Answer:
the credit balance in FIscus Company's accumulated depreciation account for this equipment at December 31, 2020 is $120,000
Explanation:
The computation of the credit balance is shown below:
= Depreciation expense per month × number of months
= $1,000 × 12 months
= $120,000
Hence, the credit balance in FIscus Company's accumulated depreciation account for this equipment at December 31, 2020 is $120,000
Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $1,400,000 of 4-year, 7% bonds at a market (effective) interest rate of 6%, receiving cash of $1,449,138. Interest is payable semiannually on April 1 and October 1.
Required:
A. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording of account titles.
1. Issuance of bonds on April 1.
2. First interest payment on October 1 and amortization of bond premium for six months, using the straight-line method. The bond premium amortization is combined with the semiannual interest payment. (Round to the nearest dollar.)
B. Explain why the company was able to issue the bonds for $20,811,010 rather than for the face amount of $20,000,000.
Answer:
A1.Apr.1
Dr Cash $1,449,138
Cr Premium on Bonds Payable $49,138
Cr Bonds Payable $1,400,000
A2. Oct. 1
Dr Interest Expense $24,431
Dr Premium on Bonds Payable $24,569
Cr Cash $49,000
B. The BONDS was paying HIGHER INTEREST RATE of 7% to the MARKET INTEREST RATE of 6%.
Explanation:
A1. Preparation of the journal entry to record Issuance of bonds on April 1Apr.1
Dr Cash $1,449,138
Cr Premium on Bonds Payable $49,138
($1,449,138-$1,400,000)
Cr Bonds Payable $1,400,000
(To record Issuance of bonds)
A2. Preparation of the journal entry to record First interest payment on October 1 and amortization of bond premium for six months, using the straight-line method.
Oct. 1
Dr Interest Expense $24,431
($49,000-$24,569)
Dr Premium on Bonds Payable $24,569
[($1,449,138-$1,400,000)4*2]
Cr Cash $49,000
( $1,400,000 x 7% x 6/12)
(To record First interest payment and amortization of bond premium )
B. Based on the information given the reason
WHY the company was able to issue the bonds for $20,811,010 RATHER THAN for the FACE AMOUNT of $20,000,000 was because the BONDS was paying HIGHER INTEREST RATE of 7% to the MARKET INTEREST RATE of 6%.
Daschle LLC completed some research and development during June of the current year. The related costs were $69,600. If Daschle wants to capitalize and amortize the costs as quickly as possible, what is the total amortization amount Daschle may deduct during the current year
Answer:
The answer is "8073.6".
Explanation:
Given:
Cost[tex]=69,600\\\\[/tex]
Total years[tex]= 5 \ or\ 60\ months\\\\[/tex]
total months during the year[tex]=7\\\\[/tex]
Calculating the Amortization expense:
[tex]= 69,600 \times \frac{7}{60}\\\\= 6,960 \times \frac{7}{6}\\\\= 6,960 \times 1.16\\\\=8073.6[/tex]
Hocker Company issues $200,000 of ten-year, 8% bonds to yield 10% on January 1, 20X1. The bonds pay interest annually on December 31. The bonds were sold at a discount of $24,578. The bond interest expense for 20X1 is:
Answer:
$16,000.
$17,542.
$20,000.
Explanation:
It just is
The bonds were sold at a discount of $24,578. The bond interest expense for 20X1 is $16,000, $17,542, $20,000.
What is a bond?A bond is a sort of security used in finance where the issuer owes the holder a debt and is required, depending on the terms, to repay the principal and interest on the bond at the maturity date.
The interest is typically due at predetermined intervals, such semiannually, annually, and less frequently at various times.
A bond is therefore a type of loan or IOU. With the help of bonds, the borrower can finance long-term investments or, in the case of government bonds, current expenses.
Although both stocks and bonds are considered securities, stockholders have an equity ownership in a corporation, whereas bondholders have a creditor stake.
Bondholders have precedence over stockholders in terms of debt. In the event of bankruptcy, they will receive payment before stockholders but after secured creditors.
