Mila is helping to set performance targets for her company, Urban Supply. The target of increasing the company's online customer satisfaction rate by 1% in the next quarter is an example of a performance target focused on the customer perspective of the balance scorecard.
a. true
b. false

Answers

Answer 1

Answer: True

Explanation:

The balanced scorecard perspective implies that the company has to satisfy their customer through the provision of quality products and services.

From the question, the target of increasing customers satisfaction is a good example of a performance target that is focused on customer's perspective of the balance scorecard. This means that the statement is true.


Related Questions

Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below:
Claimjumper Makeover Total
Sales $106,000 $53,000 $159,000
Variable expenses 32,800 6,950 39,750
Contribution margin $73,200 $46,050 119,250
Fixed expenses 82,575
Net operating income $36,675
Requirement:
1: Compute the overall contribution margin (CM) ratio for the company.
2: Compute the overall break-even point for the company in sales dollars.
3: Verify the overall break-even point for the company by constructing a contribution format income statement showing the appropriate levels of sales for the two products.

Answers

Answer and Explanation:

1. The computation of overall contribution margin ratio is shown below:-

Overall contribution margin ratio = Total contribution ÷ Total sales

= $119,250 ÷ $159,000  

= 75%

2. The computation of overall break-even point for the company in sales is shown below:-

Overall Break even = Fixed costs ÷ Contribution margin  

= $82,575 ÷ 75%

= $110,100

3. The overall break-even point for the company by constructing a contribution format income statement showing the appropriate levels of sales for the two products is shown below:-

here, Sales at Break even in the ratio will be 2:1

Particulars      Claimjumper       Makeover        Total  

Sales                $106,000               $53000      $159,000

($106,000 ÷ $159,000 × $110,100)   ($53,000 ÷ $159,000 × $110,100)    

Break even

sales                  $73,400                $36,700        $110,100

Particulars              Claimjumper       Makeover        Total

Sales                        $73,400             $36,700        $110,100

Variable expense     $22,712              $4,813           $27,525

Contribution margin  $50,688             $31,887       $82,575

Fixed expense                                                             $82,575

Net operating income                                                    0

Working Note

Variable expense for Claimjumper = Variable expenses ÷ Sales × Break even sales

= $32,800 ÷ $106,000 × $73,400

= $22,712  

Variable expense for  Makeover = Variable expenses ÷ Sales × Break even sales

= $6,950 ÷ $53,000 × $36,700

= $4,813

Constable Co. reported the following information at December 31, Year 1: Accounts Payable $ 6,750 Accounts Receivable 14,025 Cash 35,235 Common Stock 135,000 Equipment 74,250 Inventory 46,800 Notes Payable due December 31, Year 3 3,750 Retained Earnings, December 31, Year 1 21,135 Wages Payable 3,675 What is the amount of current assets on the classified balance sheet? Multiple Choice $123,255 $96,060 $170,310 $49,260

Answers

Answer:

$ 96,060

Explanation:

The current assets are accounts receivable,cash and inventory.

The are short term assets that are used in settling short term obligations such as accounts payable  and salaries payable.

Accounts receivable amounted to $14,025

Cash amount is $35,235

Inventory is worth $46,800

Current assets value=$14,025+$35,235+$46,800=$ 96,060.00  

The correct option is the second one with amount of $ 96,060 for current assets

Adams operates his $57500 firm using his own equity. Bob operates his firm with $28750 of his own money plus $28750 of debt at a cost of 5 percent interest. Calculate Adams's and Bob's return on equity if their respective businesses produce earnings before interest and tax of $7000. Assume perfect markets.

Answers

Answer:

Adam return on equity is 12.1%. while Bob return on equity is 19.3%

Explanation:

Given that:

Now,

For Adam:

Earnings before interest and taxes (EBIT) = Net income + Interest + Taxes

EBIT = $7000

The equity of shareholders = $57500

The number of debt by which Adams shows no interest expense and no tax expense as perfect market presumed is stated s follows:

ROE = Net income /Average Shareholder Equity

=$7000/$57500

=0.121739

Therefore, Adam return on equity is 12.1%

For Bob

The equity of shareholders = $28750

The expense (interest) = Debt * Interest rate

=$28750 * 0.05

= 1437.5

Thus

Net income = EBIT - Interest

= 7000 -1437.5

=5562.5

Now,

ROE = Net income /Average Shareholder Equity

=5562.5 /$28750

= 0.19347

=19.3%

Therefore, Bob return on equity is 19.3%

Your grandparents would like to establish a trust fund that will pay you and your heirs $130,000 per year forever with the first payment one year from today. If the trust fund earns an annual return of 2.5 percent, how much must your grandparents deposit today

Answers

Answer:

My grandparents deposit $5200000 today.

Explanation:

The annual return earned by trust fund = $2.5 percent

It is given that the trust will pay annually a certain amount for infinite period so annual pay  = $130000 per year.

Now we have to calculate the invested or deposited amount by grandparents today.

The present value of future constant annual payment over infinite period = (P/A, i%, n = infinity) or 1 / i%

The amount that should be deposited today :

[tex]= 130000 \times \frac{1}{2.5 \ percent} \\= 5200000[/tex]

Suppose Binder corporatio's common stock has a return of 17.61 percent. The risk-free rate is 3.68 percent, the market return is 12.4 percent and there is no unsystematic risk affecting Binder's return. Given the one-factor arbitrage pricing model, what is the factor beta

Answers

Answer:

1.597

Explanation:

The computation of the factor beta using the one-factor arbitrage pricing model is shown below:

As we know that

= (Expected rate of return - risk-free rate of return) ÷ (market rate of return-risk-free rate of return)

= (17.61% - 3.68%) ÷ (12.4% - 3.68%)

= 1.597

We simply applied the above formula to determine the factor beta and the same is to be considered

Kenzie is a research scientist in Tallahassee, Florida. Her spouse Gary stays home to take care of their house and two dogs. Kenzie's total wages for 2019 were $60,500 from which $5,900 of federal income tax was withheld. ​ Calculate the income tax due or income tax refund on Kenzie and Gary's 2019 individual income tax return. Use the tax formula for individuals and show your work.

Answers

Answer:

tax due 1,848 (presenting head of household)

Explanation:

They will use Head of household

As Gary do not work and this will report the better tax-burden for them

Tax bracket table for the year ended December 31th 2019

10%   $         0 to $13,850

12%   $13,851 to $52,850

22%   $52,851 to $84,200

13.850 x 10% = 1,385

(52,850 - 13,850) x 12% = 4,680

(60,500 - 52,850) x 22% = 1,683

Total tax:  7.748

tax due 7,748 - 5,900 = 1,848

Nenn Co.'s allowance for uncollectible accounts was $190,000 at the end of 2024 and $200,000 at the end of 2023. For the year ended December 31, 2024, Nenn reported bad debt expense of $26,000 in its income statement. What amount did Nenn debit to the appropriate account in 2024 to write off actual bad debts?

Answers

Answer:

The amount Nenn debited to write off of actual bad debt is $36,000

Explanation:

Allowance for Uncollectible beginning = $200,000

Allowance for Uncollectible at the end = $190,000

Bad debt expense reported = $26,000

Amount Nenn debited to write off of actual bad debt = $200,000 + $26,000 - $190,000 = $36,000

A company’s trial balance included the following account balances: Accounts Payable $ 19,207 Accounts Receivable 81,336 Cash 73,324 Income Tax Payable 3,512 Inventory 25,816 Note Payable, due in two years 1,709 Equipment 54,128 Stockholders’ Equity 202,808 Supplies 5,512 Wages Payable 12,880 What is the amount of the current ratio? (Round your answer to 2 decimal places.)

Answers

Answer:

5.22

Explanation:

The formula for calculating the current ratio is as follows:

Current ratio = Current assets / Current liabilities .......... (1)

From the question, we have:

Current assets = Accounts Receivable + Cash + Inventory + Supplies = $81,336 + $73,324 + $25,816 + $5,512 = $185,988.

Note: Equipment is not a current asset but a fixed asset.

Current liabilities = Accounts Payable + Income Tax Payable + Wages Payable = $19,207 + $3,512 + $12,880 = $35,599.

Note: Note Payable, due in two years is not a current liability but a long term liability since it is not payable within one year.

Substituting the values into equation (1) we have:

Current ratio = $185,988 / $35,599 = 5.22

The current ratio of 5.22 indicates that the company more than enough current assets, 5.22 times, to pay of its current liabilities.

On January 1, 20X8, Potter Corporation acquired 90 percent of Shoemaker Company’s voting stock, at underlying book value. The fair value of the noncontrolling interest was equal to 10 percent of the book value of Shoemaker at that date. Potter uses the fully adjusted equity method in accounting for its ownership of Shoemaker. On December 31, 20X9, the trial balances of the two companies are as follows: Based on the preceding information, what amount would be reported as income to controlling interest in the consolidated financial statements for 20X9?

Answers

Answer:

$138,000

Explanation:

Subsidiary is a company which is controlled by its parent. Potter Corporation acquired 90% stock in Shoemaker Company. The non controlling interest is 10% in Shoemaker Company. The company made a profit of $1,380,000. The 90% share will be allocated to the parent company and only 10% share will be allocated to the Non Controlling Interest.

Elaborate on two instances at the workplace where "silence is golden " may be applicable.

Answers

Answer:

It could be applicable when there is a negative compliment: When this happens it is best and advisable to be silent about it and continue with the work activities. Negative compliments are usually hurtful to the recipients and tempers may flare up if words are exchanged.

It could also be applicable when important informations are passed during meetings: Some meetings at work requires dissemination of information with various steps in accomplishing them. If an individual isn’t silent and pays less attention, a step may be missed and will make the worker being unable to perform the task.

Grosheim Incorporated has fixed expenses of $211,500 per year. Right now, Grosheim Incorporated is selling its products for $100 per unit. Management is contemplating a 20% increase in the selling price for the next year. Variable costs are currently 40% of sales revenue and are not expected to change in dollar amount on a per unit basis next year (the company will pay the same amount for variable costs next year). If fixed costs increase 10% next year, and the new selling price per unit goes into effect, how many units will need to be sold to breakeven?

Answers

Answer:

Breakeven in units is 3231

Explanation:

Breakeven units=fixed costs/contribution margin per unit.

new selling price=$100*(1+20%)=$120

variable cost per unit=$120*40%=$48

contribution margin=selling price per unit-variable cost per unit

contribution margin per unit=$120-$48=$72

fixed costs next year=$211,500*(1+10%)=$232,650.00  

breakeven units=$232,650.00/$72=3231

Karim Corp. requires a minimum $8,000 cash balance. Loans taken to meet this requirement cost 1% interest per month (paid monthly). Any excess cash is used to repay loans at month-end. The cash balance on July 1 is $8,400, and the company has no outstanding loans. Forecasted cash receipts (other than for loans received) and forecasted cash payments (other than for loan or interest payments) follow.

July August September
Cash receipts $20,000 $26,000 $40,000
Cash payments 28,000 30,000 22,000

Required:
Prepare a cash budget for July, August, and September.

Answers

Answer:

                                           Karim Corp

                                          Cash Budget

                                                 July              August         September

Cash inflows:                         $20,000      $26,000         $40,000                   

Cash outflows:                     ($28,000)    ($30,000)       ($22,000)

Monthly cash flow:                ($8,000)       ($4,000)          $18,000          

Monthly interests:                           $0             ($76)          ($116.76)

Initial cash balance:                $8,400       $8,000         $8,000

Ending cash balance:                $400          $3,924       $25,883.24

Required bank loan:               $7,600          $4,076                   $0

Payment of bank loan:                  $0                 $0          ($11,676)

Total                                         $8,000         $8,000       $14,207.24           

Explanation:

A cash budget is the estimation of the business's future cash flows including estimated revenues and expenses.

How did industrialization and unionization need to outsourcing

Answers

Answer: It is often assumed that manufacturing workers in developing countries, as recipients of outsourced jobs, would achieve economic benefits and organizational power. The author argues that job growth in developing countries through outsourcing to competing firms has often actually resulted in declining unionization and lower wage rates relative to traditional, integrated manufacturing firms. Using time-series data on union membership from 1980-2003 for Honduras and El Salvador as well as 2004 Household Survey Data for El Salvador, he examines the determinants of unionization rates and wages in the manufacturing sectors. He finds that that competitive outsourcing hurts labor at the plant-level in three ways: 1) it reduces labor's strike leverage by geographically dispersing the production process; 2) it increases the threat of plant mobility by decreasing plant-level investments; and 3) it increases labor costs relative to total costs, which creates an incentive for employers to keep wages low and unions out.

Consider the business Dave’s Doughnuts. Which of the following is a sunk cost of this business? Group of answer choices The monthly rent Dave must pay to use a building downtown The wages Dave pays to his workers who make the doughnuts The expenses that went into research and development of a new doughnut flavor The salary that Dave could be earning elsewhere if he didn’t own the business None of the above

Answers

Answer:

The expenses that went into research and development of a new doughnut flavor

Explanation:

A sunk cost is a cost that has already been incurred and cannot be recovered. It is money that has already been spent. Sunk costs are bygone and are not to be considered when deciding whether to continue an investment project.

The expenses that went into research and development of a new doughnut flavor is a sunk cost since the cost has been incurred already and cannot be recovered because it is not a relevant cost.

Perdue found that one of its chicken products may have been contaminated with bacteria, so it pulled it off the shelves and instituted a recall. This potential ethical issue was associated with which element of the marketing mix?
1. product
2. price
3. distribution
4. marketing communications promotion

Answers

Answer:

1. Product

Explanation:

Perdue finding out that one of its chicken products may have been contaminated with bacteria, pulled it off the shelves and instituted a recall.

Hence, this potential ethical issue is associated with product marketing mix because Perdue was very much concerned about the quality level, safety and reliability of his chicken products. This simply means, Perdue is much more interested in producing and selling highly uncontaminated products to it's customers.

A product marketing mix is focused mainly on the products, reason Perdue pulled the chicken products off the shelves and instituted a recall.

This would help to boost confidence among their customers to use more of their products in the future and by extension their market share.

Levi Corporation (a U.S. company) has several transactions with foreign entities. Each transaction is denominated in the local currency unit of the country in which the foreign entity is located. On December 2, 20X1, Levi sold confectionary items to a foreign company at a price of 50,000 yen when the direct exchange rate was 1 yen = $1.15. The account has not been settled as of the year ended December 31, 20X1, when the exchange rate had changed to 1 yen = $1.12. The foreign exchange gain or loss on Levi's records at year-end for this transaction will be

Answers

Answer: $1500 loss

Explanation:

From the question, On December 2, 20X1, Levi sold confectionary items to a foreign company by selling at a price of 50,000 yen when direct exchange rate was 1 yen = $1.15.

Sale value in dollar = 50,000 × 1.15

= $57500

The account has not been settled as of the year ended December 31, 20X1, when exchange rate had changed to 1 yen = $1.12.

Sale value in dollar = 50,000 × 1.12

= $56000

Foreign exchange loss:

= $57500 - $56000

= $1500 loss

In 2021, the Marion Company purchased land containing a mineral mine for $1,150,000. Additional costs of $448,000 were incurred to develop the mine. Geologists estimated that 310,000 tons of ore would be extracted. After the ore is removed, the land will have a resale value of $110,000.

To aid in the extraction, Marion built various structures and small storage buildings on the site at a cost of $102,300. These structures have a useful life of 10 years. The structures cannot be moved after the ore has been removed and will be left at the site. In addition, new equipment costing $51,500 was purchased and installed at the site. Marion does not plan to move the equipment to another site, but estimates that it can be sold at auction for $5,000 after the mining project is completed.

In 2021, 41,000 tons of ore were extracted and sold. In 2022, the estimate of total tons of ore in the mine was revised from 310,000 to 397,500. During 2019, 71,000 tons were extracted, of which 51,000 tons were sold.

Required:

a. Compute depletion and depreciation of the mine and the mining facilities and equipment for 2018 and 2019. Marion uses the units-of-production method to determine depreciation on mining facilities and equipment.
b. Compute the book value of the mineral mine, structures, and equipment as of December 31, 2019.

Answers

Answer:

Marion Company

a1) Depletion of the Mine for two years:

2018: 41,000/310,000 * $1,488,000 = $196,800

2019: 51,000/397,500 * $1,488,000 = $190,913

a2) Depreciation of Mining Facilities:

2018: 41,000/310,000 *$102,300 = $13,530

2019: 51,000/397,500 * $102,300 = $13,125

a3) Depreciation of Mining Equipment

2018: 41,000/310,000 *$46,500 = $6,150

2018: 51,000/397,500 * $46,500 = $5,966

b) Book Values December 31, 2019:

1) Mineral Mine:

Cost = $1,598,000

Accumulated Depletion $387,713 (2018 & 2019)

Book Value = $1,210,287

b2) Structures:

Cost = $102,300

Accumulated Depreciation $26,655 (2018 & 2019)

Book Value = $75,645

b3) Equipment:

Cost = $51,500

Accumulated Depreciation $12,116

Book Value = $39,384

Explanation:

a) Cost of Mine:

Land              $1,150,000

Development $448,000

Less Resale    ($110,000)

Total cost =  $1,488,000

b) Cost of Facilities or Structure:

Building cost = $102,300

c) Cost of Equipment = $51,500 - $5,000 = $46,500

d) Depletion is an accrual accounting technique used to allocate the cost of extracting natural resources.  It is like depreciation and amortization, which lower the cost value of an asset incrementally through periodic charges to income.

e) Depreciation is an accounting method for allocating the cost (the value used up) of a tangible or physical asset over its useful life.

Requirements
1. Record each transaction in the journal using the following account titles: Cash; Accounts Receivable; Office Supplies; Prepaid Insurance; Land; Furniture; Accounts Payable; Utilities Payable; Unearned Revenue; Common Stock; Dividends; Service Revenue; Salaries Expense; Rent Expense; and Utilities Expense. Explanations are not required.
2. T-accounts have been opened for each of the accounts. Post the journal entries to the T-accounts, using transaction dates as ledger accounts. Label the balance of each account Bal posting references in the ledger accounts.
3. Prepare the trial balance of Beth Stewart, Designer, as of November 30, 2018.
Nov.1 Received $41,000 cash and issued common stock to Stewart Nov. 1
4 Purchased office supplies, $1,200, and furniture, $2,300, on account.
6 Performed services for a law firm and received $2,100 cash.
7 Paid $27,000 cash to acquire land to be used in operations.
10 Performed services for a hotel and received its promise to pay the $800 within one week.
14 November 4 on account Paid for the furniture purchased 14 on.
15 Paid assistant's semimonthly salary, $1,470.
17 Received cash on account, $500.
20 Prepared a design for a school on account, $680.
25 Received $1,900 cash for design services to be performed in December.
28 Received $3,100 cash for consulting with Plummer & Gordon.
29 Paid $840 cash for a 12-month insurance policy starting on December 1.
30 Paid assistant's semimonthly salary, $1,470.
30 Paid monthly rent expense, $650.
30 Received a bill for utilities, $650. The bill will be paid next month
30 Paid cash dividends of $2,800.
Post the journal entries to the​ T-accounts, using transaction dates as posting references in the ledger accounts. Label the balance of each account Bal.We will post to the accounts one transaction at a time. Begin by posting the events from the 1st.July​1: Yangcontributed $64,000 cash to the business in exchange for Common Stock.
Date Accounts Debit Credit
Jul.1 Cash 68,000
Commom Stock 68,000

Answers

Journal entries:

Nov. 1, common stocks issued

Dr Cash 41,000

    Cr Common stock 41,000

Nov. 4, office supplies and furniture purchased

Dr Office supplies 1,200

Dr Furniture 2,300

    Cr Accounts payable 3,500

Nov. 6, service revenue

Dr Cash 2,100

    Cr Service revenue 2,100

Nov. 7, land purchased

Dr Land 27,000

    Cr Cash 27,000

Nov. 10, service revenue

Dr Accounts receivable 800

    Cr Service revenue 800

Nov. 14, payment of furniture

Dr Accounts payable 2,300

    Cr Cash 2,300

Nov. 15, wages expense

Dr Wages expense 1,470

    Cr Cash 1,470

Nov. 17, collection of accounts receivable

Dr Cash 500

    Cr Accounts receivable 500

Nov. 20, service revenue

Dr Accounts receivable 680

    Cr Service revenue 680

Nov. 25, received cash in advance

Dr Cash 1,900

    Cr Unearned revenue 1,900

Nov. 28, service revenue

Dr Cash 3,100

    Cr Service revenue 3,100

Nov. 29, purchase prepaid insurance

Dr Prepaid insurance 840

    Cr Cash 840

Nov. 30, wages expense

Dr Wages expense 1,470

    Cr Cash 1,470

Nov. 30, rent expense

Dr Rent expense 650

    Cr Cash 650

Nov. 30, utilities expense

Dr Utilities expense 650

    Cr Accounts payable 650

Nov. 30, dividends distributed

Dr Retained earnings 2,800

    Cr Dividends payable 2,800

Dr Dividends payable 2,800

    Cr Cash 2,800

Since there is not enough space here, I prepared an excel spreadsheet with the T-accounts.

In order to prepare a trial balance sheet, I must first prepare an Income Statement:

Service revenue              $6,680

Wages expense             ($2,940)

Rent expense                   ($650)

Utilities expense              ($650)

Net income:                    $2,440

Retained earnings = $2,440 (net income) - $2,800 (dividends) = ($360)

        STEWART CO.

     BALANCE SHEET

       NOV. 30, 2018

Assets:

Cash $12,070

Accounts receivable $980

Prepaid insurance $840

Office supplies $1,200

Furniture $2,300

Land $27,000

Total assets: $44,390

Liabilities and stockholders' Equity:

Accounts payable $1,850

Unearned revenue $1,900

Common stock $41,000

Retained earnings ($360)

Total liabilities and stockholders' equity: $44,390

Harrod Company paid $5,800 for a 4-month insurance premium in advance on November 1, with coverage beginning on that date. The balance in the prepaid insurance account before adjustment at the end of the year is $5,800, and no adjustments had been made previously. The adjusting entry required on December 31 is:

Answers

Answer:

Prepaid Insurance = credit = $2900.

Prepaid Insurance = debit = $2900

Explanation:

So, we are given the following data or parameters or information which is going to assist us in solving this particular Question or problem;

=> The amount paid for a 4-month insurance premium in advance on November 1, with coverage beginning on that date = $5,800.

=> "The balance in the prepaid insurance account before adjustment at the end of the year =$5,800, and no adjustments had been made previously.

So, we are asked to determine the adjusting entry required on December 31.

The adjusting entry required on December 31;

Prepaid Insurance = credit = 5800 × 2/4= $2900.

Prepaid Insurance = debit = $2900.

Answer:

Debit Insurance Expense $2,900; Credit Prepaid Insurance $2,900

Explanation:

Total Prepaid Insurance= $5,800

Monthly Insurance=Total Prepaid Insurance / 4 = $1,450

Insurance expenses for 2 month (November and December)= $1,450 * 2 = $2,900

There is no cash transaction in this adjusting entry

When insurance expenses increase= Debit

When decrease in prepaid expenses= Credit

Debit Insurance Expense $2,900; Credit Prepaid Insurance $2,900

. Gwen is leading a meeting and wants to make sure that they stick to the agenda and end on time. What should she do to move the meeting along? a. Say as much as possible during the meeting. b. Move divergent topics to a separate list to be discussed later. c. Not worry so much about time; the most important thing is to make sure that all agenda items are discussed fully. d. Ask anyone who monopolizes the conversation to leave.

Answers

Answer:

b.

Explanation:

When leading a meeting with many different topics, the best way to move the meeting along faster so that it ends in time is to move divergent topics to a separate list to be discussed later. This would remove the unimportant topics from that specific meeting and allow the very specific important topics to be discussed thoroughly in that meeting, thus moving it along but still being as efficient as possible. The divergent topics can be scheduled to be discussed at a later date when they are of a higher priority.

Kansas Enterprises purchased equipment for $76,000 on January 1, 2021. The equipment is expected to have a ten-year service life, with a residual value of $7,200 at the end of ten years. Using the straight-line method, depreciation expense for 2021 would be:

Answers

Answer:

The depreciation expense for 2021 would be: $6,880

Explanation:

Straight line method charges a fixed depreciation charge over the life of asset.

Depreciation Charge = (Cost - Residual Value) / Number of Estimated Useful life

                                   = ($76,000 - $7,200) / 10

                                   = $6,880

The amount of depreciation is charged at fixed amount of $6,880 for each of the years that this asset is in use in the business.

Conclusion :

The depreciation expense for 2021 would be: $6,880

As an employee in the Lottery Commission, your job is to design a new prize. Your idea is to create two grand prize choices: (1) receiving $50,000 at the end of each year beginning in one year for 20 consecutive years, or (2) receiving $500,000 today followed by a one-time payment at the end of 20 years. Using an interest rate of 6%, which of the following comes closest to the amount prize (2) needs to pay at the end of year 20 in order that both prizes to have the same present value?
a. $ 326,649
b. $ 440,463
c. $ 114,932
d. $ 393,342
e. $ 235,712

Answers

Answer:

The correct option is  $235,712,option E  

Explanation:

The present value of prize(1) can be computed by using the excel pv formula as shown below:

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

rate is interest rate of 6%

nper is the number of years payment would be made which is 20

pmt is the amount of money received per year which is $50,000

fv is the total future worth of the prize (1) which is unknown

=-pv(6%,20,50000,0)

=$573,496.06  

The difference between present value of prize(1) $573,496.06   and $500,000 receivable from prize (2) today is $73,496.06

The difference is today's worth, its future worth can be computed thus:

FV=PV*(1+r)^n

PV is $73,496.06  

r is 6%

n is 20 years

FV=$73,496.06*(1+6%)^20 =$ 235,711.82  

The amount that prize (2) needs to pay after 20 years so that both prizes bear the same present value is closer to Option B. $440,463.

Data and Calculations:

N (# of periods) = 20 years

I/Y (Interest per year) = 6%

PMT (Periodic Payment) = $50,000

FV (Future Value) = $0

Results:

Present Value (PV) = $573,496.06

Sum of all periodic payments = $1,000,000.00

Total Interest = $426,503.94

Thus, the amount that prize (2) needs to pay after 20 years so that both prizes bear the same present value is closer to Option B.

Learn more about the present value of cash flows here: https://brainly.com/question/24674907

New lithographic equipment, acquired at a cost of $800,000 at the beginning of a fiscal year, has an estimated useful life of five years and an estimated residual value of $90,000. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year. On the basis of the data presented to the manager, the double-declining-balance method was selected.

In the first week of the fifth year, the equipment was sold for $135,000.

Required:

1. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by the following methods:

a. Straight-line method

Year Depreciation Expense Accumulated Depreciation, End of Year Book Value, End of Year
1 $ $ $
2 $ $ $
3 $ $ $
4 $ $ $
5 $ $ $
b. Double-declining-balance method

Year Depreciation Expense Accumulated Depreciation, End of Year Book Value, End of Year
1 $ $ $
2 $ $ $
3 $ $ $
4 $ $ $
5 $ $ $
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2. Journalize the entry to record the sale, assuming double-declining balance method is used. If an amount box does not require an entry, leave it blank.

