The influence of the media on a person's attitudes and perceptions is quite small.
According to the principle of limited effects, media only has a small impact on people's attitudes and perceptions. This hypothesis casts doubt on past theories of mass communication that claimed audiences were directly and strongly influenced by the media.
According to the limited effects theory, exposure to media material has less of an impact on behavior than do personal traits like values, beliefs, and attitudes. According to the notion, people actively shape the consequences of media messages rather than simply being passive recipients of them.
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Your question is incomplete, but most probably the full question was.
The theory of limited effects states that the media have a minimal effect on the individual's attitudes and perceptions. We are limited in our knowledge of the effects that the media might have on individuals' attitudes and perceptions. Audiences are made up of passive people who are equally susceptible to media messages. People are active audience participants who make conscious decisions about what they watch, listen to, and read.
TRUE/FALSE. resort gift shop is operated as a partnership, with five partners. shan has a one-third interest in the firm. each of the other partners has a one-sixth interest. thieu is the senior partner. with respect to management decisions
True. In a partnership, the management decisions are typically made by the partners collectively. In this case, the resort gift shop is operated as a partnership with five partners. Shan has a one-third interest in the firm, and each of the other partners has a one-sixth interest. Thieu being the senior partner means that he has a higher position or authority within the partnership. As a result, Thieu may have more influence or decision-making power when it comes to management decisions. However, it is important to note that major decisions should be made collectively by all the partners, as this is a characteristic of partnerships.
Consider a 529 (college savings) plan that will pay $20,000 once a year for a 4-year period (4 annual payments). The first payment will come in exactly 5 years (at the end of year 5) and the last payment in 8 years (at the end of year 8). a. What is the duration of the pension obligation? The current interest rate is 8% per year for all maturities. b. To generate the scheduled payments, the fund would like to invest the present value of the future payouts in bonds and match the duration of its obligation in part a). If the fund uses 5-year and 10-year zero-coupon bonds to construct its investment position, how much money (dollar amount) ought to be placed in each bond now? What should be the total face value (not current market value) of each zero-coupon bond held? c. Right after the fund made its investment outlined in part b), market interest rates for all maturities dropped from 8% p.a.to 7% p.a. Show that the investment position constructed in part b) can still fund (approximately) the future payments by showing that the fund’s net investment is close to 0 at the end of year 8 after making all the scheduled payments. Assume that interest rates will remain at 7% p.a. Any excess cash from the 5-year investment will be reinvested at 7% and any fraction of the 10-
year bonds held can be sold at the going market price at any time to fund the annual payments.
a. To find the duration of the pension obligation, we have to calculate the weighted average of all the payments. We use the following formula:[tex]$$D=\frac{\sum{t_i \times PVIF_i}}{\sum{PVIF_i}}$$[/tex] where [tex]$t_i$[/tex] is the time until each payment is received and [tex]$PVIF_i$[/tex]
is the present value interest factor for each payment.The PVIF for $i$ payment at an interest rate of 8% per year is given as:[tex]$$PVIF_i=\frac{1}{(1+0.08)^{t_i}}$$[/tex]
Therefore, the duration of the pension obligation,[tex]$D$, is:$$D=\frac{(5\times3.99)+(6\times3.53)+(7\times3.17)+(8\times2.85)}{3.99+3.53+3.17+2.85}=6.10\text{ years}$$[/tex]
Therefore, the duration of the pension obligation is 6.10 years. b. In this part, we need to find the amount of money that ought to be placed in each bond now. We use the following formula to calculate the present value of each payment.
[tex]$$PV_i=FV_i\times PVIF_i$$[/tex] where $FV_i$ is the future value of the $i$-th payment and $PV_i$ is the present value of the $i$-th payment.Using the given information, we get the present value of each payment as follows: [tex]$$PV_1=\frac{20000}{(1+0.08)^5}=12,411.10$$$$PV_2=\frac{20000}{(1+0.08)^6}=11,048.85$$$$PV_3=\frac{20000}{(1+0.08)^7}=9,868.68$$$$PV_4=\frac{20000}{(1+0.08)^8}=8,856.43$$[/tex] Now, let's find the weights for each zero-coupon bond using the following formula:$$w_i=\frac{PV_i}{V}$$where $V$ is the total present value of all the payments, which is:[tex]$$V=PV_1+PV_2+PV_3+PV_4=42,185.07$$[/tex]
Therefore, the weights for each bond are:[tex]$$w_{5\text{-year}}=\frac{PV_1+PV_2}{V}=0.5359$$$$w_{10\text{-year}}=\frac{PV_3+PV_4}{V}=0.4641$$[/tex] Now, we need to find the dollar amount that ought to be placed in each bond. Let's assume that the face value of the zero-coupon bond is $F$. Then, we can find the dollar amount that ought to be placed in each bond using the following formulas.
[tex]$$\text{Amount invested in 5-year bond}=(w_{5\text{-year}}\times V)\div PVIF_{5\text{-year}}}$$and$$[/tex] \text{Amount invested in 10-year bond}=(w_{10\text{-year}}\times V)\div PVIF_{10\text{-year}}}[tex]$$where $PVIF_{5\text{-year}}$ and $PVIF_{10\text{-year}}$[/tex] are the present value interest factors for the 5-year and 10-year zero-coupon bonds, respectively.Using the given information, we get:[tex]$PVIF_{5\text{-year}}=\frac{1}{(1+0.08)^5}=0.6806$$and$$[/tex] PVIF_{10\text{-year}}=\frac{1}{(1+0.08)^{10}}=0.4632$$Substituting these values in the above equations, we get the following amounts:$$\text{Amount invested in 5-year bond}=22,677.58$$and$$\text{Amount invested in 10-year bond}=23,313.49$$Now.
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Enviro Company issues 8%,10-year bonds with a par value of $250,000 and semianriual interest payments. On the issue date, the annual market rate for these bonds is 10%, which implies a selling price of 871/2. Prepare the journal entry for the issuance of the bonds for cash on January 1. Record the issue of bonds with a par value of $250,000. Note: Enter debits before credits.
Cash debit: $218,750, Discount on Payable Bonds debit: $31,250, Bonds Payable credit: $250,000.
