Answer:
A. $25,000
B. $4,300
Explanation:
A. Calculation to determine What amount will the insurance company pay for the damages
Using this formula
Insurance payment=(Claim amount, Policy limit)
Let plug in the formula
Insurance payment= $25,000
Therefore the amount that the insurance company will pay for the damages is $25,000
B. Calculation to determine What amount will Kurt have to pay
Using this formula
Personal liability=Claim amount - Insurance payment
Let plug in the formula
Personal liability=($9,000 + $20,300) - $25,000
Personal liability=$29,300-$25,000
Personal liability=$4,300
Therefore Kurt have to pay $4,300
Mandolin produced 70,000 units and sold 50,000 units. Their unit selling price is $20 and they have variable unit production costs of $10, variable selling expenses of $3 and fixed overhead of $10,000. Compute Mandolin's net income under variable costing. Multiple choice question. $340,000 $350,000 $450,000 $500,000
Answer:
$340,000
Explanation:
The computation of the net income under variable costing is shown below;
Sales (50000 × $20) $1,000,000
Less: Variable costs of production;
Units produced (70000 × $10) $700,000
Cost of goods available for sale $700,000
Less: Ending inventory (20000 × $10) ($200,000)
Cost of goods sold ($500,000)
Gross contribution margin $500,000
Less: Variable selling expenses (50000 × $3) ($150000)
Contribution margin $350,000
Less: Fixed overhead ($10,000)
Net income $340,000
Answer:
Net Income = $340000
Explanation:
Given the total unit produced = 70000
Number of units sold = 50000
Selling price = $20
Variable cost of production = $10
Variable selling expense = $3
Fixed overhead = $10000
Net Income = (50000 x 20) - (50000 x 10) - (50000 x 3) - 10000
Net Income = $340000
Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs.
Products Sales Revenue Traditional ABC
Product 540X 198,200 54,440 45,520
Product 137Y 158,700 49,090 39,290
Product 249S 83,190 11,290 30,010
Required:
a. For each product line, compute operating income using the traditional costing system.
b. For each product line, compute operating income using the activity-based costing system
Solution :
a). Operating the income using traditional costing system
Products Sales revenue($) Traditional($) Operating income($)
( A ) ( B ) ( A - B )
540X 198,200 54,440 143,760
137Y 158,700 49,090 109,610
249S 83,190 11,290 71,900
b). Operating income using the activity-based costing system
Products Sales revenue($) Traditional($) Operating income($)
( A ) ( B ) ( A - B )
540X 198,200 45,520 152,680
137Y 158,700 39,290 119,410
249S 83,190 30010 53,180
The government has the ability to influence the level of output in the short run using monetary and fiscal policy. There is some disagreement as to whether the government should attempt to stabilize the economy. Which of the following are arguments in favor of active stabilization policy by the government?
a. Shifts in aggregate demand are often the result of waves of pessimism or optimism among consumers and businesses.
b. The current tax system acts as an automatic stabilizer.
c. Businesses make investment plans many month in advance.
d. The Fed can effectively respond to excessive pessimism by expanding the money supply and lowering interest rates.
1 Cash on hand at the company and not yet deposited at the bank. 4,800
2 EFT for monthly utility bill not yet recorded by the company. 1,600
3 Note collected by the bank and not yet recorded by the company. 10,200
4 Interest collected by the bank from note in #3 not yet recorded by the company. 1,300
5 A check witten for insurance expense for $90 was cashed. The check was recorded on the books for $160. ?
6 Checks written by the company but not yet processed by the bank. 2,600
7 Service fee charged by bank but not yet recorded by the company. 100
8 Customer checks determined by the bank to have nonsufficient funds. 3,000
Bank balance at the end of the period. 16,990
Company balance at the end of the period. 12,320
Required:
1-a. What is the revised Cash balance at the end of the period?
1-b. Is the bank reconciliation in balance?
Yes
No
2-a. What is the balance in Cash if the entry to correct the insurance payment hasn't been made?
