Answer:
Input price and input efficiency variances are:
Favorable.
Explanation:
The input price is the cost of production. When the actual cost of production (input price) is 5% lower than budgeted, it is a favorable outcome. Similarly, when the input efficiency (that is the quantity of input) is 5% lower than budgeted, it shows a favorable outcome. Therefore, the variances of these input elements (price and efficiency) are all together favorable.
Mary Willis is the advertising manager for Bargain Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of a new lighting system and increased display space that will add $57,600 in fixed costs to the $387,600 currently spent. In addition, Mary is proposing that a 5% price decrease ($60 to $57) will produce a 20% increase in sales volume (20,000 to 24,000). Variable costs will remain at $36 per pair of shoes. Management is impressed with Maryâs ideas but concerned about the effects that these changes will have on the break-even point and the margin of safety.
Q1) Compute the current break-even point in units, and compare it to the break-even point in units if Maryâs ideas are used. (Round answers to 0 decimal places, e.g. 1,225.)
Q2) Compute the margin of safety ratio for current operations and after Maryâs changes are introduced. (Round answers to 0 decimal places, e.g. 15%.))
Q3Prepare a CVP income statement for current operations and after Maryâs changes are introduced.
Answer:
1. Current BEP is 16,150 units that increases to 21,200 units.
2. Current margin of safety is 19% that falls to 12%
Explanation:
1. Current break-even point = Fixed cost / contribution margin
Fixed cost = $387600
Contribution margin = Sales price - variable cost
= 60 - 36 = $24
Current BEP = 387600 / 24 = 16,150 units
BEP if Maryas ideas are used:
Fixed cost = 57600 + 387600 = $445,200
Contribution margin = 57 - 36 = $21
BEP = 445200 / 21 = 21,200 units
BEP increases to 21,200 units from 16,150 units in case Maryas ideas are used.
2. Current Margin of safety Ratio = Actual sales - BEP / Actual sales
= 20,000 - 16,150 / 20,000
= 3850/20000
= 0.1925 or 19%
Margin if safety if Maryas ideas used = 24000 - 21200 / 24000
= 2800/24000
= 0.1167 or 12%
Margin of safety falls to 12% from 19% if Maryas ideas are used.
3. Current income statement
Sales (20,000 * 60) $1,200,000
less: Variable expense $720,000
(20,000*36)
Contribution margin $480,000
less Fixed expense $387,600
Net income $92,400
Income statement after Maryas ideas
Sales (24,000 * 57) $1,368,000
less: Variable expense $864,000
(24,000*36)
Contribution margin $504,000
less Fixed expense $445,200
Net income $58,800
The following is the ending balances of accounts at June 30, 2021, for Excell Company.
Account Title Debits Credits
Cash $ 93,000
Short-term investments 75,000
Accounts receivable (net) 290,000
Prepaid expenses (for the next 12 months) 42,000
Land 85,000
Buildings 330,000
Accumulated depreciation—buildings $ 165,000
Equipment 270,000
Accumulated depreciation—equipment 125,000
Accounts payable 178,000
Accrued liabilities 50,000
Notes payable 110,000
Mortgage payable 240,000
Common stock 150,000
Retained earnings 167,000
Totals $ 1,185,000 $ 1,185,000
Additional information:
The short-term investments account includes $23,000 in U.S. treasury bills purchased in May. The bills mature in July, 2021.
The accounts receivable account consists of the following:
a. Amounts owed by customers $ 232,000
b. Allowance for uncollectible accounts—trade customers (18,000 )
c. Nontrade notes receivable (due in three years) 70,000
d. Interest receivable on notes (due in four months) 6,000
Total $ 290,000
The notes payable account consists of two notes of $55,000 each. One note is due on September 30, 2021, and the other is due on November 30, 2022.
The mortgage payable is a loan payable to the bank in semiannual installments of $4,800 each plus interest. The next payment is due on October 31, 2021. Interest has been properly accrued and is included in accrued expenses.
Eight hundred thousand shares of no par common stock are authorized, of which 300,000 shares have been issued and are outstanding.
The land account includes $55,000 representing the cost of the land on which the company's office building resides. The remaining $30,000 is the cost of land that the company is holding for investment purposes.
