Answer:
$812.49 and $28,369,687.5
Explanation:
Let us assume the annual payments be X
Sale of ordinary annuity = X × PVAF factor
$4,947.11 = X × PVAF(6.5%, 8 years)
$4,947.11 = 6.0888 × X
X = $812.49
And,
The Present value is
Present value = Annual payments + Annual payments × PVAF factor
= $4,375,000 + $4,375,000 × PVAF(6.5%, 7 years)
= $4,375,000 + $4,375,000 × 5.4845
= $28,369,687.5
The $4,375,000 is come from
= $35,000,000 ÷ 8 years
= $4,375,000
Refer to the PVAF factor table
We simply applied the above formulas
Denton Company manufactures and sells a single product. Cost data for the product are given below:
Variable costs per unit:
Direct materials $5
Direct labor 11
Variable manufacturing overhead 3
Variable selling and administrative 1
Total variable cost per unit $20
Fixed costs per month:
Fixed manufacturing overhead $120,000
Fixed selling and administrative 169,000
Total fixed cost per month $289,000
The product sells for $52 per unit. Production and sales data for July and August, the first two months of operations, are as follows:
Units Produced Units Sold
July 27,000 23,000
August 27,000 31,000
The companyâs Accounting Department has prepared absorption costing income statements for July and August as presented below:
July August
Sales $1,196,000 $1,612,000
Cost of goods sold 483,000 651,000
Gross margin 713,000 961,000
Selling and administrative expenses 241,000 265,000
Net operating income $472,000 $696,000
Required:
1. Determine the unit product cost under absorption costing and variable costing.
2. Prepare contribution format variable costing income statements for July and August.
3. Reconcile the variable costing and absorption costing net operating income.
Answer:
1. The unit product cost under absorption costing and variable costing.
Product Cost : Absorption Costing = $23,44
Product Cost : Variable Costing = $19.00
2. Contribution format variable costing income statements for July and August.
July August
Sales 1,196,000 1,612,000
Less Cost of Sales : (437,000) (513,000)
Opening Stock 0 76,000
Add Production 513,000 513,000
Less Closing Stock (76,000) (76,000)
Contribution 759,000 1,099,000
Less Expenses :
Selling and administrative expenses
Variable : (23,000) (21,000)
Fixed : (169,000) (169,000)
Net operating income 567,000 909,000
3. Reconcile the variable costing and absorption costing net operating income
July August
Absorption costing net operating income $584,760 $891,240
Add Fixed Costs in Opening Inventory $17,760
Less Fixed Costs in Closing Inventory ($17,760)
Variable costing net operating income $567,000 $909,000
Explanation:
Product Cost : Absorption Costing = All Manufacturing Costs (Fixed and Variable)
= $5+$11+$3+($120,000/27,000)
= $5+$11+$3+$4.44
= $23,44
Product Cost : Variable Costing = Variable Manufacturing Costs
= $5+$11+$3
= $19.00
Martin Services Company provides its employees vacation benefits and a defined contribution pension plan. Employees earned vacation pay of $45,000 for the period. The pension plan requires a contribution to the plan administrator equal to 7% of employee salaries. Salaries were $400,000 during the period. Required: Provide the journal entries for (a) the vacation pay and (b) the pension benefit. Refer to the Chart of Accounts for exact wording of account titles.
Answer and Explanation:
The journal entries are shown below:
a. Vacation and Holidays expenses Dr. $45,000
To vacation and Holidays payable $45,000
(Being the Vacation pay is recorded)
For recording this we debited the vacation and holidays expense as it increase the expenses and credited the vacation & holidays payable as it also increase the liabilities
b. Pension Expense Dr. $28,000 ($400,000 × 7%)
To Pension Liability $28,000
(Being the pension benefit is recorded)
For recording this we debited the pension expense as it increase the expenses and credited the pension liability as it also increase the liabilities
Vasquez Construction has been awarded a contract by a local school board to build a new public school and must provide a performance bond. a. With respect to the performance bond, identify the principal, surety, and obligee. b. If Vasquez Construction fails to complete the building according to the terms of the contract, what would be the surety’s obligation? c. Does the surety have any recourse against Vasquez Construction in this example? Explain your answer.
Answer:
(a) The Vasquez construction is the principal, the surety is the party that underwrites the contract and local school board is the obligee.
(b) If Vasquez fails to finish the contract, then the surety will be required to pay for the loss suffered by the obligee due to the contract failure.
(c) In a surety bonds contract, the surety has a legal right to get back the losses from the principal.
Explanation:
Solution:
(a) Under a performance bond contract, the owners assures that the work will be completed within a specific time frame and contract specification.
