of Belgrade, Serbia, is contemplating building a second airport to relieve congestion at the main airport and is considering two potential sites, X and Y. Hard Rock Hotels would like to purchase land to build a hotel at the new airport. The value of land has been rising in anticipation and is expected to skyrocket once the city decides between sites X and Y. Consequently, Hard Rock would like to purchase land now. Hard Rock will sell the land if the city chooses not to locate the airport nearby. Hard Rock has four choices: (1) buy land at X, (2) buy land at Y, (3) buy land at both X and Y, or (4) do nothing. Hard Rock has collected the following data (which are in millions of euros):
Site X Site Y
Current purchase price 29 18
Profits if airport & hotel built at this site 35 30
Sale price if airport not built at this site 8 4
Hard Rock determines there is a 55% chance the airport will be built at X (hence, a 45% chance it will be built at Y)
Set up a decision table (in millions of Euros) (enter as a whole number and include minus sign if necessary)
State of Nature
Alternatives Airport at X Airport at Y
buy land at X
buy land at Y
buy land at both X & Y
Do nothing
Probability 0.55 0.45
Answer:
Alternatives Airport at X Airport at Y
Buy land at X 6 -14
Buy land at Y -21 12
Buy land at X and Y -15 -2
Do nothing 0 0
probability 0.55 0.45
Payoff if you buy land at X = (0.55 x 6) + (0.45 x -) = -3
Payoff if you buy land at Y = (0.55 x -21) + (0.45 x 12) = -6.15
Payoff if you buy land at X and Y = (0.55 x -15) + (0.45 x -2) = -9.15
Payoff for doing nothing = 0
The best option is simply doing nothing. The risks are too high, the potential losses are very large and the benefits are really low.
Pitbull Construction Corporation applies IFRS, has equipment that it can reliably measure fair value of, and has chosen to apply the revaluation model to valuing this equipment on its accounting records. The carrying value of this equipment on Pitbull's books at the end of last year, December 31, 20X1, was $200,000. At the end of this year, December 31, 20X2, due to decreased demand for the equipment, especially when resold as used, the fair value is $150,000. For the year 20X2, in relation to this equipment for which Pitbull has chosen to apply the revaluation method, Pitbull must:_________
Answer and Explanation:
If there is decrease in fair value of an asset as is seen in the example with Pitbull corporation, we decrease asset revaluation reserve in the balance sheet by the value reduced $50000 here to recognise new carrying value of the asset and then debit the expenses of revaluation to the income statement or profit and loss account. If there was an increase in fair value, revaluation would add to retained earnings in balance sheet and income in income statement
In which category do commodities belong?
long-term investment only
short-term investment only
either short- or long-term investment
neither short- nor long-term investment
Answer:
c. either short- or long-term investment
Explanation:
The commodities are belongs to either short- or long-term investment.
What is commodity?Commodity is defined as a basic good that is used in trading or in commerce. It can be alternated with the another goods at the same time of trading or commerce.
A commodity is either short- or long-term investment because it is fully based on the intention for the use of the commodity, if the commodity is used for the short term, then it will be called as the short term investments and vice versa.
Therefore, option C is correct.
Learn more about the commodity, refer to:
https://brainly.com/question/23132703
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MotorCar, a major automobile company headquartered in Detroit, is concerned about being left behind in the race to produce autonomous vehicles. There remains much uncertainty regarding the future of autonomous vehicle technology. Some industry experts say fully self-driving cars could be brought to market within a couple of years. Others believe the technology could take decades to develop. And still others are skeptical that the technology will ever be safe enough to bring to the automobile mass market. Further, in addition to safety and technological hurdles, there are regulatory obstacles as well. However, MotorCar has decided that it needs to innovate.
The company is considering (1) increasing funding to its existing R&D department to expand to the development of AI (artificial intelligence) technology, needed for self-driving vehicles; (2) launching a fully owned subsidiary (a new company that it owns and controls) focused exclusively on AI; or (3) partnering with a major Silicon Valley tech company that has already made considerable progress on AI technology.
Required:
What do you see as some of the potential benefits and risks of these different organizational approaches?
Answer:
(1) increasing funding to its existing R&D department to expand to the development of AI (artificial intelligence) technology, needed for self-driving vehicles
This strategy would produce the benefit of puttinig the company on the edge of the development of AI in order to produce driverless vehicles.
The risk is that the investment could be too high for the initial benefit, since there is no certainty that driveless cars will be in the market in the short-term.
(2) launching a fully owned subsidiary (a new company that it owns and controls) focused exclusively on AI
This strategy would produce a similar benefit as the strategy above. However, it could also benefit from a little bit less administrative control because in this case, the AI development would be in charge of a subsidiary, not a division.
The risk is the same as above: initial investments may be too high for the initial benefits.
(3) partnering with a major Silicon Valley tech company that has already made considerable progress on AI technology.
This strategy produces the benefit of requiring less investment while still putting the company on the edge of AI research. However, the risk lies in loss of control over the thecnology, and possible future conflicts with the partner company.
Prepare an answer sheet with the column headings that follow. For each of the following transactions or adjustments, indicate the effect of the transaction or adjustment on assets, liabilities, and net income by entering for each account affected the account name and amount and indicating whether it is an addition (+) or a subtraction (-). Transaction a has been done as an illustration. Net income is not affected by every transaction. In some cases, only one column may be affected because all of the specific accounts affected by the transaction are included in that category.
Assest Liaabilities Net income
a. Recorded $200 Accumulated Depreciation
of depreciation Depreciation Expense
expense. -200 -200
a. Recorded $200 of depreciation expense.
b. Sold land that had originally cost $9,000 for $12,000 in cash.
c. Acquired a new machine under a financing lease.
d. The present value of future lease payments, discounted at 11%, was $11,000. Recorded the first annual payment of $2,500 for the leased machine (in part c).
e. Recorded a $6,600 payment for the cost of developing and registering a trademark. Recognized periodic amortization for the trademark (in part e) using a 40-year useful life. Sold used production equipment for $16,000 in cash.
f. The equipment originally cost $44,000, and the accumulated depreciation account has an unadjusted balance of $23,400.
g. It was determined that a $1,300 year-to-date depreciation entry must be recorded before the sale transaction can be recorded. Record the adjustment and the sale.
Answer:
Accounts Assets Liabilities Net income
a. Depreciation Expense -$200 -$200
b. Land / Cash -$9,000 + $12,000 + $3,000
c. Equipment/Lease Liability +$11,000 +$11,000
d. Cash /Lease Liability -$2,500 -$2,500
e. Cash /Trademark -$6,600 + $6,600
Amortization Expense -$165
f. & g. Cash /Equipment +$16,000 -$19,300 -$3,300
Explanation:
b. The land was sold with a gain of $3,000 ($12,000 - 9,000)
e. The trademark's amortization expense = $6,600/40 = $165 per year.
f and g. The Accounts involved are:
1. Cash +$16,000 for the sale.
2. Equipment has a debit balance of $44,000 and a credit balance of $23,400 plus Depreciation expense of $1,300. These give a net balance of $19,300. The equipment was sold for $16,000, recording a loss of $3,300.
3. Loss from sale of equipment = $3,300 as determined above.
n California, any apartment building with this many units must have an onsite manager, who is also known as a residential manager. What is the number of units to which this statement refers? Ten or more. Twelve or more. Sixteen or more. Twenty or more+.
Answer:
Sixteen or more.
Explanation:
It is mandatory by law in California to have an onsite manager, housekeeper, janitor, or another responsible person reside in a building with more than 16 apartments. Onsite means the manager or caretaker must be a resident in the building complex. The manager's role is to attend to the tenant's needs and offer protection to their properties. This requirement applies if the landlord is not a resident in the apartment building.
provide an example of two companies that have built an effective co-operation.briefly explain the relationship of it g
Answer:
An example of two companies that have built an effective co-operation is discussed below in details.
Explanation:
Louis Vuitton & BMW
Co-operation Operations: The Art of Travel
Designer Louis Vuitton and Carmaker BMW may not be the usual simple pairings. But if you believe about it, they have some significant things in general. If you concentrate on Louis Vuitton's trademark baggage lines, they're both in the industry of journey. They both value leisure. And finally, they're both well-known, fabulous brands that are recognized for high-quality craftsmanship.
BENEFITS OF COPORATE GOVERNANCE
Explanation:
Reducing the cost of capital. In today’s volatile environment, the implementation of good governance practices can lead to a reduction in a company’s cost of capital. An organisation that is seen to be stable, reliable and able to mitigate potential risks will be able to borrow funds at a lower rate than those with weak corporate governance. Companies with debt or equity investors may find that their investors pay a premium to work with a company that has a sound governance framework.
Improving top-level decision-making. There is a strong and demonstrable link between an organisation’s governance and rapid decision-making associated with improved performance, explains the Corporate Governance Institute in a recent report. Moreover, a number of performance failures have been directly linked to poor governance. There is no doubt that good governance assures rapid access to information and the good communication among stakeholders that leads to better results. Good governance also enables rapid and accurate prioritising of actions. This can prove invaluable in enabling the organisation to weather tough economic storms and supports the organisation’s sustainability
Tom Cruise Lines Inc. issued bonds five years ago at $1,000 per bond. These bonds had a 20-year life when issued and the annual interest payment was then 13 percent. This return was in line with the required returns by bondholders at that point as described below:
Real rate of return 4 %
Inflation premium 5
Risk premium 4
Total return 13 %
Assume that five years later the inflation premium is only 3 percent and is appropriately reflected in the required return (or yield to maturity) of the bonds. The bonds have 15 years remaining until maturity. Use Appendix B and Appendix D.
Answer:
$1,161.23
since the coupon rate is higher than the market rate, the bonds will be priced at a premium
Explanation:
In order to calculate the current market price of the bonds we can use the yield to maturity formula:
YTM = {coupon + [(face value - market value)/n]} / [(face value + market value)/2]
YTM = 11%n = 15 yearscoupon = $130face value = $1,0000.11 = {130 + [(1,000 - market value)/15]} / [1,000 + market value)/2]
0.11 x [1,000 + market value)/2] = 130 + [(1,000 - market value)/15]
0.11 x (500 + 0.5M) = 130 + 66.67 - 0.067M
55 + 0.055M = 196.67 - 0.067M
0.122M = 141.67
M = 141.67 / 0.122 = $1,161.23
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