Answer:
Total Assets $895,000
Total liabilities and stockholders'equity $895,000
Explanation:
Preparation of a classified balance sheet for the Excell Company at June 30, 2021
EXCELL COMPANY Balance Sheet At June 30, 2021
ASSETS
Current assets:
Cash and cash equivalents $116,000
($93,000+$23,000)
Short-term investments $52,000
($75,000-$23,000)
Accounts receivable, net of allowance for uncollectible accounts $214,000
($232,000-$18,000)
Interest receivable $6,000
Prepaid expenses $42,000
Total current assets $430,000
($116,000+$52,000+$214,000+$6,000+$42,000)
Investments:
Note receivable $70,000
Land held for sale $30,000
$100,000
($70,000+$30,000)
Property, plant, and equipment:
Land $55,000
Buildings $330,000
Equipment $270,000
($55,000+$330,000+$270,000)
$655,000
Less: Accumulated depreciation ($290,000)
Net property, plant, and equipment $365,000
($655,000-$290,000)
TOTAL ASSETS $895,000
($430,000+$100,000+$365,000)
LIABILITIES AND STOCKHOLDERS'S EQUITY
Current liabilities:
Accounts payable $178,000
Accrued expenses $50,000
Note payable $55,000
Current maturities of long-term debt $9,600
(4800*2)
Total current liabilities $292,600
($178,000+$50,000+$55,000+$9,600)
Long-term liabilities:
Note payable $55,000
Mortgage payable $230,400
($240,000-$9,600)
Total long-term liabilities $285,400
($55,000+$230,400)
Shareholders’ equity:
Common stock, no par value; 800,000 shares
authorized; 300,000 shares issued and outstanding $150,000
Retained earnings $167,000
Total shareholders ’equity $317,000
($150,000+$167,000)
TOTAL LIABILITIES AND STOCKHOLDERS'S EQUITY $895,000
($292,600+$285,400+$317,000)
Therefore the classified balance sheet for the Excell Company at June 30, 2021 will be :
Total Assets $895,000
Total liabilities and stockholders'equity $895,000
Frank is a salesman of Richard Laundry Equipment. He wants to give a presentation to a five star hotel for setting up an in-house laundry system. The hotel manager sent Frank the hotel's requirements and space constraints for a laundry system. Frank prepared a layout which suited the hotel's requirements. Frank has to select an approach for his allotted ten minute presentation. What advice can you give to Frank
Answer: Use customer benefit statements due to the time allotment.
Explanation:
The options include:
a. Use the curiosity approach to generate interest.
b. Open with a demonstration to convince the prospect.
c. Use customer benefit statements due to the time allotment.
d. Use the product approach to make the prospect aware of discounts.
e. Open with the premium approach as the prospect is a five star hotel.
Based on the information given, the advice that'll be given to Mike is to use the customer benefit statements due to the time allotment.
We should note that the benefit statements are typically used in scenarios whereby one knows the critical needs of the customer and there's a short time available for a presentation to be done. Since the Tim tht Frank has is short but he already knows what the hotel wants, then this is the best option.
Frank should use the customer benefit approach for is presentation since he has limited time to complete the same.
What is customer benefit approach?The customer benefit approach refers to an approach that involves prior research before presenting anything before the audience. It focuses on the consumer specific benefit of the product or service that are prompt to be offered.
The customer benefit approach is usually used when there is a time limit for completing the presentation or the assigned task.
In the given case Frank was given 10 minutes to complete his presentation about the in house laundry system in 5 star hotel.
Therefore the appropriate advice is to use customer benefit approaches.
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Suppose that the Federal Reserve decides to decrease the money supply with a $300 purchases of Treasury bills. Complete the tables that represent the financial position of the Federal Reserve and commercial banks after this open-market operation. Be sure to use a negative sign for reduced values.
Federal Reserves Assest Liabilities
Commercial Reserves Assets Liabilities
For the Federal Reserve, what are assets? What are liabilities?
a. Monetary base; Reserves
b. Monetary base; Treasury bills
c. Treasury bills; Reserves
d. Reserves; Treasury bill
e. Treasury bills; Monetary base
Answer:
1. Federal Reserves:
Assets : $300
The Fed purchased these T-bills so they will form part of the Fed's assets as they are now owned by the Fed.
Liabilities: $300
Liabilities of the Fed will increase by $300 because the banks will deposit the money they got from the purchase in the Fed.
Commercial Banks:
Treasury Bills: -$300
The Treasury bills will reduce by $300 to reflect that the Fed purchased $300 worth of T-bills from the banks.
Reserves: $300
Reserves will increase because the banks would have made money from selling the T-bills to the Fed.
2. e. Treasury bills; Monetary base
Treasury bills are assets to the Fed in this case because as explained, they own these T-bills now after purchasing them.
The monetary base however, is a liability because it represents commercial bank reserves held in the Fed. They owe the banks this money thereby making it a liability.
