Answer:
Correct Answer:
b. Functional competencies would be useful in many different industries.
Explanation:
This is because, the competencies of the organization could be useful leading to its application in many different industries. For example, a company into plastic manufacturing could diversify into electric bicycle manufacturing. Their competency in plastic manufacturing could come handy due to the parts of the bicycle being manufactured made up of plastics also.
You are saving money for a down payment on a house. Suppose you want to have total savings of $20,000 in 10 years time and you have currently $5,000. What annual interest rate do you need to earn on your initial investment, assuming you contribute no additional savings?
Answer:
14.87%
Explanation:
we have to use the future value formula to solve this question:
future value = present value x (1 + rate)ⁿ
you need to save $20,000 in 10 years (this is your future value)
currently you have $5,000 which will be $5,000 x (1 + r)¹⁰
$20,000 = $5,000 x (1 + r)¹⁰
(1 + r)¹⁰ = $20,000 / $5,000
(1 + r)¹⁰ = 4
¹⁰√(1 + r)¹⁰ = ¹⁰√4
1 + r = 1.1487
r = 1.1487 - 1
r = 0.1487 = 14.87%
A woman worked for 30 years before retiring. At the end of the first year of employment she deposited 5000 into an account for her retirement. At the end of each subsequent year of employment, she deposited 3% more than the prior year. The woman made a total of 30 deposits. She will withdraw 50,000 at the beginning of the first year of retirement and will make annual withdrawals at the beginning of each subsequent year for a total of 30 withdrawals. Each of these subsequent withdrawals will be 3% more than the prior year. The final withdrawal depletes the account. The account earns a constant annual effective interest rate. Calculate the account balance after the final deposit and before the first withdrawal.
Answer:
$797,837
Explanation:
the first withdrawal is $50,000
the second is $51,500
and so on...
the formula that used to solve the interest rate earned by the annuity is:
$50,000 x {[(1 + i)³⁰ - (1 + 3%)³⁰] / [(1 + i)³⁰ x (i - 3%)]} x (1 + i) = $5,000 x {[(1 + i)³⁰ - (1 + 3%)³⁰] / (i - 3%)}
we start to simplify the equation by cancelling {[(1 + i)³⁰ - (1 + 3%)³⁰] / (i - 3%)}
[$50,000 x (1 + i)] / (1 + i)³⁰ = $5,000
now we cancel $5,000 on each side:
[10 x (1 + i)] / (1 + i)³⁰ = 1
now lets take away (1 + i):
10 / (1 + i)²⁹ = 1
things get a little bit more simple now:
10 = (1 + i)²⁹
²⁹√10 = ²⁹√(1 + i)²⁹
1.082636734 = 1 + i
i = 1.082636734 - 1 = 0.082636734 = 8.2636734%
now we replace i in any equation:
= $50,000 x {[(1 + 0.082636734)³⁰ - 1.03³⁰] / [(1 + 0.082636734)³⁰ x (0.082636734 - 0.03)]} x (1 + 0.082636734)
= $50,000 x {[10.82636738 - 2.427262471] / [10.82636738 x 0.052636734]} x (1 + 0.082636734)
= $50,000 x {8.399104909 / 0.56986462} x (1.082636734)
= $50,000 x 14.73877236 x 1.082636734
= $797,837
Problem 5-13 Comprehensive Problem; Second Production Department-Weighted-Average Method [LO5-2, LO5-3, LO5-4, LO5-5] Old Country Links, Inc., produces sausages in three production departments—Mixing, Casing and Curing, and Packaging. In the Mixing Department, meats are prepared and ground and then mixed with spices. The spiced meat mixture is then transferred to the Casing and Curing Department, where the mixture is force-fed into casings and then hung and cured in climate-controlled smoking chambers. In the Packaging Department, the cured sausages are sorted, packed, and labeled. The company uses the weighted-average method in its process costing system. Data for September for the Casing and Curing Department follow:
Question Completion:
Data for September for the Casing and Curing Department follow:
Percent Completed
Units Mixing Materials Conversion
Work in process inventory, Sept. 1 7 100% 60% 50%
Work in process inventory, Sept 30 7 100% 20% 10%
Costs:
Mixing Materials Conversion
Work in process inventory, Sept. 1 $13,006 $112 $11,193
Costs added during September $128,404 $11,852 $110,310
Mixing cost represents the costs of the spiced meat mixture transferred in from the Mixing Department. The spiced meat mixture is processed in the Casing and Curing Department in batches; each unit in the above table is a batch and one batch of spiced meat mixture produces a set amount of sausages that are passed on to the Packaging Department. During September, 72 batches (i.e., units) were completed and transferred to the Packaging Department.