Another distinction is that, unlike stocks, which often have an unlimited shelf life, bonds typically have a defined term, or maturity, after which the bond is repaid.
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Current operating income for Bay Area Cycles Co. is $26,000. Selling price per unit is $100, the contribution margin ratio is 25% and fixed expense is $104,000. Required: 1. Calculate Bay Area Cycle's breakeven point in units and total sales dollars. Break-even units Break-even dollars 2. Calculate Bay Area Cycle's margin of safety and margin of safety ratio.
Answer:
Results are below.
Explanation:
First, we need to calculate the unitary contribution margin:
Unitary contribution margin= 100*0.25
Unitary contribution margin= $25
Now, we can calculate the break-even point in units and dollars:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 104,000 / 25
Break-even point in units= 4,160
Break-even point (dollars)= fixed costs/ contribution margin ratio
Break-even point (dollars)= 104,000 / 0.25
Break-even point (dollars)= $416,000
Finally, the margin of safety in dollars as a ratio:
Current sales= (26,000 + 104,000) / 25
Current sales= 5,200
Margin of safety= (current sales level - break-even point)
Margin of safety= (5,200*100 - 416,000)
Margin of safety= $104,000
Margin of safety ratio= (current sales level - break-even point)/current sales level
Margin of safety ratio= 104,000 / 520,000
Margin of safety ratio= 0.2 = 20%
The Perfect Rose Co. has earnings of $2.30 per share. The benchmark PE for the company is 16. a. What stock price would you consider appropriate
Answer:
a.$36.80
b. $43.70
Explanation:
a. Calculation to determine What stock price would you consider appropriate
Using this formula
P= Benchmark PE ration x EPS
Let plug in the formula
P=16($2.30)
P=$36.80
Therefore What stock price would you consider appropriate is $36.80
b. Calculation to determine the stock price if the benchmark PE were 19
Using this formula
P= Benchmark PE ration x EPS
Let plug in the formula
P=19($2.30)
P= $43.70
Therefore the stock price if the benchmark PE were 19 will be $43.70
On January 1, 2017, ARC Inc. issued 100 5-year bonds, with a face value of $1,000 each and a coupon rate of 10%, payable semiannually. The interest is paid on June 30 and December 31 of each year. The market rate of interest at the time that the bonds were issued was 13%, so that the bonds were sold for $892 each.1. Interest expense for the January 1–June 30 period was $_____.
2. Interest expense for the July1–December 31 period was $_____.
3. Book value of Bonds on June 30 was $_____.
4. Book value of Bonds on December 31 was $_____.
5. Interest payment on June 30 was $_____.
Answer:
ARC Inc.
1. Interest expense for the January 1–June 30 period was $__5,798___.
2. Interest expense for the July 1–December 31 period was $__5,850___.
3. Book value of Bonds on June 30 was $__89,998___.
4. Book value of Bonds on December 31 was $__90,848___.
5. Interest payment on June 30 was $__5,000___.
Explanation:
a) Data and Calculations:
January 1, 2017:
Face value of issued bonds = $100,000 ($1,000 * 100)
Coupon rate of interest = 10%
Effective rate of interest = 13%
Price of issued bonds = $89,200 ($892 * 100)
Discount on bonds = $10,800 ($100,000 - $89,200)
Interest payment = June 30 and December 31 (semiannually)
June 30:
Interest expense = $5,798 ($89,200 * 6.5%)
Cash payment = $5,000 ($100,000 * 5%)
Amortization of discount = $798
Value of bonds = $89,998 ($89,200 + $798)
December 31, 2017:
Interest expense = $5,850 ($89,998 * 6.5%)
Cash payment = $5,000 ($100,000 * 5%)
Amortization of discount = $850
Value of bonds = $90,848 ($89,998 + $850)
Cost of occupancy, general management and salesforce management are considered ______________.
a) full costs
b) indirect costs
c) contribution accounting
d) All of the above
e) None of the above
Answer:
B) indirect costs
Explanation:
Indirect costs can be regarded as costs incurred whereby this cost are not directly assigned to a cost object specifically. Indirect costs can comes as a fixed cost, it can also come as variable cost. Some of Indirect costs are; personnel as well as
administration and security costs. They are costs that are not regarded as been directly related to production.
It should be noted that Cost of occupancy, general management and salesforce management are considered indirect costs.
The following are all characteristics of projects EXCEPT: A. Projects are complex, involving a variety of skills and capabilities. B. Projects have a clear starting and ending point. C. Projects typically require significant levels of cross-functional and inter-organizational coordination. D. Projects are non-routine, making planning difficult. E. Projects are companies that launch a new, sustainable business model.
Answer:
E. Projects are companies that launch a new, sustainable business model.
Explanation:
project can be regarded as series of tasks which is under processing and need to be completed so that specific outcome can be reached. A project can as well be regarded as a set of both outputs and inputs that it's needed in achieving a particular goal. Projects can simple or complex one , managing of project can be by one person or a hundred.
It should be noted that following are all characteristics of projects;
✓ Projects are non-routine, making planning difficult.
✓Projects are complex, involving a variety of skills and capabilities.
✓ Projects have a clear starting and ending point.
✓Projects typically require significant levels of cross-functional and inter-organizational coordination.
In a small open economy, output (gross domestic product) is $25 billion, government purchases are $6 billion, and net factor payments from abroad are zero. Desired consumption and desired investment are related to the world real interest rate in the following manner:
World Real Interest Rate Desired Consumption Desired Investment
5% $12 billion $3 billion
4% $13 billion $4 billion
3% $14 billion $5 billion
2% $15 billion $6 billion
For each value of the world real interest rate, find national saving, foreign lending, and absorption. Calculate net exports as the difference between output and absorption. What is the relationship between net exports and foreign lending?
Answer:
Consumption is given.
Investment is also given.
Government spending is $6 billion.
GDP is $25 billion.
National Saving = GDP - Consumption - Government spending
Foreign lending = Savings - Investment
Absorption = Consumption + Investment + Government spending
Net Exports = GDP - Absorption
The relationship/ correlation between Net Exports and Foreign Lending is one that is perfectly positive as both measures are exactly the same.
Marigold Company had the following operating data for the year for its computer division: sales, $650000; contribution margin, $147000; total fixed costs (controllable), $96000; and average total operating assets, $287000. What is the controllable margin for the year?
A. $51000.
B. $147000.
C. 15%.
D. 51%
Joe is currently selling 873 hamburgers per month at $5 per hamburger for total monthly sales of $4,365. The restaurant manager feels that a $1,000 monthly advertising budget would increase monthly sales by $3,000 to a total of 1,473 hamburgers. Should Joe add advertising
Answer:
Yes
Explanation:
Yes, as long as Joe is able to recover the money that he has spent on advertising and still increase his profit, then he should advertise. In this scenario, he wants to spend a fixed $1000 monthly on ads. If these ads generate an increase monthly sales of $3,000 as expected, then this means that Joe's restaurant will increase their total profits by $2,000 after recovering what they spent on the ads. This is what ads are for.
1. Ranghu started business with cash $80,000, goods $40,000 and furniture $20,000.
2. Sold goods to Anna of the list price $2000 at trade discount of 10%.
3. Paid rent $800, Trade expenses $400and Travelling expenses $500.
4. Deposited to AC bank for opening a current account $25,000.
5. Bought goods from Kamal for $20,000 at a trade discount of 10% and Cash discount of 2%. Paid 60% amount immediately.
Answer:
1.Raghu start the business with three things i. e cash, goods, furniture etc. Something that come in the business is debited. All these things are done by the properitor. Hence all these things are goes to Capital account. JOURNAL ENTRY WILL BE!!!! Cash a / c . Dr. 80,000 Purchase a / c . Dr. 40,000 Furniture a / c . Dr 20,000 ..To Capital a/c........... 1,40,000 (being started business with cash, goods and furniture.)
2.The answer will be Rs.1800 Explanation: 2000^ * 10\%=200 2000-200=18003.Answer will be $7004.250005.5000 please mark as brainliestHarris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 32,000 direct labor-hours would be required for the period’s estimated level of production. The company also estimated $557,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.00 per direct labor-hour. Harris’s actual manufacturing overhead cost for the year was $679,453 and its actual total direct labor was 32,500 hours.
Required:
Compute the company’s plantwide predetermined overhead rate for the year.
Answer:
Predetermined manufacturing overhead rate= $19.41 per direct labor hour
Explanation:
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= (557,000 / 32,000) + 2
Predetermined manufacturing overhead rate= $19.41 per direct labor hour
Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next months budget appear below:
Selling price per unit $29 per unit
Variable expenses $16 per unit
Fixed expenses $8,600 per month
Unit sales 1,010 units per month
Required:
a. Compute the company’s margin of safety.
b. Compute the company’s margin of safety as a percentage of its sales.
Answer and Explanation:
a. The calculation of the margin of safety is
Sales price per unit $ 29.00
Variable cost per unit ($16.00)
Contribution per unit $13.00
Fixed expenses $8,600.00
Break even sales in units ($8,600 ÷ 13) 662
Break even sales in dollars = (662 ×$29) $19,198
Actual Sales (1,010 × $29) $29,290
Margin of safety $10,092
b. The margin of safety in percentage is
= $10,092 ÷ $29,290
= 34.46%
What happens to the price of a three-year annual coupon paying bond with an 8% coupon when interest rates change from 8% to 8.96%
Answer:
It would reduce to -24.3185
Explanation:
I solved this on paper and have added the solution as an attachment
At 8% rate of interest the price of this bond is 1000
At 8.96% rate of interest the calculated price of the coupon bond is 975.681
975.681-1000 = -24.3185
When the interest rate falls from 8% to 8.96%, the price of the bond reduces by -24.3185
Consider the following information: Portfolio Expected Return Beta Risk-free 5 % 0 Market 10.6 1.0 A 8.6 0.9 a. Calculate the expected return of portfolio A with a beta of 0.9. (Round your answer to 2 decimal places.) b. What is the alpha of portfolio A. (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) c. If the simple CAPM is valid, is the above situation possible?
Answer:
a. Expected return of portfolio A = 10.04%
b. Alpha of portfolio A = 1.44%
c. No, the above situation is NOT possible. This is because return as per CAPM and expected return have different values. Therefore, we say that CAPM is NOT valid.
Explanation:
Given:
Portfolio Expected Return Beta
Risk-free 5 % 0
Market 10.6 1.0
A 8.6 0.9
a. Calculate the expected return of portfolio A with a beta of 0.9. (Round your answer to 2 decimal places.)
Expected return of portfolio A = Return as per CAPM = Risk free rate + (Beta * (Market return - Risk free rate)) = 5% + (0.9 * (10.6% - 5%)) = 10.04%
b. What is the alpha of portfolio A. (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.)
Alpha of portfolio A = Return as per CAPM - Expected return = 10.04% - 86% = 1.44%
c. If the simple CAPM is valid, is the above situation possible?
No, the above situation is NOT possible. This is because return as per CAPM and expected return have different values. Therefore, we say that CAPM is NOT valid.
You have just made your first $4,400 contribution to your retirement account. Assume you earn a return of 13 percent per year and make no additional contributions. a. What will your account be worth when you retire in 29 years
Answer: $152,309.69
Explanation:
You are looking for the future value of this amount in 29 years assuming it will be compounded annually.
Future value = Amount * (1 + rate)^ number of years
= 4,400 * ( 1 + 13%)²⁹
= $152,309.69
A farmer sells a bushel of corn to the supermarket for $12. The supermarket then sells the corn to customers for $25. What is the total contribution to GDP?
Answer:
$ 25
Explanation:
As per the description, the exact amount that is being contributed from the corn bushel to the Gross Domestic Product would be $ 25. The price at which the farmer sold it to the supermarket would not be included in the GDP because it would be considered as an intermediary good because the good purchased for the resale purpose is not included in GDP as it leads to double-counting. Thus, only the price of the final good i.e. $ 25 would be included in GDP as it will now be used for final consumption by the customers.
which of the following is false? when a cboe call option on ibm is exercised, ibm issues more stock. an american option can be exercised at any time during its life. a put option will always be exercised at maturity if the strike price is greater than the underlying asset price
Answer:
The false statement is:
when a CBOE call option on IBM is exercised, IBM issues more stock.
Explanation:
CBOE = Chicago Board Options Exchange. CBOE pioneered the options trading in 1973. It has remained the largest U.S. options market operator. It supports options trading on thousands of publicly listed stocks and exchange-traded products. Exercising a call option on the exchange platform does not affect the outstanding IBM stock and will never force IBM Corporation to issue more stock.
A stock just announced that its next annual dividend will be $1.02 and it expects to increase that dividend by 2.5 percent annually. The stock is currently selling for $28 a share. How do you compute the expected rate of return?
a) i = ($1.02/$28) + 0.025
b) i = [($1.02 x 1.025)/$28] + 0.025
c) i = ($1.02/$28) - 0.025
d) i = ($1.02 X 1.025)/$28
Answer: A. i = ($1.02/$28) + 0.025
Explanation:
The expected rate of return will be calculated as:
= (Expected dividend/Price today) + growth rate
where,
Expected dividend = $1.02
Price today = $28
Growth rate = 2.5%
Then, slotting the figures into the equation will give:
= (1.02/28) + 2.5%
= (1.02/28) + 0.025
Therefore, the correct option is A
Kuley bought a new loom today from GlivCo. She will receive a cash rebate of $820 from GlivCo in 1 year, pay $1,470 to GlivCo in 2 years, receive a cash rebate of $940 from GlivCo in 4 years, and pay $3,580 to GlivCo in 7 years. If the discount rate is 7.12 percent, then what is the present value of the cash flows associated with this transaction
Answer:
$-2013.69
Explanation:
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow in year 1 = 820
Cash flow in year 2 = -1470
Cash flow in year 3 = 0
Cash flow in year 4 = 940
Cash flow in year 5 = 0
Cash flow in year 6 = 0
Cash flow in year 7 = -3580
I = 7,12 %
PV = -2013
To find the PV 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
he building is subject to a mortgage of $10,000, which the partnership has assumed. The partnership agreement also specifies that profits and losses are to be distributed evenly without a true up payment. What amounts shoul
Answer:
I. $35,000; II. $75,000
Explanation:
Calculation to determine What amounts should be recorded as capital for Roberts and Smith at the formation of the partnership
ROBERTS net assets contributed= ($20,000 + $15,000)
Roberts net assets contributed=$35,000
SMITH fair market value of the net assets contributed = ($30,000 + $15,000 + $40,000 - $10,000)
Smith fair market value of the net assets contributed=$75,000
Therefore the amount tha should be recorded as capital for Roberts and Smith at the formation of the partnership is $35,000;$75,000
The second step in developing a Performance Measurement Baseline (PMB) is to: Define and scope the work Schedule the work Prepare the Integrated Program Management Report (IPMR) Budget the work
Answer:
The second step in developing a Performance Measurement Baseline (PMB) is to:
Schedule the work.
Explanation:
After determining the goal and deliverables of the project, the scope baseline is created using the scope statement, the work breakdown structure and dictionary. These documents require stakeholders approval. Then, the second step is to determine the sequence of activities, estimate the durations of activities, and determine the resource needs of the scheduled activities.
If the substitution effect of the real interest rate on saving is larger than the income effect of the real interest rate on saving, then a rise in the real interest rate leads to a ________ in consumption and a ________ in saving, for someone who's a lender.
Answer:
rise, fall
Explanation:
In the case when the subsitution effect with respect to the real rate of interest should be saved and more than the income effect on the real rate of interest so if there is an increased in the real rate of interest so there is an increase in the consumption also there is the fall in the savings
Also, if there is a more income effect, the consumption should rise and the savings would decline
Therefore the rise and fall should be considered to fill the blanks
Rick has met with the Small Business Administration, which analyzed his entrepreneurial skills and provided him with a summary of the results. Out of these findings of the SBA, what might challenge Rick in his quest to become a successful entrepreneur? a) Rick is conscientious and emotionally stable. b) Rick has some tolerance for ambiguity because he knows he is trying to do things that haven't been done before. c) Rick has an external locus of control. d) Rick is comfortable with a moderate level of risk, and he has the confidence to act decisively. e) Rick has a high nec Rick has a high need for autonomy and wants to shape his own destiny
Answer:
c) Rick has an external locus of control.
Explanation:
What can challenge Rick in his quest to become a successful entrepreneur is that he has an external locus of control, which occurs when an individual relates events related to their failures or successes to external variables that are not their responsibility, such as fate, luck or bad luck.
The external locus of control can pose a challenge for Rick in the sense that an entrepreneur's success is related to his own personal control and personal efforts to make the business viable and successful in the market. It is necessary for the entrepreneur to understand that there are risks inherent to the business and that a business can work according to their efforts, learning and planning, that is, the entrepreneur and their control and management actions will be responsible for the success or failure of the business, and not just external factors like fate or bad luck.
The EPS for TJX for the fiscal years ending January 2006 (FY2005) through January 2010 (FY2009) are:
Answer:
Fiscal Year:
2005 $1.40
2006 $1.60
2007 $1.70
2008 $2.00
2009 $2.80
Explanation:
Earnings per share is the residual profit after interest and dividends available for shareholders. EPS is calculated by dividing net profit by outstanding shares. It indicates company profitability and analysts use this ratio to make prediction about future performance of the company.
While Amazon has become a very powerful e-commerce firm here in the US, Alibaba, the Chinese company is very powerful in many parts of the world. Go to Wikipedia and read about the different type of businesses that Alibaba operates. Then write a short outline of these businesses.
Answer:
Alibaba is a chinese company, one of the largest in the world by market capitalization.
While it mainly specializes in online retail (both business to consumer, and business to business), it is also involved in other business activities such as cloud computing, electronic payment, artificial intelligence services, and data science and analysis. In fact, Alibaba is considered not only one of the best retailers in the world, but also one of the best artificial intelligence and data-driven companies in the world.
If a firm has sales of $100, total expenses (including interest and taxes) of $50, has a stock that is selling at $50 per share and has 10 shares of stock outstanding, then the firm has a P/E ratio of:
Answer: 10
Explanation:
P/E Ratio = Price per share/Earnings per share
Earnings per share:
= (Sales - expenses) / number of shares outstanding
= (100 - 50) / 10
= $5.00
P/E Ratio is therefore:
= 50 / 5
= 10
Jolene, a sales representative, was worried about her work-related productivity so she made a series of entries in her records to show that she had more sales than she actually did. This is known as _____.
a. defalcation.
b. fraudulent concealment.
c. false entries.
d. forgery.
e. pretexting.
Answer: False entries
Explanation:
False entries refers to the entries on the books of a company or a bank that is intentionally made as a form of deceit and false misinterpretation.
The intent of false entries is usually to defraud an organization. False entries is a punishable offence by law. Since Jolene recorded sales that was more than what she actually did, this is a false entry.
Entering records that shows that she had more sales than she actually did is called false entries.
What is false entries?This is the act of fraudulently entering data that does not actually exist on a record.
This is a fraudulent act that can cost her the job when discovered. It shows that she does not have respect for work ethics.
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The marginal product of labor in the production of computer chips is chips per hour. The marginal rate of technical substitution (MRTS) of hours of labor for hours of machine capital is . What is the marginal product of capital? The marginal product of capital is nothing chips per hour. (Enter your response as an integer.)
Answer: 500 chips per hour
Explanation:
Marginal rate of technical substitution is calculated by the formula:
= Marginal product of labor / Marginal product of capital
0.20 = 100 / marginal product of capital
Marginal product of capital * 0.20 = 100
Marginal product of capital = 100 / 0.20
= 500