7. You are considering the possibility of replacing an existing machine that has a book value of $500,000, a remaining depreciable life of five years, and a salvage value of $300,000. The replacement machine will cost $2 million and have a ten-year life. Assuming that you use straight-line depreciation and that neither machine will have any salvage value at the end of the next ten years, how much would you need to save each year to make the change (the tax rate is 40 percent)
Answer:
$221344.48
Explanation:
Book value of existing machine = $500,000
remaining depreciable life = 5 years
salvage value = $300,000
cost of replacement machine = $2 million
depreciable life = 10 years
Tax rate = 40 %
Difference in the cost of new machine and salvage value of existing machine
= 2,000,000 - 300,000 = $1,700,000
Calculate the depreciation tax benefit of new machine = ( 500,000 / 5 ) * 0.4 = $40,000
next calculate the present value of this tax benefit
= $40000,PVAF(1.10,5years)^5 ------- ( 1 )
where the Annuity of 5 years at 10% = 1/(1.10)5 = 3.7907)
Insert value into equation 1 (to calculate the present value of the tax benefit
= 40000*3.79078676 = $1,51,631.47 ( present value of tax benefit )
Determine the Annual depreciation tax advantage of the new machine
= (2,000,000/10)*0.40 = $80,000
Determine present value of this annuity
= $80,000,PVAF(1.10,10years)^10 ------ ( 2 )
where the Annuity of 5 years at 10% = 1/(1.10)^10 ) = 6.144567
Insert value into equation2 ( to calculate the present value of this annuity )
= 80000 * 6.144567 = $491565.36
Therefore the Net cost of the new machine will be
= $491565.36 - $151631.47 - $1,700,000 = $1,360,066
Annual savings on the new machine in 10 years
= 1,360,066 / 6.144567 = $221344.48
Hane Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products: Activity Cost Pool Activity Rate Assembling products $ 8.90 per assembly hour Processing customer orders $ 31.23 per customer order Setting up batches $ 43.72 per batch Data for one of the company's products follow: Product U94W Number of assembly hours 389 Number of customer orders 53 Number of batches 61 How much overhead cost would be assigned to Product U94W using the activity-based costing system
Answer:
Total allocated costs= $7,784.21
Explanation:
To allocate overhead to Product U94W, we need to use the following formula:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Assembling products= 8.90*389= $3,462.1
Processing customer orders= 31.23*53= $1,655.19
Setting up batches= 43.72*61= $2,666.92
Total allocated costs= $7,784.21
Phillip, the proprietor of a vineyard, estimates that the first 10900 bottles of wine produced this season will fetch a profit of $6 per bottle. However, the profit from each bottle beyond 10900 drops by $0.0001 for each additional bottle sold. Assuming at least 10900 bottles of wine are produced and sold, what is the maximum profit
Answer:
See below
Explanation:
With regards to the above information, we can write out the equation to be;
P = (10,900 + y)($6 - 0.0001y)
= 65,400 - 1.09y + 6y - 0.0001y^2
= 65,400 + 4.9y - 0.0001y^2
dp/dx = 4.9 - 0.002y
Set equal to zero to find maximum
4.9 - 0.002y = 0
y = 8,000
So, maximum profit is $
Point Company uses the standard costing method. The company's product normally takes 0.25 hour to produce. Normal annual capacity is 3,000 direct labor hours, and budgeted fixed overhead costs for the year were $6,750. During the year, the company produced and sold 8,000 units. Actual fixed overhead costs were $4,800. Compute the fixed overhead variance.
Answer:
the fixed overhead variance is $1,660 (favorable)
Explanation:
The fixed overhead variance results from Fixed Overhead Expenditure (Spending) variance and Fixed Overhead Volume variance.
Expenditure Variance = Actual Fixed Overheads - Budgeted Fixed Overheads
= $4,800 - $6,750
= $1,950 (favorable)
Volume Variance = Budgeted overhead at actual activity - Budgeted fixed overhead
= ($6,750 ÷ 3,000/0.25) x 8,000 units - $4,800
= $300 (unfavorable)
Total Variance = Expenditure Variance + Volume Variance
= $1,950 (favorable) + $300 (unfavorable)
= $1,660 (favorable)
Conclusion :
the fixed overhead variance is $1,660 (favorable)
The total fixed overhead variance is $1,660 Favorable.
Here, we will calculate the expenditure and volume variance to enable us derive the total fixed overhead variance.
Expenditure Variance = Actual Fixed Overheads - Budgeted Fixed
Expenditure Variance = $4,800 - $6,750
Expenditure Variance = $1,950 Favorable
Volume Variance = Budgeted overhead at actual activity - Budgeted fixed overhead
Volume Variance = ($6,750 / (3,000/0.25)) * 8,000 units - $4,800
Volume Variance = $4500 Favorable - $4,800 Unfavorable
Volume Variance = $300 Unfavorable
Total Variance = Expenditure Variance + Volume Variance
Total Variance = $1,950 Favorable + $300 Unfavorable
Total Variance = $1,660 Favorable
Therefore, the total fixed overhead variance is $1,660 Favorable.