2-b. Would the bank reconciliation still be in balance?
Yes
No
3. Which statement below is true regarding the effect of the company incorrectly recording a customer deposit at $180,000 rather than $18,000?
No effect on the bank reconciliation.
The difference of $162,000 will be subtracted from the book balance.
The difference of $162,000 will be added to the book balance.
The bank balance will be increased by $180,000.
Answer:
1 a. $19,190
1 b. Yes
2 a. $19,050
2 b. No
3. The difference of $162,000 will be subtracted from the book balance.
Explanation:
Reconciliation Statement:
Balance as per bank $16,990
Add: deposits $4,800
Less; Outstanding Checks - $2,600
Adjusted Bank Balance $ 19,190
Balance as per Books $12,320
Less: EFT on monthly bills - $1,600
Add: Notes Collected $10,200
Add: Interest On notes $1,300
Less: Error in recording $70
Add: Service Fees - $100
Less : Checks returned -$3,000
Adjusted Balance of Books $19,190
Your grandparents put $10,200 into an account so that you would have spending money in college. You put the money into an account that will earn an APR of 4.19 percent compounded monthly. If you expect that you will be in college for 4 years, how much can you withdraw each month?
Answer:
Monthly withdrawal = $ 231.17 per month
Explanation:
Below is the calculation:
Deposit amount in the bank = $10200
Interest rate earned by the deposit = 4.19%
Monthly interest rate = 4.19% / 12 = 0.34917%
Number of periods = 4 years x 12 = 48
Amount in the account = Monthly withdrawal x (P/A, 0.34917%, 48)
10200 = Monthly withdrawal x 44.12246
Monthly withdrawal = 10200/44.12246
Monthly withdrawal = $ 231.17 per month
Why do you think demand analysis is essential for businesses?
✦ ✦ ✦ Beep Boop - Blu Bot! At Your Service! Scanning Question . . .
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--------------------------------------------------------------------------------------------------------------Question: Why do you think demand analysis is essential for businesses?
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Answer: Demand analysis is the process of understanding the customer demand for a product or service in a target market. Companies use demand analysis techniques to determine if they can successfully enter a market and generate expected profits to expand their business operations. It also gives a better understanding of the high-demand markets for the company’s offerings, using which businesses can determine the viability of investing in each of these markets. The importance of demand analysis in the business decision is that it helps firms design their pricing policy. The Firm can choose either to lower or raise a product’s price by observing the trend of consumer demand for that product. Producers can’t fix the price for their products without first understanding the market demand for them. These are reasons why I think demand analysis is essential for businesses
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A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 7.3%, and sells for $1,170. Interest is paid annually.a. If the bond has a yield to maturity of 10.7% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your anser to nearest whole number.)b. What will be the annual rate of return on the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)c. Now assume that interest is paid semiannually. What will be the annual rate of return on the bond?Slightly greater than your part b answerSlightly less than your part b answerd. If the inflation rate during the year is 3%, what is the annual real rate of return on the bond? (Assume annual interest payments.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)
Answer:
a. Price 1 year later = $810
b. Annual rate of return on the bond = -24.53%
c. Since -24.79% is lower than -24.53% obtained part b, this implies that annual rate of return is slightly less than our part b answer.
d. Annual real rate of return on the bond = -26.73%
Explanation:
a. If the bond has a yield to maturity of 10.7% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your answer to nearest whole number.)
This can be calculated as follows:
Price 1 year later = Coupon rate * Par value / Yield to maturity * (1 - 1 / (100% + Yield to maturity)^Years to maturity) + Par value / (100% + Yield to maturity)^Years to maturity = 7.3% * 1000 / 10.7% * (1 - 1 / (100% + 10.7%)^9) + 1000 / (100% + 10.7%)^9 = $810
b. What will be the annual rate of return on the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)
This can be calculated as follows:
Annual rate of return on the bond = (Price 1 year later + Coupon rate * Par value) / Price now - 1 = (810 + 7.3% * 1000) / 1170 - 1 = -24.53%
c. Now assume that interest is paid semiannually. What will be the annual rate of return on the bond?Slightly greater than your part b answer Slightly less than your part b answer
This can be determined as follows:
Price 1 year later = (Coupon rate / 2) * Par value / (Yield to maturity / 2) * (1 - 1 / (100% + (Yield to maturity / 2))^(Years to maturity * 2)) + Par value / (100% + (Yield to maturity / 2))^(Years to maturity * 2) = (7.3% / 2) * 1000 / (10.7% / 2) * (1 - 1 / (100% + (10.7% / 2))^(9 * 2)) + 1000 / (100% + (10.7% / 2))^(9 * 2) = $807
Annual rate of return on the bond = (Price 1 year later + Coupon rate * Par value) / Price now - 1 = (807 + (7.3% / 2) * 1000) / 1170 - 1 = -24.79%
Since -24.79% is lower than -24.53% obtained part b, this implies that annual rate of return is slightly less than our part b answer.
d. If the inflation rate during the year is 3%, what is the annual real rate of return on the bond? (Assume annual interest payments.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)
This can be calculated as follows:
Annual real rate of return on the bond = (1 + nominal return) / (1 + inflation)-1 = (1 - 24.53%) / (1 +3 %) - 1 = -26.73%
Griffin Co. is considering the investment of $136,000 in a new machine. The machine will generate cash flow of $22,500 per year for each year of its eight-year life and will have a salvage value of $8,000 at the end of its life. Griffin Co.'s cost of capital is 8 percent.(a) Calculate the net present value of the proposed investment. Ignore income taxes, and round all answers to the nearest $1. (b) What will the internal rate of return on this investment be relative to the cost of capital?
Answer:
$-2,378.47
7.55
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.
Cash flow in year 0 = $-136,000
Cash flow in year 1 to 7 = $22,500
Cash flow in year 2 = $22,500 + 8,000
I = 8 %
NPV = $-2,378.47
IRR = 7.55
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button
Categorize each scenario as describing a movement along a demand curve or a shift of the demand curve.
a. College students rush and buy discount furniture to take advantage of a one-day sale
b. Students eat out more often as the federal government increase how much grant money it provides
c. College students reduce how detergent they for each of laundry response to higher detergent prices.
d. College students purchase many more energy drinks during finals week than during the rest of the semester.
Answer:
a, a movement along a demand curve
b. shift of the demand curve.
c. a movement along a demand curve
d. shift of the demand curve.
Explanation:
Only a change in the price of a good leads to a movement along the demand curve of that good. Also, only a change in the price of the good would lead to an increase or decrease in the quantity demanded of that good.
Other factors other than the change in the price of the good would lead to a shift of the demand curve. Some of those factors include :
1. a change in consumers' expectation
2. a change in the taste of consumers
3. a change in income
a. A discount would reduce the price of furniture, as a result the quantity demanded would increase. There would be a movement down along the demand curve.
b. As a result of the increase in grant, the income of students increase. this would lead to an increase in demand. the demand curve would shift outward
c. As a result of higher prices, the quantity demanded of detergents would reduce. This would lead to a movement up along the demand curve for detergents
d. An increase in demand for energy drinks is as a result of a change in taste. this would lead to an outward shift of the demand curve
a letter to the editor of english newspaper and about the serious issues of law and order begin faced by pakistan national. argent please solve the question in 600 world
Hi, I provided some suggestions about how you go about writing your letter.
Explanation:
Note that in this scenario, the letter is going to be addressed in a formal way since the letter is been addressed to someone holding an official office/position.
It is important for the sender to note these details as he constructs the letter to the Addressee (the person receiving the letter).