Answer:
Old Country Links, Inc.
Required:
1. Determine the Casing and Curing Department's equivalent units of production for mixing, materials, and conversion for the month of September:
Mixing Materials Conversion
Equivalent units of production:
Ending Work in process 7 1.4 0.7
Completed and transferred out 72 72 72
Equivalent units 79 73.4 72.7
2. Compute the Casing and Curing Department's cost per equivalent unit for mixing, materials, and conversion for the month of September.
Mixing Materials Conversion
Total costs of production $141,410 $11,964 $114,503
Equivalent units 79 73.4 72.7
Cost per equivalent unit: $1,790 $163 $1,575
3. Compute the Casing and Curing Department's cost of ending work in process inventory for mixing, materials, conversion, and in total for September.
Mixing Materials Conversion Total Cost
Cost per equivalent unit: $1,790 $163 $1,575
Equivalent units of Ending WIP 7 1.4 0.7
Ending WIP $12,530 $228 $1,103 $13,861
4. Compute the Casing and Curing Department's cost of units transferred out to the Packaging Department for mixing, materials, conversion, and in total for September.
Mixing Materials Conversion Total Cost
Cost per equivalent unit: $1,790 $163 $1,575
Transferred out 72 72 72
Cost transferred out $128,880 $11,736 $113,400 $254,016
5. Prepare a cost reconciliation report for the Casing and Curing Department for September.
Costs to be accounted for:
Cost of beginning WIP $17,311
Costs added to production 250,566
Total costs to be accounted for $267,877
Costs accounted for:
Cost of Ending WIP $13,861
Cost of units completed
& transferred out $254,016
Total costs accounted for $267,877
Explanation:
a) Total Costs of production:
Costs:
Mixing Materials Conversion
Work in process inventory, Sept. 1 $13,006 $112 $4,193
Costs added during September $128,404 $11,852 $110,310
Total costs of production $141,410 $11,964 $114,503
b) Equivalent unit of Ending WIP and beginning WIP
Ending Work in process 7 (7 x 100%) 1.4 (7 x 20%) 0.7 (7 x 10%)
Beginning Work in process 7 (7 x 100%) 4.2 (7 x 60%) 3.5 (7 x 50%)
c) In using the weighted-average method, Old Country Links, Inc. calculates the equivalent units of production by adding the units transferred to the Packaging Department during the period and the equivalent units in the Casing and Curing Department's ending work in process inventory. Old Country Links, Inc. uses one Work in Process account to accumulate costs for all jobs in each department.
On January 1, 2018, Gibson Corporation entered into a four-year operating lease. The payments were as follows: $26,000 for 2018, $20,500 for 2019, $18,000 for 2020, and $14,500 for 2021. What is the correct amount of total lease expense for 2019
Answer: $19,750
Explanation:
The Annual Lease expense is the average of the lease over the 4 year period.
Annual Lease Expense = Total lease expense / number of years
= (26,000 + 20,500 + 18,000 + 14,500) / 4
= 79,000 / 4
= $19,750
Suppose that Firm A and Firm B are independently deciding whether to sell at the low price or a higher price. The payoff matrix below shows the profits per year for each company resulting from the two price options. a. Does Firm A have a dominant strategy? The dominant strategy for Firm A is a low price. No, there is no dominant strategy for Firm A. The dominant strategy for Firm A is a high price.
Answer: No, there is no dominant strategy for Firm A.