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Here is the income statement for Teal Mountain Inc.
TEAL MOUNTAIN INC.
Income Statement
For the Year Ended December 31, 2017
Sales revenue $402,900
Cost of goods sold 256,700
Gross profit 146,200
Expenses (including $ 10,200 interest and $29,600 income taxes) 89,200
Net income $57,000
Additional information:
1. Common stock outstanding January 1, 2017, was 30,000 shares, and 39,000 shares were outstanding at December 31, 2017.
2. The market price of Teal Mountain stock was $15 in 2017.
3. Cash dividends of $24,700 were paid, $ 6,500 of which were to preferred stockholders.
Compute the following measures for 2017.
(a) Earnings per share $_____
(b) Price-earnings ratio _____ times
(c) Payout ratio _____ %
(d) Times interest earned _____ times
Answer:
See below
Explanation:
a. The earnings per share would be calculated as;
Earnings per share = (Net income - Preferred stock dividend) / Average number of common shares outstanding
But
Weighted average number of common shares = (Number of common shares outstanding in the beginning + Number of common shares outstanding at then end) / 2
= (30,000 + 39,000) / 2
= 34,500
Preferred stock dividend = 6,500
Therefore,
Earnings per share = ($57,000 - $6,500) / 34,500
= $50,500 / 34,500
= $1.46
b. Price earnings ratio
= Market price per share / Earning per share
= $15 / $1.46
= 10.27 times
c. The payout ratio
= (Total cash dividends - Preferred stock dividends) / Net income
= ($24,700 - $6,500) / $57,000
= $18,200 / $57,00)
= 31.93%
d. Times interest
= ( Net income + Interest expense + Tax expense) / Interest expense.
= $57,000 + $10,200 + $29,600) / $10,200
= $96,800 / $10,200
= 9.49 times
Compute the cost of 1,000 gallons of each flavor of ice cream using the department allocation rates computed in requirement (b) if the number of machine-hours for 1,000 gallons of each of the three flavors of ice cream are as follows:
Strawberry Vanilla Chocolate
Direct labor (per 1,000 gallons) $766 $841 $1,141
Raw materials (per 1,000 gallons) 816 516 616
Required:
If the number of hours of labor per 1,000 gallons is 60 for strawberry, 70 for vanilla, and 100 for chocolate, compute the total cost of 1,000 gallons of each flavor using plantwide allocation.
Answer:
As you did not include the departmental allocation rate calculated or the question relating to it, I shall provide an allocation rate and you can relate this with your assignment.
Assume the allocation rate is $3.00
Labor, raw materials and overhead cost allocation hours are given in terms of 1,000 gallons already.
Cost of Strawberry:
= Direct labor + Raw materials + Overhead cost
= 766 + 816 + (60 hours * $3.00 allocation)
= 766 + 816 + 180
= $1,762
Cost of Vanilla:
= 841 + 516 + (70 * 3)
= 841 + 516 + 210
= $1,567
Cost of Chocolate:
= 1,141 + 616 + (100 * 3)
= 1,141 + 616 + 300
= $2,057
what are the categories under the demographic segmentation
Answer:
Age, gender, religion, incomes and family status.
Explanation:
Demographic segment is one of the methods for STP in marketing. As the name employees demographic related to people. The segmentation follows dividing people in terms of the age, gender, religion, race, family and income basis.This segmentation focuses on the psychological and behavioural traits of company or organisation and how business tends to operate and manage work. Focuses the client or customer centric model.The following transactions occurred regarding the Central Purchasing Fund, an Internal Service Fund. Record the entries for the transactions, and identify the fund(s) used. 1. The General Fund transferred $100,000 as a capital contribution to establish the fund. 2. The Central Purchasing Fund bills $200,000 for services it provided to other funds. 3. The Central Purchasing Fund incurred depreciation expense of $50,000 and paid $250,000 in operating expenses. 4. The General Fund subsidized the operations of the Purchasing Fund by transferring an additional $100,000 to the fund.
Answer:
1.GF
Dr Transfer out to Internal Service Fund—contributed capital $100,000
Cr Cash $100,000
ISF
Dr Cash $100,000
Cr Transfer in from General Fund—contributed capital $100,000
2.ISF
Dr Due from other funds $200,000
Cr Revenues--charges for services$200,000
No entries
3.ISF
Dr Operating expenses $300,000
Cr Cash $250,000
Cr Accumulated depreciation $50,000
4. GF
Dr Transfer out to Internal Service Fund—contributed capital $100,000
Cr Cash $100,000
ISF
Dr Cash $100,000
Cr Transfer in from General Fund—contributed capital $100,000
Explanation:
Preparation of the Journal entries to Record the entries for the transactions, and identify the fund
1.GF
Dr Transfer out to Internal Service Fund—contributed capital $100,000
Cr Cash $100,000
ISF
Dr Cash $100,000
Cr Transfer in from General Fund—contributed capital $100,000
2.ISF
Dr Due from other funds $200,000
Cr Revenues--charges for services$200,000
No entries reason been that the exercise did not mention the user funds.