3. Journalize the entry to record the sale, assuming that the equipment was sold for $88,750 instead of $135,000. If an amount box does not require an entry, leave it blank.

Answers

Answer:

a. Straight-line Method :

Year     Depreciation   Accumulated    End of Year Book Value

0          Expense          Depreciation    $800,000

1            $142,000        $142,000          $ 658,000

2           $142,000        $284,000         $ 516,000

3           $142,000        $426,000         $ 374,000

4           $142,000        $568,000         $ 232,000

5           $142,000        $710,000            $90,000

b. Double-Declining-Balance Method:

Year     Depreciation   Accumulated    End of Year Book Value

0          Expense          Depreciation    $800,000

1            $320,000        $320,000        $ 480,000

2           $192,000          $512,000        $ 288,000

3            $115,200         $627,200         $ 172,800

4             $69,120         $696,320         $ 103,680

5             $13,680          $710,000          $90,000

2. Journal entry to record the sale, assuming double-declining balance method:

Debit Cash $135,000

Credit Sale of Equipment $135,000

To record sale of equipment.

Debit Sale of Equipment $103,680

Debit Accumulated Depreciation $696,320

Credit Equipment $800,000

To record close of accumulated depreciation and equipment accounts.

3. Journal entry to record sale, assuming equipment was sold for $88,750:

Debit Cash $88,750

Credit Sale of Equipment $88,750

To record sale of equipment.

Debit Sale of Equipment $103,680

Debit Accumulated Depreciation $696,320

Credit Equipment $800,000

To record close of accumulated depreciation and equipment accounts.

Explanation:

a) Straight-line method of depreciation applies the same amount of depreciation charge over the life of the asset.  It is calculated by subtracting the salvage value from the asset and dividing the resulting figure by the number of useful life in years.  It is very simple, but does not take into consideration maintenance costs incurred as assets age.  Therefore, it does not spread the costs of the asset evenly over the periods the asset is in use, or according to the productivity value of the asset in each period.

b) Declining balance method of depreciation accelerates depreciation charge initially but the annual expense declines with age of the fixed asset.  Under this method, depreciation expense is calculated by applying the depreciation rate to the book value of the asset at the start of the period.

Computing investing cash flows
Indicate the effect each separate transaction has on investing cash flows. (Amounts to be deducted should be indicated with a minus sign.) Sold a truck costing $48,000, with $25,200 of accumulated depreciation, for $11,200 cash. The sale results in a $11,600 loss. Sold a machine costing $13,800, with $9,600 of accumulated depreciation, for $8,200 cash. The sale results in a $4,000 gain. Purchased stock investments for $17,600 cash. The purchaser believes the stock is worth at least $33,200.

Answers

Answer: Please refer to Explanation

Explanation:

The Cash Flow Statement was created to ensure that businesses would know just how much hard cash they actually have. This Statement is therefore different from others in that in only records cash when it has been received and/or disbursed thus making it easier for a company to know how much cash it has.

The Investing Section of the Cashflow statement deals with fixed assets as well as transactions involving securities and bonds of other entities as those are investments.

When cash is spent on these transactions it is a Cash Outflow and is therefore subtracted.

When cash is received from such transactions it is considered a cash inflow and is added.

Effects of Above Transactions.

Sold a Truck for $11,200. This will INCREASE the Investing Cash Flow by $11,200.

Sold a Machine for $8,200. This will INCREASE the Investing Cash Flow by $8,200.

Purchased stock investments for $17,600 cash. This will DECREASE the Investing Cash Flow by -$17,600 as it was a cash Outflow.

The Investing Section of the Cash Flow Statement will look like,

Sold a Truck $11,200

Sold a Machine $8,200

Purchased stock investments -$17,600

Net Cashflow from Investing Activities $1,800

Marx and Springsteen provides​ hair-cutting services in the local community. In February, the business cut the hair of 200 ​clients, earned $ 5,100 in​ revenues, and incurred the following operating​ costs:

Hair saloon expense: $500
Building rent expense: 1458
Utilities expense: 200
Depreciation expense--- Equipment: 50

Required:
What was the cost of service to provide one haircut?

Answers

Answer:

Cost of service to provide one haircut is $ 11.04

Explanation:

Hair saloon expense: $500

Building rent expense: $1,458

Utilities expense: $200

Depreciation expense --- Equipment: $50

Total operating cost = Hair saloon expense + Building rent expense + Utilities expense + Depreciation expense

= $500 + $1,458 + $200 + $50

= $ 2,208

Total hair cuts = 200

Therefore, cost per hair cut = Total operating cost ÷ Total hair cuts

= $2,208 ÷ $200

=  $ 11.04

On August 2, 2018, Wendy purchased a new office building for $3,800,000. On October 1, 2018, she began to rent out office space in the building. On July 15, 2022, Wendy sold the office building. If required, round your answers to the nearest dollar.
a. What MACRS convention applies to the new office building?
b. What is the life of the asset for MACRS?
c. Wendy's cost recovery deduction for 2018 is $_________ and for 2022 is ____________$ .

Answers

Answer:

a. Mild Month MACRS convention applies to the new office building

b. The life of the asset under MACRS is 39 years

c. The cost recovery deduction for 2018 is $20,330

The cost recovery deduction for 2022 is $52,776

Explanation:

a. According to the given data Mild Month MACRS convention is applicable here because real property is placed in service in the middle of the month in which acquired.

b. The life of the asset under MACRS is 39 years

c. cost recovery deduction for 2018= $3,800,000*0.535%

cost recovery deduction for 2018=$20,330

cost recovery deduction for 2022= $3,800,000*2.564%

cost recovery deduction for 2022= $52,776

As a toy company produces more toys the average total cost of each toy produced decreases. This is because: total fixed costs are decreasing as more toys are produced. average variable cost is decreasing as more toys are produced. total variable cost is decreasing as more toys are produced. None of the above.

Answers

Answer:

total fixed costs are decreasing as more toys are produced.

Explanation:

Costs are classified as variable or fixed based on their relationship with the level of activity.

At any given level of activity, variable unit costs are constant. However, the unit fixed costs decrease as more units are produced.

On May 1, 2021, Bonita Industries declared and issued a 10% common stock dividend. Prior to this dividend, Bonita had 195000 shares of $1 par value common stock issued and outstanding. The fair value of Bonita's common stock was $24 per share on May 1, 2021. As a result of this stock dividend, Bonita's total stockholders' equity:______
a. decreased by $480700.
b. increased by $480700.
c. did not change.
d. decreased by $23000.

Answers

Answer:

No Answer in Option but the Equity decreases by $468,000

Explanation:

From the question,

Common Stock that Bonita industries had at par $1 = $195,000

They issued a common stock dividend= 10%

The Value of Stock dividend = 10/100 * 195,000 = $19,500

The fair value of Bonita's common stock was $24 per share on May 1, 2021. Hence, the stock dividend will be 19,500 * 24 = $468,000

We must understand that Stock dividend are issued from Retained Earning, hence as a result of this stock dividend, Bonita's total stockholder equity decreased by $468,000

Shulman Inc. has the following data, in thousands. Assuming a 365-day year, what is the firm's cash conversion cycle? Annual sales = $45,000 Annual cost of goods sold = $30,000 Inventory = $4,500 Accounts receivable = $1,800 Accounts payable = $2,500

Answers

Answer:

38.93

Explanation:

Firm Cash Conversion Cycle = Inventory Conversion Period + Average Collection Period  - Payable Deferral Period

Inventory Conversion Period =  365 * Inventory / Annual cost of goods sold

365 days * 4500 / 30000 = 54.75

Average Collection Period = 365 days * Account receivable /  sales

= 365 * 1800 / 45000 = 14.60

Payable Deferral Period = 365 days * Account payable /  sales =  365 * 2500 / 30000 = 30.42

Hence, Firm Cash Conversion Cycle = 54.75 + 14.60 - 30.42 = 38.93

The firm Cash Conversion Cycle is 38.93

Murphy Printers ​(MP) manufactures printers. Assume that MP recently paid $ 500 comma 000 for a patent on a new laser printer. Although it gives legal protection for 20​ years, the patent is expected to provide a competitive advantage for only eight years.
Requirements
1. Assuming the​ straight-line method of​ amortization, make journal entries to record​ (a) the purchase of the patent and​ (b) amortization for the first full year.
2. After using the patent for four ​years, MP learns at an industry trade show that another company is designing a more efficient printer. On the basis of this new​ information, MP​ decides, starting with year 5​, to amortize the remaining cost of the patent over two remaining​ years, giving the patent a total useful life of six years. Record amortization for year 5.

Answers

Answer: The answer is given below

Explanation:

1. The journal entries to record​ the purchase of the patent and​ the amortization for the first full year has been solved and attached.

2. The amortization expense of he 4 years will be:

= $62500 × 4

= $250,000

Therefore, the book value of the patent will be:

= Cost of the patent - amortization expense

= 500,000 - 250,000

= $250,000

Amortization for year 5 = Book value/Estimated useful life remaining

= 250,000/2

= $125,000

The journal for the amortization expense for year 5 has been attached

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