Explanation:
Dominant strategies would refer to those that a Firm can take and still have a better payoff regardless of what the other Firm/player chooses. From the above, there is no dominant strategy for Firm A because there is no single strategy that they can follow that will maximise payoff regardless of what B does.
For instance, if Firm A were to charge a lower price, and Firm B charged a higher price, Firm A would make less than Firm B at $2 million. They make less regardless of any decision they make.
You have a credit card with a balance of $12,100 and an APR of 17.5 percent compounded monthly. You have been making monthly payments of $235 per month, but you have received a substantial raise and will increase your monthly payments to $285 per month. How many months quicker will you be able to pay off the account
Answer:
you will pay off your debt in 32 months less
Explanation:
I prepared two amortization schedules:
if you pay $235, it will take you 99 months to pay off your debt
if you pay $285, it will take you 67 months to pay off your debt
The alternative to viewing management as a process is to focus on
A/ Strategy
B/ People
C/ Resources
Answer:
B/ People
Explanation:
This is because, the ability to manage people and direct them on what is expected of them to do and not to do can be viewed as management. For example, directing workers on what job duties to do in a sugar manufacturing company is called management.
The following information describes a company's usage of direct labor in a recent period: Actual direct labor hours used Actual rate per hour Standard rate per hour Standard hours for units produced How much is the direct labor efficiency variance?
Answer: a) $26,000 Favorable
Explanation:
The Direct labor efficiency variance checks the how well staff are actually utilizing labor hours vs how they are expected to be utilizing it and is calculated by the formula;
Direct Labor Efficiency variance = (Standard hours – Actual hours) x Standard rate
Direct Labor Efficiency variance = ( 43,000 - 41,000 ) * 13
Direct Labor Efficiency variance = $26,000
As the Standard hours are higher than the actual hours used, this is considered a Favorable Variance.
Norek Corp. owned 70% of the voting common stock of Thelma Co. On January 2, 2018, Thelma sold a parcel of land to Norek. The land had a book value of $42,000 and was sold to Norek for $75,000. Thelma's reported net income for 2018 was $200,000. What is the non-controlling interest's share of Thelma's net income?
Answer:
$50,100
Explanation:
The computation of the non-controlling interest share is shown below:
= {Net income - (Sale value - book value)} × non owning percentage
= {$200,000 - ($75,000 - $42,000)} × 0.30
= ($200,000 - $33,000) × 0.30
= $50,100
Hence, the non controlling interest share of net income is $50,100 and the same is to be considered
What do you think are the possible major tensions that exist when a pharmaceutical firm forms an alliance with a biotechnology firm?
Answer:
The answer is below
Explanation:
Possible major tensions that exist when a pharmaceutical firm forms an alliance with a biotechnology firm are the following amongst others:
1. There is high competition from other alliances between different pharmaceutical and biotechnological firms:
In recent times, several pharmaceutical and biotechnological firms are establishing partnerships with a high probability of success, in the development of drugs and marketing. This has led to more competition and which made firms to be under immense pressure to formulate new products.
2. More public attention of the business methods and profits by the government:
Many policies and regulations regarding the healthcare sectors are designed to checkmate corrupt practices in the health industry. Thus, such alliances need to accept such regulations and operate. Otherwise, this may result in the cancellation of the permission of the operation.
3. The interdependence of the firms involved:
Both firms might find it difficult to operate most specifically at the beginning, as there will be little tension when it comes to management decisions and operation.
In which situations is a broker/seller NOT required to provide a written disclosure regarding the broker's license status?
Answer: when the broker is selling property for the broker's sister
Explanation:
The situations in which a broker or seller is not required to provide a written disclosure regarding the broker's license status is when the broker is selling property for the broker's sister.
It should be noted that license holders
that wants to either purchase or sell a property on their behalf or for a relation should disclose that they are licensed and this should be done in writing.
On June 1, Pina Colada Corp. borrows $111,000 from First Bank on a 6-month, $111,000, 8% note.
Required:
a. Prepare the entry on June 1.
b. Prepare the adjusting entry on June 30.
c. Prepare the entry at maturity (December 1), assuming monthly adjusting entries have been made through November 30.
Answer:
June 1
Cash $111,000 (debit)
Note Payable $111,000 (credit)
June 30
Interest expense $1,480 (debit)
Note Payable $1,480 (credit)
Nov 30
Note Payable $119,800 (debit)
Cash $119,800 (credit)
Explanation:
June 1
Recognize the Cash Asset received and a liability Note Payable
June 30
Interest for 1 month has accrued and this is calculated as :
Interest Expense = $111,000 × 8% × 1/6
= $1,480
Nov 30
Total Interest is capitalized to the Note Payable and the full amount is repaid
Total Interest = $111,000 × 8%
= $8,800
Ballon Amount = $111,000 + $8,800
= $119,800
2.Privacy goes hand in hand with security, but many of the activities of information security analysts seem to be an invasion of privacy. Discuss how employers can justify the use of tools, such as Encase by Guidance Software.
Answer And Explanation:
Privacy and security do work in hand in hand and complement each other in ensuring information security .By privacy we mean data that should not be available to the public and is only privy to individuals or organizations that can be attributed to ownership or use of the data. Private data could be such things as documents, photos, emails or tax returns of a person. security on the other hand are measures taken both technological or otherwise to protect the data and only give access to who should have access to the data example the owner of the photos. More specifically, security on this sense measures or comprises how secure our data is from external and undesired/unauthorized access bordering on such things as terms of network security,hardware security or data security.
Now for a security analyst to be able to protect your data, there is need to have access to your data and be able to keep track of data stored and packet flow. This could be argued to contradict privacy of data but it can be concluded that the security analyst cannot protect your data if he is not able to scan and keep track of data and therefore have access to the data.
It therefore goes to say that there must be a balance between security and privacy as they are both complementary. Encase by Guidance Software is a good example of a security software that somewhat compromises security to achieve maximum security. It is known to permeate all private data of employees in organization in the bid to keep track and protect against any malicious attacks or illegal activity. In other words, while it may seem like it violates privacy, it balances it with full protection
Suppose a local hardware store has explicit costs of $2 million per year and implicit costs of $44,000 per year. If the store earned an economic profit of $50,000 last year, this means that the store's accounting profit equaled:
Answer:
$94,000
Explanation:
A local hardware store has explicit cost of $2 million per year
The implicit costs are $44,000 per year
The store earned an economic profit of $50,000 last year
Therefore, the store's accounting profit can be calculated as follows
Accounting profit = Implicit costs + economic profit
= $44,000 + $50,000
= $94,000
Hence the store's accounting profit is $94,000
Skor Co. leased equipment to Douglas Corp. on January 2, 2011 for a 7-year period expiring December 31, 2017. Equal payments under the lease are $600,000 and are due on January 2 of each year. The first payment was made on January 2, 2011. The cost of the equipment is $2,400,000. The lease is appropriately accounted for as a sales-type lease. The present value of the lease payments is $2,800,000. What is the effect on Cost of Goods Sold for the year ended December 31, 2011?
Answer:
$2,400,000
Explanation:
Always remember that in the case of a sales type lease, the lessor at the inception of the sales type lease would recognize sale of equipment at a price of present value of the lease payments which is $2,800,000 and cost of goods sold will be recorded at cost of equipment which is $2,400,000.
Case 1: If the equipment was an inventory then the double entry would be as under:
Recording of Sales:
Dr Lease Asset $2,800,000
Cr Sale of Inventory $2,800,000
Recording of inventory out:
Dr Cost of Goods Sold $2,400,000
Cr Inventory Account $2,400,000
Case 2: If the equipment was fixed asset then the double entry would be as under:
Recording of Sales:
Dr Lease Asset $2,800,000
Cr Sale of Fixed Asset $2,800,000
Recording of equipment handing over to customer:
Dr Cost of Goods Sold $2,400,000
Cr Equipment Account $2,400,000
In both of the cases the cost of goods sold will be $2,400,000.
With this in mind, are accountants ethically obligated to report financial information accurately? Does reporting using the generally accepted accounting principles imply accuracy? What are some potential consequences for an external analyst if a company provides inaccurate or misleading financial statements?
Answer:
1. Accountants are ethically obligated to report financial information accurately
2. Reporting using the generally accepted accounting principles underscore on accuracy
3. Loss of confidence, lack of trust on the accounting team, a huge strain on their professional judgement and ethics.
Explanation:
1. Financial information in itself possesses some vital characteristics. One of these is the accuracy of the financial information. As the handler of financial activities, accountants are therefore saddled and ethically obligated to present and prepare their information accurately. This is so as to reflect the true picture of the going in the organization.
2. Reporting using GAAP - Generally Accepted Accounting Principles, seeks to converge the presentation of financial reports and statements on the basis of accuracy. Thus, reliability and relevance are ultimately the foremost objectives of these principles. I therefore have no doubt its usage conveys accuracy of reports.
3. Loss of confidence - financial reports through which the external analyst worked upon are often prepared by the internal staffs. The implication of a wrong and misleading reports from the company is an erosion of confidence on the credibility, reliability and competence of company's preparers of reports.
Lack of trust - The point above ultimately impacts on the level of trust placed on the accuracy, reliability and relevance of financial reports.
Professional Judgement and Ethics - The conducts of the company in presenting a wrong report throws the analyst into an ethnical dilemma, and a huge professional strain. This is not in line with best practices.
A project with an initial cost of $51,400 is expected to generate annual cash flows of $16,910 for the next 5 years. What is the project's internal rate of return
Answer:
19.27%
Explanation:
Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
Cash flow in year 0 = $-51,400
Cash flow each year from year 1 to 5 = $16,910
IRR = 19.27%
To find the IRR 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 IRR button and then press the compute button.
You recently purchased a stock that is expected to earn 20 percent in a booming economy, 15 percent in a normal economy, and lose 2 percent in a recessionary economy. There is 21 percent probability of a boom, 72 percent chance of a normal economy, and 7 percent chance of a recession. What is your expected rate of return on this stock
Answer:
rE = 0.1486 or 14.86%
Explanation:
The expected rate of return of a stock is the mean return that is expected to be earned by the stock considering the different scenarios that can occur, the return in these scenarios and the probability of the occurrence of these scenarios. The formula for expected rate of return of stock is,
rE = pA * rA + pB * rB + ... + pN * rN
Where,
pA, pB, ... represents the probability that scenario A, B and so on will occur or the probability of each scenariorA, rB, ... represents the return in scenario A, B and so onrE = 0.21 * 0.2 + 0.72 * 0.15 + 0.07 * -0.02
rE = 0.1486 or 14.86%
The coupon rate on a debt issue is 6%. If the yield to maturity on the debt is 9%, what is the after-tax cost of debt in the weighted average cost of capital if the firm's tax rate is 34%
Answer:
Weighted average cost of capital= 5.94%
Explanation:
The cost of debt is the required rate of return payable to investors in the debt instruments of a company. These investors include providers of long term debt finance to the company.
The cost of debt finance can determined by working out the yield to maturity on debt with adjustment for tax.
It is noteworthy that debt finance affords the company a tax savings advantage because interest expense incurred on the use of debt of are tax deductible expense.
After-tax cost of debt = (1- Tax rate) × before-tax cost of debt
Before tax cost of debt = 9%
Tax rate = 34%
After-tax cost of debt = (1-0.34) × 9% = 5.94%
After-tax cost of debt = 5.94%
Weighted average cost of capital= 5.94%
Voltanis Corp. has preferred stock outstanding that will pay an annual dividend of $2.85 every year in perpetuity. If the stock currently sells for $92.87 per share, what is the required return?
Answer:
3.07%
Explanation:
Required return is a financial term that describes the least return an individual or investor hopes to obtain by investing in a particular project. This can be derived by dividing expected annual dividend of stock with current rate of stocks, then multiply by 100
Hence, in this case, the expected annual dividend of stock is $2.85
The current rate of stock per share is $92.87
Therefore, the required return is $2.85/$92.87 = 0.0307 * 100
=> 3.07%
Hence, the final answer is 3.07%.