3.ISF
Dr Operating expenses $300,000
($250,000+$50,000)
Cr Cash $250,000
Cr Accumulated depreciation $50,000
4. GF
Dr Transfer out to Internal Service Fund—contributed capital $100,000
Cr Cash $100,000
ISF
Dr Cash $100,000
Cr Transfer in from General Fund—contributed capital $100,000
Bramble, Inc. has 11200 shares of 3%, $100 par value, noncumulative preferred stock and 224000 shares of $1 par value common stock outstanding at December 31, 2020. There were no dividends declared in 2019. The board of directors declares and pays a $65700 dividend in 2020. What is the amount of dividends received by the common stockholders in 2020?
Answer:
See
Explanation:
Total dividends = 65,700
Common stock outstanding = 224,000 shares
Preferred dividend
= Number of shares × Par value 3%
= 11,200 × 100 × 3%
= $33,600
Dividends received by common stockholders
= (65,700 × 2) - (33,600 × 3)
= 131,400 - 100,800
= 30,600
Froggatt Enterprises,a premier educational products company, experiences ups and downs in demand each year corresponding to major school holidays. The company maintains a steady workforce and uses overtime, inventory, and subcontracting to absorb fluctuations in demand. Expected demand, available capacities, and costs for the next four quarters are given below. There is no beginning inventory. Design a production plan that will satisfy demand at minimum cost.
Period Demand Regular Capacity Overtime Capacity Subcontracting Capacity
1 600 1000 500 500
2 2100 1000 500 500
3 800 1000 500 500
4 1800 1000 500 500
Regular production cost per unit $8
Overtime production cost per unit $10
Subcontracting cost per unit $12
Inventory holding cost per unit per period $1
Answer:
Answer is explained in the explanation section below.
Explanation:
Note: As this question contains tables, here I cannot insert table properly, so I have done it on excel spreadsheet and it is attached in the attachment below. Please refer to the attachment below for the minimum cost production plan.
Please refer to Attachment.
Priority should be given in the order mentioned below.
1. Maintain maximum capacity output even though demand is lower for the period because demand for the next period is higher and inventory holding costs are only $1 per unit per period.
2. Over time output for remaining demand, including demand for the following year, since it is less costly than subcontract production and inventory keeping costs are just $1 per unit per period.
3. There is no obligation for output to be subcontracted.
Econo Nation started 2015 with no national budget debt or surplus. By the end of 2015, it had a budget surplus of $304 million; in 2016, it had a budget deficit of $452 million; in 2017, it had a budget surplus of $109 million; and the amount of its budget deficit or surplus in 2018 is unknown. If at the end of 2018 Econo Nation’s national debt totaled $50 million, determine the deficit or surplus in 2018.
Answer:
$11 million
Explanation:
Calculation to determine the deficit or surplus in 2018.
First step is to calculate the national budget debt using this formula
National budget debt= Budget surplus in 2008 + budget deficit in 2009 + budget surplus in 2010
Let plug in the formula
National budget debt= $304 million - $452 million + $109 million
National budget debt= - $39 million
Now let calculate the the deficit or surplus in 2018 using this formula
Deficit or surplus= National budget debt + national debt
Let plug in the formula
Deficit or surplus= -$39 million + $50 million
Deficit or surplus= $11 million
Therefore the deficit or surplus in 2018 is $11 million
Ramon and Sammy are working on a group homework assignment. The homework consists of a set of essay questions and a set of questions on graphing models. Ramon can finish an essay question in about 15 minutes and a graphing question in about 30 minutes. Sammy can finish an essay question in about 20 minutes and a graphing question in about 35 minutes. Assume that Ramon and Sammy produce the same quality answers. Calculate Ramon and Sammy's opportunity cost of each task. Please round each answer to the nearest tenth.
a. Ramon's opportunity cost of completing an essay question: graphing questions
b. Ramon's opportunity cost of completing a graphing question: essay questions
c. Sammy's opportunity cost of completing an essay question: graphing questions
d. Sammy's opportunity cost of completing a graphing question: essay questions
e. If the two want to specialize in working on their homework, who should do the essay questions and who should do the graphing questions?
