Amberjack Company is trying to decide on an allocation base to use to assign manufacturing overhead to jobs. The company has always used direct labor hours to assign manufacturing overhead to products, but it is trying to decide whether it should use a different allocation base such as direct labor dollars or machine hours. Actual and estimated data for manufacturing overhead, direct labor cost, direct labor hours, and machine hours for the most recent fiscal year are summarized here:

Estimated Value Actual Value
Manufacturing overhead cost $732,000 $842,000
Direct labor cost $366,000 $377,000
Direct labor hours 14,640 hours 16,600 hours
Machine hours 18,300 hours 17,500 hours

Required:
Based on the company’s current allocation base (direct labor hours), compute the following:
a. Predetermined overhead rate.
b. Applied manufacturing overhead.
c. Over- or underapplied manufacturing overhead.

Answers

Answer 1

Answer:

Results are below.

Explanation:

Giving the following information:

Estimated Value Actual Value

Manufacturing overhead cost $732,000 $842,000

Direct labor hours 14,640 hours 16,600 hours

To calculate the predetermined manufacturing overhead rate we need to use the following formula:

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

Predetermined manufacturing overhead rate= 732,000 / 14,640

Predetermined manufacturing overhead rate= $50 per direct labor hour

Now, we can allocate overhead:

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

Allocated MOH= 50*16,600

Allocated MOH= $830,000

Finally, the over/under allocation:

Under/over applied overhead= real overhead - allocated overhead

Under/over applied overhead= 842,000 - 830,000

Underapplied overhead= $12,000


Related Questions

Osborn Manufacturing uses a predetermined overhead rate of $19.10 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $246,390 of total manufacturing overhead for an estimated activity level of 12,900 direct labor-hours. The company actually incurred $245,000 of manufacturing overhead and 12,400 direct labor-hours during the period.
Required:
1. Determine the amount of underapplied or overapplied manufacturing overhead for the period.
2. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied overhead increase or decrease the company’s gross margin? By how much?

Answers

Answer and Explanation:

The computation is shown below:

a. The underapplied or overapplied overhead is

But before that the applied overhead is

Applied overhead = 12400 × 19.1

= $236,840  

Now Underapplied overhead is

= $245,000 - $236,840

= $8,160

2 The gross margin of the company would be decreased by $8,160    

Identify Project Needs The first step in any media-driven project is to determine whether the project is relevant to the purpose, audience, and audience needs. This step is important as the answers to the project questions will determine how you plan, structure, and produce a video-based project.Purpose:Upon completing this project, you will be able to understand how to decide what is needed for a project.Steps for completion:1.Which are four questions that need to be answered before beginning a project

Answers

Answer:

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1. In a manufacturing firm, product costs include: ______

a. all GAAP costs
b. all variable costs
c. all manufacturing costs
d. all fixed costs all non-manufacturing costs

2. Period costs include:

a. all fixed costs
b. all non-manufacturing costs
c. all variable costs
d. all non-GAAP costs
e. all manufacturing costs

Answers

Answer and Explanation:

1. The product cost involved all the manufacturing cost i.e. direct cost that includes direct material, direct labor, manufacturing overhead etc

2. The period cost involved non-manufacturing cost i.e. indirect cost like rent expense, fixed selling & admin expenses, depreciation expense, etc

Therefore for 1 the option c is correct and for 2 the option b is correct

1.  In a manufacturing firm, product costs include all manufacturing costs. Thus, option C is the correct option.

2. Period costs include all non-manufacturing costs. Thus, option B is the correct option.

Product Costs are the expenses incurred during a product's creation. Materials, labor, production supplies, and factory overhead are all included in these prices. A product cost includes the price of the labor needed to provide a service to a consumer.

Period costs are any expenses that are not accounted for in product costs. The manufacturing method is not directly related to period expenses. Period costs include overhead and sales, general, and administrative (SG&A) expenses. Period costs are expenses that are not connected to or related to the creation of inventories in management and cost accounting.