In this example given, the Vasquez construction is the principal, the surety is the party that underwrites the contract and local school board is the obligee.
(b) If the Vasquez construction fails to complete or finish the contract, then the surety will be obliged to pay for the loss suffered by the obligee due to the failure of the contract.
(c) In a surety bond contract, the surety has a legal right to recover the losses from the principal. for this later on, the surety can recover it's loss from the principal.
Ziva is an organic lettuce farmer, but she also spends part of her day as a professional organizing consultant. As a consultant, Ziva helps people organize their houses. Due to the popularity of her home-organization services, Farmer Ziva has more clients requesting her services than she has time to help if she maintains her farming business. Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce.
Refer to Scenario 13-3. Ziva's economic profit from farming equals _______.
Answer:
Economic profit= -$80
Explanation:
Giving the following information:
Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce.
The economic profit includes the opportunity cost of not working as a home-organization.
Economic profit= (300 - 130) - 25*10
Economic profit= -80
The independent cases are listed below includes all balance sheet accounts related to operating activities:
Case A Case B Case C
Net income $ 303,000 $ 11,500 $ 413,000
Depreciation expense 33,000 143,000 73,000
Accounts receivable increase (decrease) 86,000 (193,000) (13,000)
Inventory increase (decrease) (43,000) 28,000 43,000
Accounts payable increase (decrease) (43,000) 113,000 63,000
Accrued liabilities increase (decrease) 53,000 (213,000) (33,000)
Required:
1. Show the operating activities section of cash flows for each of the given cases. (Amounts to be deducted should be indicated with minus sign.)
Case A Case B Case C
Net Income
Adjustments to Reconcile Net income to Net Cash Provided by Operating Activities
Depreciation
Changes in Assets and Liabilities
Accounts Receivable
Inventory
Accounts Payable
Accrued Liabilities
Net Cash Provided by Operating Activities
Answer:
Explanation:
Cash flow from operating activities:
Case A Case B Case C
Net Income 3,03,000 11,500 4,13,000
Depreciation Expense 33,000 1,43,000 73,000
Accounts Receivable increase(decrease) -86,000 1,93,000 13,000
Inventory increase(decrease) 43,000 -28,000 -43,000
Accounts Payable increase(decrease) -43,000 1,13,000 63,000
Accrued Liabilities increase(decrease) 53,000 -2,13,000 -33,000
Net Cash provided by Operating activities 3,03,000 2,19,500 4,86,000
Answer:
See answer and explanation below.
Explanation:
Details Case A ($) Case B ($) Case C ($)
Net income 303,000 11,500 413,000
Depreciation expense 33,000 143,000 73,000
Changes in Assets and Liab.:
Accounts receivable (86,000) 193,000 13,000
Inventory 43,000 (28,000) (43,000)
Accounts payable (43,000) 113,000 63,000
Accrued liabilities 53,000 (213,000) (33,000)
Net Cash from Operating Act. 303,000 219,500 486,000
National Corporation needs to set a target price for its newly designed product M14–M16. The following data relate to this new product.
Per Unit Total
Direct materials $23
Direct labor $45
Variable manufacturing overhead $12
Fixed manufacturing overhead $1,296,000
Variable selling and administrative expenses $ 10
Fixed selling and administrative expenses $ 1,134,000
These costs are based on a budgeted volume of 80,000 units produced and sold each year. National uses cost-plus pricing methods to set its target selling price. The markup percentage on total unit cost is 35%.
Required:
a) Compute the total variable cost per unit, total fixed cost per unit, and total cost per unit for M14–M16.
b) Compute the desired ROI per unit for M14–M16. (Round answer to 2 decimal places, e.g. 10.50.)
Answer:
Total Variable Costs per unit $ 90
Total Fixed Cost per unit $ 30.375
Total Unit Costs= $ 120.375
The investor will receive a benefit of $ 1.13 per unit .
Explanation:
National Corporation
M14–M16
Per Unit Total
Direct materials $23 1840,000
Direct labor $45 3600,000
Variable manufacturing overhead $12 960,000
Fixed manufacturing overhead $1,296,000
Variable selling & Admin. expenses $ 10 800,000
Fixed selling and administrative expenses $ 1,134,000
Total Variable Costs per unit $ 90
Direct materials $23
Direct labor $45
Variable manufacturing overhead $12
Variable selling & Admin. expenses $ 10
Total Fixed Cost per unit $ 30.375
Fixed manufacturing overhead =$1,296,000/ 80,000= $ 16.2
Fixed selling and administrative expenses = $ 1,134,000 / 80,000 = $ 14.175
Total Unit Costs= Total Variable Costs per unit + Total Fixed Cost per unit
=$ 90 + $ 30.375= $ 120.375
Return on investment measures the benefit an investor will receive in relation to their investment cost.
Desired ROI per unit + Fixed Cost= Mark Up Percentage * Variable Cost Per Unit
Putting values in the above
Desired ROI per unit + $ 30.375= 35 % * $ 90
Desired ROI per unit = 31.5- 30.375
Desired ROI per unit = $ 1.125= $ 1.13
The investor will receive a benefit of $ 1.13 per unit .
Fir the third quarter, the sales are 1,000 units, the seasonal index fir the quarter is 0.85. what is the deseasonalized sales for the quarter
Answer:
1,176 units
Explanation:
The demand which is created due to a season or specific time in each year is called seasonal demand.
Seasonal Demand = 1,000 units
Seasonal Index = 0.85
Using following formula we can calculate the deseasonalized sales
Seasonal demand = Deseasonalized Sales x Seasonal Index
Placing value in the formula
1,000 units = Deseasonalized Sales x 0.85
Deseasonalized Sales = 1,000 / 0.85 = 1176.47
Deseasonalized Sales = 1,176 units
what form of business ownership would you recommend to Alison and why?
Business Case-Alison's coffee shop
Answer:
Sole ownership will be the best for the coffees business
Explanation:
This is because opening a coffee shop comes with the individual usually having a very great deal of passion for it. The recipes for the coffee would also be best suited to a person who prepares it in his/her unique way.
The coffee shops mostly comes with a reasonably average degree of profitability and lower risks due to a low degree of wastage or spoilage and it being very easy to make so it’s best owned by a single person to cut cost and avoid profit sharing .
Dalrymple Bay Coal Terminal, a coal-handling facility and export terminal in Queensland, Australia, has issued triple-A rated bonds for $680 million in Australian dollars. The bonds will be used to refinance existing bank debt caused by the acquisition of eases from the Queensland government in 2002. The Commonwealth Bank of Australia acted as investment bankers to the transaction.
Required:
1. This means the Commonwealth Bank of Australia __________.
Group of answer choices:
A. Engaged in factoring the sale
B. Bought the bonds from Dalrymple and sold them to the public
C. Operates in the secondary securities market
D. Was responsible for co-insurance of the bond premium
E. Would be responsible for paying the dividend if Dalrymple were unable to
Answer:
B. Bought the bonds from Dalrymple and sold them to the public
Explanation:
As the Investment Bankers for the event, The Commonwealth Bank of Australia were underwriters to the issue.
One of the methods of Underwriting that Investment bankers embark on is called the FIRM COMMITMENT Principle which states that the Investment bank will.buy all the bonds or shares and then resell them. If they are unable to resell them however, the remaining bonds or stock is their problem.
Teal Mountain Company leased equipment from Costner Company, beginning on December 31, 2019. The lease term is 8 years and requires equal rental payments of $54,782 at the beginning of each year of the lease, starting on the commencement date (December 31, 2019). The equipment has a fair value at the commencement date of the lease of $340,000, an estimated useful life of 8 years, and no estimated residual value. The appropriate interest rate is 8%. Click here to view factor tables. Prepare Teal Mountain’s 2019 and 2020 journal entries, assuming Teal Mountain depreciates similar equipment it owns on a straight-line basis
Answer:
See the explanation below.
Explanation:
Date Details Dr ($) Cr ($) .
31 Dec. '19 Leased equipment 340,000
Lease liability 340,000
To record liability form equipment lease. .
31 Dec. '19 Leased liability 54,782
Cash 54,782
To record lease payment. .
31 Dec. '20 Interest expense 22,817.44
Lease liability 31,964.56
Cash 54,782
To record interest expense and lease payment. .
31 Dec. '20 Depreciation expense 42,500
Accumulated depreciation - lease 42,500
To record right-of -use equipment amortization .
Note:
31 Dec. '20 Interest expense = (340,000 - 54,782) * 8% = $22,817.44
31 Dec. '20 Lease liability = $54,782 - $22,817.44 = $31,964.56
31 Dec. '20 Depreciation expense = 340,000 / 8 = $42,500
You manage a department of five employees. You have identified that Ashley has a high need for achievement, Mary has a high need for power, and Keith has a high need for affiliation. Sarah scored high on the need for power and low on the need for affiliation. Doug scored low on both need for power and need for affiliation.
1. Which of these five employees is most likely to be suitable for a new assignment that involves a high degree of personal responsibility and feedback?
A) Mary
B) Ashley
C) Keith
D) Sarah
E) Doug
2. Which of these five employees is most suitable for handling your responsibilities when you are on a vacation?
A) Ashley
B) Mary
C) Keith
D) Sarah
E) Doug
Answer: 1. B. Ashley
2. D. Sarah
Explanation:
1. When selecting someone fkr an assignment that involves a high degree of personal responsibility and feedback, it is important that their drive to accomplish the mission is gauged. They must be the type of people that will want to get the job done.