The following would be the journal entry for the cash-for-bonds issuance on January 1:
Cash debit: $218,750
Debit: Discount on Payable Bonds $31,250
Bonds Payable, Inc. $250,000
By dividing the $250,000 par value by the 87 1/2% (or 87.5%) selling price, the corporation receives cash in the amount of $218,750. When calculating the discount on bonds payable, the cash received is subtracted from the bonds' par value. It amounts to $31,250 in this instance ($250,000 - $218,750). The par value of $250,000 is then credited to the Bonds Payable account.
Given that the market rate of 10% is higher than the coupon rate of 8%, this entry reflects the bonds being issued at a discount. The Bond Discount The difference between the par value of the bonds and the money investors contributed is represented by the payable account.
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Hello...I would like a rebuttal to this answer. Thanks!
Enterprise funds are accounted for on a full accrual basis. Thus, they are accounted for similarly to businesses. Governmental funds, by contrast, are accounted for on a modified accrual basis. The arguments in favor of using the full accrual basis for accounting for enterprise funds include the following: • The full accrual basis of accounting (i.e., a measurement focus on all economic resources) captures all the resources and obligations associated with an activity, including capital assets and long-term obligations. It provides a complete picture of the entity's financial position and operating results. • The measurement focus on all economic resources is more consistent with the GASB's objectives that financial reporting should provide information to determine whether current-year revenues were sufficient to pay for current-year services and to assist users in assessing service efforts, costs, and accomplishments. • Full accrual accounting provides information on depreciation, an essential cost of operations. • Business-type accounting facilitates comparisons with similar private enterprises. The arguments against including the following: • Two separate measurement focuses and bases of accounting within the same set of financial statements are confusing and limit the usefulness of government-wide consolidated statements that purport to present an overview of the entity as an economic whole. • There are no clear-cut distinctions between business and non-business activities. Despite many similarities, government activities cannot — and should not — be compared to activities carried out in the private sector. A government should have sound political and economic reasons — other than merely earning a profit — for conducting a particular action in the public sector. If it does not, then the activity should be privatized. These reasons suggest that the activities should be assessed by criteria other than profits — the "bottom line" of business-type financial reports. • Insofar as the full accrual basis is superior to the modified accrual basis, it should be used to account for all government activities, not merely business-type activities. Indeed, the above arguments can be applied to governmental and enterprise funds.
The use of full accrual basis for accounting for enterprise funds is justified for several reasons. It provides a comprehensive view of the entity's financial position and operating results by capturing all resources and obligations, including capital assets and long-term obligations.
This measurement focus aligns with the objectives of financial reporting and facilitates comparisons with private enterprises. Additionally, full accrual accounting offers valuable information on depreciation, a crucial cost of operations.
However, there are arguments against using full accrual basis, such as the potential confusion and limited usefulness of combining two different measurement focuses within the same set of financial statements. Furthermore, government activities should not be solely compared to private sector activities, as they serve different purposes and require different assessment criteria.
The proponents of using full accrual basis for enterprise funds argue that it provides a comprehensive view of the financial position and operating results. By including all economic resources and obligations associated with an activity, such as capital assets and long-term obligations, the full accrual basis ensures that nothing is overlooked.
This approach aligns with the objectives of financial reporting set by the Governmental Accounting Standards Board (GASB) to determine whether current-year revenues were sufficient to cover current-year services and to assess service efforts, costs, and accomplishments.
Furthermore, full accrual accounting allows for the inclusion of depreciation, which is an essential cost of operations for enterprises. Another argument in favor of full accrual basis is that it facilitates comparisons with private enterprises. By using similar accounting methods, it becomes easier to benchmark performance and evaluate efficiency.
This is particularly relevant for business-type activities within the government that function similarly to private businesses. The ability to make meaningful comparisons helps in assessing the effectiveness and competitiveness of government-operated enterprises. However, there are counterarguments against the use of full accrual basis for all government activities.
One concern is the potential confusion and limited usefulness of having two separate measurement focuses and bases of accounting within the same set of financial statements. This can make it challenging to present an overview of the entity as an economic whole when different accounting principles are applied. It may also complicate the interpretation of financial information for users of the statements.
Moreover, the nature of government activities and their objectives differ from those of private businesses. Government actions are driven by political and economic considerations, rather than solely focusing on earning a profit.
Therefore, comparing government activities to private sector activities solely based on financial performance may not provide a complete understanding of their purpose and impact. It is argued that government activities should be assessed by criteria other than profits, as the "bottom line" of business-type financial reports, to account for their broader societal objectives.
While the full accrual basis offers advantages for accounting enterprise funds, there are valid arguments against its universal application across all government activities. The decision to use full accrual accounting should consider the need for comprehensive financial reporting, the comparability with private enterprises, and the distinctiveness of government activities and objectives.
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The use of full accrual basis for accounting for enterprise funds is justified for several reasons. It provides a comprehensive view of the entity's financial position and operating results by capturing all resources and obligations.
This measurement focus aligns with the objectives of financial reporting and facilitates comparisons with private enterprises. Additionally, full accrual accounting offers valuable information on depreciation, a crucial cost of operations.
However, there are arguments against using full accrual basis, such as the potential confusion and limited usefulness of combining two different measurement focuses within the same set of financial statements. Furthermore, government activities should not be solely compared to private sector activities, as they serve different purposes and require different assessment criteria.
The proponents of using full accrual basis for enterprise funds argue that it provides a comprehensive view of the financial position and operating results. By including all economic resources and obligations associated with an activity, such as capital assets and long-term obligations, the full accrual basis ensures that nothing is overlooked.
This approach aligns with the objectives of financial reporting set by the Governmental Accounting Standards Board (GASB) to determine whether current-year revenues were sufficient to cover current-year services and to assess service efforts, costs, and accomplishments.
Furthermore, full accrual accounting allows for the inclusion of depreciation, which is an essential cost of operations for enterprises. Another argument in favor of full accrual basis is that it facilitates comparisons with private enterprises. By using similar accounting methods, it becomes easier to benchmark performance and evaluate efficiency.
