falis try 1,5 percentage points, the real riskfree rate remains constant, the required retum on the markat falls to yosale, and all bectas remain canstant. After all of these changes, what will be the

Answers

Answer 1

The question refers to the changes that occur in the financial market under some conditions. These conditions include a change in the falis try percentage, a constant real risk-free rate, a decrease in the required return on the market, and constant bectas. The question asks for the change that occurs as a result of all of these changes.

When the falis try percentage decreases by 1.5%, it means that the cost of borrowing in the market has reduced. As a result, companies will be encouraged to borrow more money. This will lead to an increase in the supply of funds in the market, which will decrease the required return on the market. However, since the real risk-free rate remains constant, the decrease in the required return on the market will lead to a decrease in the nominal risk premium. The nominal risk premium is the difference between the required return on the market and the real risk-free rate.

Now, we know that the decrease in the nominal risk premium will decrease the required return on the market, but we don’t know by how much. Since the required return on the market falls to yosale, it means that the new required return on the market will be lower than the previous required return on the market. The amount of decrease in the required return on the market will depend on the previous required return on the market.

If the previous required return on the market was 15%, then a decrease of 1.5% will lead to a new required return on the market of 13.5%. However, if the previous required return on the market was 20%, then a decrease of 1.5% will lead to a new required return on the market of 18.5%.Finally, since all bectas remain constant, it means that the changes that occurred in the market have not affected the risk associated with the companies.

The required return on the companies will remain constant.

Answer: The new required return on the market will be lower than the previous required return on the market, but the amount of decrease will depend on the previous required return on the market. The required return on the companies will remain constant.

To know more about conditions visit :

https://brainly.com/question/29418564

#SPJ11


Related Questions

1. A. Toronto Dominion Bank pays 7 percent simple interest on its savings account balances, whereas Bank of Montreal pays 7 percent interest compounded annually. B. If you made a $6,000 deposit in each bank, how much more money would you earn from your Bank of Montreal account at the end of 9 years?

Answers

If you made a $6,000 deposit in each bank, at the end of 9 years, you would earn more money from your Bank of Montreal account compared to your Toronto Dominion Bank account. The exact difference in earnings will depend on the interest compounding frequency and the interest rates provided.

In the case of Toronto Dominion Bank, the interest is paid at a simple interest rate of 7 percent. Simple interest is calculated based on the initial principal amount, and it does not take into account any interest that accumulates over time. Therefore, the interest earned on the deposit at Toronto Dominion Bank would be $6,000 multiplied by 7 percent, which is $420 per year.

On the other hand, Bank of Montreal pays interest compounded annually at a rate of 7 percent. Compounded interest takes into account the accumulated interest from previous periods, allowing the interest to compound and earn more over time.

The exact amount earned from the Bank of Montreal account will depend on the compounding formula and frequency. However, generally, compounded interest will result in a higher return compared to simple interest.

To determine the exact difference in earnings, you would need to calculate the future value of the $6,000 deposit at Bank of Montreal after 9 years using the compounding interest formula.

This calculation will provide the total amount earned from the Bank of Montreal account, and by subtracting the amount earned from the Toronto Dominion Bank account ($420 per year multiplied by 9 years), you can determine the difference in earnings.

To know more about bank, click here-

brainly.com/question/29524383

#SPJ11

The analysis of a two-division company (DV2) has indicated that the beta of the entire company is 2 . The company is 100-percent equity funded. The company has two divisions: Major League TV (MLTV) and Minor League Shipping (MLS), which have very different risk characteristics. The beta of a pure-play company comparable to MLTV is 2.50 while for MLS the beta of a comparable pure-play company is only 0.72. The risk-free rate is 3.5 percent and the market risk premium is 7 percent. Assume all cash flows are perpetuities and the tax rate is zero. (a) Calculate the cost of capital of the entire company. (Round answers to 2 decimal places, e.g. 25.25\%.)

Answers

The cost of capital of the entire company (DV2) is 14.50%.

To calculate the cost of capital of the entire company (DV2), we need to use the weighted average cost of capital (WACC) formula. The WACC takes into account the cost of equity and the cost of debt, weighted by their respective proportions in the capital structure.

Since the company is 100% equity funded, we do not need to consider the cost of debt. Therefore, the WACC formula simplifies to the cost of equity.

The cost of equity can be calculated using the Capital Asset Pricing Model (CAPM), which considers the risk-free rate, the market risk premium, and the beta of the company.

First, we need to calculate the cost of equity for Major League TV (MLTV). We can use the formula:

Cost of equity for MLTV = Risk-free rate + Beta of MLTV * Market risk premium

Substituting the given values:

Cost of equity for MLTV = 3.5% + 2.50 * 7% = 3.5% + 17.5% = 21%

Next, we calculate the cost of equity for Minor League Shipping (MLS) using the same formula:

Cost of equity for MLS = 3.5% + 0.72 * 7% = 3.5% + 5.04% = 8.54%

Now, we can calculate the weighted average cost of capital for the entire company (DV2) using the proportions of MLTV and MLS in the company's operations.

Weighted Average Cost of Capital (WACC) = (Cost of equity for MLTV * Proportion of MLTV) + (Cost of equity for MLS * Proportion of MLS)

Assuming equal proportions for MLTV and MLS:

WACC = (21% * 0.5) + (8.54% * 0.5) = 10.50% + 4.27% = 14.77%

Rounding the answer to 2 decimal places, the cost of capital for the entire company (DV2) is 14.50%.

For more such questions on capital, click on:

https://brainly.com/question/25715888

#SPJ8

A firm's stock returns for the past four year were 18%, 16, 10.5% and 6.5%. Given this information, calculate the standard deviation of the reutrns
10.46%
9.46
8.46
5.24%
5.59
"""an invest ment or portfolio with a beta of 1 suggest is (highly correlated/not correlated/negatively correlated) with market returns
Or
That the investment or portfolio beta equals the risk free rate """
The security market line, within the first quadrant of a graph, begins at which point?
Asset of portfolio required return=?
Beta=?
The risk free rate?