Ashley scored high on Achievement making her the best for this role because she will strive hard to accomplish the task because she loves achieving set targets.
2. Sarah scored high on power but low on affiliation. This means that she a high need to control others and yet a low need to have overly friendly relationship with others. This will help her manage the company well because she yarns to control people and at the same time will be impartial due to her low need for affiliation.
Torres Company accumulates the following summary data for the year ending December 31, 2020, for its Water Division, which it operates as a profit center: sales—$2,076,800 budget, $2,240,000 actual; variable costs—$1,002,000 budget, $1,054,100 actual; and controllable fixed costs—$298,600 budget, $303,800 actual.
Prepare a responsibility report for the Water Division for the year ending December 31, 2020.
Answer and Explanation:
The Preparation of responsibility report is shown below:-
Responsibility report
Torres Company
For the year ended December 31, 2020
Particulars Budgeted Actual Difference
Sales a $2,076,800 $2,240,000 $163,200 Favorable
Variable costs b $1,002,000 $1,054,100 $52,100 Unfavorable
Contribution
margin $1,074,800 $1,185,900 $111,100 Favorable
c = a - b
Controllable
fixed costs d $298,600 $303,800 $5,200 Unfavorable
Controllable
margin $776,200 $882,100 $105,900 Favorable
e = c - d
Therefore if budgeted is higher than actual then it will become Favorable and if actual is higher than budgeted than it will become Unfavorable.
Ying pays $300 of investment interest related to her investments. The interest is not directly related to any particular investment owned by Ying. She owns $40,000 worth of municipal bonds that pay her $2,400 in interest and $20,000 worth of bonds that pay her taxable interest of $2,000. Ying allocates the investment fees based on the fair market value of the securities. The allocation between the nondeductible portion of the fee and the deductible portion is:
Answer:
yeet
Explanation:
Doon Company incurred the following costs while producing 580 units: direct materials, $ 5 per unit; direct labor, $ 29 per unit; variable manufacturing overhead, $ 10 per unit; total fixed manufacturing overhead costs, $ 12 comma 180; variable selling and administrative costs, $ 3 per unit; total fixed selling and administrative costs, $ 8 comma 120. There are no beginning inventories. What is the operating income using absorption costing if 580 units are sold for $ 120 each?
Answer:
$22,040
Explanation:
The operating income using absorption costing is find out by using the following equation
Sales revenue $69,600 (580 units × $120)
Less:
Direct material cost $2,900 (580 units × $5)
Direct labor cost $16,820 (580 units × $29)
Variable manufacturing overhead $5,800 (580 units × $10)
Fixed manufacturing overhead $12,180
Variable selling and admin cost $1,740 (580 units × $3)
Fixed selling and admin cost $8,120
Operating income using absorption costing $22,040
We simply deduct the all cost from the sales so that the operating income under absorption costing could come
As an auditor for Bernard and Thomas, you are responsible for determining the proper classification of income statement items in the audit of California Sports Grill. Required: Select whether each of the following items should be classified as discontinued operations, other revenues, or other expenses.
Items Description
a. One of the company's restaurants was destroyed in a forest fire that raged through Southern California. Uninsured losses from Other expenses the fire are estimated to be $450,000
b. Califomia Sports Grill has three operating divisions: restaurants, catering, and frozen retail foods. The company sells the frozen retail foods division of the business for a profit of $2.4 million in order to focus more on the restaurant and catering business
c. An employee strike to increase wages and benefits shut down operations for several days at an estimated cost of $200,000.
d. A restaurant waiter slipped on a wet floor and sued the company. The employeo won a settlement for $100,000, but Califormia Sports Grill has not yet paid the settiement.
e. The company owns and operates over 40 restaurants but sold one restaurant this year at a gain of $650,000 Other revenues
Answer:
a. One of the company's restaurants was destroyed in a forest fire that raged through Southern California. Uninsured losses from the fire are estimated to be $450,000: Other expenses.
b. California Sports Grill has three operating divisions: restaurants, catering, and frozen retail foods. The company sells the frozen retail foods division of the business for a profit of $2.4 million in order to focus more on the restaurant and catering business: Discontinued operations.
c. An employee strike to increase wages and benefits shut down operations for several days at an estimated cost of $200,000: Other expenses.
d. A restaurant waiter slipped on a wet floor and sued the company. The employee won a settlement for $100,000, but California Sports Grill has not yet paid the settlement: Other expenses.
e. The company owns and operates over 40 restaurants but sold one restaurant this year at a gain of $650,000: Other revenues.