What aspect of evaluating a supplier might be affected by meeting government standards?
A. Completeness of orders
B. Quality
C. Flexibility
D. Timeliness
Answer:
B. Quality
Explanation:
Quality of goods and services rendered by a supplier could be affected by government standards as a result of the established methods by the government. For example, meat supplier has to abide to government standards when supplying to markets and retail sellers.
On January 1, 2018, Bishop Company issued 10% bonds dated January 1, 2018, with a face amount of $19.3 million. The bonds mature in 2027 (10 years). For bonds of similar risk and maturity, the market yield is 12%. Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided. Round your intermediate calculations to the nearest whole dollar.) Required: 1. Determine the price of the bonds at January 1, 2018. 2. Prepare the journal entry to record the bond issuance by Bishop on January 1, 2018. 3. Prepare the journal entry to record interest on June 30, 2018, using the effective interest method. 4. Prepare the journal entry to record interest on December 31, 2018, using the effective interest method.
Answer:
1) $19.3 million in bonds issued January 1, 2018
coupon rate 10%, semiannual 5% interest
maturity = 10 years x 2 = 20 periods
market interest rate = 12% / 2 = 6% semiannual
1) market price of the bonds:
PV of face value = $19,300,000 / (1 + 6%)²⁰ = $6,017,831.23
PV of coupon payments = $965,000 x 11.470 (PV annuity factor, 6%, 20 periods) = $11,068,550
market price = $17,086,381.23 ≈ $17,086,381
2) January 1, 2018, bonds issued at a discount
Dr Cash 17,086,381
Dr Discount on bonds payable 2,213,619
Cr Bonds payable 19,300,000
3) June 30, 2018, first coupon payment
Dr Interest expense 1,025,183
Cr Cash 965,000
Cr Discount on bonds payable 60,183
amortization of bond discount = ($17,086,381 x 6%) - $965,000 = $1,025,182.86 - $4,860,000 = $60,182.86 ≈ $60,183
4) December 31, 2018, second coupon payment
Dr Interest expense 1,028,794
Cr Cash 965,000
Cr Discount on bonds payable 63,794
amortization of bond discount = ($17,146,564 x 6%) - $965,000 = $1,028,793.84 - $965,000 = $63,793.84 ≈ $63,794
The condensed income statement for a business for the past year is as follows: Product T U Sales $660,000 $320,000 Less variable costs 540,000 220,000 Contribution margin $ 120,000 $100,000 Less fixed costs 145,000 40,000 Income (loss) from operations $ (25,000) $ 60,000 Management is considering the discontinuance of the manufacture and sale of Product T at the beginning of the current year. The discontinuance would have no effect on the total fixed costs and expenses or on the sales of Product U. What is the amount of chang
Answer:
Decrease in Net Income to the amount of $120,000
Explanation:
Some words are missing. The word are "change in net income for the current year that will result from the discontinuance of product T?"
Solution
Product T
Sales $660,000
Less: Variable cost $540,000
Contribution margin $120,000
Interpretation: By discontinuing Product T, therefore there will be a decrease in Net Income to the amount of $120,000
Timmy Company's comparative balance sheet at January 31, 2017, and 2016. reports the following (in millions):
Three situations about Timmy Company's issuance of stock and declaration and payment of dividends during the year ended January 31, 2017.
follow. Read the requirements.
Begin by reviewing the labels for the change in stockholders' equity and then enter the amounts for each situation. (Enter an amount in each input area. Input a "0" when there is no amount to be entered. Enter amount millions. Use a minus sign or parentheses when entering net losses or numbers to be subtracted.)
Total stockholders' equity, January 31, 2016
Add: Issuance of stock
Net income
Less: Dividends declared
Net loss
Total stockholders' equity, January 31, 2017
For each situation, use the accounting equation and the statement of retained earnings to compute the amount of Timmy's net income or net loss during the year ended January 31 2017.