Clearly include the address of the writer (in this case your own address) Date Mention the Designation of the Addressee (in the case, The editor of the english newspaper).Should also include:
Address of the Receiver Salutation or Greeting Subject The body of the letter (which should detail the main intent or content of the letter). Conclusion, finally include Complimentary Close with the Name and Signature of the Sender.Vietnamese citizens went working in Korea. They sent their income back to the families in Vietnam, worth of $678,000. Which account is affected?; how do you record this into the US BoP?
Answer:
a. Current Account.
b. A credit to the Current Account.
Explanation:
When people go to another country for work and send the income they make back to their country of origin as remittances, this goes to the Current Account of a nation's Balance of Payments.
It would be recorded as a credit to this account because when money goes out, it goes to the credit side of the U.S. BOP as it is being exported out so is leaving the economy of the U.S.
Jamison Company uses the total cost method of applying the cost-plus approach to product pricing. Jamison produces and sells Product X at a total cost of $1,000 per unit, of which $680 is product cost and $320 is selling and administrative expenses. In addition, the total cost of $1,000 is made up of $570 variable cost and $430 fixed cost. The desired profit is $200 per unit.
Required:
Determine the markup percentage on total cost.
Answer:
the markup percentage on total cost is 20 %
Explanation:
Mark up = Profit / Total Cost x 100
where,
Total Cost = $1,000
Profit = $200
therefore,
Mark up = $200 / $1,000 x 100 = 20 %
thus,
the markup percentage on total cost is 20 %
Define and explain SMART?
Retained earnings, December 31, 2019 $210,300
Decrease in total liabilities during 2019 45,800
Gain on the sale of buildings during 2019 16,100
Dividends declared and paid in 2019 4,500
Proceeds from sale of common stock in 2019 49,400
Net income for the year ended December 31, 2019 22,600
Required:
From the above data, calculate the retained earnings balance as of December 31, 2015.
Answer:
See below
Explanation:
Given the above information,
Retained earnings balance as of December 31, 2015
Ending retained earnings = Beginning retained earnings + Net income for year ended - Dividends declared and paid in 2019
$210,300 = Beginning retained earnings + $22,600 - $4,500
Beginning retained earnings = $192,200
Therefore, retained earnings balance as of 31 December 2015 is $192,200
Mertis, Inc. reported Net fixed assets as follows on its Balance sheets for December 31, 2011, and December 31, 2012 look as follows:
2011 2012
Net fixed assets 815,000 865,000
On its 2012 Income statement, Mertis recorded a depreciation expense of $34,971. What amount of cash did Mertis spend in 2012 on new fixed assets? (Record your answer without a dollar sign and without commas, for example, a record $32,400 as 32400).
Answer:
the amount of cash did Mertis spend in 2012 on new fixed assets is $84,971
Explanation:
The computation of the amount of cash did Mertis spend in 2012 on new fixed assets is shown below;
= ending net fixed assets + depreciation expense - beginning net fixed assets
= $865,000 + $34,971 - $815,000
= $84,971
Hence, the amount of cash did Mertis spend in 2012 on new fixed assets is $84,971
Complete accounting cycle and financial statements
The city council of E. Staatsboro approved the following budget for the General Fund for fiscal year 2019.
Estimated Revenues
Property taxes $335,000
License fees 40,000
Fines and penalties 15,000
Total revenues $390,000
Appropriations
Salaries $350,000
Supplies and utilities 30,000
Debt service 3,000
Total appropriations 383,000
Budgeted Increase in Fund Balance $7,000
The postclosing trial balance for the fund, as of December 31, 2018, was as follows:
Debits Credits
Cash $15,000
Vouchers payable $8,000
Fund balance (unassigned) 7,000
$15,000 $15,000
The following transactions and events occurred during FY 2019.
1. Levied property taxes of $335,000 and mailed tax bills to property owners.
2. Borrowed $300,000 on tax anticipation notes at an interest rate of 1 percent per annum.
3. Ordered supplies expected to cost $18,000.
4. The supplies arrived, along with an invoice for $19,000; the city paid the invoice immediately.
5. Received cash ($383,000) from the following sources: property taxes ($330,000), licenses and fees ($38,000), fines and penalties ($15,000).