A. Sammy should do all of the questions.
B. Ramon should do the graphing questions, and Sammy should do the essay questions.
C. Ramon should do the essay questions, and Sammy should do the graphing questions.
D. Ramon should do all of the questions.
Answer:
2 graphing questions
0.5 essay questions
1.75 graphing questions
0.57 essay questions
b
Explanation:
Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives
The individual with the lower opportunity cost should specialise in an activity
Opportunity cost of Ramon finishing an essay question = 30/15 = 2 graphing questions
Opportunity cost of Ramon finishing a graphing question = 15/30 = 0.5 essay questions
Opportunity cost of Sammy finishing an essay question = 35/20 = 1.75 graphing questions
Opportunity cost of Sammy finishing a graphing question = 20/35 = 0.57 essay questions
Sammy has a lower opportunity cost in answering an essay question and should specialise in answering essay questions
Ramon has a lower opportunity cost in answering graphing question and should specialise in answering graphing questions
Priority Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended: Actual units produced: 9,000 Actual variable overhead incurred: $54,400 Actual machine hours worked: 16,000 Standard variable overhead cost per machine hour: $3.50 If Priority estimates two hours to manufacture a completed unit, the company's variable-overhead efficiency variance is: Multiple Choice None of the answers is correct. $1,600 favorable. $7,000 favorable. $7,000 unfavorable. $1,600 unfavorable.
Answer:
The correct option is $7,000 favorable.
Explanation:
This can be calculated using the following formula:
Standard hours for actual units produced = Actual units produced * Estimated number of hours to manufacture a completed unit = 9,000 * 2 = 18,000
Variable-overhead efficiency variance = (Actual machine hours worked - Standard machine hours for actual units produced) * Standard variable overhead cost per machine hour = (16,000 - 18,000) * 3.50 = –$7,000
Since the calculated Variable-overhead efficiency variance is negative, that implies that it is favorable,
Therefore, the correct option is $7,000 favorable.
The Category Profile that involves evaluating the major forces and trends that are impacting an industry: including pricing, competition, regulatory forces, technology, and demand trends is called the:
Answer: External Industry Analysis
Explanation:
External Industry Analysis simply refers to the examination of the industry environment of a particular company such as its dynamics, competitive position, history etc.
The external industry analysis on a macro scale has to do with examining the factors like technological, political, demographic, and social analysis. External industry analysis is vital as it shows the threats and the opportunities that exist in a particular industry and can also be used to determine growth of an organization.
The term that explains Category Profile and its relationship with evaluation of major force as well as trends that has impact on a particular industry such as competition, technology as well as price is called External analysis
External analysis can be regarded as Category Profile which helps in the evaluation of factors such as forces and trends and how they influence a particular industry.These forces could be;
technology pricingcompetitionregulatory forcesTherefore, External analysis examine the environment of an industry and determine the opportunities as well as threats in a particular industry.
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Simpkin Corporation owns manufacturing facilities in States A, B, and C. B uses a three- factor apportionment formula under which sales are double-weighted Simpkin's operations generated $1,000,000 of apportionable income, and its sales and payroll activity and average property owned in each of the three states is as follows.
State A State B State C Totals
Sales $400,000 $800,000 $300,000 $1,500,000
Payroll 100,000 150,000 50,000 300,000
Property 200,000 200,000 200,000 600,000
Simpkin's apportionable income assigned to B is:________.
a. $1,000,000
b. $533,333
c. $475,000
d. $0.
Answer:
Simpkin Corporation
Simpkin's apportionable income assigned to B is:________.
b. $533,333
Explanation:
a) Data and Calculations:
Apportionable operating income = $1,000,000
State A State B State C Totals
Sales $400,000 $800,000 $300,000 $1,500,000
Payroll 100,000 150,000 50,000 300,000
Property 200,000 200,000 200,000 600,000
State B's portion of the operating income = $1,000,000 * $800,000/$1,500
= $533,333
Andrew paid $30 to buy a potato cannon, a cylinder that shoots potatoes hundreds of feet. He was willing to pay $45. When Andrew's friend Nick learns that Andrew bought a potato cannon, he asks Andrew if he will sell it for $60, and Andrew agrees, since he would have sold it for $45. Nick is thrilled, since he would have paid Andrew up to $80 for the cannon. Andrew is also delighted. Determine the consumer surplus from the original purchase and the additional surplus generated by the resale of the cannon.
