Data collected from the economy of Pokerville reveals that a 16% increase in income leads to the following changes:

• A 12% increase in the quantity of horses demanded.
• A 14% decrease in the quantity of clubs demanded.
• A 28% increase in the quantity of diamonds demanded.

Compute the income elasticity of demand for each good and use the dropdown menus to complete the first column in the following table.

Good Income Elasticity of Demand Normal or Inferior Good
Horses
Spades
Aces

Which of the following three goods is most likely to be classified as a luxury good?

a. Aces
b. Spades
c. Horses

Answers

Answer 1

Answer:

Horses - 0.75 - normal

Clubs- 0.875 - inferior

Diamonds - 1.75 - normal

Diamond is a luxury good

Explanation:

Income elasticity of demand measures the responsiveness of quantity demanded to changes in income of the consumer.

Income elasticity of demand = percentage change in demand / percentage change in income

Income elascitiy for horses = 12% / 16% =

Income elasticity of demand for spades = 14% / 16% = 0.875

Income elasticity of demand for diamonds 28% / 16% = 1.75

A normal good is a whose demand increases when income increases and falls when income falls.

An inferior good is a good whose demand increases when income falls and whose demand falls when income increases.

Horses and diamonds are normal goods because the demand for the goods increases with income while clubs are inferior goods because the demand for the goods falls when income rises.

A luxury good is a good whose demand rises more than the rise in income. The demands for diamonds increase more than the increase in income, so diamonds are luxury goods.

I hope my answer helps you


Related Questions

J-Chron's board of directors periodically meets with the CFO of the company. The CFO reports on the financial status of a company project. The board asks whether the project is compliant with legally-required accounting principles, but asks no other questions about the project, such as how the project supports the company's mission and strategy. Which of the following is true? 1. The board is meeting legal requirements but not its duty of care to shareholders. 2. The board is fully meeting its duty of care to shareholders. 3. The board is not legally required to meet any duty of care requirements. 4. The board is not meeting its duty of care to shareholders.

Answers

Answer:

1. The board is meeting legal requirements but not its duty of care to shareholders.

Explanation:

During a Board of Directors meeting with CFO all conversations will be about strengthening the company and the organization's shareholders. Shareholders are also considered the entity's owners, so it is very important to comply with all the legal provisions in addition to increasing shareholders.

In this given situation, the board meets with CFO and asks in compliance with accounting standards, but asks little more about how the project aims to achieve the company's mission and strategy. Mission and plan describe the company's vision alongside the company's owners(shareholders) vision and benefits.

hence, the correct option is 1.

"In July, one of the processing departments at Okamura Corporation had beginning work in process inventory of $13,000 and ending work in process inventory of $18,000. During the month, the cost of units transferred out from the department was $148,000. In the department's cost reconciliation report for July, the total cost to be accounted for under the weighted-average method would be:"

Answers

Answer:

The total cost to be accounted for under the weighted-average method is $166,000

Explanation:

Okamura Corporation Partial Manufacturing Account

                         Particulars                                Amount

Cost of ending work in process inventory      $18,000

Add: Cost of units transferred out                   $148,000

Total cost accounted for                                  $166,000

The total cost to be accounted for under the weighted-average method is $166,000

The 6.3 percent, semi-annual coupon bonds of PE Engineers mature in 13 years and have a price quote of 99.2. These bonds have a current yield of ________ percent, a yield to maturity of ________ percent, and an effective annual yield of ________ percent.

Answers

Answer:

Current yield is 6.35%

YTM is 6.40%

Effective annual yield is 6.50%

Explanation:

Current yield =coupon amount/price=6.3%*$1000/$1000*99.2%=6.35%

Yield to maturity can be computed using excel rate formula as below:

=rate(nper,pmt,-pv,fv)

nper is the number of coupon payments of the bond which is 13*2

pmt is the annual coupon=6.3%*$1000=$63/2=$31.5

pv is the current price=99.2%*$1000=$992

fv is the face value of $1000

=rate(13*2,31.5,-992,1000)=3.20%

Semiannual yield =3.20%

annual yield=3.20%*2=6.40%

effective annual yield=(1+YTM/2)^2-1

effective annual yield=(1+6.40%/2)^2-1=6.50%

You have $17,000 to invest in a stock portfolio. Your choices are Stock X with an expected return of 15 percent and Stock Y with an expected return of 10 percent. Assume your goal is to create a portfolio with an expected return of 12.15 percent. How much money will you invest in Stock X and Stock Y