6. Paid cash for the following purposes: unpaid vouchers at the start of year ($8,000); salaries ($340,000); utility bills ($11,000).
7. Repaid the tax anticipation notes 6 months after date of borrowing, with interest.
8. Processed a budgetary interchange, increasing the appropriation for supplies and utilities by $2,000 and reducing the appropriation for salaries by the same amount.
9. Will pay salaries for the last few days in December, amounting to $2,000, at the end of the first pay period in January 2020; also, received in early January 2020 a utilities invoice for $1,000 applicable to December 2019.
Use the preceding information to do the following:
a. Prepare journal entries to record the budget and the listed transactions and events.
b. Prepare a preclosing trial balance.
c. Prepare a balance sheet; a statement of revenues, expenditures, and changes in fund balance; and a budgetary comparison schedule.
Suppose that a price floor is set in the market for oranges, raising the price from $1.05 per pound to $1.10 per pound of oranges. The sum of which two areas represents the lost social surplus (deadweight loss) from this price floor?
Answer and Explanation:
To calculate deadweight loss, we need to know the initial price and quantity as well as the new price and quantity.
Assume at initial price $1.05, quantity is 300 oranges
At new price $1.10, quantity is 200 oranges
Deadweight loss = 0.5×(P2-P1)×(Q1-Q2)
= 0.5×(1.10-1.05)×(300-200)
Deadweight loss= 0.5×0.05×100
Deadweight loss= 2.5
Christopher started a tutoring website. After a few months, a publishing company files a lawsuit against his company for copyright infringement. Christopher had to close his business and sell all of the business's assets and his car in order to settle the lawsuit. This is an example of?
A. Corporation
B. Partnership
C. Proprietorship
D. LLP/LLC
Answer:
C. Proprietorship
Explanation:
A sole proprietorship business is a type of business that is owned by a single person and as such their profits are taxed once as personal income tax.
Basically, it is a type of business that is typically owned by an individual or one person and as such is solely responsible for its debts.
In this scenario, Christopher started a tutoring website and was later sued for copyright infringement by a publishing company.
As a result, Christopher had to close his business and sell all of the business's assets, including his car in order to settle the lawsuit. Thus, this an example of sole proprietorship business because he's only one that own the business and as such would bear the burden of any debt or liability alone.
A machine having a first cost of $20,000 is expected to save $1500 in thefirst year of operation, and the savings should increase by $200 every year until (and including) the ninth year, thereafter the savings will decrease by $150 until (and including) the 16th year.
Using equivalent uniform annual worth, is this machine economical? Assume a MARR of 9%.
Answer:
This machine is not economical. A further explanation is provided below.
Explanation:
Given:
First cost,
= $20,000
Saving,
= $1500
Increase by,
= $200
Decrease by,
= $150
Now,
The EUAW will be:
= [tex]-20000+1500(\frac{P}{F}, 9 \ percent,1 )+1700(\frac{P}{F}, 9 \ percent,8 )+1550(\frac{P}{F}, 9 \ percent,7 )[/tex]
= [tex]-20000+1500\times 0.9174+1700\times 0.5018+1550\times 0.5470[/tex]
= [tex]-20,000 + 1,371.1 + 856.06 + 847.85[/tex]
= [tex]-16,294.99[/tex] ($) negative
Thus this machine is not economical.
Chris and Jane have recently financed the purchase of a new home. They have signed a mortgage note in the amount of $250,000 with a fixed interest rate of 6.25% over 30 years. What would have been the difference, if any, in their monthly payment if they had signed this same note for only a 15-year period
Answer:
Chris and Jane
The difference in their monthly payment if they had signed this same note for only a 15-year period is:
= $8,346.57.