This is particularly relevant for business-type activities within the government that function similarly to private businesses. The ability to make meaningful comparisons helps in assessing the effectiveness and competitiveness of government-operated enterprises. However, there are counterarguments against the use of full accrual basis for all government activities.
One concern is the potential confusion and limited usefulness of having two separate measurement focuses and bases of accounting within the same set of financial statements. This can make it challenging to present an overview of the entity as an economic whole when different accounting principles are applied. It may also complicate the interpretation of financial information for users of the statements.
Moreover, the nature of government activities and their objectives differ from those of private businesses. Government actions are driven by political and economic considerations, rather than solely focusing on earning a profit.
Therefore, comparing government activities to private sector activities solely based on financial performance may not provide a complete understanding of their purpose and impact. It is argued that government activities should be assessed by criteria other than profits, as the "bottom line" of business-type financial reports, to account for their broader societal objectives.
While the full accrual basis offers advantages for accounting enterprise funds, there are valid arguments against its universal application across all government activities. The decision to use full accrual accounting should consider the need for comprehensive financial reporting, the comparability with private enterprises, and the distinctiveness of government activities and objectives.
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.- Each year a company receives $3.5 million, at the end of the year. For the first 3 years an interest rate of 8% will apply, for the last 2 years an interest rate of 11% will apply. a) What is the Future Value ? b) What is the Present Value?
a) Future ValueWe are supposed to find the future value of $3.5 million, at the end of the year. The interest rate for the first 3 years is 8%, and for the last 2 years, it's 11%.We'll use the Future Value formula to calculate it.
We'll use the Present Value formula to calculate it. The Present Value is the current worth of future cash flows after considering a rate of return over a specified period of time. It is calculated by discounting the future cash flows back to the present time using a discount rate.
Therefore, the formula for calculating the Present Value of a cash flow or investment at the beginning of n years can be written as:PV = FV/(1+r)nWhere:FV = $5,657,264.15r = Annual Interest Rate = 8% for the first 3 years, and 11% for the last 2 yearsn = 5 yearsThe formula gives us:PV = $5,657,264.15/(1+0.11)²/(1+0.08)³PV = $3,208,459.60Therefore, the present value of the company's money received after 5 years is $3,208,459.60.
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Suppose that on January 15,2010 , the Canadian government issued a five-year inflation-indexed note with a coupon of 4%. On the date of issue, the consumer price index (CPI) was 265. By January 15, 2015, the CPI had increased to 322 . What principal and coupon payment was made on January 15,2015? Assume that the face value is $1000. The principal amount of the bond increased to $ (Round to the nearest cent.) The semi-annual coupon payment is $ (Round to the nearest cent.)
An inflation-indexed bond is a bond in which the principal amount of the bond is adjusted periodically to account for inflation in the economy.
The coupons of these bonds are also adjusted periodically to account for the change in inflation. It allows the investor to earn a return on investment that is not affected by the inflation rate in the economy, thus providing some stability to the investment.
Given,
The Canadian government issued a five-year inflation-indexed note on January 15,2010, with a coupon of 4%. On the date of issue, the consumer price index (CPI) was 265. By January 15,2015, the CPI had increased to 322. The face value is $1000.
To find: What principal and coupon payment was made on January 15,2015?
We know that the coupon payment of the bond is 4% of the face value, which is $1000.
Therefore, the semi-annual coupon payment is $20.
The CPI has increased from 265 to 322 over 5 years.
The principal amount of the bond would be increased by the same percentage as the CPI.
We can use the formula:
Principal amount = (CPI at maturity/CPI at issue date) x Face value of the bond
Where CPI is the Consumer Price Index
Hence,
The principal amount of the bond increased to (322/265) × $1000 = $1215.09 (rounded to the nearest cent)
The semi-annual coupon payment is $20 (rounded to the nearest cent).
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Toyochem Specialty Chemical Sdn Bhd purchases a compound that is then processed to yield three types of acids: Sulfuric acid, Acetic acid and Nitric acid. In January 2022, Toyochem purchased 10,000 gallons of the compound at a cost of RM280,000 and the company incurred joint production cost of RM40,000. Sales and production information for the month of January 2022 is as follows: (Note: round up all decimal points to two decimal points where applicable) Sulfuric acid and Acetic acid are sold to other chemical companies at the split off point. Nitric acid can be sold at the split off point or processed further into ammonia nitic for the manufacture of fertilizer. Required: Compute and allocate the total joint cost to three products using: a) Physical unit method. (3 marks) b) Sales-value at split of point. (3 marks) c) Net realizable value method. (3 marks)
To allocate joint cost using this method, we use the physical output of each product in proportion to the total physical output of all three products.
The formula for calculating this is: Joint cost allocation per unit = Joint cost / Total physical output Compute and allocate the total joint cost to three products using the physical unit method as follows:
Joint cost = RM 40,000 Total physical output = 10,000 gallons
(since all the three types of acids are produced from this quantity of compound)
Sulfuric acid output = 4,000 gallons Acetic acid output = 3,000 gallons
Nitric acid output = 3,000 gallons
Joint cost allocation per unit for sulfuric acid [tex]= 40,000 / 10,000 = RM[/tex] 4
Joint cost allocation per unit for acetic acid = 40,000 / 10,000 = RM 4
Joint cost allocation per unit for nitric acid = 4[tex]0,000 / 10,000 = RM[/tex]4
To allocate joint cost using this method, we use the relative sales value of each product at the split off point. The formula for calculating this is: Joint cost allocation per unit = Joint cost * (Relative sales value / Total relative sales value)Compute and allocate the total joint cost to three products using the sales-value at split of point method as follows:
Sulfuric acid sales value = RM 4 per gallon Acetic acid sales value = RM 6 per gallon
Nitric acid sales value at split off point = RM 5 per gallon
Total sales value at split off point = [tex]RM 4 + RM 6 + RM 5 = RM[/tex] 15
Joint cost allocation per unit for sulfuric acid = 40,000 * (4/15) = RM 10,667
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of the five-year period, Ybarra must pay the bond holders a balloon payment of $400,000. a. What would the issue price of the bonds be if the prevailing interest rate is: Round answers to the nearest whole number. (i) 4%$ (ii) 6%$ b. Compute the market price of these bonds on November 1, 2017 assuming that the prevailing market interest rate at that 8% Round answer to the nearest whole number. q
The issue price of the bonds with a prevailing interest rate of 6% would be approximately $311,434.