Answers

Answer:

For X = $7,130

For Y = $9,690

Explanation:

The calculation of investment in stock X and stock Y is shown below:-

We assume the weight of investment in stock x = x

Expected return = Weight of x × Return of x + Weight of y × Return of y

12.15 = x × 15 + (1 - x) × 10

12.15 = 15x + 10 - 10x

x = (12.15 - 10) ÷ 5

x = 43%

Investment in stock Y = 100 - 43

= 57%

Now,

Dollar Investment in x = Stock investment × Expected return

= $17,000 × 43%

= $7,130

Dollar Investment in x = Stock investment × Expected return

= $17,000 × 57%

= $9,690

So, we have applied the above formula.

Sparky Corporation uses the FIFO method of process costing. The following information is available for February in its Molding Department: Units: Beginning Inventory: 34,000 units, 100% complete as to materials and 55% complete as to conversion. Units started and completed: 119,000. Units completed and transferred out: 153,000. Ending Inventory: 34,500 units, 100% complete as to materials and 35% complete as to conversion. Costs: Costs in beginning Work in Process - Direct Materials: $52,000. Costs in beginning Work in Process - Conversion: $57,850. Costs incurred in February - Direct Materials: $349,625. Costs incurred in February - Conversion: $608,150. Calculate the cost per equivalent unit of materials.

Answers

Answer:

The cost per equivalent unit of materials is $2.28

Explanation:

The Concept of Equivalent units measures the number of units complete to the extent of the input elements added during production.

The FIFO method in Process costing Accounts for Costs only incurred during the Manufacturing Period. Also, The Opening Work In Process is Assumed to be completed first.

The First Step is to Calculate the Total Equivalent Units of Production for Raw Materials :

To finish Opening Work In Process (34,000 × 0%)         =        0

Started and Completed ((153,000 - 34,000) × 100% )     =  119,000

Closing Work In Process (34,500 × 100%)                       =   34,500

Total Equivalent Units of Production                               =   153,500

The Next and Final Step is to calculate the cost per equivalent unit of materials.

Cost per equivalent unit = Total Cost During the Current Period / Total Equivalent Units of Production

                                           = $349,625 / 153,500

                                           = $2.2776872

                                           = $2.28 (2 decimal places)

Conclusion :

The cost per equivalent unit of materials is $2.28

A hardware store is interested in reaching people who are characterized by the VALS system as being practical,down-to-earth,and self-sufficient who like to work with their hands,the ________ category.A) believersB) striversC) survivorsD) experiencersE) makers

Answers

Answer: Makers--E

Explanation:The VALS  system is a system that describes the Values, Attitude lifestyles of individuals and their responsiveness to buying products. Understanding this system, affords businesses the opportunity to tailor their products to suit their target consumers.

The Makers are characterized as being practical  and expressive, having skills  which enable them to carry out their task successfully.  They value family life and therefore cut down on frivolities and non functional possessions. when it comes to consumption, they would rather go for the basic essential commodities that have value  than luxury goods.

Therefore, A hardware store is interested in reaching people who are characterized by the VALS system as being practical,down-to-earth,and self-sufficient who like to work with their hands,the MAKERS category.

An inexperienced accountant for Ayayai Corp. showed the following in the income statement: income before income taxes $250,000 and unrealized gain on available-for-sale securities (before taxes) $85,000. The unrealized gain on available-for-sale securities and income before income taxes are both subject to a 25% tax rate. Prepare a correct statement of comprehensive income.

Answers

Answer:

                          Ayayai Corp.

      Statement of Comprehensive Income

            For the Year Ended xxx, 202x

Net income                                                $187,500

Other comprehensive income:

Unrealized gain on AFS securities           $85,000

Comprehensive income                          $272,500

Explanation:

In order to prepare a statement of comprehensive income we first need to determine net income after taxes = $250,000 x (1 - 25%) = $187,500

Unrealized gains or losses are not taxed until they are actually realized (either make profit or lose money).

6. Limitations of GDP Although GDP is a reasonably good measure of a nation's output, it does not necessarily include all transactions and production for that nation. Which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure methods of calculating GDP for the United States? Check all that apply. Funds spent by city governments to renovate their buildings The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government The costs of air and water pollution The variety of goods available to consumers When a U.S. company purchases and imports automotive parts from Canada to use to build cars within the United States, this purchase increases the component of GDP while also net exports by the same amount. Therefore, the purchase of automotive parts from Canada causes in US GDP.

Answers

Answer:

The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government

The costs of air and water pollution

The variety of goods available to consumers

It increases investment spending by businesses

Decreasing net export

No change

Explanation:

Gross domestic product is the sum of the goods and services produced in an economy within a given period which is usually a year.

Gross domestic product calculated using the expenditure approach = Consumption spending + Investment spending + net export + government spending

Items not included in the calculation of GDP:

1. Intermediate goods

2. Externalities e.g. pollution

3. Measures of welfare available to individuals

4. Transactions not reported to the government.

Funds spent by city governments to renovate their buildings are included in GDP as part of investment spending.

Purchase of automative parts would be included in GDP as part of investment spending. So investment spending would rise. Also, it would be recorded as an import and import is a negative function of GDP and thus net export would decrease . As a result, the increase in investment spending would be offset by the decrease in net export and there would be no change in GDP

I hope my answer helps you

Weisman, Inc. uses activity-based costing as the basis for information to set prices for its six lines of seasonal coats.
Activity Cost Pools Estimated Overhead Estimated Use of Cost Drivers per
Activity
Designing $455,000 14,000 designer hours
Sizing and cutting 3,948,000 168,000 machine hours
Stitching and trimming 1,479,725 78,500 labor hours
Wrapping and packing 333,000 30,000 finished units
Compute the activity-based overhead rates using the following budgeted data for each of the activity cost pools.
Activity-based overhead rates
Designing $ per designer hour
Sizing and cutting $ per machine hour
Stitching and trimming $ per labor hour
Wrapping and packing $ per finished unit

Answers

Answer:

Designing =  $32.50 per designer hour

Sizing and cutting =  $23.50 per machine hour

Stitching and trimming =  $18.85 per labor hour

Wrapping and packing = $11.10 per finished unit

Explanation:

The Activity Based Overhead Costing involves calculation of cost driver rate for each activity center.

Cost Driver Rate = Cost of Activity / Number of Times that Activity is Performed

Designing = $455,000 / 14,000

                 = $32.50

Sizing and cutting = $3,948,000 / 168,000

                              = $23.50

Stitching and trimming = $1,479,725 / 78,500

                                      = $18.85

Wrapping and packing = $333,000 / 30,000

                                      = $11.10

According to this case study, what is an upcoming key technology that will be used in retail stores to improve customer service? And how it is currently being used? What will be the role of smartphones in the future of shopping? Support your claim with a reference.

Answers

Answer:

 

1. According to the case study (copy attached) "the upcoming technology that will be used in retail stores to improve customer service is the Scan As You Go Mobile Devices".

2. It is currently being used by sales officers in some shopping malls to scan items on the spot and let customers pay without going through the cash registers.

It is also being used to help customers take advantage of discounts and coupons on items being purchased. The effect is that customers spend 10% when they shop using this technology.

3. In the future, the customers will be able to check out using their smartphones.

4. According to the case study, the technology referred to in 3 above is already pioneered by Apple Stores.

Cheers!

At the end of 2001, Lehnhoff Inc. had $75 million in cash on its balance sheet. During 2002, the following events occurred: The cash flow from Lehnhoff's operating activities totaled $325 million. Lehnhoff issued $500 million in common stock. Lehnhoff's notes payable decreased by $100 million. Lehnhoff purchased fixed assets totaling $600 million. How much cash did Lehnhoff Inc. have on its balance sheet at the end of 2002

Answers

Answer:

The multiple choices are:

a. $200 Million

b. $50 Million

c. $1.4 Billion

d. $100 Million

The correct option is A,$200 million

Explanation:

The increase in cash recorded from the statement of cash flows prepared in the year plus the opening balance of cash at the beginning of the year gives the cash balance at the end of the year shown below:

Increase in cash in the year=cash flow from operations+cash flow from financing activities-cash flow used on investing activities

increase in cash in the year=$325+($500-$100)-$600=$125  million

cash at the end of the year=$125 +$75=$200 million

If a perpetual inventory system is in use _____. a physical inventory count is not required because the Inventory account is updated for each purchase and sale. a physical inventory count is not required because the Inventory account is updated every time a transaction or event occurs. a physical inventory count should be taken at least annually. a physical inventory count is required because the Inventory account is not updated when inventory is purchased or sold.

Answers

Answer:  a physical inventory count should be taken at least annually

Explanation: That an inventory is perpetual does not discount the need for taking physical inventory at least once a year. This is important because it helps in the identification of shrinkage or shortages and to also test the accuracy of the perpetual records under use. Now, a perpetual inventory is a kind of inventory that tracks and records continuously, items as they are added to or subtracted from the inventory thus keeping it updated and aids in keeping the track of the cost of goods bought and sold.

Interstate Delivery Service is owned and operated by Katie Wyer. The following selected transactions were completed by Interstate Delivery during May:Indicate the effect of each transaction on the following accounting equation elements (Assets, Liabilities, Common Stock, Dividends, Revenue, and Expense). Also indicate the specific item within the accounting equation element that is affected. To illustrate, the answer to (1) follows:(1) Asset (Cash) increases by $18,000; Common Stock increases by $18,000. Element Item Direction1. Received cash in exchange for common stock, $18,000. Asset Cash Increases Common Stock Increases2. Paid advertising expense, $4,850. 3. Purchased supplies on account, $2,100. 4. Billed customers for delivery services on account, $14,700. 5. Received cash from customers on account, $8,200.

Answers

Answer and Explanation:

The indication and effect of each transaction are as follows

Particulars                                  Element       Item     Direction

1. Received cash in exchange

for common stock, $18,000.          Asset     Cash     Increases

                                                   Common Stock      Increases

It increased both assets and the common stock

2. Paid advertising expense,

$4,850.                           Expense Advertising Expense Increases

                                         Asset                  Cash                 Decreases

It increased the expenses and reduced the assets

3. Purchased supplies on account,

$2,100.                                          Asset   Supplies Increases

                                                      Liability Accounts Payable Increases

It increased the assets and also increased the liabilities

4. Billed customers for delivery

services on account, $14,700. Asset   Accounts Receivable   Increases

                                                  Revenue Delivery Service Fees Increases

It increased the assets and the revenue is also increased

5. Received cash from

customers on account, $8,200.  Asset     Cash       Increases

                                              Asset    Accounts Receivable Decreases

It increased the assets in cash but it reduced the assets i.e account receivable

Answer: I took this class, these are the answers

Explanation:

The indication and effect of each transaction are as follows

Particulars                                  Element       Item     Direction

1. Received cash in exchange

for common stock, $18,000.          Asset     Cash     Increases

                                                  Common Stock      Increases

It increased both assets and the common stock

2. Paid advertising expense,

$4,850.                           Expense Advertising Expense Increases

                                        Asset                  Cash                 Decreases

It increased the expenses and reduced the assets

3. Purchased supplies on account,

$2,100.                                          Asset   Supplies Increases

                                                     Liability Accounts Payable Increases

It increased the assets and also increased the liabilities

4. Billed customers for delivery

services on account, $14,700. Asset   Accounts Receivable   Increases

                                                 Revenue Delivery Service Fees Increases

It increased the assets and the revenue is also increased

5. Received cash from

customers on account, $8,200.  Asset     Cash       Increases

                                             Asset    Accounts Receivable Decreases

It increased the assets in cash but it reduced the assets i.e account receivable

Celine Dion Company issued $600,000 of 10%, 20-year bonds on January 1, 2017, at 102. Interest is payable semiannually on July 1 and January 1. Dion Company uses the straight-line method of amortization for bond premium or discount.
Instructions
Prepare the journal entries to record the following.
A) The issuance of the bonds.
B) The payment of interest and the related amortization on July 1, 2017.
C) The accrual of interest and the related amortization on December 31, 2017.

Answers

Answer:

A) The issuance of the bonds.

January 1, 2017, bonds are issued

Dr Cash 612,000

    Cr Bonds payable 600,000

    Cr premium on bonds payable 12,000

B) The payment of interest and the related amortization on July 1, 2017.

July 1, 2017, first coupon is paid

Dr Interest expense 29,700

Dr Premium on bonds payable 300

    Cr Cash 30,000

C) The accrual of interest and the related amortization on December 31, 2017.

December 31, 2017, accrued interest payable

Dr Interest expense 29,700

    Cr interest payable 29,700

Explanation:

$600,000 of 10%, 20-year bonds at 102, interest is paid semiannually ($600,000 x 10% x 1/2 = $30,000)

straight line amortization method is used to amortize bond premium

bond premium = $12,000 / 40 coupons = $300 amortized with each coupon payment

A day trader buys an option on a stock that will return $150 profit if the stock goes up today and lose $650 if it goes down. Complete parts a and b below given that the trader thinks there is a 70 % chance that the stock will go up.
a) What is her expected value of the option's profit?
b) What do you think of this option?

Answers

Answer:

A.-90

B.What I think of the option is that it will be extremely risky reason been that her expected value was a loss in (a).

Explanation:

Option on stock $150

Loss$650

Percentage 70 %

A.

150*.70= $105

100%-70%

=30%

-650*.30

= -195

$105 + (-195)

= -90

Therefore the expected value of the option's is losing 90

b.

What I think of the option is that it will be extremely risky reason been that her expected value was a loss in (a).

Lipman Auto Parts, a family-owned auto parts store, began January with $10,300.00 in cash. Management forecasts that collections from credit customers will be $11,400.00 in January and $14,800.00 in February. The store is scheduled to receive $5,000.00 in cash on a business note receivable in January. Projected cash payments include inventory purchases ($13,000.00 in January and $13,600.00 in February) and operating expenses ($2,700.00 each month). Lipman Auto Parts’ bank requires a $10,000.00 minimum balance in the store’s checking account. At the end of any month when the account balance dips below $10,000.00, the bank automatically extends credit to the store in multiples of $1,000.00. Lipman Auto Parts borrows as little as possible and pays back loans in quarterly installments of $2,000.00, plus 4 percent interest on the entire unpaid principal. The first payment occurs three months after the loan.
Prepare Lipman Auto Parts

Answers

Answer: The answer has been attached below

Explanation:

The question says we should prepare Lipman Auto Parts cash budget for January and February.

A cash budget is a budget of expected cash receipts and the disbursements during a period. The cash inflows and cash outflows include revenues collected, the expenses paid, and the loans receipts and payments. A cash budget is an estimated projection of a company's cash position in the future.

Lipman Auto Parts cash budget for January and February has been solved and attached.

Magpie Corporation uses the total cost method of product pricing. Below is cost information for the production and sale of 60,000 units of its sole product. Magpie desires a profit equal to a 25% return on invested assets of $700,000. Fixed factory overhead cost $38,700 Fixed selling and administrative costs 7,500 Variable direct materials cost per unit 4.60 Variable direct labor cost per unit 1.88 Variable factory overhead cost per unit 1.13 Variable selling and administrative cost per unit 4.50 The markup percentage on total cost for Magpie's product is

Answers

Answer:

Mark-up =22.64%

Explanation:

Profit = Return on Investment (%) × assets\

Profit = 25% × 700,000 = 175,000

Total variable cost = (4.60+ 1.88+ 1.13+ 4.50 )× 60,000= 726600

Total cost = Total variable cost + total fixed cost

                  =  726600  + 38,700+ 7,500= 772800

Mark-up = profit/cost × 100

              = 175,000/726,600 × 100 = 22.64%

Mark-up =22.64%

A company purchased 10 units for $5 on January 3. It purchased 10 units for $7 each on February 28. It sold 10 units on March 1. If the company uses the last in, first out (LIFO) inventory costing method, what is the dollar amount for ending inventory on the December 31 balance sheet, assuming that the company uses a perpetual inventory system

Answers

Answer:

The dollar amount for ending inventory using the last-in-first-out method of inventory valuation is $50

Explanation:

Using LIFO,last-in-first-out  method of inventory valuation,items received last into the store are deemed to be sold first, hence the sales of 10 units on March 1 was the inventory purchased on February 28, leaving the items of inventory purchased on January 3 as closing inventory

value of closing inventory using LIFO=10*$5=$50

Gangsta Industries,INC produces a variety of anti-crime and safety products such as burglar alarms, smoke detectors, surveillance cameras, and specialty locks. Gangsta sells to households, businesses, and government agencies. They have found that each market group requires a different marketing strategy. Gangsta would probably benefit from departmentalization by:

Answers

Answer:

Customer type.

Explanation:

From the scenario described in the question above,   Gangsta Industries would benefit from departmentalization by type of consumer.

In this type of departmentalization, the company groups its activities according to its common customer base, or the types of customers that the organization serves.

This is a strategy that enables the company to better serve a group of specific customers based on their problems, needs and preferences, which results in a more targeted and effective service.

Pablo Management has seven employees, each of whom earns $210 per day. They are paid on Fridays for work completed Monday through Friday of the same week. Near year-end, the seven employees worked Monday, December 31, and Wednesday through Friday, of the same week. The next week, the seven employees worked only four days because New Year's Day was an unpaid Holiday.

Required:
a. Prepare the adjusting entry that would be recorded Monday, December 31, 2013.
b. Prepare the journal entry that would be made to record payment of the employees' wages on Friday, Janyary 4, 2014.

Answers

Answer:

a) $1,470 Debit –Wage Expense; $1,470 Credit –Wage Payable.

b) $4,410 Debit –Wage Expense; $1,470 Debit –Wage Payable

Explanation:

Remember, we are told each of the worker earns $210 per day. Therefore

a.To record accrued and current wages.Wages expense = 7 workers × 3 days × $210 = $4,410.

b. To record accrued wages four days Cash = 7 workers × 4 days × $210 = $5,880. For one day (7 workers × $210) = $1,470.

On January 1, Year 1, Milton Manufacturing Company purchased equipment with a list price of $37,000. A total of $4,000 was paid for installation and testing. During the first year, Milton paid $6,000 for insurance on the equipment and another $700 for routine maintenance and repairs. Milton uses the units-of-production method of depreciation. Useful life is estimated at 100,000 units, and estimated salvage value is $8,000. During Year 1, the equipment produced 14,000 units. What is the amount of depreciation for Year 1

Answers

Answer:

Annual depreciation= $4,620

Explanation:

Giving the following information:

Purchasing price= $37,000

Installation= $4,000

Milton uses the units-of-production method of depreciation. Useful life is estimated at 100,000 units, and the estimated salvage value is $8,000. During Year 1, the equipment produced 14,000 units.

First, we will determine the total cost consisting of the purchasing price and all costs to make the equipment operable.

Total cost= 37,000 + 4,000= $41,000

Now, to calculate the depreciation expense, we need to use the following formula:

Annual depreciation= [(original cost - salvage value)/useful life of production in units]*units produced

Annual depreciation= [(41,000 - 8,000)/100,000]*14,000

Annual depreciation= $4,620

A firm is deciding between two different sewing machines. Technology A has fixed costs of $500 and marginal costs of $50 whereas Technology B has fixed costs of $250 and marginal costs of $100. ​If the price is $60 per unit, what is the break even amount of units for technology A?A. ​50 ​B. 100 ​C. 150​D. None-They would have to shut down

Answers

Answer:

A. 50 units

Explanation:

Break even point (units) = Fixed cost / (Selling price - Variable cost)

= $ 500 / ($ 60 - $ 50)

= $ 500/$10

= 50 units

The break-even point is derived by dividing the fixed costs of production by the price per unit - the variable costs of production. Break-even point is the level of production at which the costs of production equal the Income for the particular product

A firm has fixed assets of $28,000, long-term debt of $12,000, current liabilities of $4,000, current assets of $5,000 and equity of $17,000. What is the total of the assets side of the balance sheet of the firm

Answers

Answer:

$33,000

Explanation:

assets = liabilities + stockholders' equity

assets include current assets + non current or fixed assets = $5,000 + $28,000 = $33,000

liabilities and stockholders' equity include current liabilities + long term liabilities + equity = $4,000 + $12,000 + $17,000 = $33,000

both sides of the accounting equation must always be equal, that is meant by balance.

An asset was acquired on September 30, 2021, for $104,000 with an estimated five-year life and $25,000 residual value. The company uses double-declining-balance depreciation. Calculate the gain or loss if the asset was sold on December 31, 2022, for $54,000. Partial-year depreciation is to be calculated.

Answers

Answer:

There is a loss on disposal of $80

Explanation:

The double declining rate method of depreciation is an accelerated form of charging depreciation on an asset. It charges higher depreciation in the earlier years and lower depreciation in the later years of the useful life of the asset. the formula for double declining balance depreciation per year is,

Depreciation expense = 2 * [ (Cost - Accumulated depreciation) / estimated useful life of the asset ]

The depreciation expense per year on this asset is,

Depreciation expense = 2 * [(104000 - 0) / 5]

Depreciation expense for the 1 year(2021) = $41600

As the asset was purchased in September, we will charge a depreciation expense of 4 months.

Depreciation expense for 2021 = 31600 * 4/12   = $13866.67

Accumulated depreciation at the end of 2021 = $13866.67

Depreciation expense for 2nd year (2022) = 2 * [(104000 - 13866.67) / 5]

Depreciation expense for 2nd year (2022) = $36053.33

Accumulated depreciation at the end of 2022 = 13866.67 + 36053.33

Accumulated depreciation at the end of 2022 = $49920

To calculate the gain or loss on disposal, we need to determine the Net Book value of the asset at the end of 2022 and compare it with the cash received from the sale. If the cash received is more than the Net Book Value, there is a gain on disposal and if the cash received is less than the Net Book Value, there is a loss on disposal.

Net Book value at the end of 2022 = 104000 - 49920   = $54080

Loss on disposal = 54000 - 54080  =  - $80 (loss on disposal)

The loss on the sale of the asset is $2,160.

There would be a loss on the sale of the asset is the book value of the asset is greater than the selling price of the asset.

Depreciation is a method used to reduce the carrying value of an asset.

Double declining depreciation = (2/ useful life) x cost of the asset

Depreciation expense in 2021 = (2/5) x $104,000 = $41,600

3/12 x  $41,600 = $10,400

Book value in 2021 = $104,000 - $10,400 = $93,600

Depreciation expense in 2022 = (2/5) x $93,600 = $37,440

Book value in 2022 =  $93,600 - $37,440 = $56,160

Loss = $56,160 - $54,000.= $2,160

To learn more about depreciation, please check: https://brainly.com/question/25887124

The topic of email is written in _________________.

a) CC Box
b) BCC Box
c) Subject Box
d) None of these

Answers

Answer:

the subject box is where you write your topic of email

Answer:

C. Subject box

Explanation:

The CC box is the carbon copy box. This is where you put other people's emails. They will receive a copy of the email, and they will be able to see who else received the copy.

The BCC box is the blind carbon copy box. This is also where you can put other people's emails. They will receive a copy, but they can't see the others who also got the copy, hence the name blind carbon copy.

The subject box is where you write the subject or topic of the email. This tells the recipients what the email is about, before they begin reading it.

Therefore, the best choice is C: subject box.

A young couple is planning for the education of their two children. They plan to invest the same amount of money at the end of each of the next 16 years. The first contribution will be made at the end of the year and the final contribution will be made at the end of the year the older child enters college. The money will be invested in securities that are certain to earn a return of 8% each year. The older child will begin college in 16 years and the second child will begin college in 18 years. The parents anticipate college costs of $25,000 a year (per child). These costs must be paid at the end of each year. If each child takes four years to complete their college degrees, then how much money must the couple save each year

Answers

Answer:

The couple must save $ 6,598 each year

Explanation:

Calculating the payment amount:

Cost per year = $25,000 per each child

Cost for 4 years = $25,000 × 4 = $100,000

For the oldest child, the college will begin in 16 years and the second child the college will begin in 18 years.

Calculating the amount to be deposited each year for the oldest child.

Using Microsoft Excel PMT function  

Rate = 8%

N = 16

PV = 0

FV = -100000

= $3,298

Therefore, they must deposit $3,298 each year for their oldest child.

Calculating the amount to be deposited each year for the second child:

Using Microsoft Excel PMT function  

Rate = 8%

N = 18

PV = 0

FV = -100000

= $2,670

Therefore, they must deposit $2,670 each year for their second child.

Total sum to be saved per year = $3,298 + $2,670 = $6,598

Baka Corporation applies manufacturing overhead on the basis of direct labor-hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $243,000 and 8,000 estimated direct labor-hours. Actual manufacturing overhead for the year amounted to $244,200 and actual direct labor-hours were 5,700.The applied manufacturing overhead for the year was closest to:________
a. 229586
b. 234600
c. 242006
d. 236854

Answers

Answer:

Allocated overhead= $173,137.5

Explanation:

Giving the following information:

Estimated overhead= $243,000

Estimated direct-labor hours= 8,000

Actual direct labor-hours were 5,700.

First, we need to calculate the predetermined overhead rate:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 243,000/8,000

Predetermined manufacturing overhead rate= $30.375 per direct labor hour

Now, we can allocate overhead based on actual direct labor hours:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated overhead= 30.375*5,700= $173,137.5

"In the Modigliani Miller perfect world with no taxes, if we assume that the effect of adding debt to firm's capital structure is exactly balanced by an increase in the cost of equity as more debt is added, what is the effect of increased debt usage on the weighted average cost of capital (WACC)

Answers

Answer: WACC remains constant as leverage increases.

Explanation:

Here is the complete question:

In the Modigliani Miller perfect world with no taxes, if we assume that the effect of adding debt to firm's capital structure is exactly balanced by an increase in the cost of equity as more debt is added, what is the effect of increased debt usage on the weighted average cost of capital (WACC)?

a. WACC first increases, then decreases as leverage increases.

b. WACC remains constant as leverage increases.

c. WACC increases continuously as leverage increases.

d. WACC decreases continually as leverage increases.

In the Modigliani Miller perfect world with no taxes, the capital structure is not relevant as the way a company finances it operations does not really matter.

For the capital markets, they will be perfectly competitive and there will be no taxes, bankruptcy costs or transactions cost and investors all have the same expectations. The weighted average cost if capital will be thesame even though leverage increases.

Due to the adoption of a just in time assembly line system, NWC is expected to decrease. Inventory is expected to decrease from $254600 to $143072 while accounts payable will also decrease by $26648. What is the cash flow impact for the change in net working capital to be included in the initial investment

Answers

Answer:

$84,880

Explanation:

Since there is a decrease in inventory from $254,600 to $143,072 i.e $111,528 and the account payable is also decreased by $26,648

So, there is an increase in cash flow due to the change in net working capital of

= Decrease in inventory - decrease in account payable

=  $111,528 - $26,648

= $84,880

Hence, the cash flow impact is of $84,880 i.e to be included in the initial investment

You own a farm, you hire labor and capital to produce apples. The marginal product of the last unit of labor input is 15 and the marginal product of the last unit of capital input is 45. The market wage for labor is $8. If you are using the optimal combination of inputs, then the price of capital is

Answers

Answer:

$24

Explanation:

We can say the Optimal combination of inputs can be expressed as the ratio of marginal productivity of labor to the marginal productivity of capital is equal to the ratio of price of labor(wage) to the price of capital(RENT).

Lets denote:

marginal productivity of labor = MPL

marginal productivity of capital = MPC  

Wage= W

Rent= R

Then the formula will be

[tex]\frac{MPL}{MPC}=\frac{W}{R}[/tex]

Workings:

Lets put in the values in the formula

[tex]\frac{15}{45} = \frac{8}{R}[/tex]

We have to find out R(Rent)

R= 8x3

R= $24

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