Explanation:
Other expenses in business management are non-operating expenses that a business incurs. It is a cost that isn't related to the main operation of a company's business, such as interest expense, losses incurred from disposal of a fixed asset.
Other revenues in business are revenues that are derived by a company from any source other than the company's business operations, such as a company selling one of it's restaurants.
Discontinued operations in business describes a situation where parts of a company's core business are sold, abandoned or shut down and all the profits or losses are usually reported separately on an income statement.
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows:
Direct materials: 4 pounds at $8 per pound $ 32
Direct labor: 2 hours at $16 per hour 32
Variable overhead: 2 hours at $6 per hour 12
Total standard cost per unit $ 76
The planning budget for March was based on producing and selling 32,000 units. However, during March the company actually produced and sold 37,000 units and incurred the following costs:
a. Purchased 160,000 pounds of raw materials at a cost of $7.40 per pound. All of this material was used in production.
b. Direct laborers worked 67,000 hours at a rate of $17 per hour.
c. Total variable manufacturing overhead for the month was $422,100.
Required:
1. What raw materials cost would be included in the company's planning budget for March?2. What raw materials cost would be included in the company's flexible budget for March?3. What is the materials price variance for March?4. What is the materials quantity variance for March?
Answer:
Material cost for planning budget =$1,024,000
Material cost flexible budget =$1,184,000
Material price variance $96,000 favorable
Quantity variance $96,000 unfavorable
Explanation:
Material cost for planning budget = $32 × 32,000 =$1024000
Material cost flexible budget = $32× 37,000 =$1184000
Material price variance: $
160,000 pounds should have cost ( 160,000 × $8.00) 1,280,000
but did cost ( 160,000× $7.40) 1,184,000
Material price variance 96000 favorable
Material quantity variance
pounds
37,000 units should have used (37,000 × 4 pounds) 148,000
but did take 160,000
Variance 12000 unfavorable
standard price × $8.00
Quantity variance $96,000 unfavorable
Ted is the owner and chief executive officer of a business. He recently began an advertising campaign to promote a new product that is regulated by state law. The law is somewhat unclear. Before launching the campaign, he researched the relevant law and consulted with his attorney in an effort to comply with the law. Nevertheless, the attorney general of his state has filed a lawsuit against him for deceptive advertising. Ted's best defense is that ___________.a. He acted in good faith by conducting due diligence and acting accordingly, under anunclear law.b. Marshall owns and operates a construction firm.c. He uses inexpensive and low-gradebuilding products and accepts inferior carpentry work from his subcontractors.d. Nevertheless, Marshall complies with all the city building codes as well as all state and federal laws.
Answer:
The answer is "Option a"
Explanation:
In the given question only "option a" is correct, which can be described as follows:
He is the owner and managing director of an organization and recently he introduced media attention initiatives to encourage a specific app controlled by federal law.Its law is rather ambiguous. He reviewed the relevant law before starting the initiative and met with his counsel in an attempt to comply with the rule. Even so, this state attorney general's office also filed a suit against him after misleading publicity. He provides the best defense, which acted in good faith with proper research and in line with an unspecified rule.Byrd Company produces one product, a putter called GO-Putter. Byrd uses a standard cost system and determines that it should take one hour of direct labor to produce one GO-Putter. The normal production capacity for this putter is 145,000 units per year. The total budgeted overhead at normal capacity is $1,160,000 comprised of $435,000 of variable costs and $725,000 of fixed costs. Byrd applies overhead on the basis of direct labor hours.
During the current year, Byrd produced 79,900 putters, worked 94,400 direct labor hours, and incurred variable overhead costs of $157,882 and fixed overhead costs of $539,908.
a) Compute the predetermined variable overhead rate and the predetermined fixed overhead rate.
b) Compute the applied overhead for Byrd for the year.
c) Compute the total overhead variance.
Answer:
Product, A Putter Called GO-Putter. Byrd Uses A Standard Cost System And Determines That It Should Take One Hour Of Direct Labor To Produce One GO-Putter. The Normal Production Capacity For This Putter Is 145,000 Units Per Year
Explanation:
Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.31 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $1,785,000 in annual sales, with costs of $695,000. The tax rate is 25 percent and the required return on the project is 12 percent. What is the project’s NPV? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, and round your answer to 2 decimal places, e.g., 1,234,567.89.)