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Assume that the British government eliminates all controls on imports by British companies. Other things being equal, the U.S. demand for pounds would ____, the supply of pounds for sale would ____, and the equilibrium value of the pound would ____. a. remain unchanged; increase; decrease b. remain unchanged; increase; increase c. decrease; increase; decrease d. increase; increase; increase

Answers

Answer:

increase

increase

decrease

A limit buy order is an order to buy if the stock price goes ___ a specified level; a stop buy is an order to buy if the stock price goes ___ a specified level; a limit sell is an order to sell if the stock price goes ___ a specified level; a stop loss is an order to sell if the stock price goes ___ a specified level.

Answers

Answer:

YES

Explanation:

Louis has stable preferences (the same every year) and consumes two goods, wine and cheese. In 1994, the price of wine was $4/glass and the price of cheese was $2/ounce. Louis’s income was $60 and he bought 12 glasses of wine and 6 ounces of cheese. In 1995, wine costs $2/glass and cheese costs $4/ounce. Louis’s income is still $60.

Required:
Draw both years’ budget lines. Where do they cross?

Answers

Answer:

both budget lines intersect at 10 units of wine and 10 units of cheese purchased (see attached graph)

Explanation:

Identify the following as financing activities (F) or investing activities (I):

a. Purchase of equipment
b. Purchase of treasury stock
c. Reduction of long-term debt
d. Sale of building
e. Resale of treasury stock
f. Increase in short-term debt
g. Issuance of common stock
h. Purchase of land
i. Purchase of common stock of another firm
j. Payment of cash dividends
k. Gain on sale of land
l. Repayment of debt principal

Answers

Answer:

Explanation:

Financial activities would basically be anything that involves money but is does not involve an asset with value. This would instead be considered Investing activities if you are buying or selling any asset financial asset. Therefore the following would be considered...

a. Purchase of equipment   (F)

b. Purchase of treasury stock  (I)

c. Reduction of long-term debt   (F)

d. Sale of building   (I)

e. Resale of treasury stock   (I)

f. Increase in short-term debt   (F)

g. Issuance of common stock  (I)

h. Purchase of land   (I)

i. Purchase of common stock of another firm   (I)

j. Payment of cash dividends   (I)

k. Gain on sale of land   (I)

l. Repayment of debt principal   (F)

Kahuna Industries has two manufacturing departments--Fabrication and Finishing. The company used the following data at the beginning of the year to calculate pre-determined overhead rates:
Fabrication Finishing Total
Estimated total machine-hours (MHs) 4,000 1,000 5,000
Estimated total fixed manufacturing overhead cost $30,000 $3,400 $33,400
Estimated variable manufacturing overhead cost
per machine-hour $2.00 $4.00
During the most recent month, the company started and completed two jobs--Job 14-X and Job 15-Z. There were no beginning inventories. Data concerning those two jobs follow:
Job 14-X Job 15-Z
Direct materials $14,700 $8,400
Direct labor cost $21,600 $8,400
Fabrication machine-hours 2,700 1,300
Finishing machine-hours 400 600
Assume that the company uses a plantwide pre-determined manufacturing overhead rate based on machine-hours. The total manufacturing cost assigned to Job 15-Z is closest to:______.

Answers

Answer:

Total manufacturing cost= $34,052

Explanation:

First, we need to calculate the predetermined overhead rate:

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

Total estimated overhead= 33,400 + (2*4,000 + 4*1,000)

Total estimated overhead=  $45,400

Predetermined manufacturing overhead rate= 45,400 / 5,000

Predetermined manufacturing overhead rate= $9.08 per machine hour

Now, we can determine the total manufacturing cost of Job 15-Z:

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

Allocated MOH= (1,300 + 600)*9.08= $17,252

Total manufacturing cost= 8,400 + 8,400 + 17,252

Total manufacturing cost= $34,052

Assume that two countries (Home and Foreign) each produce two goods (corn and wheat) under constant cost production. Home produces 1/2 ton of corn or 1 ton of wheat with a day of labor. Foreign produces 1 ton of corn and 1/2 ton of wheat. Suppose that, after trade occurs, the international price actually becomes 1.5 tons of wheat per ton of corn.

Required:
a. What is Home's price of corn in autarky?
b. How large is Home's labor force?

Answers

Answer:

Home and Foreign

a. Home's price of corn in autarky = 2 tons of wheat

b. Home's labor force is half of the labor force of Foreign.

Explanation:

a) Data and Calculations:

Number of countries involved in trade = 2

Number of goods produced = 2 (corn and wheat)

Country   Tons of corn   Tons of wheat

Home          1/2                    1

Foreign       1                        1/2

International price = 1.5 tons of wheat per ton of corn

Home's price of corn in autarky = 2 tons of wheat (1 / 0.5)

b) In international trade, when the international terms of trade settle at a level that is between each country's opportunity cost, both countries will benefit from the trade.  One country will benefit while the other will lose when the trade terms are too above or below this opportunity cost.

A company pays each of its two office employees each Friday at the rate of $240 per day for a five-day week that begins on Monday. If the monthly accounting period ends on Tuesday and the employees worked on both Monday and Tuesday, the month-end adjusting entry to record the salaries earned but unpaid is:_________.a. Debit Unpaid Salaries $1,440 and credit Salaries Payable $1,440.b. Debit Salaries Expense $960 and credit Salaries Payable $960.c. Debit Salaries Expense $1,440 and credit Salaries Payable $1,440.d. Debit Salaries Payable $960 and credit Salaries Expense $960.e. Debit Salaries Expense $960 and credit Cash $960.

Answers

Answer:

b. Debit Salaries Expense $960 and credit Salaries Payable $960.

Explanation:

Salary expense per employee = $240 per day

Number of employees = 2

Salary expense for 2 days = Salary expense per employee * Number of employees * 2 = $240 * 2 * 2 = $960

Date   Account title           Debit     Credit

          Salaries expense     $960  

                  Salaries payable             $960

          (To record salaries expense for 2 days)

Record adjusting journal entries for each of the following for year ended December 31. Assume no other adjusting entries are made during the year.

Accounts Receivable. At year-end, the L. Cole Company has completed services of $20,500 for a client, but the client has not yet been billed for those services.
Interest Receivable. At year-end, the company has earned, but not yet recorded, $450 of interest earned from its investments in government bonds.
Accounts Receivable. A painting company bills customers when jobs are complete. The work for one job is now complete. The customer has not yet been billed for the $1,420 of work.

Answers

Answer:

1. Dr Account receivable $20,500

Cr Service revenue $20,500

2. Dr Interest receivable $450

Cr Interest revenue $450

3. Dr Account receivable $1,420

Cr Service revenue $1,420

Explanation:

Preparation of the adjusting journal entries for each of the following for year ended December 31.

Based on the information given the adjusting journal entries for each of the following for year ended December 31 will be :

1. Dr Account receivable $20,500

Cr Service revenue $20,500

(Being to record Accounts Receivable)

2. Dr Interest receivable $450

Cr Interest revenue $450

(Being to record Interest receivable)

3. Dr Account receivable $1,420

Cr Service revenue $1,420

(Being to record Accounts Receivable)

Bi-Lo Traders is considering a project that will produce sales of $44,800 and have costs of $25,700. Taxes will be $4,500 and the depreciation expense will be $2,650. An initial cash outlay of $2,100 is required for net working capital. What is the project's operating cash flow?

Answers

Answer:

$10,700

Explanation:

Operating cash flow is computed as;

= Net income + non cash expenses - outlay in working capital

First, we'll determine the net income

Net income = Sales $44,800 - cost $27,500 depreciation expense $2,650 - Taxes $4,500

Net income = $10,150

Operating cash flow = $10,150 + $2,650 - $2,100 = $10,700

A company that sells running shoes online wants to compare two new marketing strategies. They will test the strategies on 10 weekdays. In the morning of each day, a web page describing the comfort of the running shoes will be displayed. In the afternoon of each day, a web page describing the discounted price for the shoes will be displayed. Sales of the featured running shoes in the morning will be compared with sales in the afternoon at the end of the experiment. What are the experimental units, the treatments, and the outcomes for this experiment

Answers

Answer:

The explanation of the three factors and they conclusion are below.

Explanation:

To begin with, when we talk about experimental units we refer to the entities that the researcher looks forward to make inferences about, so that means that in this case the experimental units of the situation will be all the people who got to visit the website in both schedules, the morning shift and the afternoon shift.

Secondly, the treatments is understood to be the process or the way, it could be said, that the researchers administrate to the experimental units. So that implicates that in this case the treatments will be the morning with its comfort described and the afternoon on the other side with its discounted prices shown.