Explanation:
Mortgage Note Payable = $250,000
Fixed interest rate = 6.25%
Period of the note = 30 years or 15 years
Difference in monthly payment:
30-year period = $9,022.96
15-year period = $17,369.53
Difference = $8,346.57
b) The computations show that Chris and Jane pay more per month on a 15-year period mortgage than on a 30-year period mortgage. However, the total interest is more with a 30-year period than with a 15-year period. This shows that interest expense increases more with longer periods of debt.
From an online financial calculator:
N (# of periods) 30
I/Y (Interest per year) 6.25
PV (Present Value) 250000
FV (Future Value) 0
Results
PMT = $9,022.96
Sum of all periodic payments = $270,688.83
Total Interest = $20,688.83
N (# of periods) 15
I/Y (Interest per year) 6.25
PV (Present Value) 250000
FV (Future Value) 0
Results
PMT = $17,369.53
Sum of all periodic payments = $260,542.92
Total Interest = $10,542.92
Assume that Division Blue has achieved a yearly income from operations of $166,000 using $976,000 of invested assets. If management has set a minimum acceptable return of 8%, the residual income is a.$166,000 b.$105,504 c.$70,336 d.$87,920
Answer:
d.$87,920
Explanation:
Residual Income = Net Income - Cost of Investment
therefore
Residual Income = $166,000 - ($976,000 x 8%)
= $87,920
A company enters a futures contract to sell 50,000 units of a commodity for 70 cents per unit. The initial margin is $4,000 and the maintenance margin is $3,000. What change in the futures price (per unit) would lead to a margin call?
Answer:
72 cents
Explanation:
There is going to be a margin call when greater than 1000 dollars has been lost from the margin. Then the balance in the account is going to be smaller than that of the maintenance margin. so 1 cent increase in the price would bring about a lossof
0.01 * 50000
= $500
if the increase in the future price is about 2 cents then there would be a margin call.
70+2 = 72cents, this is when there would be a margin call
tine Company uses a job order cost system. On May 1, the company has a balance in Work in Process Inventory of $3,500 and two jobs in process: Job No. 429 $2,000, and Job No. 430 $1,500. During May, a summary of source documents reveals the following.
Job Number Materials Requisition Slips Labor Time Tickets
429 $2,500 $1,900
430 3,500 3,000
431 4,400 $10,400 7,600 $12,500
General use 800 1,200
$11,200 $13,700
Stine Company applies manufacturing overhead to jobs at an overhead rate of 60% of direct labor cost. Job No. 429 is completed during the month.
Required:
Prepare summary journal entries to record (1) the requisition slips, (2) the time tickets, (3) the assignment of manufacturing overhead to jobs, and (4) the completion of Job No. 429.
Answer:
1. Dr Work in Process Inventory $10,400
Dr Manufacturing Overhead $800
Cr Raw Materials Inventory $11,200
2. Dr Work in Process Inventory $12,500
Dr Manufacturing Overhead $1,200
Cr Factory Labor $13,700
3.Dr Work in Process Inventory $7,500
Cr Manufacturing Overhead $7,500
4. 31-May
Dr Finished Good Inventory $7,540
Cr Work in Process Inventory $7,540
Explanation:
1. Preparation of the summary journal entries to record (1) the requisition slips,
31-May
Dr Work in Process Inventory $10,400
Dr Manufacturing Overhead $800
Cr Raw Materials Inventory $11,200
(To record requisition slips)
2.Preparation of the summary journal entries to record the time tickets
31-May
Dr Work in Process Inventory $12,500
Dr Manufacturing Overhead $1,200
Cr Factory Labor $13,700
(To record t time tickets)
3. Preparation of the summary journal entries to record the assignment of manufacturing overhead to jobs
31-May
Dr Work in Process Inventory $7,500
($12,500*60%)
Cr Manufacturing Overhead $7,500
(To record assignment of manufacturing overhead to jobs)
4. Preparation of the summary journal entries to record the completion of Job No. 429.
31-May
Dr Finished Good Inventory $7,540
Cr Work in Process Inventory $7,540
($2,000+$2,500+$1,900+$1,140)
(To record the completion of Job No. 429)
One of the objectives of accounting is to help investors and creditors assess the amount, timing, and uncertainty of cash flows to them.
a. cannot say if it is true or false given the limited information provided
b. this is always a false statement
c. although false for most of the times, there are several exceptions detailed in Canadian GAAP
d. this is always a true statement
e. although true for most of the times, there are several exceptions detailed in Canadian GAAP
Answer: d. this is always a true statement
Explanation:
Accounting is very important in decision making because it provides figures that are useful in planning for the future of an investment. The information provided from accounting analysis helps us determine the amount of cashflows as well as the timing and uncertainty of same.
This is done through various formulas such as Discounted cash flow analysis and Residual income measures. Accounting is therefore invaluable to the financial industry because without it, we would stand a far worse chance of planning for business projects.
Kumaran Pillay has a vegetable stall at the Suva Market. His business has been plagued with under-stocking and over-stocking problems for some time now. When he under-stocks, he loses sales as customers move to competing stalls. When he over-stocks, is left with unsold vegetables. These are perishable and cannot be kept long for later sales. Pillay is concerned with how he can minimize these losses stemming from under and over-stocking.
1. Identify and explain how he could use 3 qualitative forecasting methods to improve his stocking. Note that you will need to justify your proposals and link it to the business being discussed. (10 marks)
2. Identify and explain how he could use 2 quantitative forecasting methods to improve his stocking. Note that you will need to justify your proposals and link it to the business being discussed. (10 marks)
Answer:
1) Using the 3 qualitative forecasting methods
Executive opinions,
Delphi method,
Salesforce polling.
2) Using the 2 quantitative forecasting methods:-
The straight-line method,
The average approach.
Explanation:
1) Using the 3 qualitative forecasting methods
Executive opinions- In this method, he could seek subjective views from experts concerning his sales. this might be viewed on his purchasing, finance, and future sales. However, it's utilized in conjunction with other quantitative forecasting methods so as to realize the simplest forecasts.
Delphi method- He could question a gaggle of experts about their views individually. they are doing not meet to avoid manipulation in judgments. Forecasts during this case might be compiled and analyzed by an external observer and returned to the experts for further questioning.
Salesforce polling- he could use this approach whereby he reaches bent people that are in touch with the regular customers and who can correctly predict the trends of the customers' consumption so as to offer him insights on how and when to restock counting on demand. This method is sweet for future forecasting since it gives the expected consumption trends of the purchasers that would be employed by the owner to make a decision on the quantity of inventory to stock in the future.
2) Using the 2 quantitative forecasting methods:-
The straight-line method- This is the only method of calculating future sales supported past data. It involves the utilization of a straight-line equation this measures the expansion or future predictions in sort of percentages. Here, past data is collected and a few analysis is completed to work out the trend that customers might adopt in their subsequent purchases. once they're known, the forecast on increasing or decreasing the inventory is predicated on percentage increase or reduction respectively. for instance, once demand is forecasted to grow, the vendor will decide the share they might order to hide the rise in demand.
The average approach- Here, the owner of a business conducts a mean of the past sales they need to be made to customers over a selected period. the most assumption is that the longer-term forecast is that the average of the past data. Since the owner has been making overstocking and understocking methods, it's assumed that the type of the orders is adequate to the longer-term forecast. for instance, if the owner decided within the past to order 100 units of a specific product and therefore the customers demanded quite 100 units maybe 150 units, there's an understocking decision. The owner might plan to increase subsequent stock to 200 units and at this point, the purchasers only demand 175 units making him to possess more stock than it had been required. On learning this concerning the market, the owner then decides to conduct a mean and order 150 units to require care of the overstocking and under-stocking problems.
The adjusted trial balance of Novak Corp. shows these data pertaining to sales at the end of its fiscal year, October 31, 2022: Sales Revenue $907,200; Freight-Out $13,600; Sales Returns and Allowances $19,800; and Sales Discounts $15,200.