Answer:
$115,849.581
Explanation:
For computing the net present value first we have to do following calculations
Annual depreciation expense is
= (Cost - Salvage value) ÷ Useful life
= ($2.31 million ÷ 3)
= $770,000
Now
Annual Operating cash flow = (Sales - Costs) × (1 - tax rate) + Tax savings on Annual depreciation
= ($1,785,000 - $695,000) × (1 - 0.25) + (0.25 × $770,000)
= $817,500 + $192,500
= $1,010,000
Now Present value of annuity is
= Annuity × [1 - (1 + interest rate)^ -time period] ÷ rate
= $1,010,000 × {1 - (1.12)^-3] ÷ 0.12
= $1,010,000 × 2.401831268
= $2,425,849.581
So, Net present value is
= Present value of inflows - Present value of outflows
= $2,425,849.581 - $2,310,000
= $115,849.581
Truck drivers for a hauling company, while loading a desk, found a $100 bill that had fallen out of the desk. They agreed to get it exchanged for small bills and divide the proceeds. En route to the bank, one of them changed his mind and refused to proceed with the scheme, whereupon the other pulled a knife and demanded the bill. A police officer intervened. What crimes have been committed?
Find the given attachments
When the non-dividend paying stock price is $20, the strike price is $20, the risk-free rate is 6%, the volatility is 20% and the time to maturity is 3 months, which of the following is the price of a European call option on the stock?
(Note: N(*) represent cumulative normal density function.)
a. 20*N(0.1) - 19.7*N(0.2)
b. 19.7*N(0.2) - 20N*(0.1)
c. 19.7*N(0.1) - 20N*(0.2)
d. 20N*(0.2) - 19.7N*(0.1)
Answer:
The correct option is d.20N(0.2)-19.7N*(0.1)
Explanation:
Given the following inputs:
Stock Price 20
Strike Price 20
Time to maturity: 0.25
Risk-free Rate 0.06
Dividend Yield 0
Annualized volatility 0.2
Cost of Carry 0.06
We get the following outputs:
d1=0.2
d2=0.1
N(d1)=0.57925971
N(d2)=0.53982784
Call=0.94937723
Describe the best structural configuration for an organization?
Explanation:
The structural configuration in an organization corresponds to a model that helps in understanding the organizations existing in a company for the development of effective strategies.
In order to establish the configuration, all parts of the organization, design parameters, situational factors and coordination mechanisms must be simulated, so that there is an integrated understanding so that it is possible to establish which strategic management model will be ideal for each type of organization. structural configuration.
There are seven types of organizational configuration:
business organization, machine organization, professional organization, diversified organization, innovative organization, missionary organization and political organization.There are also the forces associated with the structural configuration, such as: learning, efficiency, direction, proefficiency, responsibility, cooperation and competition.
For a company to develop the best structural configuration, it must be evaluated to identify challenges and impediments of the project, so that it is aligned with the organizational values and objectives, so that the structure is integrated and effective.
Property Rights and Corruption When looking at a country as a market or investment, the international business must consider the country's legal system. In that assessment, the firm needs to understand the differences between private actions, which refer to theft, piracy, blackmail, and the like from individuals or groups, and public actions, which are those actions taken by politicians and government bureaucrats. Either kind of action would pose a serious threat to the firm's investment or operations. Before the firm can seek legal remedies, it must clearly understand the options open to it.
In a legal sense, property refers to a resource over which an individual or a business holds a legal title. It is a resource that it owns. Countries differ in the extent to which their legal systems define and protect property rights, even those countries that are still nominally communist states. Property rights can be violated, sometimes by governments and sometimes by individuals or groups.
1. Pleae select that whether below items are the Private Action or Public Action?
a. legal mechanisms
b. theft or blackmail
c. organized crime/ protection money
d. bribery
e. weak legal system
f. corruption
Options:
O Private Action
O Public Action
Answer:
Property Rights and Corruption
Private Action or Public Action:
a. legal mechanisms = Public Action
b. theft or blackmail = Private Action
c. organized crime/ protection money = Private Action
d. bribery = Private Action
e. weak legal system = Public Action
f. corruption = Private Action
Explanation:
Eclectic Paradigm is a three-tiered evaluation process which a company that plans to go international must follow in determining whether it would profit the company better limiting its operations to the domestic market or extending its operations to the international market.
The eclectic paradigm is called the OLI model or framework. It examines the Ownership Rights, Locational Advantages, and Internalization Factors. This helps the company to make decisions that are beneficial to it.
Property rights and corruption are aspects of the Ownership Rights that must be considered. Failure to put these factors into consideration may expose the company to risks and uncertainties and greatly reduce the ability of the company to increase economic benefits arising from transactions.