To calculate the issue price of the bonds, we can use the present value formula. The present value of the balloon payment can be calculated as the discounted value of the future payment.
a. Assuming the prevailing interest rate is:
(i) 4%
(ii) 6%
Let's calculate the issue price for each case:
(i) Prevailing interest rate of 4%:
To calculate the issue price, we need to discount the $400,000 balloon payment back to its present value using a 4% discount rate. Since the balloon payment is due after five years, we will discount it for five periods.
Issue price = $400,000 / (1 + 0.04)^5
Issue price ≈ $329,481
Therefore, the issue price of the bonds with a prevailing interest rate of 4% would be approximately $329,481.
(ii) Prevailing interest rate of 6%:
Using the same formula, we can calculate the issue price with a 6% discount rate.
Issue price = $400,000 / (1 + 0.06)^5
Issue price ≈ $311,434
b. To compute the market price of these bonds on November 1, 2017, assuming a prevailing market interest rate of 8%, we need to compare the coupon rate of the bond (which is not provided) with the prevailing market interest rate.
If the coupon rate is equal to the market interest rate of 8%, the bond will be priced at its face value, which is typically $1,000 or $1,000 per bond.
If the coupon rate is higher than 8%, the bond will be priced at a premium (above face value).
If the coupon rate is lower than 8%, the bond will be priced at a discount (below face value).
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A government's policy of redistributing income makes the income distributiona. more equal, distorts incentives, alters behavior, and makes the allocation of resources less efficient.b. more equal, distorts incentives, alters behavior, and makes the allocation of resources more efficient.c. less equal, distorts incentives, alters behavior, and makes the allocation of resources more efficient.d. less equal, distorts incentives, alters behavior, and makes the allocation of resources less efficient.Question 35The marketplace allocates resourcesa. to those desiring them least.b. efficiently.c. fairly.d. both efficiently and equitably.Question 36A typical worker’s normal or average income is calleda. the life cycle.b. in-kind transfers.c. transitory income.d. permanent income.
34. A government's policy of redistributing income makes the income distribution more equal, distorts incentives, alters behavior, and makes the allocation of resources less efficient. Hence, Option (A) is correct.
35. The marketplace allocates resources efficiently. Hence, Option (B) is correct.
36. A typical worker’s normal or average income is called permanent income. Hence, Option (D) is correct.
34. When a government implements a policy of income redistribution, it aims to make the income distribution more equal by taking from higher-income individuals or groups and transferring it to lower-income individuals or groups.
While this redistribution may address income inequality, it can have unintended consequences.
Thus, the unintended effects result from the redistribution of income and can hinder economic productivity and efficiency.
35. Through the forces of supply and demand, market participants determine the prices and quantities of goods and services, leading to an efficient allocation of resources based on consumer preferences and producer capabilities.
Thus, the marketplace allocates resources more efficiently than others.
36. A typical worker's normal or average income represents the expected long-term income that a worker can rely on and is based on factors such as education, skills, and experience.
Permanent income is distinguished from transitory income, which refers to temporary fluctuations in income due to factors like bonuses, overtime pay, or one-time windfalls.
Thus, permanent income is how a typical worker’s normal or average income is referred to.
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Question 34
A government's policy of redistributing income makes the income distribution
a. more equal, distorts incentives, alters behavior, and makes the allocation of resources less efficient.
b. more equal, distorts incentives, alters behavior, and makes the allocation of resources more efficient.
c. less equal, distorts incentives, alters behavior, and makes the allocation of resources more efficient.
d. less equal, distorts incentives, alters behavior, and makes the allocation of resources less efficient.
Question 35
The marketplace allocates resources
a. to those desiring them least.
b. efficiently.
c. fairly.
d. both efficiently and equitably.
Question 36
A typical worker’s normal or average income is called
a. the life cycle.
b. in-kind transfers.
c. transitory income.
d. permanent income.
In January 2006, Los Angeles-based Hilton Hotels Corpration annourwed that ffe company was
introducing a new luxury hotel line named the Waldorf Astoria Collection. Five weeks later, the company
announced that it finalized its acquisition of the lodging assets of British company Hilton Group plc
(Hilton Group) including its operating subsidiary, Hilton Intemational Co. Then in September in Moscow,
Hilton Hotels Corporation signed a long-term franchise agreement with Russian joint stock company
Sadko Hotel as franchisee. Also included in the agreement was the American company Interstate
Management Services, Inc. as the hotel operator for its first hotel, the upscale Hilton Moscow
Leningradskaya.
These and other developments enabled the company's leadership to announce, "In all,
2006 was quite a year, one of the most exciting and productive ever for Hilton Hotels Corporation. We hit
the ground running with the Hilton International acquisition, kept our eye on our strategic and
made significant progress toward all of our strategic goals." I
These events were important not only for Hilton Hotels Corporation, but reflected the expansion processes
in the global hotel industry as a whole. During the rise of in the hotel industry,
companies such as Hilton Hotels Corporation were in of finding new markets and setting
priorities.
In January 2006, Hilton Hotels Corporation announced the introduction of a new luxury hotel line called the Waldorf Astoria Collection. Shortly after, the company finalized the acquisition of the lodging assets.
Hilton Group plc, including Hilton International Co. This acquisition expanded Hilton Hotels Corporation's presence and assets.
In September of the same year, Hilton Hotels Corporation signed a franchise agreement with Sadko Hotel, a Russian joint-stock company, to establish its first hotel in Moscow, the Hilton Moscow Leningradskaya. The agreement also involved Interstate Management Services, Inc., an American company, as the hotel operator.
These developments were significant for Hilton Hotels Corporation and reflected the overall expansion happening in the global hotel industry. Companies like Hilton Hotels Corporation were actively seeking new markets and setting strategic goals to capitalize on the industry's growth. The year 2006 was described as one of the most exciting and productive for Hilton Hotels Corporation, as they made progress towards their strategic objectives.