1. Timmy issued $13 million of stock and declared no dividends.
2. Timmy issued no stock but declared dividends of $17 million.
3. Timmy issued $20 million of stock and declared dividends of $27 million.
Answer:
The Accounting Equation states that;
Assets = Liabilities + Equity
Equity as at 2016 = Assets - Liabilities
= 50 - 13
= $37 million
Equity as at 2017 = Assets - Liabilities
= 77 - 18
= $59 million
1. Timmy issued $13 million of stock and declared no dividends.
The Net Income ( loss) will be the figure that gives the Statement of Equity a figure of $59 million.
Net Income = Total stockholders' equity, January 31, 2017 - Total stockholders' equity, January 31, 2016 - Issuance of stock
= 59 - 37 - 13
= $9 million
Total stockholders' equity, January 31, 2016 ................ 37
Add: Issuance of stock ......................................................... 13
Net income ......................................................................9
Less: Dividends declared......................................................0
Net loss.......................................................................................0
Total stockholders' equity, January 31, 2017...................59
2. Timmy issued no stock but declared dividends of $17 million.
Net Income (loss) = Total stockholders' equity, January 31, 2017 - Total stockholders' equity, January 31, 2016 + Dividends Declared
= 59 - 37 + 17
= $39 million
Total stockholders' equity, January 31, 2016 ................ 37
Add: Issuance of stock ......................................................... 0
Net income ......................................................................39
Less: Dividends declared......................................................(17)
Net loss.......................................................................................0
Total stockholders' equity, January 31, 2017...................59
3. Timmy issued $20 million of stock and declared dividends of $27 million.
Net Income (loss) = Total stockholders' equity, January 31, 2017 - Total stockholders' equity, January 31, 2016 + Dividends Declared - Issuance of stock
= 59 - 37 + 27 - 20
= $29 million
Total stockholders' equity, January 31, 2016 ................ 37
Add: Issuance of stock ......................................................... 20
Net income ......................................................................29
Less: Dividends declared......................................................(27)
Net loss.......................................................................................0
Total stockholders' equity, January 31, 2017...................59
Since entrepreneurs are starting new businesses, experience gained from working for an established business isn't particularly helpful.a) trueb) false
Answer:
False
Explanation:
Entrepreneurs who are starting new businesses, can use experiences gained from working for an established business. This is particularly helpful. It helps them to avoid certain mistakes and pitfalls that they might have noticed or observed in the established company they are coming from.
Also, it enables them to practice certain business ethics they learnt from the established firms they are coming from.
Phyllis Stintson needs to decide whether to start a campaign against deforestation in Indonesia. Though her research team has provided substantial information on the high feasibility of the project, Stintson does not go ahead with the project. Stintson's decision is most likely influenced by which of the following if she made the decision by drawing unconscious references from several different experiences in the past?
A) optimization
B) intuition
C) fundamental attribution error
D) framing effect
E) anchoring bias
Answer:
B) intuition
Explanation:
Analyzing the scenario above, it is clear that Phyllis Stintson performed the decision-making process according to her intuition.
It is possible to perceive the use of intuition as the question provides information that he made the decision by drawing unconscious references from several different experiences in the past.
Intuition can be an important skill for leaders, who need to make decisions that are increasingly quick and important for the success of an organization, so it is important that a leader's self-awareness is a valued characteristic, because from self-awareness the leader has greater emotional control over his experiences, his intuition, his knowledge and other essential characteristics which will be useful to base an important decision-making process.
The manager at Tom's Taxidermy expects to sell units at each unit. In order for the manager to breakeven, the manager must sell units. What is the margin of safety in dollars?
The manager at Tom's Taxidermy expects to sell 900 units at $80 each unit. In order for the manager to breakeven, the manager must sell 100 units. What is the margin of safety in dollars?
Answer:
$64,000
Explanation:
Given that, the margin of safety is a term that describes the disparity between the actual sales volume and the breakeven volume.
In this case, Tom's Taxidermy expects to sell 9,00 units at $80 each and their breakeven volume is 100 units, the margin of sales, in dollars, is:
MS = ( 900 - 100) * $80
MS = 800 * $80
= $64,000
Therefore, the right answer as Margin of Safety in dollars = $64,000
The following information is available for Fuller Manufacturing Company for the month ending October 31:_______.
Cost of direct materials used in production $1,323,600
Direct labor 1,680,000
Work in process inventory, October 1 455,300
Work in process inventory, October 31 378,100
Total factory overhead 3,544,200
Determine Fuller Manufacturing's cost of goods manufactured for the month ended October 31.
Answer:
$6,625,000
Explanation:
Direct material $1,323,600
Direct labor. $1,680,000
Total factory overhead. $3,544,200
Add: Opening work in process inventory $455,300
Less: Closing work in process inventory ($378,100)
Costs of goods manufactured $6,625,000
10 years ago, the City of Melrose issued $3,000,000 of 8% coupon, 30-year, semiannual payment, tax-exempt muni bonds. The bonds had 10 years of call protection, but now the bonds can be called if the city chooses to do so. The call premium would be 6% of the face amount. New 20-year, 6%, semiannual payment bonds can be sold at par, but flotation costs on this issue would be 2% of the amount of bonds sold. What is the net present value of the refunding? Note that cities pay no income taxes, hence taxes are not relevant.
Answer:
the net present value of the refunding = $453,443
Explanation:
Given that:
Amount issued by City of Melrose = $3,000,000
Old rate of coupon = 8%
Period (years) = 20
Call premium = 6%
New rate coupon = 6%
Flotation cost = 2%
For the cost of refunding ; we have:
Call premium = 6% × $3,000,000
Call premium = 0.06 × $3,000,000
Call premium = $180000
Floatation cost = 2% × $3,000,000
Floatation cost = 0.02 × $3,000,000
Floatation cost = $60000
The total investment outlay = Call premium + Flotation cost
The total investment outlay = $180000 + $60000
The total investment outlay = $240000
However, the interest on the old bond per 6 months = (old coupon/2 ) × Amount issued
the interest on the old bond per 6 months = (8%/2) × $3000000
the interest on the old bond per 6 months = (0.08/2) × $3000000
the interest on the old bond per 6 months = 0.04 × $3000000
the interest on the old bond per 6 months = $120000
the interest on the new bond per 6 months = (new coupon/2 ) × Amount issued
the interest on the new bond per 6 months = (6%/2) × $3000000
the interest on the new bond per 6 months = (0.06/2) × $3000000
the interest on the new bond per 6 months = 0.03 × $3000000
the interest on the new bond per 6 months = $90000
Amount savings per 6 months = $120000 - $90000
Amount savings per 6 months = $30000
Finally, the present value for the savings = 30000 × PVIFA(0.03,40)
the present value for the savings = $693,443
Thus;
the net present value of the refunding = the present value for the savings - Cost of refunding
the net present value of the refunding = $693,443 - $240000
the net present value of the refunding = $453,443
A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. The company bases its variable manufacturing overhead standards on direct labor-hours.
Standard hours per unit of output 5.30 DLHs
Standard variable overhead rate $ 11.66 per DLH
The following data pertain to operations for the last month:
Actual direct labor-hours 8,800 DLHs
Actual total variable manufacturing overhead cost $ 96,000
Actual output 1,500 units
What is the variable overhead efficiency variance for the month?
a. $6,883 U
b. $6,883 F
c. $9,911 U
d. $3,252 U
Answer:
Variable overhead efficiency variance= $9,911 unfavorable
Explanation:
Giving the following information:
Standard hours per unit of output 5.30 DLHs
Standard variable overhead rate $ 11.66 per DLH
Actual direct labor-hours 8,800 DLHs
Actual output 1,500 units
To calculate the variable overhead efficiency variance, we need to use the following formula:
Variable overhead efficiency variance= (Standard Quantity - Actual Quantity)*Standard rate
Standard quantity= 5.3*1,500= 7,950
Variable overhead efficiency variance= (7,950 - 8,800)*11.66
Variable overhead efficiency variance= $9,911 unfavorable