Answer:
$15
$35
Explanation:
Calculation to Determine the consumer surplus from the original purchase and the additional surplus generated by the resale of the cannon
Consumer surplus from the original purchase=$45-$30
Consumer surplus from the original purchase=$15
Additional surplus generated by the resale of the cannon=$80-$45
Additional surplus generated by the resale of the cannon=$35
Therefore the consumer surplus from the original purchase is $15 and the additional surplus generated by the resale of the cannon is $35
Answer each of the following independent questions. Required: Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $88,000 cash immediately, (2) $34,000 cash immediately and a six-period annuity of $9,300 beginning one year from today, or (3) a six-period annuity of $18,400 beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1.1 Assuming an interest rate of 7%, determine the PV value for the above options.
1.2 Which option should Alex choose? Option (1) Option (2) Option (3)
2. The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2022. Weimer will make annual deposits of $175,000 into a special bank account at the end of each of 10 years beginning December 31, 2013. Assuming that the bank account pays 8% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2022?
Table of calculation function?
Payment?
N?
I?
Future value?
Answer:
option 1
$4,056,237.49
Explanation:
To determine the better option, we have to determine the present value of options 2 and 3
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
option 2
Cash flow in year 0 = $34,000
Cash flow in year 1 to 6 = $9,300
I = 7 %
PV = 78,328.82
Option 2
Cash flow in year 1 to 6 = $$18,400
I = 7 %
PV = 87704.33
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
It is the first option that has the highest value
The formula for calculating future value = A / annuity factor
Annuity factor = {[(1+r) n] - 1} / r
P = Present value
R = interest rate
N = number of years
Explain why effective critical thinking is important for high self-esteem?
Answer:
Critical thinking help you to be active and love what you do. Therefore it call critical thinking
Moonbeam Company manufactures toasters. For the first 8 months of 2020, the company reported the following operating results while operating at 75% of plant capacity:
Sales (375,200 units) $4,378,000
Cost of goods sold 2,588,880
Gross profit 1,789,120
Operating expenses 839,510
Net income $949,610
Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Moonbeam receives a special order for 20,800 toasters at $7.87 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $2,900 of shipping costs but no increase in fixed costs.
(a) Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Reject Order Accept Order Net Income Increase (Decrease) Revenues $enter revenues in dollars $enter revenues in dollars $enter revenues in dollars Cost of goods sold enter the cost of goods sold in dollars enter the cost of goods sold in dollars enter the cost of goods sold in dollars Operating expenses enter operating expenses in dollars enter operating expenses in dollars enter operating expenses in dollars Net income $enter net income in dollars $enter net income in dollars $enter net income in dollars
(b) Should Moonbeam accept the special order? Moonbeam Company select an option the special order.
Answer:
Moonbeam Company
a) Incremental analysis for the special order:
Sales revenue ($7.87 * 20,800) = $163,696
Variable costs ($6.62 * 20,800) = (137,696)
Contribution margin = 26,000
Shipping costs (2,900)
Net income from special order = $23,100
b) Moonbeam should accept the special order. It generates some net income for covering the company's fixed cost and does not exceed the company's plant capacity. It only adds about 4% to the operating plant capacity.
Explanation:
a) Data and Calculations:
Total Variable Fixed
Sales (375,200 units) $4,378,000
Cost of goods sold 2,588,880 1,812,216 776,664
Gross profit 1,789,120
Operating expenses 839,510 671,608 167,902
Net income $949,610
Total costs $2,483,824 $944,566
Selling price = $11.67 ($4,378,000/375,200)
Variable costs per unit = $6.62 ($2,483,824/375,200)
Total plant capacity = 500,267 units (375,200/75%)
Increase in plant capacity = 396,000 (375,200 + 20,800)
Below are amounts found in the income statements of three companies. Company Sales Revenue Cost of Goods Sold Operating Expenses Non-operating Expenses Income Tax Expense Henry $38,000 $ 13,300 $ 5,300 $2,300 $2,300 Grace 41,000 27,880 13,400 7,300 0 James 46,000 27,600 3,300 0 3,300 2-a. For each company, calculate the gross profit ratio.
Answer and Explanation:
The computation of the gross profit ratio for each company is shown below:
As we know that
Gross profit ratio is
= Gross profit ÷ sales revenue
= (Sales revenue - cost of goods sold) ÷ sales revenue
For henry
= ($38,000 - $13,000) ÷ ($38,000)
= 66%
For grace
= ($41,000 - $27,880) ÷ ($41,000)
= 32%
For James
= ($46,000 - $27,600) ÷ ($46,000)
= 40%
A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a rate of 5.0%. The probability distribution of the risky funds is as follows: Expected Return Standard Deviation Stock fund (S) 11% 40% Bond fund (B) 6 20 The correlation between the fund returns is 0.16. Solve numerically for the proportions of each asset and for the expected return and standard deviation of the optimal risky portfolio.