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a. Whit would Rockis profit margin be if the Lime division were dropped? b. What would Rock's profit margin be if the Nina division were dropped?
a. The profit margin is the amount by which revenue from sales exceeds costs of goods sold or production. It is usually expressed as a percentage of sales. Rock Company has two divisions, Lime and Nina. If Lime division is dropped, it would result in a decrease in both revenue and expenses.
The costs associated with Lime division, including the cost of goods sold, direct labor costs, and direct materials costs would all decrease, while sales revenue would also decrease. However, the decrease in expenses would be greater than the decrease in revenue, as the Lime division was operating at a loss. Thus, the profit margin would increase if Lime division were dropped.b. Similarly, if the Nina division were dropped, it would also result in a decrease in both revenue and expenses.
It is important to note that dropping a division may have other impacts beyond the changes in revenue and expenses. It may also affect the overall business strategy and future growth potential of the company. Therefore, the decision to drop a division should be carefully considered based on a variety of factors, not just the impact on profit margin.
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For an interest rate of 12% per month, determine the nominal and
effective rates (i) per quarter, and (ii) per year.
Given, Interest rate per month, r = 12% Nominal rate of interest: The nominal rate of interest is a simple rate of interest charged by a bank or lender on the amount borrowed.
It doesn't consider the effect of compounding over time, which means it is only based on the original principal and does not consider any interest earned on it. The formula to calculate the nominal interest rate is as follows:
Nominal rate of interest = r x n where r = interest rate per period n = number of periods
[tex]For per quarter: r = 12%/3 = 4% Number of periods in a year = 12/3 = 4[/tex]
Nominal rate of interest per quarter[tex]= r x n= 4% x 4= 16%[/tex]
[tex]For per year: r = 12%Number of periods in a year = 1[/tex]Nominal rate of interest per year [tex]= r x n= 12% x 1= 12%[/tex]
The effective rate of interest is a rate that takes into account the effect of compounding over time. It shows the actual amount of interest earned on an investment or charged on a loan over a period of time, and it is higher than the nominal rate of interest.
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top management’s views about where the company is headed and what its future product-customer-market-technology will be
Top management's views about where the company is headed and its future product-customer-market-technology (PCMT) can vary depending on the specific company and its strategic vision. However, there are some common factors that top management typically considers when shaping their views on the company's direction:
1. Market Analysis: Top management conducts thorough market analysis to identify current and emerging trends, customer preferences, and market opportunities. They assess the competitive landscape and industry dynamics to understand where the company can differentiate itself and capture future market share.
2. Customer Insights: Understanding customer needs, preferences, and behaviors is crucial for determining the future direction of the company. Top management gathers customer insights through market research, customer feedback, and data analysis to identify unmet needs and develop products and services that align with customer expectations.
3. Technological Advancements: Top management monitors technological advancements and assesses their potential impact on the industry and the company's products or services. They stay updated on emerging technologies, digital transformation, and innovation trends to leverage new technologies that can drive future growth and enhance the company's competitive advantage.
4. Strategic Planning: Top management engages in strategic planning processes to define the company's long-term goals and objectives. They consider the organization's strengths, weaknesses, opportunities, and threats (SWOT analysis) to identify areas for improvement and develop strategies that align with the company's capabilities and resources
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E16-17 Various Unrelated Transactions [LO 16-4]
Following are several unrelated transactions involving a hospital.
1. The hospital has a contractual agreement with a lender requiring that $600,000 in cash be set aside to meet its future debt payment.
2. The hospital accrued $1,600,000 in patient service revenues. Charity services of $465,000 were also provided. Contractual adjustments total $585,000.
3. An increase of $55,000 was recorded for bad debts.
4. General services of $200,000 were donated by technicians. Normally, the hospital would have purchased these specialized services.
5. An endowment contribution of $1,600,000 was received.
6. Investments held by the hospital increased in fair value by $42,000.
7. The hospital purchased $847,000 in equipment with resources that had been contributed in prior years for such a purchase.
Required
a. Prepare journal entries to record the foregoing transactions, assuming the hospital is a not-for-profit facility. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
b. Prepare journal entries to record the foregoing transactions, assuming the hospital is a business-type government facility. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
A journal entry is a way of recording any transaction, whether it is economic or not. An accounting diary that displays the credit and debit positions of a corporation lists transactions. Multiple recordings, every one of which can be a type of debit or credit, may be included in the journal entry.
A journal entry acts as a record of a commercial transaction in your company's books. In double-entry bookkeeping, each transaction necessitates the creation of at least two distinct entries. A bookkeeper tracks all the alterations that a transaction might make to a company by noting them in their diary.
Simply enter one debit along with one credit in your journal. Include more than two accounts, or more than one credit alongside a debit, in your diary entries. At the end of a particular accounting month, adjusting journal entry are made to address problems like unpaid invoices and ensure that the books are in balance.
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You want to have a maximum payment of $1000. Use Goal Seek to find what the APR has to be to achieve a $1000 payment, without changing any of the other variables. Do not edit the APR cell after running Goal Seek.
Goal Seek in Excel is used to discover a value that would produce a specific outcome. By using Goal Seek, one can easily determine the value needed to achieve the desired results.
Here, the objective is to determine the APR needed to achieve a payment of $1000, without changing any of the other variables. The following are the required measures to complete the task:
To begin, go to the Data tab and select What-If Analysis and then Goal Seek.
Select the cell that has the payment figure you desire ($1000) as the “Set Cell.”
Select the APR cell (the cell that has the formula that calculates the APR) as the “To Value.” Excel will give you the option to alter the value to meet your needs. Press Enter once you’ve selected the values and click OK.
Now you can see the APR needed to achieve a payment of $1000, and you didn't have to modify any of the other variables.
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American General offers a 13-year annuity with a guaranteed rate of 9.54% compounded annually. How much should you pay for one of these annuities if you want to receive payments of $700 annually over the 13 year period? How much should a customer pay for this annuity? $ (Round to the nearest cent.)
A customer should pay approximately $6,037.53 for this annuity.
By using the given parameters of the annuity, including the number of years (13), annual payment ($700), and interest rate (9.54% compounded annually), we can calculate the present value of the annuity using the present value formula. After performing the calculation, we find that the customer should pay approximately $6,037.53 for this annuity. This amount ensures that they will receive annual payments of $700 over the 13-year period. To calculate the amount that should be paid for the annuity, we can use the present value formula for an annuity.
Given:
Number of years (n) = 13
Annual payment (PMT) = $700
Interest rate (r) = 9.54% (convert to decimal: 0.0954)
The present value (PV) can be calculated using the formula:
PV = PMT * (1 - (1 + r)^(-n)) / r
Substituting the given values into the formula:
PV = $700 * (1 - (1 + 0.0954)^(-13)) / 0.0954
Using a calculator, we find that the present value (amount to be paid for the annuity) is approximately $6,037.53.
Therefore, a customer should pay approximately $6,037.53 for this annuity in order to receive annual payments of $700 over the 13-year period.
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Sales = $260,000, depreciation = $25,000, interest paid = $45,000, net income = $60,000, taxable income is four times higher than taxes. What is cost of goods sold?
Below $17,000
Between $17,000 and $32,000
Between $32,000 and $47,000
Between $47,000 and $62,000
Between $62,000 and $77,000
Between $77,000 and $92,000
Between $92,000 and $117,000
Above $117,000
To calculate the cost of goods sold using the given data: Sales = $260,000 Depreciation = $25,000Interest Paid = $45,000Net Income = $60,000Taxable income is four times higher than taxes.
The cost of goods sold can be determined using the following equation: Cost of goods sold = Sales - Gross Profit The gross profit is calculated by subtracting all of the expenses from the sales and is determined by the following equation: Gross Profit = Sales - Cost of goods sold - Operating expenses - Depreciation - Interest paid.
To solve for cost of goods sold, first we need to solve for Gross Profit. By rearranging the above equation we get the following: Cost of goods sold = Sales - Gross Profit Gross Profit = Sales - Cost of goods sold - Operating expenses - Depreciation - Interest paid.
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April decided to deposit $7,000 into a CD that offers her an APR of 5.4 percent with quarterly compounding for 3 years. How much money will she have in this CD when it matures in 3 years?
The problem concerns determining how much money April will receive after depositing $7,000 into a CD offering her an annual percentage rate (APR) of 5.4% compounded quarterly for three years. To solve the problem, we will utilize the following formula:
[tex]A = P(1 + r/n)^nt[/tex]
where: A = the total amount accumulated after time t P = the principal amount (initial investment) r = the annual interest rate (as a decimal) n = the number of times the interest is compounded per year t = the number of years The information given in the problem is as follows:Principal amount (P) = $7,000 Annual interest rate (r) = 5.4%
Compounding frequency (n) = 4 times per year (quarterly)Time (t) = 3 years Substituting these values into the formula above, we have:A = $7,000(1 + 0.054/4)^(4 x 3)A = $7,000(1.0135)^12A = $7,000(1.4818)A = $10,373.03 Therefore, after three years, April will have $10,373.03 in the CD when it matures.
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Consider a Bertrand oligopoly consisting of four firms that produce an identical product at a marginal cost of $200. Analysts estimate that the inverse market demand for this product is P=400−4Q. a. Determine the equilibrium level of output in the market. b. Determine the equilbrium market price. $ c. Determine the profits of each firm. $
Bertrand oligopoly is a situation in which the companies compete with each other by deciding on prices. In this oligopoly market.
There are four firms that produce an identical product at a marginal cost of $200. The inverse market demand for this product is given by the equation P = 400 - 4Q. We will solve this problem in three parts. Equilibrium level of output in the market.
Since the product produced by all the firms is identical, they will have to sell their products at the same price. In this case, since they compete with each other by setting the price, they will set the price equal to their marginal cost to maximize their profit. Therefore.
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GlobalHead Foundation is a profit-making organization that conducts welfare programs for differently-abled children it strives to keep its pace with its competitors and comes up with equivalent programs that can beneft the children. Recently, the management of GlobalHead had ideas that could put it in the forefront of the healthcare sector. However, the company has been reluctant to take risks and go beyond its usual workflow, In this scenario, GlobalHead is required to. A. have a situational constraint B. set a stretch goal C. have a rotational design D. set a cognitive target
B. Set a stretch goal. GlobalHead Foundation should set a stretch goal to break free from reluctance, inspire innovation, and push for significant achievements.
Setting a stretch goal will help GlobalHead Foundation overcome its reluctance and push itself to go beyond its usual workflow. By aiming for a challenging objective, the organization can inspire its management and employees to think innovatively and come up with ideas that can put them at the forefront of the healthcare sector. This will create a sense of urgency and motivation within the organization, encouraging them to take calculated risks and embrace change.
Setting a stretch goal also fosters a culture of creativity and continuous improvement. It encourages employees to explore new possibilities and push their boundaries to develop equivalent programs that can benefit differently-abled children. By striving for a stretch goal, GlobalHead can differentiate itself from competitors and stay competitive in the sector, ultimately benefiting the children they serve.
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.
You are senior on the audit of Rexxon (Pty) Ltd, a medium sized wholesaler of stationery and supplies. All of the company's financial systems are computerized and you have been asked to assist in the
This documentation serves as a record of the work performed and is essential for reporting to the client and management.
As a senior on the audit of Rexxon (Pty) Ltd, a medium-sized wholesaler of stationery and supplies, with all of the company's financial systems computerized.
If you have been asked to assist in the preparation of an audit programme, you should do the following:
Assess the risk: First and foremost, assess the risk associated with the client and the audit, and design audit procedures to address those risks.
Understand the client: Conduct interviews with management to gain a better understanding of the client's processes, internal controls, and how they work.
Create a list of audit procedures: Based on your assessment of the risk and understanding of the client, you should create a list of audit procedures that are tailored to the client's specific circumstances.
Set up a timeline: Establish a schedule for performing the audit procedures, ensuring that they are performed in a timely and efficient manner.
Assign tasks: Assign tasks to team members as needed to ensure that all audit procedures are performed effectively.
Document your work: Document your work in an audit program, including the procedures you performed, the evidence you collected, and any findings or issues that you identified.
This documentation serves as a record of the work performed and is essential for reporting to the client and management.
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Donald E. Petersen, former chairman of the board of Ford Motor Company, remarked, "If we aren’t customer driven, our cars won’t be either."
How do cars add value to people’s lives?
Cars add value to people’s lives by providing convenience, independence, status, employment opportunities, and entertainment. Cars add value to people’s lives in many ways.
Firstly, they provide convenience and mobility to people, allowing them to travel to different places easily and quickly. They also offer a sense of independence and freedom, as people are no longer restricted to public transportation schedules or walking distances.
Secondly, cars provide status and prestige to people who own them. Some people may choose to buy cars that are luxurious or high-end, which can boost their confidence and social status.
Thirdly, cars provide employment opportunities to many people. The automobile industry creates jobs for people in manufacturing, engineering, sales, and many other fields.
Finally, cars can also provide entertainment and recreation to people. Some people enjoy driving for fun, while others may use their cars to go on road trips or explore new places.
In conclusion, cars add value to people’s lives by providing convenience, independence, status, employment opportunities, and entertainment.
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Ivy Com, has received a request for a special order of 9,000 units of product G4 for $46.15 each. The normal selling price of this product is 551.16cach, but the units would need to be modified slightly for the customer. The normal unit product cost of product G4 is computed as follows: Direct materials $17.68. Dirct labor $6.31 Variable manufacturing overhead \$3.84 Fixed manufacturing overhead $6.70 Direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overthead costs. The customer would like some modifications made to product G4 that would increase the variable costs by $6.03 per tnit and that would require a one-time imvestment of $46410 in special molds that would have no salvage value. This special order would have no effect on the company's otber sales. The company has ample spare capacity for producing the special order. Determine the effect on total net operating income of accepting the special order. Round only your final answer to the nearest dollar and enter a loss as negative, a gain as positive.
Accepting the special order would result in an increase in total net operating income of $64,200.
To determine the effect on total net operating income of accepting the special order, we need to calculate the incremental costs and revenues associated with the order.
Incremental revenue:
Number of units in the special order: 9,000
Selling price per unit: $46.15
Incremental revenue = 9,000 units × $46.15 per unit = $415,350
Incremental costs:
Direct materials: $17.68 per unit
Direct labor: $6.31 per unit
Variable manufacturing overhead: $3.84 per unit
Additional variable costs per unit due to modifications: $6.03 per unit
Total variable cost per unit = Direct materials + Direct labor + Variable manufacturing overhead + Additional variable costs
Total variable cost per unit = $17.68 + $6.31 + $3.84 + $6.03 = $33.86
Incremental fixed costs:
There are no incremental fixed costs since the special order would have no effect on total fixed manufacturing overhead costs.
One-time investment in special molds: $46,410
Total incremental costs:
Total variable cost = Total variable cost per unit × Number of units in the special order
Total variable cost = $33.86 × 9,000 units = $304,740
Total fixed costs = $0 (no incremental fixed costs)
Total one-time investment = $46,410
Total incremental costs = Total variable cost + Total fixed costs + Total one-time investment
Total incremental costs = $304,740 + $0 + $46,410 = $351,150
Effect on total net operating income:
Net operating income effect = Incremental revenue - Total incremental costs
Net operating income effect = $415,350 - $351,150 = $64,200
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Arthur crafts miniature chocolate dollhouses which he sells for $21 each. Arthur has calculated the break-even level of sales for his business at $1,730 of revenues. The dollhouses have a variable cost of $8 to produce per unit If Arthur sells 100 units, what are his total costs?
Arthur's total costs for selling 100 units would be $2,530.
To calculate Arthur's total costs, we need to consider both fixed costs and variable costs.
Fixed costs are costs that do not change with the level of production or sales. In this case, Arthur's fixed costs are the break-even level of sales, which is $1,730.
Variable costs, on the other hand, are costs that change based on the level of production or sales. Arthur's variable cost per unit is given as $8.
To find the total costs, we need to calculate the total variable costs and add them to the fixed costs.
Arthur sells 100 units of the dollhouses. So, the total variable costs for these 100 units would be 100 multiplied by the variable cost per unit, which is $8. This gives us a total variable cost of $800.
Now, let's add the total variable costs to the fixed costs. $800 + $1,730 = $2,530.
Therefore, Arthur's total costs for selling 100 units would be $2,530.
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an auditor selected a product maintained in the finished goods warehouse. the auditor counted the product and compared this amount with the amount in the finished goods perpetual inventory subsidiary account. which asb balance assertion is the auditor most likely testing?
This audit procedure is essential to ensure that the company's financial statements accurately reflect the value of its finished goods inventory.
The auditor is most likely testing the accuracy assertion of the finished goods inventory.
In auditing, the accuracy assertion refers to the correctness and accuracy of the financial information presented in the company's financial statements. By counting the physical inventory and comparing it to the amount recorded in the finished goods perpetual inventory subsidiary account, the auditor is verifying whether the recorded inventory quantity is accurate and in agreement with the actual physical inventory on hand.
Any discrepancies found during the audit may indicate potential errors in recording, misstatements, or other issues related to inventory management and control.
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on the route between Paradise Mountain and Calgary and (2) improvement of the road between Paradise Mountain and Calgary. costs. Information about the two alternatives is shown below. Complete parts (a) through (c). a. Compute the benefit-cost ratio of both alternatives. Is each individually viable? b. Using an incremental benefit-cost ratio approach, which of the two alternatives should be chosen? Improvement - New Buses) would be . The alternative should be chosen in either case. (Round to three decimal places as needed.) c. Compute the present worths of the two alternatives. Compare the decision based on present worths with the decisions based on benefit-cost. (Round to the nearest dollar as needed.)
On the route between Paradise Mountain and Calgary, compute the benefit-cost ratio of both alternatives. Improvement of the road between Paradise Mountain and Calgary.
On the route between Paradise Mountain and Calgary, the alternatives for the improvement of the road are given. The alternatives and their initial cost and benefits are given below. The benefit-cost ratios and present worth of the alternatives need to be computed. Calculation of Benefit-Cost Ratio.
Therefore, using an incremental benefit-cost ratio approach, Alternative 1 (Improvement) should be chosen. Calculation of Present Worth:
Present Worth = Annual Worth x Present Worth Factor
The annual worth factor can be computed using the formula:
[tex]PW(i%, N) = A [((1+i%)^N - 1) / (i% (1+i%)^N)][/tex]
The table for Present Worth Factor can be used to compute the annual worth factor for different discount rates and years: Present Worth Factor Table Alternative.
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Column A
Column B
General Manager
2. Sales Manager
3. Human Resources
4. Housekeeping
5. Food & Beverage
Time left for
assessme
156:1
a. Deliver food and beverage and related services and amenities to all customers.
b. Able to work in all the departments
Empty bins and all garbage's
d. General upkeep of the building including interior and exterior
e. Ensure that all staff work according to government rules and notify of any wrong doing
f. Incharge of only the revenue generating departments to make profit
g. General maintenance of all equipments
h. Delivery of food to only inhouse guest
i. Clean and sanitize all guest and staff areas
J. Bring in new business and maintain client relation to retain existing business
k.. Meeting clients and telling them how they should run their business
1. Work around policies that will best suit the establishment and staff
m. Manages the profitability of the whole operations by leading the team
The General Manager oversees overall operations, maximizes revenue, coordinates departments, ensures compliance, maintains cleanliness, expands clientele, and follows guidelines.
The General Manager is in charge of managing the business' overall operations and guaranteeing its profitability. To maximize revenue and successfully control costs, they manage a team and make strategic decisions. To guarantee efficient operation and coordination, they collaborate closely with all departments, including Sales, Human Resources, Housekeeping, and Food & Beverage. The general manager makes sure that everyone on staff complies with all laws and standards, and that any infractions are dealt with right away. They are also in responsible of ensuring the cleanliness and general upkeep of the structure, both inside and out. The general manager also concentrates on expanding the company's clientele and developing new business to keep current clients. They operate within specified guidelines to create a setting that is ideal for the establishment and its workers.
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Lando Corporation is a domestic company with two wholly owned subsidiaries. Michaels, CPA, has been engaged to audit the financial statements of the parent company and one of its subsidiaries and to serve as the group auditor. Thomas, CPA, has audited the financial statements of the other subsidiary whose operations are material in relation to the consolidated financial statements.
The work performed by Michaels is sufficient for serving as the group auditor and to report as such on the financial statements. Michaels has not yet decided whether to refer to the part of the audit performed by Thomas.
Identify and discuss two reporting requirements with which Michaels must comply in naming Thomas and referring to the work done by Thomas.
Two reporting requirements that Michaels, CPA, must comply with in naming Thomas and referring to his work are: 1. Disclosure of the identity of the other auditor: Michaels must disclose Thomas, CPA, as the auditor of the subsidiary whose operations are material in relation to the consolidated financial statements.
2. Description of the extent of the work performed by the other auditor: Michaels must provide information about the scope of Thomas' audit procedures and the reliance placed on his work in the overall audit of the group financial statements.
1. Disclosure of the other auditor's identity is necessary to provide transparency and allow stakeholders to understand the involvement of multiple auditors in the audit process.
2. Describing the extent of the work performed by the other auditor helps users of the financial statements assess the degree of reliance placed on that auditor's findings and conclusions. It provides insights into the division of responsibilities between the group auditor and the other auditor.
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Clouds Ltd. produces assembling machines. The company expected to have total overheads of E240,000 and to produce 4,000 assembling machines. The actual production equals 1,800 assembling machines and the actual fixed production overheads equal £190,000. Considering this information, which of the following statements is true? a. There is over-absorption of overheads of £108,000. b. There is under-absorption of overheads of £108,000 which increases profit. c. There is under-absorption of overheads £82,000. d. None of the answers is true.
Calculation of the overhead rate per machine: The overhead rate per machine-hour is calculated by dividing the total budgeted overhead costs by the total budgeted machine-hours for the year. The budgeted overhead cost of E240,000 will be divided by the expected machine hours of 4,000 hours for the year. Thus, the overhead rate per machine-hour is calculated as follows: E240,000 / 4,000 machine hours = E60 per machine hour
Calculation of the expected overhead cost for 1,800 machines: Using the calculated overhead rate per machine-hour of E60, we can find the expected overhead cost for the actual production level of 1,800 machines. The expected overhead cost is calculated as follows:
1,800 machine-hours x E60 per machine hour = E108,000
Now let's determine the under or over-absorption of the overheads: We'll calculate the difference between the expected overhead cost and the actual fixed production overheads. A firm with higher overheads than the expected overhead cost experiences over-absorption, whereas a firm with lower overheads than the expected overhead cost experiences under-absorption of overheads. We'll use the following formula to compute the over-absorption/under-absorption amount: Actual overhead cost - Expected overhead cost Now that we have actual fixed overheads of £190,000 and expected overheads of £108,000 for 1,800 machines, we can determine whether there is under-absorption or over-absorption of overheads.
Under absorption of overheads = Actual overheads - Expected overheads= £190,000 - £108,000= £82,000
Therefore, there is under-absorption of overheads £82,000.
Option (c) is correct.
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From the project plan, we that a project has a total budgeted cost of $983,112 and a project completion time of 18 weeks. At the moment, the project has been in a performing stage. At the end of week 8 , the project progress report shows that the project has consumed a total of $310,635, the project cumulative earned value is $285,084, and the project schedule performance index is 0.88. What is the value of the cost variance at the end of week 8?
The value of the cost variance at the end of week 8 is $28430.68.
According to the given data; The project total budgeted cost = $983,112
The project completion time = 18 weeks
The project is currently in the performing stage The project has consumed = $310,635
The project cumulative earned value = $285,084
The project schedule performance index = 0.88
So, we have to find the value of the cost variance at the end of week 8.
Here, we will use the cost variance formula:
COST VARIANCE (CV) = Earned Value (EV) - Actual Cost (AC) CV = EV - AC
And, Earned Value (EV) = (Percent completed) x (Total budget)
Earned Value (EV) = (285,084/983,112) x 100% = 29.00%
Actual Cost (AC) = $310,635
Cost Variance (CV) = EV - AC= (Percent completed) x (Total budget) - Actual cost CV = (29.00%) x ($983,112) - $310,635 = $28430.68
Therefore, the value of the cost variance at the end of week 8 is $28430.68.
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