Your boss approaches you in mid-December and requests that you pay certain employees their gross pay amount as if there were no deductions as their Christmas bonuses. None of the employees have reached the Social Security wage base for the year. What is the gross-up amount for each of the following employees?
a) The tax rate on bonuses is 28%.
b) The Social Security (6.2%) and Medicare taxes (1.45%) must be added to this rate.
c) Yves St. John, regular gross pay per period $1425 Kim Johnson, regular gross pay per period $2,400
d) Michael Hale, regular gross pay per period $2,240
Answer:
Yves St Jones would be payed $2,214.45
Kim Johnson would be payed $3,729.60
Michael Hale would be payed $3,480.96
Explanation:
Tax rate = Bonus + Social Security + Medicare Tax
= 28.00% + 6.20% + 1.45%
Total Tax rate = 35.65%
Net pay ratio = 100% - Tax rate
= 100% - (28 + 6.2 + 1.45)% = 64.35%
Gross pay = Net pay ÷ Net pay ratio
Employee Regular pay per period Net Pay ratio Gross pay
Yves St Jones $1,425 64.35% $2,214.45
Kim Johnson $2,400 64.35% $3,729.60
Michael Hale $2,240 64.35% $3,480.96
What would happen to the price of a certain commodity if the demand was always greater than the supply? There would be surplus of supply at any given price. Consumers would be willing to pay more for an abundant commodity and sellers would charge more, resulting in an upward spiral of the prices for the commodity. There would be a surplus of supply until the supply equals the demand. Consumers would be willing to pay more for a scarce commodity and sellers would charge more, resulting in an upward spiral of the prices for the commodity. There would be a shortage of supply until the supply equals the demand. Consumers would be willing to pay more for a scarce commodity and sellers would charge more, resulting in an upward spiral of the prices for the commodity. There would be a shortage of supply at any given price. Consumers would be willing to pay
Answer:
Consumers would be willing to pay more for a scarce commodity and sellers would charge more, resulting in an upward spiral of the prices for the commodity.
Explanation:
When demand exceeds supply, there's a scarcity. As a result of the scarcity, consumers would be willing to pay more for the good or service and suppliers would increase the price of the commodity. As a result price would rise.
Please check the attached image for a graph showing effect of excess demand on price
I hope my answer helps you.
The operations of Winston Corporation are divided into the Blink Division and the Blur Division. Projections for the next year are as follows:
Blink Division Blur Division Total
Sales $ 295,000 $ 174,000 $ 469,000
Variable costs 101,000 80,000 181,000
Contribution margin $ 194,000 $ 94,000 $ 288,000
Direct fixed costs 87,000 73,000 160,000
Segment margin $ 107,000 $ 21,000 $ 128,000
Allocated common costs 42,000 34,500 76,500
Operating income (loss) $ 65,000 $ (13,500 ) $ 51,500
Required:
1. If the Blur Division were dropped, Blink Division's sales would increase by 30%. If this happened, the operating income for Winston Corporation, as a whole, would be ___________.
A) $84,500.
B) $65,000.
C) $88,700.
D) $66,950.
Answer:
c. $88,700
Explanation:
The computation of operating income for Winston Corporation is shown below:-
Particulars Dropping before Dropping after
Sales a $469,000 $383,500
($295,000 × 130%)
Variable cost b $181,000 $131,300
($101,000 × 130%)
Contribution margin $288,000 $252,200
(c = a - b)
Direct fixed cost d $160,000 $87,000
Segment margin e $128,000 $165,200
(e = c - d)
Allocated common cost f $76,500 $76,500
Operating income(loss) $51,500 $88,700
(g = d - e)
Therefore to reach the operating income(loss) we simply deduct the allocated common cost from segment margin.
Thermal Rising, Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management has designed an activity-based costing system with the following activity cost pools and activity rates:
Activity Cost Pool Activity Rate
Supporting direct labor $26 per direct labor-hour
Order processing $284 per order
Custom designing processing $186 per custom design
Customer service $379 per customer
Management would like an analysis of the profitability of a particular customer, Big Sky Outfitters, which has ordered the following products over the last 12 months:
Standard Model Design Custom Model
Number of gliders 20 3
Number of orders 1 3
Number of custom designs 0 3
Direct labor-hours per glider 26.35 28.00
Selling price per glider $1,850 $2,400
Direct materials cost per glider $564 634
The company's direct labor rate is $19.50 per hour.
Using the company's activity-based costing system, compute the customer margin of Big Sky Outfitters.
Answer:
$1,144
Explanation:
According to the scenario, computation of the given data are as follow:-
Particular Amount ($)
Sales 44,200
Less-Direct material cost of grinder 13,182
Less-Direct labor cost 11,915
Less-Supporting direct labor 15,886
Less- Order processing 1,136
Less-customer service 379
Less- Custom designing 558
Margin of customer of big sky outfitters 1,144
Working notes
1 . Sales = Selling Price Per Grinder × No. of Grinder
= $1,850 × 20 + $2,400 × 3
= $37,000 + $7,200
= $44,200
Direct Material Cost of Grinder = Selling Price Per Grinder × No. of Grinder
= $564 × 20 + $634 × 3
= $11,280 + $1,902
= $13,182
Direct Labor Cost = No. of Grinder × Direct Labor Hour - Per Grinder × Direct Labor Rate
= 20 × 26.35 × $19.50 + 3 × 28 × $19.50
= $10,276.5 + $1,638
= $11,914.5
Supporting Direct Labor = No. of Grinder × Direct Labor Hour-Per Grinder × Supporting Direct Labor Per Direct Labor-Hour
=20 × 26.35 × $26 + 3 × 28 × $26
= $13,702 + $2,184
= $15,886
Order Processing = Total No. of Order × Order Processing Per Order
= ( 1+3) × $284
= 4 × $284
= $1,136
Custom Designing = Total No. of Custom Designing × Price Per Custom Designing
=(0+3) × $186
= $558
The customer margin is $1,144
Computation for the customer margin of Big Sky Outfitters Using the company's activity-based costing.
Revenue $44,200
[($1,850×20)+($2,400×3)
Costs:
Direct materials $13,182
[($564×20)+($634×3)]
Direct labor $11,915
[(26.35×20×19.5)+(28×3×19.5)]
Supporting Direct labor $15,886
[(26.35×20×26)+(28×3×26)]
Order processing $1,136
[(1×284)+(3×284)]
Custom design processing $558
(3×186)
Customer service $379
Total costs $43,056
Customer margin $1,144
($44,200-$43,056)
Inconclusion the customer margin is $1,144.
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https://brainly.com/question/15576057
Andre Candess manages an office supply store. One product in the store is computer paper. Andre knows that 10,000 boxes will be sold this year at a constant rate throughout the year. There are 250 working days per year and the lead-time is 3 days. The cost of placing an order is $30, while the holding cost is $15 per box per year. If he orders in batches of 500 boxes at a time, what is his annual holding cost
Answer:
$3,750
Explanation:
The computation of the annual holding cost is shown below:
= Economic order quantity ÷ 2 × holding cost per box per year
where,
Economic order quantity = 500 boxes
And, the holding cost per box per year is $15
Now putting the values to the above formula
The annual holding cost is
= 500 boxes ÷ 2 × $15 per box per year
= 250 boxes × $15 per box per year
= $3,750
Caden is 62 years old and has a traditional IRA with a balance of $220,000. Of that amount, $66,000 is from nondeductible contributions made while Caden was working. Earnings on the nondeductible contributions equal $20,600. If Caden withdraws $15,000 from his IRA this year, $_____ will NOT be subject to taxation.
Answer:
$4500.
Explanation:
So, we are given the following data or parameters or information in the question above;
=>" traditional IRA with a balance => $220,000."
=> "Of that amount, $66,000 is from nondeductible contributions made while Caden was working. "
=> "Earnings on the nondeductible contributions equal $20,600. "
=> "If Caden withdraws $15,000 from his IRA this year"
Hence;
The amount that will NOT be subject to taxation = (Amount from nondeductible contributions made while Caden was working) ÷ (traditional IRA with a balance) × (withdrawal from his IRA this year).
=> [66000/ 220000] × 15,000 = $4500.
NB: IRA stands for Individual retirement account and it is used in the United States of America to allow workers to save for their retirement and making sure that they are tax-free.
Suppose a ten-year, $ 1 comma 000 bond with an 8.6 % coupon rate and semiannual coupons is trading for $ 1 comma 035.77. a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)? b. If the bond's yield to maturity changes to 9.9 % APR, what will be the bond's price? a. What is the bond's yield to maturity (expressed as an APR with semiannual compounding)? The bond's yield to maturity is nothing%. (Round to two decimal places.)
Answer:
a. 8.30 %
b. $918.65
c. 16,60%
Explanation:
a. What is the bond's yield to maturity
Using a Financial Calculator Enter the following respective values and find i.
N = 10×2 = 20
Pmt = $1,000 × 8.6 % / 2 = $43
P/yr = 2
Pv = $ 1,035.77
Fv = $1,000
YTM / i = ?
i = 8.30%
Therefore yield to maturity is 8.30 %
b. What will be the bond's price
Using a Financial Calculator Enter the following respective values and find Pv .
N = 10×2 = 20
Pmt = $1,000 × 8.6 % / 2 = $43
P/yr = 2
Fv = $1,000
YTM / i = 9.90%
Pv = ?
Pv = $ 918.65
Therefore the bond's price is $918.65
c. What is the bond's yield to maturity
bond's yield to maturity - expressed as an APR = 8.30 % × 2
= 16,60%