Finally, the most probable outcomes for this experiments will be that the statics will show how the people interact with the variables and which of them generated more interest, that being either price or comfort. It will also show the behavior of the people when it comes to understand if the tend more to visit the web site at morning or afternoon.

19) Which of the following best describes horizontal analysis? A) calculating key ratios to evaluate performance B) comparing a company's financial statements with other companies C) comparing financial statement amounts from year to year for the same company D) expressing each financial statement amount as a percentage of a budgeted amount

Answers

Answer:

C) comparing financial statement amounts from year to year for the same company

Explanation:

Horizontal analysis refers to an analysis of the items in the financial statements that should be compared for a period of time. It basically used to see the situation of the trends how it goes whether it is increase or decrease. For using this, the two or more periods financial statements are required

Therefore according to the given options, the option c is correct

By promoting transparency, the government can improve

a.profit margins
b.economies of scale
c.market efficiency
d.zoning

Answers

Answer:

Option c. is correct

Explanation:

By promoting transparency, the government can improve market efficiency.

The government should be transparent as transparency will also strengthen the democracy and effectiveness in Government. Openness provides information to the citizens about what their Government is doing for them.

Option c. is correct

In a small town, there is a shoe factory which employs workers at $15 an hour, for forty-hour weeks. There is a writer, who expects to finish a novel in nine months. If he does not write the novel, he can teach high school English for $12 an hour. What is his opportunity cost of writing the novel

Answers

Answer:

the amount he would have earned if he taught, $12

Explanation:

Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives

If the writer decides to write, he loses the opportunity to teach and earn $12. This is his opportunity cost.

Also, if he decided to teach instead, his opportunity cost the time he could have spent writing the novel

Thomlin Company forecasts that total overhead for the current year will be $10,282,000 with 194,000 total machine hours. Year to date, the actual overhead is $5,689,800, and the actual machine hours are 98,100 hours. If Thomlin Company uses a predetermined overhead rate based on machine hours for applying overhead, as of this point in time (year to date), the overhead is

Answers

Answer:

$490,500 underapplied

Explanation:

The computation of the overhead is shown below:

But before that the predetermined overhead rate and the applied overhead is

Predetermined overhead rate is

= Estimated overhead ÷ estimated activity

= $10,282,000 ÷ 194,000

= $53 per MH

Now

Applied overhead = actual activity × overhead rate

 = 98,100 hours ×$53 per MH

= $5,199,300

Now the underapplied overhead is

= $5,689,800 - $5,199,300

= $490,500 underapplied

A rational decisionmaker
A. ignores marginal changes and focuses instead on “the big picture.”
B. takes an action only if the combined benefits of that action and previous actions exceed the combined costs of that action and previous actions
C. ignores the likely effects of government policies when he or she makes choices
D. takes an action only if the marginal benefit of that action exceeds the marginal cost of that action

Answers

The Answer is Option B.

Poorer countries have historically been responsible for the bulk of world carbon emissions because of poor technology and environmental regulations. Air and water quality in developed countries is generally much better today than it was several decades ago. Tackling climate change issues is likely to only modestly dent long-term economic growth. Carbon emissions are negatively correlated with economic growth.
a. True
b. False

Answers

Answer:

Carbon emissions are negatively correlated with economic growth.

b. False

Explanation:

Various environmental studies have established that economic growth has caused more carbon emissions into the atmosphere.  Greater carbon emission is done by the less developed countries than by the developed nations.  Coupled with poor technology and lax environmental regulations, the poorer countries also suffer more from the carbon emissions.  However, climate change has posed challenges to the world generally in recent times.  Therefore, there is the need to tackle the problems head-on because tackling climate issues will not deter long-term economic growth.

Trade can benefit a family:__________
a. by allowing each person to specialize in the activities he or she does best.
b. by allowing the family to buy a greater variety of goods and services at a lower cost.
c. All of the above are correct.
d. Both a and b are correct.
e. only if the family is not in economic competition with other families.

Answers

Answer:

Option d: Both a and b are correct

Explanation:

Trade is simply defined as the act of giving or exchanging one or more goods and services for another. It can be between people,countries e.t.c. it makes people well paid off when they have different taste or preferences and said to have a rapid increase in terms of productivity through different specialization and the division of knowledge. It makes rich people richer and it leads to an increase in terms of productivity through comparative advantage.

You are a contracting officer responsible for source selection for a negotiated competitive services acquisition. The estimated value of the acquisition is $1,650,000. What would be true about regarding the evaluation of the past performance?

Answers

Question Completion with options:

a. Past performance information provided directly by the offeror should not be relied upon.

b. The past performance evaluation satisfies the responsibility determination required under FAR subpart 9.1.

c. Evaluations should take into account past performance information regarding predecessor companies.

d. Offerors with demonstrated past performance that is neither relevant nor recent must not be removed from further consideration for award.

Answer:

The statement that is true regarding the evaluation of the past performance is:

c. Evaluations should take into account past performance information regarding predecessor companies.

Explanation:

It has been established that past performance is the best indicator of future performance.  Past performance can predict future performance, behavior, and success.  Organizations that achieve some good performance in the past build the required confidence, which will help them to forge ahead in the present and future.  This is why in selecting companies for a negotiated competitive services acquisition, even the past performance of predecessor companies should be reviewed to get a better handle on the company's ability to deliver on the projects.

a. On April 1, the company hired an attorney for a flat monthly fee of $2,500. Payment for April legal services was made by the company on May 12.
b. As of April 30, $2,175 of interest expense has accrued on a note payable. The full interest payment of $6,525 on the note is due on May 20.
c. Total weekly salaries expense for all employees is $14,000. This amount is paid at the end of the day on Friday of each five-day workweek. April 30 falls on a Tuesday, which means that the employees had worked two days since the last payday. The next payday is May 3.
The above three separate situations require adjusting journal entries to prepare financial statements as of April 30. For each situation, present both the April 30 adjusting entry and the subsequent entry during May to record the payment of the accrued expenses.

Answers

Answer:

A. Apr 30

Dr Legal fees expense 2,500

Cr Legal fees payable 2,500

May 12

Dr Legal fees payable 2,500

Cr Cash 2,500

B. Apr 30

Dr Interest expense 2,175

Cr Interest payable 2,175

May 20

Dr Interest expense 4,350

Dr Interest payable 2,175

Cr Cash 6,525

C. Apr 30

Dr Salaries expense 5,600

Cr Salaries payable 5,600

May 03

Dr Salaries expense 8,400

Dr Salaries payable 5,600

Cr Cash 14,000

Explanation

Preparation of the adjusting entry for both April 30 and the subsequent entry during May to record the payment of the accrued expenses.

A. Apr 30

Dr Legal fees expense 2,500

Cr Legal fees payable 2,500

May 12

Dr Legal fees payable 2,500

Cr Cash 2,500

B. Apr 30

Dr Interest expense 2,175

Cr Interest payable 2,175

May 20

Dr Interest expense 4,350

(6,525-2,175)

Dr Interest payable 2,175

Cr Cash 6,525

C. Apr 30

Dr Salaries expense 5,600

(14,000*2/5)

Cr Salaries payable 5,600

May 03

Dr Salaries expense 8,400

(14,000*3/5)

Dr Salaries payable 5,600

(14,000*2/5)

Cr Cash 14,000

Rossdale, Inc., had additions to retained earnings for the year just ended of $641,000. The firm paid out $50,000 in cash dividends, and it has ending total equity of $7.36 million.
1. If the company currently has 730,000 shares of common stock outstanding, what are:
a. Earnings per share?
b. Dividends per share?
c. Book value per share? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
2. lf he stock currently sells or $30.60 per share, what is:
a. the market-to-book ratio?
b. the price earnings ratio?
3. If total sales were $10.66 million, what is the price-sales ratio?

Answers

Answer:

1. a. Earnings per share:

= Total earnings / No. of shares

= (Addition to retained earnings + Dividends) / No. of shares

= (641,000 + 50,000) / 730,000

= $0.95

b. Dividends per share:

= Dividends / No. of shares

= 50,000 / 730,000

= $0.07

c. Book Value per share:

= Ending total equity / No. of shares

= 7,360,000 / 730,000

= $10.08

2. a. Market to book ratio

= Market price / Book value

= 30.60 / 10.08

= 3.06 times

b. Price - earnings ratio:

= Market price / Earnings per share

= 30.60 / 0.95

= 32.21 times

3. Price - sales ratio

= Market value of equity / Sales

= (30.60 * 730,000 shares) / 10,660,000

= 2.1 times

Identify whether each of the following examples belongs in M1 or M2. If an example belongs in both, be sure to check both boxes.

a. Crystal has $8,000 in a two-year certificate of deposit (CD).
b. Tim has a roll of quarters that he just withdrew from the bank to do laundry.
c. Brian has $25,000 in a money market account.

Answers

Answer:

M2

M1 M2

M2

Explanation:

What is a benefit of joining a professional organization for your chosen career path?

Answers

Answer: experience

Explanation: This will give the opportunity to show off your skills in the organization you have chosen plus it would be hands on and they can show you things to enhance your skills you learned.

The following partially completed T-accounts summarize transactions for Farwest Corporation during the year: Raw Materials Beg Bal 4,700 10,000 6,900 Work in Process Beg Bal 4,600 26,300 7,400 8,000 6,800 Finished Goods Beg Bal 1,900 22,900 26,300 Manufacturing Overhead 2,600 6,800 3,000 1,900 Wages & Salaries Payable 12,300 Beg Bal 1,400 11,000 Cost of Goods Sold 22,900 The Cost of Goods Manufactured was: Group of answer choices $22,900 $26,300 $6,400 $49,200

Answers

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Imagine you have $25.00. Your best friend’s birthday is coming up, and you’d like to get them a gift. You’ve also been wanting to buy a new backpack since your current one has some holes in it. What do you decide to d with $25.00 and Why

Answers

Answer:

buy a new backpack because you need it more

Explanation:

If I had $25.00 and my best friend's birthday was coming up while I also needed a new backpack, I would first prioritize my friend's gift since it's time-sensitive. I would allocate around $15.00 for the gift, leaving me with $10.00 for the backpack.

What is a military-style backpack?

Military backpacks are designed to carry all necessary materials for protracted periods of time. Assault packs are typically designed for shorter-duration or even day missions. Assault packs only hold about 20L, compared to a military backpack's capacity of 96L. Throughout the day, they are significantly more compact, lightweight, and portable.

For my friend's gift, I would consider their interests and what they might appreciate. I could buy a small but thoughtful gift such as a personalized card or a small decorative item. Alternatively, I could get something related to their hobbies, such as a book, a piece of jewelry, or a small gadget that they might enjoy.

With the remaining $10.00, I would look for a simple but durable backpack that fits my needs. I would try to find a sale or a clearance item to stretch my budget further.

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The following condensed balance sheet is for the partnership of Hardwick, Saunders, and Ferris, who share profits and losses in the ratio of 4:3:3, respectively:
Cash $90,000 Accounts payable $210,000
Other assets 820,000 Ferris, loan 40,000
Hardwick, loan 30,000 Hardwick, capital 300,000
Saunders, capital 200,000
Ferris, capital 190,000
Total assets $940,000Total liabilities and capital $940,000
The partners decide to liquidate the partnership. Forty percent of the other assets are sold for $200,000.
Prepare a proposed schedule of liquidation at this point in time.

Answers

Answer:

Hardwick, Saunders, and Ferris Partnership

Proposed Schedule of Liquidation:

Total Cash Realized =  $772,000

Accounts payable         (210,000)

Available cash =          $562,000

Ferris, loan        40,000

Hardwick, loan  30,000 (70,000)

After loans                  $492,000

Repayment of capital:

Hardwick, capital  = $220,800

Saunders, capital =  $140,600

Ferris, capital =        $130,600

Explanation:

Profits and losses sharing ratios:

Hardwick = 4

Saunders = 3

Ferris = 3

Condensed Balance Sheet:

Cash                  $90,000    Accounts payable               $210,000

Other assets     820,000    Ferris, loan                              40,000

                                            Hardwick, loan                        30,000

                                            Hardwick, capital                  300,000

                                            Saunders, capital                 200,000

                                            Ferris, capital                        190,000

Total assets   $940,000    Total liabilities and capital $940,000

Realization of Assets:

Cash                  $90,000

Other assets     482,000 (60% of $820,000)

Other assets    200,000 (40% of $820,000)

Total cash realized = $772,000

Total capital = $690,000

Total cash available to settle capital = $492,000

Shortfall in capital = $198,000

This is shared according to their loss sharing ratio:

Hardwick = $198,000 * 40% = $79,200

Saunders = $198,000 * 30% = $59,400

Ferris = $198,000 * 30% = $59,400

The shortfall is deducted from their capital accounts:

Hardwick, capital $220,800 (300,000 - 79,200)

Saunders, capital $140,600 (200,000 - 59,400)

Ferris, capital $130,600 (190,000 - 59,400)

Balance shared = $492,000

JPM Overnight Delivery is one of the premier providers of shipping and information services worldwide, competing against firms like FedEx and UPS. As it prepares its marketing plans for the years ahead, it will conduct a very thorough SWOT analysis. Your job is to look at eight potential elements of JPM's SWOT analysis and determine which are strengths, weaknesses, opportunities, and threats. Your ability to properly categorize these elements in your own career will allow you to maximize your firm's strengths and opportunities while also minimizing weaknesses and threats.

The evaluation of a firm's strengths, weaknesses, opportunities, and threats is called a SWOT analysis. A SWOT analysis can be a valuable tool in the development of a marketing plan, but too often the SWOT analysis is not well thought out and proves to be an ineffective waste of time. Perhaps the most common mistake when conducting a SWOT analysis is the failure to separate internal issues from external issues. The strengths and the weaknesses aspects of the SWOT analysis focus on internal capabilities. The opportunities and threats aspects focus on the external environment.

Match each item with the appropriate element of the SWOT analysis.

a. Post office closings
b. JPM has information technology infrastructure
c. Increasing demand for international packages
d. JPM has an excellent workforce and human resource department
e. Potential global economic recession
f. JPM has increasing labor costs
g. JPM has less fuel efficient planes
h. Increasing fuel costs due to turmoil in the Middle East

1. Weaknesses
2. Threats
3. Opportunities
4. Strengths

Answers

Answer:

JPM Overnight Delivery

SWOT Analysis

Categorizing Potential Elements in JPM's SWOT Analysis

Weaknesses:

f. JPM has increasing labor costs

g. JPM has less fuel efficient planes

Threats:

e. Potential global economic recession

h. Increasing fuel costs due to turmoil in the Middle East

Opportunities:

a. Post office closings

c. Increasing demand for international packages

Strengths:

b. JPM has information technology infrastructure

d. JPM has an excellent workforce and human resource department

Explanation:

a) SWOT Analysis is a useful framework and tool for analyzing JPM's strengths, weaknesses, opportunities, and threats. It helps JPM to build on what it does well, to address what it lacks, to minimize risks, and to take advantage of chances for success.

1. Weaknesses:  These are internal risks that the organization is lacking, which can draw the organization down.

2. Threats:  These are the outside risks facing the business from the market, challenging its success drive.

3. Opportunities:  These are the chances presented by the environment for the organization to fly.

4. Strengths:  These are internal capabilities, knowledge, and resources that the organization can utilize to overcome weaknesses and threats while grabbing the opportunities.

Determine the difference in the present worth values of the following two commodity contracts at an interest rate of 8% per year. a. Contract 1 has a cost of $10,000 in year 1; costs will escalate at a rate of 4% per year for 10 years. b. Contract 2 has the same cost in year 1, but costs will escalate at 6% per years for 11 years

Answers

Answer:

$14,336

Explanation:

Calculation to Determine the difference in the present worth values

First step is to calculate Contract 1 present worth values

Contract 1 present worth values = 10,000{1 – [(1 + 0.04)/(1 + 0.08)]^10}/(0.08 – 0.04)

Contract 1 present worth values = 10,000{1 – [(1.04)/(1 .08)]^10}/( 0.04)

Contract 1 present worth values = $78,590

Second step is to Contract 2 present worth values

Contract 2 present worth values

= 10,000{1 – [(1 +0.06)/(1 +0.08)]^11}/(0.08 – 0.06)=

Contract 2 present worth values

= 10,000{1 – [(1 .06)/(1 .08)]^11}/( 0.02)

Contract 2 present worth values = $92,926

Now let calculate the difference in the present worth values

Present worth values Difference =$92,926-$78,590

Present worth values Difference =$14,336

Therefore the difference in the present worth values will be $14,336

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