Required:
Prepare the sales section of the income statement.
Answer:
$872,200
Explanation:
Preparation of the sales section of the income statement.
NOVAK CORP Income Statement ( Partial)
for the year ended 31 Oct, 2022
Revenue [Net Sales]
Sales Revenue $907,200
Less:
Sales Return & Allowances ($19,800)
Sales Discounts ($15,200)
Net Sales $872,200
Therefore the sales section of the income statement is $872,200
Mr. Hopper expects to retire in 30 years, and he wishes to accumulate $1,000,000 in his retirement fund by that time. If the interest rate is 12% per year, how much should Mr. Hopper put into his retirement fund at the end of each year in order to achieve this goal
Answer:
Annual deposit = $4100
Explanation:
Annual deposit = $4100
Number of years for retirement = 30 years
Future value of money = $1000000
Interest rate = 12%
Now use the below formula to find the annuity amount.
Annual deposit = Future value (A/F, r, n)
Annual deposit = 1000000 (A/F, 12%, 30)
Annual deposit = 1000000(0.0041)
Annual deposit = $4100
The amount Mr Hopper should put in his retirement fund each year is $4143.66.
In order to determine the amount of money Mr. Hopper should deposit each year, this formula would be used:
Yearly payment = future value / annuity factor
Annuity factor = {[(1+r)^n] - 1} / r
Where:
R = interest rate
N = number of years
Annuity factor = [(1.12)^30 - 1] / 0.12 = 241.332684
Yearly payment = $1,000,000 / 241.332684 = $4143.66
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A company needs 550,000 items per year. It costs the company $330 to prepare a production run of these items and $5 to produce each item. If it also costs the company $0.75 per year for each item stored, find the number of items that should be produced in each run so that total costs of production and storage are minimized. items/run
Answer:
Company A
The number of items that should be produced in each run to minimize total costs of production and storage is:
= 22,000 units
Explanation:
a) Data and Calculations:
Total annual demand = 550,000 units
Cost per production run = $330
Cost per unit = $5
Storage (holding) cost per item = $0.75
The number of items that should be produced in each run to minimize total costs of production and storage is given by Economic Order Quantity (EOQ) formula
= square root of (2 * 550,000 * $330)/$0.75
= square root of $363,000,000/$0.75
= square root of 484,000,000
= 22,000 units
In 2016, 59.7 percent of the adult population (253 million) was employed. If the employment rate increased to 62 percent,
Instructions: In part a, round your response to one decimal place. In part b, enter your response as a whole number.
a. How many more people would be working?
______ million
b. By how much would output increase if per worker GDP were $122,000?
$ _____ billion
Answer:
a. 5.819 million
b. $709918
Explanation:
Below is the calculation:
a. Total number of adult population = 253 million
Total employed adult = 253 x 59.7% = 151.041
Number of employed adult after increase in employment rate = 253 x 62% = 156.86
More people would be working = 156.86 - 151.041 = 5.819 million
b. GDP per capita is $122,000, so increase in GDP = 5.819 x 122000
Increase in GDP = $709918
The following data have been recorded for recently completed Job 450 on its job cost sheet. Direct materials cost was $2,117. A total of 34 direct labor-hours and 224 machine-hours were worked on the job. The direct labor wage rate is $14 per labor-hour. The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $16 per machine-hour. The total cost for the job on its job cost sheet would be:_____.
a. $5,867.b. $10,637.c. $8,492.d. $5,448.
Answer:
$6177
Explanation:
Calculation to determine what The total cost for the job on its job cost sheet would be
TOTAL COST
Direct materials $2,117
Direct labor (34 direct labor-hours × $14 per direct labor-hour) $476
Overhead (224 machine-hours × $16 per machine-hour) $3584
Total manufacturing cost
$6177
Therefore The total cost for the job on its job cost sheet would be:$6177