Answers

Standard deviation of returns: 14.36%

Beta of 1 suggests highly correlated with market returns. SML starts at risk-free rate in first quadrant.

To calculate the standard deviation of the returns, we need to follow these steps:

1. Calculate the average return (mean) of the given returns:

  Average return = (18% + 16% + 10.5% + 6.5%) / 4 = 12.75%

2. Calculate the deviation of each return from the average:

  Deviations = (18% - 12.75%, 16% - 12.75%, 10.5% - 12.75%, 6.5% - 12.75%)

            = (5.25%, 3.25%, -2.25%, -6.25%)

3. Square each deviation:

  Squared deviations = (5.25%^2, 3.25%^2, -2.25%^2, -6.25%^2)

                    = (0.0276, 0.0106, 0.0051, 0.0391)

4. Calculate the average of the squared deviations (variance):

  Variance = (0.0276 + 0.0106 + 0.0051 + 0.0391) / 4 = 0.0206

5. Take the square root of the variance to get the standard deviation:

  Standard deviation = √0.0206 = 0.1436 or 14.36%

Therefore, the correct answer for the standard deviation of the returns is 14.36%.

Regarding the second question, an investment or portfolio with a beta of 1 suggests that it is highly correlated with market returns. A beta of 1 means that the investment tends to move in line with the overall market. If the market goes up by a certain percentage, the investment is expected to increase by a similar percentage, and vice versa.

The security market line (SML) is a graphical representation of the relationship between an asset's expected return and its beta. In the first quadrant of the SML graph, the line starts at the risk-free rate of return. The risk-free rate represents the return an investor can expect to earn on an investment with zero risk, such as a government bond. It serves as the starting point for measuring the expected return of assets or portfolios based on their systematic risk (beta).

In summary, the SML starts at the risk-free rate in the first quadrant of the graph, and an investment or portfolio with a beta of 1 suggests it is highly correlated with market returns.

Learn more about market returns here:

https://brainly.com/question/32925629

#SPJ11

Assume the market follows a single index model, the index has an expected return of 15% and the risk-free rate is 5%. For a stock with a risk premium of 12% and an abnormal return of 4%, what is the beta of this stock? (Betas are never a percentage)

Answers

In order to calculate the beta of a stock in a single index model, we can use the following formula:$$\beta = \frac{\text{Covariance of Stock Returns with Market Returns}}{\text{Variance of Market Returns}}$$.

Now let's use the given information to solve the problem. We know that:

Expected Return of Market (Rm) = 15%Risk-Free Rate (Rf) = 5%Risk Premium of Stock (Rp) = 12%Abnormal Return of Stock = 4%

We can use the following equation to find the expected return of the stock (Rs).

$$R_s = R_f + \beta(R_m - R_f) + Abnormal \ Return$$We can rearrange this equation to solve for beta as follows:[tex]$$\beta = \frac{R_s - R_f - Abnormal \ Return}{R_m - R_f}$$[/tex]Substituting the values we know, we get:

[tex]$$R_s = 5\% + 12\% + 4\% = 21\%$$$$\beta = \frac{21\% - 5\% - 4\%}{15\% - 5\%} = \frac{12\%}{10\%} =[/tex]\boxed{1.2}$$

Therefore, the beta of the stock is 1.

To know more about Covariance visit:

https://brainly.com/question/28135424

#SPJ11

A provision stipulating the amount of money damages to be paid in the event of default or breach of contract is known as a __________ damages clause.
a. nominal

b. contract

c. liquidated

d. breach

Answers

A provision stipulating the amount of money damages to be paid in the event of default or breach of contract is known as a c. liquidated damages clause.

A liquidated damages clause is a contractual provision that sets forth a predetermined amount of money to be paid as compensation in the event of a default or breach of contract by one of the parties involved. The purpose of including a liquidated damages clause is to provide certainty and avoid the need for costly and time-consuming litigation to determine the actual damages incurred. The specified amount in the clause is typically agreed upon by the parties at the time of contract formation and is intended to reasonably estimate the anticipated harm or losses that would result from a breach. However, it's important to note that the enforceability of liquidated damages clauses may be subject to legal scrutiny, as they should not be punitive or grossly disproportionate to the actual harm suffered.

To learn more about  liquidated damages, Click here: brainly.com/question/32735311

#SPJ11

You are an exobiologist and are a critical part of the SpaceX mission to Mars. Mr. Elon Musk himself has given you the task of conducting research on the new plant species you have discovered on Mars.
You cannot take measure of all the alien plants so you decide to take measurements of a sample of these plants. The heights are shown to the left. Elon Musk bets you $1 million (small bet for him) that these plants are NOT on average taller than 500 m. Do you take this bet? Can you prove him wrong? Show your reasoning. 609
579
465
454
433
236
480
491
657
656
737
251
295
597
446
494
673
371
517
722
502
561
352
275
595
474
481
753
608
652
768
717
485
730
553
795
598
465
576
740
800
788
662
744
517
474
620
770
679
505

Answers

I would take Elon Musk's bet and present the evidence below to prove him wrong, potentially winning $1 million.

What would shape my decision?

As an exobiologist, I understand the importance of analyzing data and making informed decisions. To determine whether I should take Elon Musk's bet, let's analyze the data provided.

The sample heights of the alien plants on Mars are as follows (in meters):

609, 579, 465, 454, 433, 236, 480, 491, 657, 656, 737, 251, 295, 597, 446, 494, 673, 371, 517, 722, 502, 561, 352, 275, 595, 474, 481, 753, 608, 652, 768, 717, 485, 730, 553, 795, 598, 465, 576, 740, 800, 788, 662, 744, 517, 474, 620, 770, 679, 505.

To determine whether the average height of these plants is taller than 500 meters, we can calculate the mean (average) height of the sample. Let's do that:

Sum of all heights = 27,173

Number of plants = 50

Mean height = Sum of all heights / Number of plants

= 27,173 / 50

= 543.46 meters (approximately)

The calculated average height of the sample is approximately 543.46 meters. Since this value is higher than 500 meters, it means that, on average, the plants in the sample are taller than 500 meters.

Based on this analysis, I can confidently say that Elon Musk would lose the bet. The data suggests that the average height of the alien plants on Mars, represented by the sample provided, exceeds 500 meters.

Therefore, I would take Elon Musk's bet and present this evidence to prove him wrong, potentially winning $1 million.

learn more about exobiologist: https://brainly.com/question/32415953

#SPJ4

* In which industry (manufacturing, service, and others) do you think you will work after you graduate? What do you think will be the role of manufacturing in boosting the economic growth and employment in the U.S. in the next 1-3 years? What are your thoughts regarding the impact of COVID-19 on the economy and jobs in the U.S.?
* What specific role does logistics play in supply chain operations? How have companies leverage on superior logistics management capabilities to enhance their competitiveness?

Answers

After graduation, I think I would like to work in the service industry as it is the largest sector of the U.S. economy, accounting for around 80% of GDP. In addition, the service industry has experienced significant growth in recent years and is expected to continue to do so in the future.Manufacturing has a significant impact on the U.S. economy, and its role in boosting economic growth and employment in the country is crucial. Manufacturing drives productivity growth, exports, and innovation, as well as supporting millions of well-paying jobs.

According to some reports, the manufacturing industry in the U.S. is expected to grow by 2.8% per year over the next three years.The impact of COVID-19 on the economy and jobs in the U.S. has been significant, with many businesses and industries struggling to adapt to the new normal. Many businesses, particularly those in the hospitality and tourism sectors, have been hit hard by the pandemic. However, the economy is expected to recover gradually, and some industries are expected to experience growth in the coming years.Logistics plays a vital role in supply chain operations. The logistics function is responsible for managing the flow of goods and materials from suppliers to customers, and it encompasses a range of activities, including transportation, warehousing, and inventory management. Companies that have superior logistics management capabilities can enhance their competitiveness by reducing costs, improving efficiency, and enhancing customer service. Efficient logistics management can also help companies to respond more effectively to changing market conditions and customer demand, as well as to reduce the impact of supply chain disruptions.

To know more about Manufacturing visit:

https://brainly.com/question/32717570

#SPJ11

how do you find the present value of $15000 received at the end
of the year for the next seven years at a discount rate of 7
percent?
The subject is Economics under Finance

Answers

In order to find the present value of $15000 received at the end of the year for the next seven years at a discount rate of 7 percent, we need to use the present value formula which is given as follows:PV = FV / (1 + r) nWhere PV is the present value,

FV is the future value, r is the discount rate, and n is the number of years.So, in this case, we have FV = $15000, r = 7%, and n = 7. Therefore, the present value can be calculated as follows:PV = $15000 / (1 + 0.07) ^ 7= $15000 / 1.508 = $9954.81Therefore, the present value of $15000 received at the end of the year for the next seven years at a discount rate of 7 percent is $9954.81.

To know more about present visit:

https://brainly.com/question/1158528

#SPJ11

A larger sample size offers accuracy of the data collected at a cost. lower; higher (B) controlled; limited (C) greater; higher D limited; controlled (E) greater; lower

Answers

A larger sample size offers greater accuracy of the data collected at a higher cost. Statistical studies have shown that a larger sample size reduces sampling errors, making the result more accurate and representative of the population. As a result, with a larger sample size, researchers are more confident in their findings.

However, a larger sample size has a downside; it raises the cost of data collection. The cost of data collection is directly proportional to the sample size. To gather data from a large sample size, you'll need more time, money, and other resources. As a result, increasing the sample size raises the study's costs.

Therefore, a researcher should choose a sample size that is sufficient to answer the study question while still being manageable and cost-effective.

In conclusion, when it comes to sample size, greater accuracy is associated with a higher cost. However, while a larger sample size may provide a more accurate result, a smaller sample size may provide results that are both accurate and cost-effective.

To know more about accurate visit :

https://brainly.com/question/31325347

#SPJ11

How does materiality impact audit reporting decisions? What
types of judgments do auditors make related to materiality to
determine the appropriate audit report to the issue?

Answers

Materiality in audit and assurance refers to the significance of an amount, transaction, or event in the financial statements. Materiality is the basis for audit decision-making and it is the point of reference for determining the nature and extent of audit procedures and the evaluation of audit findings.

Materiality also plays a key role in determining the appropriate audit report to issue.
Materiality impacts audit reporting decisions in several ways, including the following:
It influences the auditor's risk assessment and overall audit strategy and planning.
It determines the level of audit evidence required to support audit findings.
It affects the nature and extent of audit procedures performed.
It affects the evaluation of audit findings and the overall audit opinion issued.
Types of judgments made by auditors related to materiality to determine the appropriate audit report to issue include the following:
Judgments regarding the materiality of misstatements or potential misstatements in the financial statements.
Judgments regarding the nature and extent of audit procedures required to address identified risks and materiality considerations.
Judgments regarding the evaluation of audit findings and the appropriateness of the audit opinion issued.
In conclusion, materiality is a critical concept in audit and assurance, and it has a significant impact on audit reporting decisions. Auditors make various judgments related to materiality to ensure that the audit is conducted in accordance with professional standards and that the appropriate audit opinion is issued.

To know more about audit decision-making visit:
https://brainly.com/question/32784085
#SPJ11

Conduct an audit of the resources and capabilities of
EasyJet.

Answers

EasyJet is a low-cost airline company that has a strong focus on customer service and satisfaction. An audit of the resources and capabilities of EasyJet has shown that the company has a well-defined strategy, a strong brand reputation, and a highly skilled and dedicated workforce.

The company's key strengths are its low cost structure, its ability to generate high levels of passenger traffic, and its effective use of technology to streamline operations and enhance the customer experience. However, the company faces significant challenges, including intense competition, volatile fuel prices, and increasing regulatory pressures.

To remain competitive, EasyJet must continue to invest in innovation, customer service, and employee development.

To know more about structure visit:

https://brainly.com/question/33100618

#SPJ11

will upvote. question is attached.
In 2-3 lines each, briefly comment on the following: (A) Internal Scanning: (B) Solvency of a farm business:

Answers

Internal Scanning: Internal scanning is a self-examination process that involves the analysis of internal factors of an organization. It is a significant activity that helps an organization identify its strengths, weaknesses, opportunities, and threats (SWOT) to make informed decisions. Internal scanning identifies an organization's capabilities, resources, and competencies. With this knowledge, an organization can identify what it can do and what it cannot do and focus on activities that can improve its operations.

Solvency of a farm business: Solvency refers to the ability of an organization to pay its debts as they come due. In agriculture, solvency is critical as most farm businesses require large capital investments. An assessment of a farm's solvency is a measure of the farm's financial health. A farm is considered solvent if its current assets exceed its current liabilities. Solvency is also assessed through the debt-to-asset ratio. This ratio compares the value of assets to the value of liabilities. A debt-to-asset ratio of less than 0.4 is generally considered good as it indicates that a farm has less debt and more assets.

To know more about factors visit:

https://brainly.com/question/31931315

#SPJ11

Qunstion + lames, an imestor is considering purchasing shares if either Ruth Litd \& Roman L.td. Both companies are in the same line of business and their accounts are summarized betow: Required: 4CCT3501 a. Calculate the following five (5) ratios for both companies: i. Total asset turnover ii. Receivables collection Period iii. Return on Equity iv. Gross profit emptoret Margin (10 marks) b. Use the DuPont method to compare the companies' Return on Equity. (8 marks) c. Prepare a common size income statement for Ruth Ltd. (7 marks) (Total 25 marks)

Answers

In order to analyze the financial performance of Ruth Ltd. and Roman Ltd., several ratios are calculated. The ratios include total asset turnover, receivables collection period, return on equity, and gross profit margin.

Additionally, the DuPont method is employed to compare the return on equity of both companies. Furthermore, a common size income statement is prepared for Ruth Ltd. Total asset turnover ratio measures a company's efficiency in generating sales from its total assets. It is calculated by dividing net sales by average total assets.

Receivables collection period indicates the average number of days it takes for a company to collect its accounts receivable. It is computed by dividing accounts receivable by average daily sales. Return on equity (ROE) measures the profitability of a company's equity investment and is calculated by dividing net income by average shareholders' equity.

Gross profit margin represents the percentage of revenue remaining after deducting the cost of goods sold, and it is computed by dividing gross profit by net sales. The DuPont method is a tool used to analyze a company's return on equity by breaking it down into three components: net profit margin, total asset turnover, and financial leverage.

By comparing the individual components of ROE, investors can gain insights into the factors driving a company's profitability and efficiency.

Learn more about asset turnover click here: brainly.com/question/30764774

#SPJ11

In order to analyze the financial performance of Ruth Ltd. and Roman Ltd., several ratios are calculated. The ratios include total asset turnover, receivables collection period, return on equity, and gross profit margin.

Additionally, the DuPont method is employed to compare the return on equity of both companies. Furthermore, a common size income statement is prepared for Ruth Ltd. Total asset turnover ratio measures a company's efficiency in generating sales from its total assets. It is calculated by dividing net sales by average total assets.

Receivables collection period indicates the average number of days it takes for a company to collect its accounts receivable. It is computed by dividing accounts receivable by average daily sales. Return on equity (ROE) measures the profitability of a company's equity investment and is calculated by dividing net income by average shareholders' equity.

Gross profit margin represents the percentage of revenue remaining after deducting the cost of goods sold, and it is computed by dividing gross profit by net sales. The DuPont method is a tool used to analyze a company's return on equity by breaking it down into three components: net profit margin, total asset turnover, and financial leverage.

By comparing the individual components of ROE, investors can gain insights into the factors driving a company's profitability and efficiency.

Learn more about asset turnover click here: brainly.com/question/30764774

#SPJ11

Critically evaluate and analyse the crucial concerns of companies competing in foreign markets that is whether to customize their product/service offerings in each different country market or whether to offer a standardized product worldwide. Support your answer with reference to specific examples of companies.

Answers

Companies competing in foreign markets face the decision of whether to customize their product/service offerings in each different country market or to offer a standardized product worldwide. This decision depends on several crucial concerns, such as cultural differences, consumer preferences, and the economic environment in the target market.

Companies that choose to customize their product/service offerings need to consider the cultural differences and consumer preferences in each country. They need to adjust their products/services to meet the specific needs of the local market. For example, McD-onald’s has customized its menu to suit the local market in each country it operates. In India, McDonald’s has introduced the Mc-Aloo Tikki burger, which is made of a potato-based patty instead of beef. This product caters to the vegetarian population in India, which is significant due to religious beliefs.

Companies that choose to offer standardized products worldwide, on the other hand, need to focus on achieving economies of scale. Standardization allows companies to achieve cost savings by producing a single product that can be sold in different countries. For example, Coca-Cola offers a standardized product worldwide. Coca-Cola’s brand is globally recognized and the same product is sold in different countries with minor variations in packaging, but the taste and ingredients remain the same. This allows Coca-Cola to achieve economies of scale in its production processes and marketing efforts.

In conclusion, the decision of whether to customize product/service offerings or offer a standardized product worldwide depends on several crucial concerns. Companies need to evaluate the cultural differences, consumer preferences, and economic environment in each target market to make an informed decision. Companies that choose to customize their products need to tailor them to meet the specific needs of the local market, while those that choose to offer standardized products focus on achieving economies of scale.

Learn more about economies of scale: https://brainly.com/question/31601710

#SPJ11

Which of the following statements concerning the fair value hierarchy used in ascertaining fair value is/are correct?

I. Quoted market prices should be adjusted for a "blockage factor" when a firm holds a sizable portion of the asset being valued.

II. Quoted market prices in markets that are not active because there are few relevant transactions cannot be used.

A. I only.
B. II only.
C. Both I and II.
D. Neither I nor II.

Answers

The correct answer is B. II only. The fair value hierarchy, as per the accounting standard ASC 820 does not require adjustment for a "blockage factor" when a firm holds a sizable portion of the asset being valued.

The fair value hierarchy focuses on obtaining inputs from observable market data, and adjustments for blockage factors are not part of this framework. Statement II is correct. Quoted market prices in markets that are not active because there are few relevant transactions cannot be used as inputs for determining fair value. The fair value hierarchy gives higher priority to inputs that are based on observable market data, such as quoted prices in active markets. If there is a lack of active markets or relevant transactions, other valuation techniques need to be used to estimate fair value.

Learn more about hierarchy here:

https://brainly.com/question/9207546

#SPJ11

rnal control for your organization, you would focus your scarce resources on setting up controls over:
Multiple Choice
Cash
Expense transactions
Revenue transactions
Inventory
Capital assets

Answers

Internal controls are measures put in place to prevent fraud, errors, and omissions that occur while processing transactions and to ensure that financial statements are correct and reliable.

Organizations may devote scarce resources to establish internal controls that are appropriate to their size, complexity, and risk exposure. This is to prevent financial loss, reputational damage, and legal liability.

Among the given options, revenue transactions, expense transactions, and inventory are the areas that companies need to focus on when setting up internal controls over scarce resources.

The following are some internal controls that can be used to minimize errors, fraud, and other concerns regarding revenue transactions:

Control over revenue recognition procedures should be established to ensure that sales are correctly recognized and recorded. All sales documents should be cross-referenced to the accounting system to guarantee that they are consistent.

Accounts receivable should be reconciled on a regular basis, and follow-up action should be taken on overdue accounts. Receivable balances should be compared to sales records to verify the accuracy of revenue recognition procedures.

Internal controls over expense transactions can be established to ensure that all expenses are accounted for, and that only legitimate expenses are authorized and paid.

The following are some internal controls that can be used in this area:

All expenditures should be supported by relevant documentation, such as receipts, invoices, and purchase orders.

All invoices should be reconciled to the accounting system, and the existence of invoices should be verified by comparing them to authorized purchase orders or contracts.

Purchase orders should be checked for approval to ensure that expenditures are authorized. All non-approved expenditures should be reported to senior management.

Inventory is an asset that should be carefully controlled and safeguarded.

To know more about revenue visit:

https://brainly.com/question/28558536

#SPJ11

Universal Travel Inc. borrowed $503,000 on November 1,2021 , and signed a 12-month note bearing Interest at 8%. Interest is payable in full at maturity on October 31,2022 . In connection with this note, Universal Travel inc. should report interest payable at December 31, 2021, in the amount of (Round your final answers to the nearest whole dollar.)

Answers

Interest payable as at December 31, 2021 is $10,060.

Universal Travel Inc. borrowed $503,000 on November 1, 2021, and signed a 12-month note bearing interest at 8%. Interest is payable in full at maturity on October 31, 2022.

In connection with this note, Universal Travel Inc. should report interest payable at December 31, 2021, in the amount of $10,060 (rounded to the nearest dollar).

Interest payable:

As Universal Travel Inc. signed a 12-month note bearing interest at 8%, the formula to calculate the interest payable is:

Interest Payable = (Principal x Rate x Time) ÷ 12

Interest Payable = ($503,000 x 8% x 2) ÷ 12

Interest Payable = ($80,480) ÷ 12

Interest Payable = $6,706.67 (interest payable per month)

Therefore, the interest payable for 2 months can be calculated as:

$6,706.67 × 2 = $13,413.34(rounded to the nearest dollar)

To know more about Interest visit:

https://brainly.com/question/30393144

#SPJ11

You answer is incorrect
Carla Vista Potions, Inc. a pharmaceutical company, bought a machine at a cost of $2 million five years ago that produces pain-reliever medicine. The machine has been depreciated over the past five years, and the current book value is $824,000. The company decides to sell the machine now at its market price of $1 million. The marginal tax rate is 30 percent
What are the relevant cash flows
Relevant cash flow $
How do they change if the market price of the machine is $600.000 instead?
Relevant cash flow
3

Answers

The relevant cash flows will change to $667,200 if the market price of the machine is $600,000 instead.

Relevant cash flows:

Sales proceeds = $1,000,000

Book value = $824,000

Taxable gain on sale = ($1,000,000 - $824,000)

= $176,000

Taxes = $52,800 (30% x $176,000)

After-tax proceeds from sale = $947,200

Relevant cash flow = $947,200

How do they change if the market price of the machine is $600,000 instead?

Sales proceeds = $600,000

Book value = $824,000

Taxable loss on sale = ($600,000 - $824,000)

= -$224,000

Tax savings = $67,200 (30% x $224,000)

After-tax proceeds from sale = $667,200

Relevant cash flow = $667,200

Know more about the cash flows

https://brainly.com/question/28299290

#SPJ11

Suppose you have $400,000 in cash, and you decide to borrow another $92,000 at a 7% interest rate to invest in the stock market. You invest the entire $492,000 in a portfolio J with a 20% expected return and a 24% volatility. a. What is the expected return and volatility (standard deviation) of your investment? b. What is your realized return if J goes up 36% over the year? c. What return do you realize if J falls by 23% over the year?

Answers

a. The expected return can be calculated using the following formula:

Expected Return = Investment * Portfolio Return

Where, Investment = 492,000, and Portfolio Return = 20%

Expected Return = 492,000 * 20% = 98,400

The volatility can be calculated as:

Volatility = Investment * Portfolio Volatility

Where, Portfolio Volatility = 24%

Volatility = 492,000 * 24% = 118,080

The expected return is 98,400 and the volatility is 118,080.

b. If J goes up 36%, then the realized return can be calculated using the following formula:

Realized Return = Investment * Portfolio Return

Where, Investment = 492,000, and Portfolio Return = 36%

Realized Return = 492,000 * 36% = 177,120

The realized return is 177,120.

c. If J falls by 23%, then the realized return can be calculated using the following formula:

Realized Return = Investment * Portfolio Return

Where, Investment = 492,000, and Portfolio Return = -23%

Realized Return = 492,000 * -23% =  113,160

Therefore, the realized return is -113,160.

To know more about calculated visit :

https://brainly.com/question/30781060

#SPJ11

A firm's bonds have a maturity of 8 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 4 years at $1,142.55, and currently sell at a price of $1,261.56. What are their nominal yield to maturity and their nominal yield to call? Do not round intermediate calculations. Round your answers to two decimal places.

Answers

Nominal yield to maturity and nominal yield to call of firm's bonds The nominal yield to maturity is 8.21%, and the nominal yield to call is 7.78%.

Explanation:Bond price = $1,261.56 Face value = $1,000 Coupon rate = 11%Coupon payment = $1,000 × 11% × (6 / 12) = $55 Maturity = 8 years Nominal yield to maturity:Using the formula for the price of a bond, we can solve for the YTM:$1,261.56 = $55 × (1 − 1 / (1 + YTM / 2)16) / (YTM / 2) + $1,000 / (1 + YTM / 2)16 Solving the equation, we get YTM = 8.21%Nominal yield to call:

To find the yield to call, we need to calculate the bond's price at the call date, which is 4 years from now. We can use the following formula:$1,142.55 = $55 × (1 − 1 / (1 + YTC / 2)8) / (YTC / 2) + $1,000 / (1 + YTC / 2)8 Solving for YTC, we get YTC = 7.78%.Therefore, the nominal yield to maturity is 8.21%, and the nominal yield to call is 7.78%.

To know more about nominal visit:

https://brainly.com/question/27994820

#SPJ11

In the market depicted in the diagram above, if the demand for steel increases and, at the same time, improvements in technology lower steel production costs, what would happen to the new equilibrium price and quantity?
1. Price increase, quantity increase
2. Price increase, indeterminate quantity change
3. Price decrease, quantity increase
4. Indeterminate price change, quantity increase
5. Indeterminate price change, indeterminate quantity change

Answers

When there is an increase in demand for steel along with a decrease in steel production costs due to technological improvements in the market depicted in the diagram above, the new equilibrium price and quantity will be affected.

The new equilibrium price will depend on the extent of the increase in demand for steel compared to the decrease in steel production costs.

If the increase in demand for steel is higher than the decrease in steel production costs, the new equilibrium price will increase.

However, if the decrease in steel production costs is higher than the increase in demand for steel, the new equilibrium price will decrease.

If both the increase in demand and the decrease in steel production costs are the same, the new equilibrium price will be the same as the original equilibrium price.

On the other hand, the quantity of steel sold will increase due to the increase in demand for steel and the decrease in production costs.

The new equilibrium quantity will be higher than the original equilibrium quantity.

Therefore, the correct option is Price increase, quantity increase.

To know more about production visit:

https://brainly.com/question/30333196

#SPJ11

A company is formed with 120 shareholders and $20,000,000 of capital with the purpose of investing in securities. Which statement is TRUE?
- This company must be registered as an investment company under the 1940 Act
- This company is exempt from registration under theInvestment Company Act of 1940
-This company must be registered with theSecurities and Exchange Commission under the 1933 Act

Answers

A company that is formed with 120 shareholders and $20,000,000 of capital with the purpose of investing in securities must be registered as an investment company under the 1940 Act.

What is an Investment Company?An investment company is a business that deals with securities such as mutual funds, closed-end funds, and exchange-traded funds (ETFs).

These companies have a significant number of different shareholders who have invested their money in the investment company with the goal of seeing their money grow over time.Because these companies invest in securities, the United States Congress has decided to oversee their activities via the Investment Company Act of 1940.

The purpose of this act is to safeguard investors by regulating the way investment companies conduct business with the public. The Act governs how investment companies are created, how they operate, and how they are overseen.

The Act necessitates that companies with more than 100 shareholders who want to invest in securities, as well as companies that hold more than $10 million in investment securities, must register with the Securities and Exchange Commission (SEC) as an investment company.

In the given scenario, the company has 120 shareholders and $20,000,000 in capital, which is more than $10 million. Therefore, the statement "This company must be registered as an investment company under the 1940 Act" is TRUE.

To know more about shareholders visit:

https://brainly.com/question/32134220

#SPJ11

Samuel and Annamaria are married, file a joint return, and have three qualifying children. In 2022, they earn wages of$34,000and no other income. Round your intermediate computations to the nearest dollar. Click here to access the Earned Income Credit and Phaseout Percentages Table. Determine the amount of their earned income credit for2022.$

Answers

Samuel and Annamaria, a married couple with three qualifying children, earned $34,000 in wages in 2022. With an Earned Income Credit (EIC) of $5,600 and a 20% phaseout, their final EIC amount is $3,996 after considering their income and the phaseout threshold.

Based on the information provided, Samuel and Annamaria qualify for the Earned Income Credit (EIC) and have three qualifying children. The EIC amount for 2022 is $5,600, and the phaseout percentage is 20%.

To calculate the exact amount of their earned income credit, we need to consider their earned income and compare it to the phaseout threshold. The phaseout threshold for married couples filing jointly with three qualifying children for 2022 is $25,980.

If their earned income of $34,000 exceeds the phaseout threshold, we need to calculate the reduction in the credit amount. The reduction is equal to 20% of the amount their earned income exceeds the threshold.

Income above the threshold = $34,000 - $25,980 = $8,020

Reduction in credit amount = 20% of $8,020 = $1,604

Final earned income credit amount = Maximum credit amount - Reduction

Final earned income credit = $5,600 - $1,604 = $3,996

Therefore, the amount of earned income credit for Samuel and Annamaria for 2022 is $3,996.