Answer:
portfolio invested in stocks = 73.20%
Portfolio invested in Bond = 26.80%
Expected return on optimal risky portfolio [ E(rp) ] = 9.66%
STD on Optimal Risky portfolio = 30.60%
Explanation:
Correlation between the funds return = 0.16
Determine the portfolio invested in each asset ( using excel )
expected risk premium on stock fund [ E(rps)] = 6%
Expected risk premium on Bond fund [ E(rpb) ] = 1%
std of stock rise premium ( бs) = 40%
std on bond rise premium ( бb) = 20%
correlation between funds [ rp(sb) ] = 0.16
Variance of stock fund ( бs^2 ) = 0.16
variance of bond fund ( бb^2 ) = 0.04
Using excel formula ( as seen in the attached screen shot )
First calculate the covariance of stock and Bond fund = 0.0128
portfolio invested in stocks = 73.20%
Portfolio invested in Bond = 26.80%
Expected return on optimal risky portfolio [ E(rp) ] = 9.66%
STD on Optimal Risky portfolio = 30.60%
In an indirect message, valid reasons for the refusal are presented before the bad news. Which option is most effective? a.If we accepted your rather dated desktops and laptops, we would risk software incompatibility, high repair bills, and substantial replacement costs for missing input and output devices. b.We're very sorry but our policy does not allow us to accept donations of used computing equipment. c.We had to establish guidelines for the acceptance of used computing equipment because only new computers provide warranties, compatible software, and come with matching peripherals.
Answer:
c.We had to establish guidelines for the acceptance of used computing equipment because only new computers provide warranties, compatible software, and come with matching peripherals.
Explanation:
An indirect message aims to soften bad news, to achieve this goal the message is transmitted through a soothing speech, where there is an explanation of the reasons for the bad news before reaching the fact, in order to cushion the impact that the message may cause. Indirect discourse is more accepted in the case of the transmission of bad news, as individuals generally tend to better understand the facts when they are explained through evidence.
Therefore, the letter c corresponds more adequately to an indirect speech.
A publishing house is using 400 printers and 200 printing presses to produce books. The printers' wage rate is $20 and the price of a printing press is $100. The last printer added 20 books to total output, while the last press added 50 books to total output. In order to maximize the number of books published with a budget of $28,000, the publishing house
Answer:
The publishing house is not using cost minimizing combination of printers and printing press.
Explanation:
The publishing house go towards more of printers and less of printing press because the cost of printing price is almost three times higher than the cots of printers. Also the output of printing press is lower and the output of printers is almost double. The publishing house should use such a combination of both the available resources which maximizes its revenue.
Adjustment for Accrued Expense
Joos Realty Co. pays weekly salaries of $17,250 on Friday for a five-day workweek ending on that day. Journalize the necessary adjusting entry assuming that the accounting period ends on Tuesday.
If an amount box does not require an entry, leave it blank. fill in the blank 2 fill in the blank 3 fill in the blank 5 fill in the blank 6
Answer and Explanation:
The adjusting entry is shown below:
Salary expense Dr ($17,250 ÷ 5 days × 2 days) $6,900
To Salary payable $6,900
(Being salary expense is recorded)
here salary expense is debited as it increased the expense and credited the salary payable as it also increased the liabilities
The purpose of preparing a direct materials budget is to ________. multiple choice 1 allocate the cost of raw materials to production departments estimate the manufacturing overhead estimate the quantity of raw materials to be purchased estimate the unit cost of direct materials to be purchased Knowledge Check 02 In a direct materials budget, the desired ending raw materials inventory for the year is equal to the ________. multiple choice 2 beginning balance of accounts payable desired ending raw materials inventory for the last period total merchandise purchased during the year value of raw material used during the year
Answer:
1. estimate the quantity of raw materials to be purchased.
2. ending raw materials inventory for the last period.
Explanation:
A budget is a financial plan used for the estimation of revenue and expenditures of an individual, organization or government for a specified period of time, often one year. Budgets are usually compiled, analyzed and re-evaluated on periodic basis.
The first step of the budgeting process is to prepare a list of each type of income and expense that will be part of the budget.
The final step by the management of an organization in the financial decision making process is making necessary adjustments to the budget.
The benefits of having a budget is that it aids in setting goals, earmarking revenues and resources, measuring outcomes and planning against contingencies.
1. The purpose of preparing a direct materials budget is to estimate the quantity of raw materials to be purchased. This includes the raw materials that would be used for the manufacturing of finished goods.
2. In a direct materials budget, the desired ending raw materials inventory for the year is equal to the ending raw materials inventory for the last period.
A dealership always replaces the tires and battery on a car before selling it ?
Answer:
I wouldn't think so, since they are new. But they check them, and if they are incorrect then yes, i would think so.
Explanation: