Answer:
The cost of equity from retained earnings based on the DCF approach is 10.50%
Explanation:
In order to calculate the cost of equity from retained earnings based on the DCF approach we would have to calculate the following formula:
Cost of Equity = (D1/P0) + growth rate
Cost of Equity =[($0.9 x 1.07)/$27.50] + 0.07
Cost of Equity = 0.1050
Cost of Equity =10.50%
Therefore, The cost of equity from retained earnings based on the DCF approach is 10.50%
Heidee Corp. and Leaudy Corp. have identical assets, sales, interest rates paid on their debt, tax rates, and EBIT. However, Heidee uses more debt than Leaudy. Which of the following statements is CORRECT?
A) Heidee would have the higher net income as shown on the income statement.
B) Without more information, we cannot tell if Heidee or Leaudy would have a higher or lower net income.
C) Heidee would have the lower equity multiplier for use in the Du Pont equation.
D) Heidee would have to pay more in income taxes.
E) Heidee would have the lower net income as shown on the income statement.
Answer:
E) Heidee would have the lower net income as shown on the income statement.
Explanation:
Heidee and Leaudy have the same Earning Before Interest and Taxes (EBIT).
They both also have the same interest rate paid on debt.
So if Heidee uses more of their debt than Leaudy it means they will incur more interest payment on debt.
This will result in less income for the company.
On the other hand Leaudy uses less debt so their interest expense is low and income is higher.
Heidee would have the lower net income as shown on the income statement.
The owner of a downtown parking lot has employed a civil engineering consulting frim to advise him on the economic feasibility of constructing an office building on the site. bill samuels, a newly hired civil engineer, has been assigned to make the analysis. he has assembled the following data
alternative total investment total net annual revenue
sell parking lot 0 0
keep parking lot 200,000 22,000
build 1 story building 400,000 60,000
build 2 story building 555,000 72,000
build 3 story building 750,000 100,000
build 4 story building 875,500 105,000
build 5 story building 1,000,000 120,000
The analysis period is be 15 years. for all alternatives, the property has an estimated resale(salvage) value at the end of 15 years equal to the present total investement.
(a) constuct a choice table for interest rate from 0% to 100%
(b) if the MARRR is 10%, what recommendation should bill make?
Answer: The answer has been attached
Explanation:
Base on the MARR been 10%, I'll recommend 3 storey building.
Further explanation has been attached. In the explanation, note that:
I = A/P e.g.
Interest rate for build 1 storey building:
= 60/400 × 100
= 15%
Cho's Performance Pizza is a small restaurant in Miami that sells gluten-free pizzas. Cho's very tiny kitchen has barely enough room for the three ovens in which her workers bake the pizzas. Cho signed a lease obligating her to pay the rent for the three ovens for the next year. Because of this, and because Cho's kitchen cannot fit more than three ovens, Cho cannot change the number of ovens she uses in her production of pizzas in the short run. However, Cho's decision regarding how many workers to use can vary from week to week because her workers tend to be students. Each Monday, Cho lets them know how many workers she needs for each day of the week. In the short run, these workers are __________ inputs, and the ovens are __________ inputs.
Answer: Variable ... Fixed
Explanation:
In the short run, Variable Inputs or costs are known as those which can be changed and their quantities can be varied. In this scenario, the employees that Cho's uses can be varied and so are the Variable Inputs.
Similarly, those costs that cann ot be changed or varied in the short run are rightly known as Fixed Inputs. Cho's Kitchen cannot take more than 3 ovens and also she has already signed a lease for them. These costs cannot be changed and so make the oven a Fixed Input.
It is worthy of note that in the long term, all Costs are considered Variable.
Indicate whether each of the following statements is true or faise Statement 1. The government can raise revenue by taxing the sellers without creating deadweight loss when the demand for the goods being taxed is perfectly inelastic 2. A tax that raises no revenue for the government cannot have any deadweight loss.
Answer and Explanation:
The indication of the following statement regarding true or false is
For Statement 1
This given statement is true as the demand is perfectly inelastic so there is no deadweight loss because quantity does not change or not have any impact
Therefore, in this case, the government only raise revenue but at the same time when there is an increase in elasticity so there is a change in deadweight loss
For Statement 2
This given statement is false as if no revenue is there, there will be deadweight loss
The May transactions of Concord Corporation were as follows. May 4 Paid $860 due for supplies previously purchased on account. 7 Performed advisory services on account for $7,490. 8 Purchased supplies for $840 on account. 9 Purchased equipment for $1,940 in cash. 17 Paid employees $500 in cash. 22 Received bill for equipment repairs of $810. 29 Paid $1,190 for 12 months of insurance policy. Coverage begins June 1. Journalize the transactions
Answer:
May 4
Debit Accounts Payable $860
Credit Bank/Cash account $860
Being entries to record payment for supplies purchased previously on Account
May 7
Debit Accounts Receivable $7,490
Credit Service revenue $7,490
Being entries to recognize service revenue made on accounts
May 8
Debit Supplies account $840
Credit Accounts Payable $840
Being entries to recognize supplies purchased on account
May 9
Debit Fixed assets account $1,940
Credit Cash account $1,940
Being entries to record equipment purchased with cash
May 17
Debit Salaries expense $500
Credit Cash account $500
Being entries to record payment of salaries
May 22
Debit Maintenance and repairs $810
Credit Accounts Payable $810
Being entries to recognize repairs expense
May 29
Debit Prepaid Insurance $1,190
Credit Cash account $1,190
Being entries to recognize advance payment for insurance
Explanation:
To purchase items on account is to purchase on credit. This creates a liability in the form of accounts payable. An increase in assets or expenses is a debit entry while a decrease is a credit entry. For liability or an income, a credit is an increase while a debit is a decrease.
Causwell Company began 2018 with 11,000 units of inventory on hand. The cost of each unit was $4.00. During 2018 an additional 35,000 units were purchased at a single unit cost, and 21,000 units remained on hand at the end of 2018 (25,000 units therefore were sold during 2018). Causwell uses a periodic inventory system. Cost of goods sold for 2018, applying the average cost method, is $108,750. The company is interested in determining what cost of goods sold would have been if the FIFO or LIFO methods were used. Required: 1. Determine the cost of goods sold for 2018 using the FIFO method. [Hint: Determine the cost per unit of 2018 purchases.] 2. Determine the cost of goods sold for 2018 using the LIFO method.
Answer and Explanation:
For computing the cost of goods sold under two method first we have to determine the cost per unit which is shown below:
The average cost per unit is
= $108,750 ÷ 25,000 units
= $4.35
Now the cost per unit is
Total cost (11,000 units + 35,000 units) × $4.35 $200,100
Beginning units (11,000 units × $4) $44,000
The Remaining cost for 35000 units ($200,100 - $44,000) $156,100
Divide by Purchase cost per unit of 35000 units $4.46
Now the cost of goods sold are as follows
1. Under the FIFO method
Beginning 11,000 × $4.00 $44,000
Purchased 14,000 × $4.46 $62,440
Total 25,000 $1,06,440
2. Under the LIFO method
Purchased 25,000 × $4.46 $1,11,500
Sally makes deposits into a retirement account every year from the age of 30 until she retires at age 65. a) If Sally deposits $ 1100$1100 per year and the account earns interest at a rate of 9 %9% per year, compounded annually, how much does she have in the account when she retires? b) How much of that total amount is from Sally's deposits? How much is interest?
Answer:
a)
Balance of account at retirement = $237,281.83
b)
Total Deposited amount = $38,500
Interest Amount = $198,781.83
Explanation:
A fix periodic payments for the specific period of time is the annuity payment. Deposit of $1,100 per year in retirement account is annuity payment.
a)
We can calculate the balance of account on retirement by using following formula
Future Value of Annuity = P x ( 1 + r )^n - 1 / r
Where
P = Periodic payments = $1,100
r = 9%
n = 65 years - 30 years = 35 years
Placing values in the formula
Balance of account at retirement = $1,100 X ( 1 + 9% )^35 - 1 / 9%
Balance of account at retirement = $237,281.83
b)
Total Deposited amount = $1,100 x 35 = $38,500
Interest Amount = Balance of account at retirement - Total Deposited amount = $237,281.83 - $38,500 = $198,781.83
The annual fixed costs for a plant are $100,000, and the variable costs are $140,000 at 70% utilization of available capacity, with net sales of $280,000. What is the breakeven point in units of production if the selling price per unit is $40
Answer:
With the production 5000 units the plant will achieve it's break even point
Explanation:
Solution
The break even points is the point in a business when the total revenue is exactly the same to the equal expenditure.
The formula is given below:
D' = Cy/(p-cy)
Here
D' =the demand at break even point
p = the selling price
cy= the variable costs per unit
Cy = the total fixed cost
Thus
The total cost of the plant = $100,000
The variable costs = $140,000
The net sales = $280,000
The selling price per unit = $40
The total no units sold per year is given as :
Annual sale (units) = Total sales/Sale per unit
Now,
By the method of substitution we have the following.
Annual sale (units) = $280,000/40
=7000 units/year
The formula for variable cost per unit cy is
cy = Cy/Annual sale (units)
Now,
We substitute in the above equation the value of Cy as $140,000 and annual sale as 7000 units/per year
cy = $140,000/7000
=$20 units
For the demand at break even point D', we have the following:
D' = Cy/(p-cy)
We We substitute in the above equation the value of Cy as $100,000 and p as $40/unit and cy as $20 /unit
D' = 100000/(40 -20)
=5000 units/year
Jasper and Crewella Dahvill were married in year 0. They filed joint tax returns in years 1 and 2. In year 3, their relationship was strained and Jasper insisted on filing a separate tax return. In year 4, the couple divorced. Both Jasper and Crewella filed single tax returns in year 4. In year 5, the IRS audited the couple’s joint year 2 tax return and each spouse’s separate year 3 tax returns. The IRS determined that the year 2 joint return and Crewella’s separate year 3 tax return understated Crewella’s self-employment income, causing the joint return year 2 tax liability to be understated by $12,700 and Crewella’s year 3 separate return tax liability to be understated by $7,350. The IRS also assessed penalties and interest on both of these tax returns. Try as it might, the IRS has not been able to locate Crewella, but they have been able to find Jasper. (Leave no cells blank - be certain to enter "0" wherever required.)
a. What amount of tax can the IRS require Jasper to pay for the Dahvill’s year 2 joint return?
Amount of Tax:__________________
b. What amount of tax can the IRS require Jasper to pay for Crewella’s year 3 separate tax return?
Amount of Tax:__________________
Answer: a. $12,700
b. $0
Explanation:
a. As Jasper and Crewella Dahvill filed joint tax returns in Year 2, both of them are joint and severally liable for any errors that may arise in the filing. The IRS could not find Crewella but they could find Jasper and as he is liable as well, he will have to pay the full amount that Crewella understated their tax liability by.
b. In year 3, Jasper and Crewella Dahvill had a strained relationship and filed their returns separately. As a result Jasper is not liable for any errors that will arise from Crewella's tax returns filing including the understatement of tax liability.
Lopez Corporation incurred the following costs while manufacturing its product.Materials used in product $120,000 Advertising expense $45,000Depreciation on plant 60,000 Property taxes on plant 14,000Property taxes on store 7,500 Delivery expense 21,000Labor costs of assembly- 110,000 Sales commissions 35,000line workersFactory supplies used 23,000 Salaries paid to sales clerks 50,000Work in process inventory was $12,000 at January 1 and $15,500 at December 31. Finished goods inventory was $60,000 at January 1 and $45,600 at December 31.Compute:____ Cost of goods manufactured $Compute cost of goods sold.
Answer:
Cost of goods manufactured is $323,500
Cost of goods sold is $337,900
Explanation:
Given:
Materials used in product = $120,000
Advertising expense = $45,000
Depreciation on plant = $60,000
Property taxes on plant = $14,000
Property taxes on store = $7,500
Delivery expense = $21,000
Labor costs of assembly-line workers = $110,000
Sales commissions = $35,000
Factory supplies used = $23,000
Salaries paid to sales clerks = $50,000
Work in process inventory was $12,000 at January 1 and $15,500 at December 31.
Finished goods inventory was $60,000 at January 1 and $45,600 at December 31.
(a) Cost of goods manufactured = Materials used in product + Depreciation on plant + Labor costs of assembly-line workers + Property taxes on plant + Factory supplies used + Beginning work in process - ending work in process
= $120,000 + $60,000 + $110,000 + $14,000 + $23,000 + $12,000 - $15,500
= $323,500
(b) Cost of goods sold = Cost of goods manufactured + opening finished goods inventory - Closing finished goods inventory
= $323,500 + $60,000 - $45,600
= $337,900
Based on the given information,
The cost of goods manufactured is $323,500
cost of goods sold $337,900
Calculations are as follows
(a) Cost of goods manufactured =Depreciation on plant + Materials used in product +Property taxes on plant + Labor costs of assembly-line workers + Factory supplies used + Beginning work in process - ending work in process
= $120,000 + $60,000 + $110,000 + $14,000 + $23,000 + $12,000 - $15,500
= $323,500
(b) Cost of goods sold = Cost of goods manufactured + opening finished goods inventory - Closing finished goods inventory
= $323,500 + $60,000 - $45,600
= $337,900
Learn more about Cost of goods sold, here:
https://brainly.com/question/28483498
#SPJ6
The curvilinear relationship of corporate performance and diversification indicates that: a. the less related the businesses acquired, the higher performing the organization. b. dominant-business corporate strategies tend to be higher performing than related constrained or unrelated business strategies. c. none of the strategies consistently outperforms the others. d. the highest performing business strategy is related constrained diversification.
Answer: d. the highest performing business strategy is related constrained diversification.
Explanation:
Multiple studies by strategic management experts have shown that business performance tends to relate in a curvelinear fashion with diversification and have shown that the companies who take advantage of this the most are companies using a related constrained diversification strategy.
This strategy involves expanding by acquiring companies or Businesses which have a similar business to the original company and then sharing resources, assets and knowledge amongst them.
In doing this they are applying the knowledge and resources as well as core competencies that made the original company successful to the acquired businesses so that they too can grow as the original company did.
In the context of the competitive environment of business, unlike leading-edge firms, bleeding-edge firms offer products just as the market becomes ready to embrace them. a. True b. False
Answer:
False
Explanation:
Bleeding edge firms provide products that are untested and carry a high risk. Products are unreliable and lead adopters stand the risk of making big losses in event that the product is not well received in the market
Leading edge firms on the other hand deal in products that are well tested and accepted by the market.
So the statement that - unlike leading-edge firms, bleeding-edge firms offer products just as the market becomes ready to embrace them. Is not true
Products offered by bleeding edge firms are not embraced by the market as they are untested and risky
A supermarket uses a periodic review system to manage inventory of gallons of drinking water. Average demand is 152 gallons of water per day with standard deviation of 33 gallons per day. It costs $57 to order water from the supplier, and orders are delivered after 4 days. The holding cost for a gallon of water is $0.11 per year. The supermarket is open 360 days per year. If the supermarket aims for a 94.5% service level for gallons of drinking water (z = 1.6), what value should be used for T, the target inventory position at the time of ordering?
The target inventory position is T= ______ gallons.
Answer:
The target inventory position is T= 713.6 gallons.
Explanation:
Given:
Average demand =per day = D = 152 Gallons
Standard deviation of demand = σ = 33 Gallons per day
Lead time for delivery = L = 4 days
Z value for 94.5% service level = 1.6
The target inventory position = (Average demand x Lead time) + Safety stock
= (D × L) + (Z× σ × [tex]\sqrt{L}[/tex])
= (152 × 4) + (1.6 × 33 × [tex]\sqrt{4}[/tex])
= (152 × 4) + (1.6 × 33 × 2)
= 608 + 105.6
= 713.6
The value of the target inventory position will be 713.6 gallons.
The following can be illustrated from the information given:
Average demand per day, D = 152Standard deviation of demand, σ = 33Lead time for delivery, L = 4Z value for 94.5% service level = 1.6Therefore, the target inventory position will be:
= (Average demand x Lead time) + Safety stock
= (D × L) + (Z× σ × ✓L )
= (152 × 4) + (1.6 × 33 × ✓4 )
= (152 × 4) + (1.6 × 33 × 2)
= 608 + 105.6
= 713.6
Therefore, the target inventory position will be 713.6 gallons.
Read related link on:
https://brainly.com/question/24674971
Some major technology companies have faced scrutiny in the past when it comes to labor and human rights on the overseas suppliers' side. What are the challenges of monitoring overseas suppliers (especially tier 3, tier 4, etc.) that are guilty of not following labor and human rights guidelines
Answer: The answer is provided below
Explanation:
With overseas factories that continue to move to new locations with a lower labour costs, the monitoring and controlling working conditions becomes a challenge. Research has shown that companies do little to monitor human rights violations in the low-cost supply chain locations.
A scandal involving Apple was reported in 2014 at a manufacturing building in China. The building which was owned by Catcher Technology Co., manufactures metal iPad covers for iPhones. Some findings included hiring discrimination, locked safety exits, excessive work hours, and also unpaid overtime each month totalling about $290,000 in owed wages. The factory was reported to have been dumping its industrial fluids and waste into nearby rivers, and also not providing proper toxic equipment for the employees.
Human rights of these people saw n those area are being abused by having them exposed to pollution, which can lead to lung diseases.
Companies like Apple have said that they are continuing to monitor situations like this, and are fixing them, but we still hear cases of more wrongdoings, therefore you have to wonder how vital these issues truly are to the firms involved.
The Prospect Company estimates that its overhead costs will amount to $602,000 and the company's manufacturing employees will work 86,000 direct labor hours during the current year. Overhead costs are allocated based on direct labor hours. If actual overhead costs for the year amounted to $619,000 and actual labor hours amounted to 87,000, then overhead cost would be:___________.
A- underapplied by $10,000.
B- overapplied by $4,000.
C- underapplied by $17,000.
D- overapplied by $10,000.
Answer:
The correct answer is A.
Explanation:
Giving the following information:
Estimated:
Overhead= $602,000
Direct labor hours= 86,000
Actual:
Overhead= $619,000
Direct labor hours= 87,000
First, we need to calculate the estimated overhead rate:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 602,000/86,000= $7 per direct labor hour
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH=7*87,000= $609,000
Finally, we determine the over/under allocation:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 619,000 - 609,000
Under/over applied overhead= 10,000 underallocated
g A firm buys on terms of 3/15, net 45. It does not take the discount, and it generally pays after 85 days. What is the nominal annual percentage cost of its non-free trade credit, based on a 365-day year? The firm's APR of not taking the trade credit is ____. (If you use percent, then do not use the percent sign. Go two places to the right of the decimal point (XX.XX). If you use decimal places, then go four places to the right of the decimal place. 0.XXXX).
Answer: 0.1613
Explanation:
From the question, a firm buys on terms of 3/15, net 45. This implies that a discount rate of 3% will be provided I payment is made within 15 days. If it's not made within 15 days, then full payment will be due on 85 days.
The nominal annual percentage cost is 0.1613. The calculation has been attached
Sloan Corporation is considering new equipment. The equipment can be purchased from an overseas supplier for $3,831. The freight and installation costs for the equipment are $554. If purchased, annual repairs and maintenance are estimated to be $415 per year over the four-year useful life of the equipment. Alternatively, Sloan can lease the equipment from a domestic supplier for $1,745 per year for four years, with no additional costs.
Required:
a. Prepare a differential analysis dated December 3 to determine whether Sloan should lease (Alternative 1) or purchase (Alternative 2) the equipment. Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If there is no amount or an amount is zero, enter "0". A colon () will automatically appear if required. (Hint: This is a "lease or buy" decision, which must be analyzed from the perspective of the equipment user, as opposed to the equipment owner.)
b. Determine whether the Sloan should lease (Alternative 1) or purchase (Alternative 2) the equipment.
Answer:
Alternative 1 Alternative 2 Differential
Lease Buy Amount
Purchase cost $0 $3,831 ($3,831)
Freight and $0 $554 ($554)
installation costs
Annual repairs and $0 $1,660 ($1,600)
maintenance costs
Lease costs $6,980 $0 $6,980
Total costs $6,980 $6,045 $935
The equipment should be purchased instead of leased because the costs of purchasing and maintenance costs are lower than lease costs.
Explanation:
A differential analysis is carried out to determine whether alternative projects' revenues and costs are higher. This way you can determine which project or investment costs less or generates higher profits.
Process Costing using the Weighted-Average Method
Compute the equivalent units of production using the weighted-average method.
Compute the cost per equivalent unit using the weighted-average method.
Assign costs to units using the weighted-average method.
Prepare a cost reconciliation report
Hayword, Inc. uses weighted-average costing and ha two departments mixing and packaging 2 The following information relates to work in the mixing department for the month of July: 4 Work in process, July 1: 5 Units in process 6 Percent completed with respect to materials 7 Percent completed with respect to conversion 8 Cost in the beginning inventory: 9 Materials cost 10Conversion cost 11 Units started into production during the period 12 Costs added to production during the period: 13 Materials cost 14 Conversion cost 15 Work in process, July 31: 16Units in process 17 Percent completed with respect to materials 18 Percent completed with respect to conversion 19 20 Use the data to answer the following 21 221. Compute equivalent units 300 60% 40% $10,500 $6,750 6,200 332,150 407,645 450 40% 30%
Answer:
First we find the equivalent units. Then Cost Per Equivalent Units. We apply these costs to the units to find the total cost. Then we compare the given costs with the found costs to see the difference.
Explanation:
Equivalent Units
Particulars Units % of Completion Equivalent Units
Materials Conversion Materials Conversion
Units transfered 6050 100 1000 6050 6050
Ending WIP 450 40 30 180 135
Equivalent Units 6230 6185
Units Completed And Transferred
Particulars Units
Beginning WIP 300
Units started in production 6200
Total Units Available 6500
Less Ending WIP 450
Units Completed and Transferred 6050
Cost Per Equivalent Unit
Particulars Materials Conversion
Beginning WIP $10,500 $6,750
Costs added 332,150 407,645
Total Costs 342,650 414,395
Equivalent Units 6230 6185
Cost Per Equivalent Unit 342,650 / 6230 414,395/ 6185
=$ 55 =$ 67
Costs Assigned
Ending WIP $ 18945
Materials ( 180 * 55) = $ 9900
Conversion ( 135 * 67) = $ 9045
Units Completed And Transferred Out : $ 738100
Materials ( 6050 *55) = $ 332750
Conversion ( 6050 * 67) = $ 405350
Cost Reconciliation
Cost to be accounted for
Beginning WIP ( $10,500 + $6,750 )= $ 17250
Cost added ( 332,150+ 407,645)= $ 739795
Total Costs $ 757045
Ending WIP $ 18945
Units Completed And Transferred Out : $ 738100
Total Costs $ 757045
Which is the same.
A couple with a newborn son wants to save for their child's college expenses in advance. The couple can establish a college fund that pays 7% annual interest. Assuming that the child enters college at age 18, the parents estimate that an amount of $40,000 per year will be required to support the child's college expenses for four years.
Determine the equal annual amounts that the couple must save until they send their child to college. (Assume that the first deposit will be made on the child's first birthday and the last deposit on the child's 18th birthday. The first withdraw will be made at the beginning of the freshman year, which also is the child's 18thbirthday.)
Answer:
The equal annual amounts that the couple must save until they send their child to college is $4,264.006 per year
Explanation:
Kindly check attached picture for detailed explanation
On October 1, Natalie King organized Real Solutions, a new consulting firm. On October 31, the company's records show the following items and amounts.
Cash $2,000 Cash dividends $3,360
Accounts receivable 13,000 Consulting fees earned 15,000
Office supplies 4,250 Rent expense 2,550
Land 36,000 Salaries expense 6,000
Office equipment 28,000 Telephone expense 660
Accounts payable 7,500 Miscellaneous expenses 680
Common stock 74,000
Also assume the following:
a. The owner’s initial investment consists of $37,720 cash and $45,940 in land in exchange for its common stock.
b. The company’s $17,710 equipment purchase is paid in cash.
c. The accounts payable balance of $8,230 consists of the $2,990 office supplies purchase and $5,240 in employee salaries yet to be paid.
d. The company’s rent, telephone, and miscellaneous expenses are paid in cash.
e. No cash has been collected on the $13,800 consulting fees earned.
Required:
Using the above information to prepare an October 31 statement of cash flows for Real Solutions.
Answer:
Statement of cash flows for Real Solutions for the year ended October 31 .
Cash flow from Operating Activities
Net Profit $14,660
Adjustment for Changes in Working Capital :
Increase in Accounts receivable ($13,000)
Increase in Accounts Payable $7,500
Net Cash from Operating Activities $9,160
Cash flow from Investing Activities
Purchase of Equipment ($17,710)
Net Cash from Investing Activities ($17,710)
Cash flow from Financing Activities
Cash dividends ($3,360)
Net Cash from Financing Activities ($3,360)
Movement during the Period ($11,910)
Cash and Cash Equivalents at Beginning of the year $37,720
Cash and Cash Equivalents at End of the year $25,810
Explanation:
The Indirect Method has been used for the Preparation of Cash flow from Operating Activities. (opt for this as it is easier to deal with the information given).
Calculation of Net Income for the Year Ended October 31
Revenue :
Consulting fees earned 15,000
Consulting fees accrued 13,800
Total Revenue 28,800
Less Expenses ;
Office supplies 4,250
Rent expense 2,550
Salaries expense 6,000
Telephone expense 660
Miscellaneous expenses 680 (14,140)
Net Income 14,660
what are the 8 core subject areas that employer expect all employees to know
Answer:
Communication. More than two-thirds of recruiters across all industries say communication is the most important skill they look for. ... Decision-Making. Flexibility. Commitment. Innovation. Integrity. Leadership. Life-long Learning.Explanation:
Have a good day and stay safe!
1) Define the external business environment of Jessops Group Limited.
Answer:
The external business environment of Jess-op Group Limited are factors such as economic, technological, regulatory, social etc. factors which the company does not have control over but affect the operation of the company.
Explanation:
The company has to adapt to its external business environment in order to continue to be successful.
Note: See the attached Microsoft word file for the full explanation. There is a difficulty in submitting everything here.
Which of the following statements is true? In market equilibrium:
a. There are uncomsummated wealth destroying transactions
b. There are unconsummated value creating transactions
c. None of these
d. There are no unconsummated wealth creating transactins
Answer: d. There are no unconsummated wealth creating transactions
Explanation:
In an equilibrium, a price has been reached that everyone is satisfied with. This is why there are no unconsummated wealth creating transactions.
The market has managed to bring together people who are want a certain good more than they will pay for it and sellers who value the good less than they will receive for it. The Equilibrium therefore sets a price that is fair on both these people which will mean that they will not be able to unfairly trade with one another. The person who values the good more than they can pay will be able to pay the person who values the goods less than they will receive. Equilibrium has brought them to a middle ground.
Firms HD and LD are identical except for their level of debt and the interest rates they pay on debt—HD has more debt and pays a higher interest rate on that debt. Based on the data given below, what is the difference between the two firms' ROEs? Applicable to Both Firms Firm HD's Data Firm LD's Data Assets $200 Debt ratio 50% Debt ratio 30% EBIT $40 Interest rate 12% Interest rate 10% Tax rate 35%
Answer:
2.41%
Explanation:
The difference between the two firms' ROEs is shown below:-
Particulars Firm HD Firm LD
Assets $200 Debt ratio 50% Debt ratio 30%
EBIT $40 Interest rate 12% Interest rate 10%
Tax rate 35%
Debt $100 $60
Interest $12 $6
($100 × 12%) ($60 × 10%)
Taxable income $28 $36
($40- $12) ($40 - $6)
Net income $18.2 $22.1
$28 × (1 - 0.35) $36 × (1 - 0.35)
Equity $100 $140
($200 - $100) ($200 - $60)
ROE 18.2% 15.79%
($18.2 ÷ $100) ($22.1 ÷ $140)
Taxable income = EBIT - Interest
Net income = Income - Taxable income
Equity = Assets - Debt
ROE = Net income ÷ Equity
Difference in ROE = ROE Firm HD - ROE Firm LD
= 18.2% - 15.79%
= 2.41%
So, for computing the difference between the two firms' ROEs we simply deduct the ROE firm LD from ROE firm HD.
Global Commerce Corporation purchased trading debt investments for $114,000 on December 31, 2018. There is a decrease of $5,800 in the fair value of the trading debt investments by the end of the year 2019. Which of the following is the correct journal entry?
A. Trading Debt Investments 5,800
Unrealized Holding
Loss-Trading 5,800
B. Fair Value
Adjustment–Trading 5,800
Unrealized Holding
Loss-Trading 5,800
C. Unrealized Holding
Loss-Trading 5.800
Retained Earnings 5,800
D. Unrealized Holding
Loss-Trading 5,800
Fair Value
Adjustment–Trading 5,800
Answer:
The correct option is D,
Unrealized Holding Loss-Trading $5,800
Fair Value Adjustment–Trading $5,800
Explanation:
The decrease in fair value by $5,800 means that the investment has potentially lost $5,800 in value which is credited to fair value adjustment while the debit is posted to unrealized holding loss-trading account.
The loss cannot be realized in retained earnings since the loss is yet to be realized as the investment has not been sold for cash.
The realized loss or gain would be determined when investment is sold for cash.
Hoosier Corporation declared a 2-for-1 stock split to all shareholders of record on March 25 of this year. Hoosier reported current E&P of $600,000 and accumulated E&P of $3,000,000. The total fair market value of the stock distributed was $1,500,000. Barbara Bloomington owned 1,000 shares of Hoosier stock with a tax basis of $100 per share.a) What amount of taxable dividend income, if any, does Barbara recognize this year? Assume the fair market value of the stock was $150 per share on March 25 of this year.b) What is Barbara's income tax basis in the new and existing stock she owns in Hoosier Corporation, assuming the distribution is tax-free?c) How does the stock dividend affect Hoosier's accumulated E&P at the beginning of next year?
Answer:
(a) The stock dividend is not taxable because it affects all shareholders pro rata
(b) Babara will transfer half of the old stock base to the new stock and make her new and old stock tax base $50
(c) Hoosier does not change his E&P for the stock dividend since the shareholders are not taxable.
Explanation:
Use the following information to answer the question: There are three firms in an economy: X, Y, and Z. Firm X buys $400 worth of goods from Firm Y, and $200 worth of goods from Firm Z to produce 250 units of output at $3 per unit. Firm Y buys $250 worth of goods from Firm X and $250 worth of goods from Firm Z to produce 250 units of output at $4 per unit. Firm Z buys $100 worth of goods from Firm X and $500 worth of goods from Firm Y to produce 500 units at $2 per unit. Given this information, using the Value Added approach to eliminating intermediate goods and services (in order to avoid double-counting), what is the economy's GDP
Answer:
$1,050
Explanation:
Value Added Approach to calculating the GDP avoids double counting by adding only the value addition of all firms in an economy to obtain the GDP. Value addition for each firm can be calculated by deducting the intermediate purchase of each firm from its intermediate sales as follows:
Firm X value addition = ($250 * 3) - $400 - $200 = $750 - $600 = $150
Firm Y value addition = ($250 * 4) - $250 - $250 = $1,000 - $500 = $500
Firm Z value addition = (500 * 2) - $100 - $500 = $1,000 - $600 = $400
Therefore, we have:
The economy's GDP = $150 + $500 + $400 = $1,050
Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two sets of forecasts are as follows:
PREDICTED DEMAND
Period Demand F1 F2
1 68 63 62
2 75 66 61
3 70 73 70
4 74 65 71
5 69 71 73
6 72 69 73
7 80 70 76
8 78 72 80
a.
Compute MAD for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2 decimal place.)
MAD F1
MAD F2
(Click to select)F1F2None appears to be more accurate.
b.
Compute the MSE for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2 decimal places.)
MSE F1
MSE F2
(Click to select)F1F2None appears to be more accurate.
c.
In practice, either MAD or MSE would be employed to compute forecast errors. What factors might lead a manager to choose one rather than the other?
Either one might already be in use, familiar to users, and have past values for comparison. If (Click to select)control chartstracking signals are used, MSE would be natural; if (Click to select)tracking signalscontrol charts are used, MAD would be more natural.
d.
Compute MAPE for each data set. Which forecast appears to be more accurate? (Round your intermediate calculations to 2 decimal places and and final answers to 2 decimal places.)
MAPE F1
MAPE F2
Answer:
a. Compute MAD for each set of forecasts. Given your results, which forecast appears to be more accurate?
I used an excel spreadsheet (attached as MAD).
F1 seems to be more accurate.
b. Compute the MSE for each set of forecasts.
I used an excel spreadsheet (attached as MSE).
F2 seems to be more accurate.
c. In practice, either MAD or MSE would be employed to compute forecast errors. What factors might lead a manager to choose one rather than the other?
Either one might already be in use, familiar to users, and have past values for comparison.
If control charts are used, MSE would be natural; if tracking signals are used, MAD would be more natural.d. Compute MAPE for each data set. Which forecast appears to be more accurate?
I used an excel spreadsheet (attached as MAPE).
F2 seems to be more accurate.
Explanation:
Period Demand F1 F2
1 68 63 62
2 75 66 61
3 70 73 70
4 74 65 71
5 69 71 73
6 72 69 73
7 80 70 76
8 78 72 80
Hahn Flooring Company uses a perpetual inventory system.
A. Sales returns of $97,650 and merchandise returns of $48,100 are estimated for the current year's sales.
B. The inventory account has a balance of $673,400, while physical inventory indicates that $663,800 of merchandise is on hand.
Journalize the December 31 adjusting entries based on the above transactions. Assume that the inventory shrinkage is a normal amount. Refer to the Chart of Accounts for exact wording of account titles.
Answer and Explanation:
The adjusting journal entries are as follows
1. Sales $97,650
To Customer refunds payable $97,650
(Being the sales return is recorded)
For recording this we debited the sales as it reduced the sales and credited the customer refund payable as it increased the liabilities
2. Estimated Returns inventory $48,100
To Cost of goods sold $48,100
(Being the merchandise return is recorded)
For recording this we debited the estimated returns inventory and credited the cost of goods sold
3. Cost of goods sold $9,600
To Inventory $9,600
(Being the inventory shrinkage is recorded)
For recording this we debited the cost of goods sold as it increased the expenses and credited the inventory as it reduced the assets
The computation is shown below:
= Balance of inventory account - physical inventory merchandise on hand
= $673,400 - $663,800
= $9,600
Prestige Manufacturing Corporation reports the following items in its statement of cash flows presented using the direct method. Indicate whether each item is disclosed in the operating activities (O), investing activities (I), or financing activities (F) section of the statement under GAAP or use (NA) if the item does not appear on the statement.1. Payment for equipment purchase. 2. Repayments of bank loan. 3. Dividends paid 4. Proceeds from issuance of stock. 5. Interest paid. 6. Receipts from customers.
Answer:
1. Payment for equipment purchase = investing activities (I)
2. Repayments of bank loan = financing activities (F)
3. Dividends paid = financing activities (F)
4. Proceeds from issuance of stock = financing activities (F)
5. Interest paid = operating activities (O)
6. Receipts from customers = operating activities (O)
Explanation:
Operating Activities are activities that generate cash in the ordinary course of business.
Investing Activities are activities that generate cash due to movement in capital expenditure balances
Financing Activities are activities that generate cash due to sourcing of funds or changes in ownership.