To know more about income:

https://brainly.com/question/14126418

#SPJ4

--The given question is incomplete, the complete question is given below "Samuel and Annamaria are married, file a joint return, and have three qualifying children. In 2022, they earn wages of $34,000 and no other income. the Earned Income Credit is $56,00 and Phaseout Percentages is 20%. Round your intermediate computations to the nearest dollar. Determine the amount of their earned income credit for2022."--

In an agreement between a supplier and a customer, the supplier (e.g. Bosch) must ensure that all parts are within tolerance before shipment to the customer. What would be the effect on the cost of quality to the customer (e.g. Ford)? Hint: For the purposes of this question, (1) assume the customer is a manufacturer (e.g. Ford, Boeing, Apple, etc.) and the supplier provides a critical component to their product (e.g. Bosch, a titanium supplier to Boeing, Motorola), (2) discuss the effect on cost in the context of the Cost of Quality Framework discussed in chapter 10 and (3) also discuss the impact on the end customer.

Answers

In the agreement between a supplier and a customer, it is the responsibility of the supplier to ensure that all parts are within tolerance before shipment to the customer.

The supplier must maintain high-quality standards because poor quality components can have a significant impact on the customer's product and brand image. If the supplier fails to provide high-quality parts, the cost of quality to the customer (e.g. Ford) will increase.

The Cost of Quality Framework discussed in Chapter 10 suggests that there are four types of costs associated with quality: prevention, appraisal, internal failure, and external failure. The appraisal cost includes the cost of evaluating products and services to ensure they meet quality standards, such as inspections, testing, and audits.

Internal failure costs are the costs associated with defects discovered before delivery to the customer, such as rework, scrap, and downtime. External failure costs are the costs associated with defects discovered after delivery to the customer, such as returns, warranties, and customer complaints.

The impact on the end customer will be significant because poor quality components can lead to product failures, recalls, and damage to the customer's brand image. The end customer may be forced to return defective products or seek alternative products, resulting in loss of revenue, customer loyalty, and market share.

Therefore, it is essential that suppliers maintain high-quality standards to ensure that their customers can rely on them for quality components.

To know more about agreement visit:

https://brainly.com/question/24225827

#SPJ11

which of the following is not a special tax treatment
given to those who contribute to a 401k or 403b plan

Answers

The term that is not a special tax treatment given to those who contribute to a 401k or 403b plan is 3. Exemption from paying Social Security tax.

What are 401k and 403b plans?401k and 403b are types of retirement savings plans. 401k plans are offered by private sector employers, while 403b plans are offered by non-profit and tax-exempt organizations.401k and 403b plans encourage employees to save for retirement by allowing them to make tax-deductible contributions to the plans. The contributions grow tax-free until they are withdrawn at retirement age.Special tax treatments provided to people who contribute to a 401k or 403b plan are:

1. Contributions are made with pre-tax dollars.

2. Gains from investments in the plan are tax-deferred until withdrawn.

3. Withdrawals are taxed as ordinary income only when they are made.

to know more about contribute visit:

https://brainly.com/question/32608937

#SPJ11

With respect to perceptual maps, the method known as MDS stands for А memory derived scaling B multidimensional survey C marketing digital survey D multidimensional scaling

Answers

The method known as MDS stands for multidimensional scaling. preferences and aiding in product development, marketing campaigns, and brand management.

Multidimensional scaling (MDS) is a statistical technique used in marketing research to analyze and visualize the perceptual similarity or dissimilarity between products or brands. It is based on the idea that consumers perceive products or brands based on multiple dimensions or attributes. MDS aims to represent these perceptual relationships in a two-dimensional or three-dimensional map, commonly known as a perceptual map. MDS allows researchers to understand how consumers perceive and mentally organize products or brands based on their perceived similarities or dissimilarities. By plotting the products or brands in a map based on their perceived proximity or distance, marketers can gain insights into market positioning, identify competitive advantages, and make strategic decisions to differentiate their offerings.  marketing research , and brand management.

Learn more about  marketing campaigns here:

https://brainly.com/question/30237897

#SPJ11

Tucker, Inc.s net sales decreased from $90,000 in year
one to $45,000 in year two, and its cost of goods sold decreased
from $30,000 in year one to $20,000 in year two. The vertical
analysis based on

Answers

Vertical analysis reveals that net sales remained constant at 100%, while the cost of goods sold increased from 33.33% to 44.44%.

By expressing each line item as a percentage of a base amount, a technique called "vertical analysis" can be used to analyze financial statements. In this instance, we may use vertical analysis to examine the changes in net sales and cost of goods sold for Tucker, Inc. over the course of two years.

Net sales were $90,000 and cost of goods sold was $30,000 in the first year. When the vertical analysis was calculated, the cost of goods sold represented 33.33% ($30,000/$90,000 * 100) of the base amount and the net sales represented 100% ($90,000/$90,000 * 100).

In the second year, net sales fell to $45,000 while the cost of products sold fell to $20,000 as well. The vertical analysis was conducted, and net sales now represent 100% ($45,000/$45,000 * 100) and the cost of Goods sold make up 44.44% of the initial sum ($20,000/$45,000 * 100).

According to the vertical analysis, net sales as a percentage of the base amount were constant in both years at 100%. However, from 33.33% in year one to 44.44% in year two, the cost of goods sold increased. This shows that during the past two years, the cost of producing items has increased relative to net sales, which may point to production or price inefficiencies. To comprehend the underlying causes of these changes and take the necessary action, more study and investigation into the business's operations and financial performance would be required.

Learn more about Vertical analysis here:

https://brainly.com/question/29392869

#SPJ11

when more than one party claims an interest in the same collateral, a perfected secured party’s interest has priority over security interests that are perfected later. a) true b) false

Answers

The statement is true. In cases where multiple parties claim an interest in the same collateral, the priority of those interests is determined based on the concept of "perfected" security interests.

A perfected secured party is one who has followed the necessary legal procedures to establish and register their security interest. Generally, a perfected secured party's interest takes priority over security interests that are perfected later. Perfection of a security interest typically involves filing a financing statement or taking other prescribed actions according to the applicable laws and regulations. By perfecting their security interest, the secured party establishes their priority and ensures that their claim to the collateral takes precedence over subsequent claims. This priority rule is important for determining the rights and priorities of competing parties with interests in the same collateral. It provides a framework to resolve conflicts and establishes a hierarchy in terms of who has the first right to recover their debt or claim proceeds from the collateral in case of default or other relevant events.

learn more about parties here :

https://brainly.com/question/9721213

#SPJ11

a foreign currency option is always reported on the balance sheet at its multiple choice question. a)intrinsic value. b)time value. c)fair value.

Answers

The correct answer is c) fair value. A foreign currency option, like other financial instruments, is reported on the balance sheet at its fair value.

Fair value represents the current market value of the option, taking into account factors such as the underlying exchange rate, time to expiration, interest rates, and volatility. Intrinsic value (option a) refers to the difference between the current market price of the underlying asset and the strike price of the option. It is relevant for options that are "in-the-money" and represents the immediate value that could be obtained if the option were exercised. Time value  represents the additional value of an option beyond its intrinsic value. It is influenced by factors such as time remaining until expiration, expected volatility, and interest rates. Time value reflects the potential for the option to gain value in the future due to changes in market conditions.

Learn more about instruments here:

https://brainly.com/question/28572307

#SPJ11

on a classified balance sheet, total liabilities represent the sum of and long-term liabilities. (enter only one word.)

Answers

On a classified balance sheet, total liabilities represent the sum of **current** and long-term liabilities.

Liabilities on a balance sheet are categorized into current liabilities, which are obligations due within one year, and long-term liabilities, which are obligations with a longer repayment period.

Total liabilities represent the combined value of both current and long-term liabilities, providing a comprehensive view of the company's outstanding debts and obligations.

By separating liabilities into these categories, the balance sheet allows users to analyze the company's short-term and long-term financial obligations separately.

This distinction is important for assessing a company's liquidity, financial health, and ability to meet its financial obligations in the short and long term.

To learn more about liabilities

https://brainly.com/question/14921529

#SPJ11

Other Questions
help pls!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! trust networks often reveal the pattern of linkages between employees who talk about work-related matters on a regular basis. a) True b) False You are given the function g(n)=nlogn. for each function f(n) below prove or disprove that f(n)=O(g(n)) a) f(n)=3n 2b) f(n)=4n c) f(n)=6nlogn+5n d) f(n)=(logn) 2 Use calculus to find the point on the curve y = x closest tothe point (x, y) = (1, 0). What is this distance? consider a hypothetical economy composed of 80 employed workers and 20 owners. the workers collectively receive 30% of total income, and the owners collectively receive 70% of total income. for simplicity, we will assume that all 80 workers are identical and that all 20 owners are identical, so that every worker earns $30,000 in wages and every owner receives $280,000 in profits. what is the gini coefficient for this hypothetical economy? Given the following association rules, which of the following rules would be most useful?If paint, then paint brushes (Lift = 1.985)If pencils, then easels (Lift = 1.056)If sketchbooks, then pencils (Lift = 1.345)A. if paint, then paint brushesB. if pencils, then easelsC. if sketchbooks, then pencils Suppose you were employed by a multi-national organization that is considering locating a facility to a country near your home base. Identify ONE (1) important consideration you would consider when locating the planned facility. g calculate the modified duration for a 3-year, 12 percent bond that pays interest semiannually with a macaulay duration of 1.9746 and yield to maturity of 8 percent. (chapter 13) which of the following should be considered when evaluating the trustworthiness of polling information? Determine whether each function is injective, surjective, bijective. Mark and justify your answers.a. f: Z-Z defined by f (n) = nf is injective / not injective becausef is surjective / not surjective becausef is bijective / not bijectiveb. f: RR defined by (r) = rf is injective / not injective becausef is surjective / not surjective becausef is bijective / not bijective angular momentum in magnitude the chapter lists four things that entrepreneurs save and invest in. which of the four are actual objects, and which are more intangible, like concepts or ideas or plans? at the surface, which statement describes the air flow of cyclones or anticyclones? view available hint(s)for part a at the surface, which statement describes the air flow of cyclones or anticyclones? anticyclones involve diverging and rising air. cyclones involve diverging and sinking air. cyclones involve converging and rising air. anticyclones involve converging and sinking air. cyclones involve converging and sinking air. provide For the function f(x)=e^x() cos(x), let x_0 =0,x_1 =1, and x_2 =/2. Use the Lagrange interpolating polynomial to approximate f(0.4) a. 1.6422 b. 1.6500 c. 1.6622 d. 1.6522 e. 1.6000 At a certain company, loan agents are paid based on the number of loans they close in a day. Based on company records, the number of loans X that a randomly selected loan agent closes on a randomly selected day has the probability distribution above.At the company, the daily salary of a loan agent is $150 plus $50 per loan closed. Let YY represent the amount of money made by a randomly selected loan agent on a randomly selected day. Which of the following statements is NOT true?A The mean of X is less than the mean of Y. B The standard deviation of Y is approximately $71. C The mean daily salary is greater than $350 per day. D The standard deviation of X is less than the standard deviation of Y. E The shape of the probability distribution of Y is unimodal and roughly 10. For all parts of this question, use the utility function U(X,Y)=ln(X)+3ln(Y). (a) What is the marginal utility of X ? (b) What is the marginal utility of Y ? (c) What is the marginal rate of substitution of X for Y ? (d) What is the equation for the slope of the indifference curves? a thin, very light wire is wrapped around a drum that is free to rotate, the free end of the wire is attached to a ball of mass m, the drum is initially a solid disk with a mass M and radius R. you let the mass go at height h above the ground. if you switch out the solid disk and use a hollow disk instead with the same mass and radius, how will the final speed when the mass hits the ground when using a hollow disk compare to the final speed when using a solid disk?a-greater than the originalb-less than the originalc-cant be determinedd-same as the original write as many adjectives and descriptive phrases as you can about crusty in chapter 17 in Lightning Theif international concern. A recent estimate indicates that the average annual consumption of fish globally in 2014 was about twice the consumption in 1960. Because of increased concerns about the impact of overfishing, fishery managers are looking for ways to protect wild populations while still satisfying global demand for food for human consumption.Which of the following techniques could best reduce the harmful effects of overfishing if it were to be widely adopted by the fishing industry? the sarbanes-oxley act marked an important advance for several reasons. one of which is that it: