Bramble Company purchased equipment on January 1, 2018 at a total invoice cost of $347000; additional costs of $5000 for freight and $32000 for installation were incurred. The equipment has an estimated salvage value of $11000 and an estimated useful life of five years. The amount of accumulated depreciation at December 31, 2019 if the straight-line method of depreciation is used is:__________
a. $153600.
b. $136400.
c. $134400.
d. $149200.

Answers

Answer 1

Answer:

d. $149200.

Explanation:

Depreciation is a method used in expensing the cost of an asset.

Deprecation expense using the straight line method = (Cost of asset - Salvage value) / useful life

Cost of asset = $347,000 + $5,000 + $32,000 = $384,000

( $384,000 - $11,000) / 5 = $74,600

Deprecation expense each year would be $74,600.

Accumulated depreciation in 2019 would be the sum of deprecation expense in 2018 and 2019

$74,600 × 2 = $149,200

I hope my answer helps you


Related Questions

A company can sell all the units it can produce of either Product A or Product B but not both. Product A has a unit contribution margin of $16 and takes two machine hours to make and Product B has a unit contribution margin of $30 and takes three machine hours to make. If there are 5,000 machine hours available to manufacture a product, income will be:

a. $10,000 more if Product A is made.
b. $10,000 less if Product B is made.
c. $10,000 less if Product A is made.
d. the same if either product is made.

Answers

Answer:

Product B has a net income of $10,000 superior to Product A.

The correct answer is C.

Explanation:

Giving the following information:

Product A:

Unitary contribution margin= $16

Machine-hours required= 2

Product B:

Unitary contribution margin= $30

Machine-hours required= 3

First, we will calculate the total income of both products.

Product A= 16*(5,000/2)= $40,000

Product B= 30*(5,000/3)= $50,000

Product B has a net income of $10,000 superior to Product A.

Donovan company incurred the following costs while producing 2000 units: Direct Materials, $15 per unit; direct labor, $5 per unit; variable manufacturing overhead, $12 per unit; variable selling and administrative costs, $14, per unit; total fixed overhead costs, $20,000; total fixed selling and administrative costs, $10,000. There are no beginning inventories.

What is the unit productive cost using absorption costing?

a. $32 per unit

b. $42 per unit

c. $52 per unit

d. $61 per unit

What is the unit product cost using variable costing?

a. $32 per unit

b. $44 per unit

c. $46 per unit

d. $61 per unit

What is the operating income using absorption costing if 1800 units are sold for $100 each?

a. $104,400

b. $96,000

c. $79,200

d. $69,200

What is the operating income using variable costing if 1900 units are sold for $100 each?

a. $57,400

b. $72,600

c. $80,200

d. $102,600

*Formulas or explanations with each part of the problem.

Answers

Answer:

1. b. $42 per unit

2. a. $32 per unit

3. d. $69,200

4. b $72,600

Explanation:

1 and 2 The computation of unit productive cost using absorption costing and unit product cost using variable costing is shown below:-

                                     Absorption        Variable

Direct material                   $15                   $15

Direct labor                         $5                    $5

Variable manufacturing

overhead                             $12                  $12

Fixed manufacturing

overhead                              $10        

($20,000 ÷ 2000)  

Product cost                        $42                $32

Therefore for computing the product cost of absorption and variable cost we simply added direct material, direct labor, variable manufacturing overhead and fixed overhead rate

3. The computation of the unit product cost using variable costing is shown below:-

Sales                                          $180,000

Cost of goods manufactured   ($756,00)

(1800 × $42)

Difference                                   $104,400

Variable and selling

administrative                             ($25,200)

(1800 × $14)

Gross profit                                  $79,200

Fixed selling and administrative

expenses                                     ($10,000)

Net operating income                $69,200

So, for computing the net operating income we simply deduct the Fixed selling and administrative expenses from gross profit.

4. The computation of operating income using variable costing is shown below:-

Sales                                               $190,000

(1,900 × $100)

Variable cost of goods

manufactured                                   $60,800

(1,900 × $32)

Gross contribution margin                $129,200

Variable and selling administrative   ($26,600)

(1900 × $14)

Net contribution margin                     $102,600

Fixed cost                                           ($30,000)

Operating income                              $72,600

Therefore for computing the operating income using variable costing we simply deduct the fixed cost from net contribution margin.

The selling price of imported olive oil is $20 per case. Your cost is 15 Euros per case, and the exchange rate is currently 1.25, so it takes 1.25 Euros to buy $1. Your largest customer has ordered 15,000 cases of olive oil. How much is the pretax profit for this transaction?

Answers

Answer:

$120,000

Explanation:

According to the question, the selling price (S.P) i.e. amount to be sold, of one imported olive oil case is $20 while the cost price (C.P) i.e. amount it was purchased, is €15

Looking at the currencies of both prices, they are different. To make the currencies the same, we need to convert euros (€) to dollars ($).

Based on the exchange rate of €1.25 to $1 given in the question;

€15 will be 15/1.25 = $12.

Therefore, the C.P is $12 and the S.P is $20

A customer ordered 15,000 cases of olive oil. This means that the;

1) The cost price (C.P) will be $12 × 15,000 = $180,000

2) The selling price will be $20 × 15,000 = $300,000

In order to obtain the pretax profit, we subtract the cost price (C.P) from the selling price (S.P). That is, $300,000 - $180,000 = $120,000

Selected information from Arbon Corporation's accounting records and financial statements for 2021 is as follows ($ in millions): Cash paid to acquire machinery $ 36 Reacquired Arbon common stock 50 Proceeds from sale of land 90 Gain from the sale of land 52 Investment revenue received 66 Cash paid to acquire office equipment 80 In its statement of cash flows, Arbon should report net cash outflows from investing activities of:

Answers

Answer:

Arbon should report net cash outflows from investing activities of: ($26)

Explanation:

Arbon Corporation

Statement of cash flows (extract)

Purchase of machinery                                  ($36)

Proceeds from sale of land                               90

Cash paid to acquire office equipment          (80)

Net cash outflows from investing activities  ($26)

Therefore, Arbon should report net cash outflows from investing activities of ($26).

Note that reacquired stock affects the financing section of the cash flows, while gain on sale of land and investment revenue received affect the operating section of the cash flows.

Wicker Rockers, Inc. is planning to offer a defined contribution plan for its employees. The company would like to incorporate a "cliff" vesting schedule for the employer contributions into the plan. What is the minimum vesting period the company can choose for a "cliff" vesting schedule

Answers

Answer:3 years

Explanation:

Cliff vesting is when an employee of a company becomes fully vested on a specified date rather than the employee becoming partially vested in increasing amounts over extended period. Cliff Vesting is a process whereby the employees are entitled to full benefits from their firm’s pension policies and qualified retirement plans on a given date.

Upon the completion of the cliff period, employees receive full benefits. The Pension Protection Act of 2006 deduced a three-year cliff vesting schedule for the designated defined-contribution plans which includes 401Ks.

At the beginning of last year, Tarind Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Tari's fixed manufacturing overhead budget variance was $12,000 favorable. Its fixed manufacturing overhead volume variance was $19,200 favorable. Actual direct labor-hours for the year were 625,000. What was Tari's total standard machine-hours allowed for last year's output?

Answers

Answer:

The answer is 612800 hours

Explanation:

Solution

Recall that:

At the start of last year, Tari Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours.

At the end of the year, Tari's fixed manufacturing overhead budget variance was $12000 favorable. Its fixed manufacturing overhead volume variance was $19200 favorable. The direct actual labor-hours for the year were 625,000. What was Tari's standard total machine-hours allowed for last year's output?

Now,

The Budgeted at beginning of  the year =  $900,000

fixed manufacturing overhead for =  600,000 machine hours

Thus,

The Standard = $900,000 / 600,000 hours = $1.5 fixed overhead / machine/machining hour

So,

At end of year, manufacturing overhead volume was $19,200 favorable which means  that,

$19200 / $1.5 = 12800 additional hours.

Total Standard Machine Allowance Allowed for output = 600,000 +12800 = 612800 hours

Therefore, Tari's total standard machine-hours allowed for last year's output is 612800 hours

If  Tarind Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Its fixed manufacturing overhead volume variance was $19,200 favorable. What Tari's total standard machine-hours allowed for last year's output will be is: 612,800 machine hours

Using this formula

Total standard machine-hours=Machine -hours level of activity+ [Fixed manufacturing overhead volume variance÷(Fixed manufacturing overhead÷ Machine -hours level of activity)]

Where:

Machine -hours level of activity=600,000

Fixed manufacturing overhead volume variance=$19,200

Fixed manufacturing overhead=$900,000

Let plug in the formula

Total standard machine-hours=600,000+[$19,200÷($900,000÷600,000)]

Total standard machine-hours=600,000+($19,200÷1.5)

Total standard machine-hours=600,000+12,800

Total standard machine-hours=612,800 machine hours

Inconclusion if Tarind Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Its fixed manufacturing overhead volume variance was $19,200 favorable. What Tari's total standard machine-hours allowed for last year's output will be is: 612,800 machine hours

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An outside supplier has offered to provide the annual requirement of 7,200 of the parts for only $13 each. The company estimates that 60% of the fixed manufacturing overhead cost above could be eliminated if the parts are purchased from the outside supplier. Assume that direct labor is an avoidable cost in this decision. Based on these data, the financial advantage (disadvantage) of purchasing the parts from the outside supplier would be:

Answers

Super corporation produces a part in the manufactures of its product. The unit cost is $21 computed as follows:

An outside supplier has offered to provide the annual requirement of 7,200 of the parts for only $13 each. The company estimates that 60% of the fixed manufacturing overhead cost above could be eliminated if the parts are purchased from the outside supplier. Assume that direct labor is an avoidable cost in this decision. Based on these data, the financial advantage (disadvantage) of purchasing the parts from the outside supplier would be:

                                                                        $

Direct material                                                 6

Direct labour                                                    8

Variable manufacturing overhead                2

Fixed manufacturing overhead                     5

Total cost                                                        21

Answer:

Total financial advantage of buying from the supplier $43,200

Explanation:

Unit relevant variable  cost of making= 6+8 +2 = 16

                                                                                    $

Variable cost of making (   16×    7200) =             115,200      

Variable of buying           (13   ×7200)                    93,600

Savings in variable cost                                         21,600

Savings in fixed cost  (60%*72300 × 5)                 21600

Total savings from buying                                   43,200

 Total financial advantage of buying from the supplier $43,200

g On July 1, 2019, Sheffield Corp. issued 9% bonds in the face amount of $12400000, which mature on July 1, 2025. The bonds were issued for $11859948 to yield 10%, resulting in a bond discount of $540052. Sheffield uses the effective-interest method of amortizing bond discount. Interest is payable annually on June 30. At June 30, 2021, Sheffield's unamortized bond discount should be

Answers

Answer:

$393,063

Explanation:

The bond is issued on discount when the issuance price is less than the face value of the bond. The discount is expensed over the bond period until maturity. It is added to the interest expense value to expense it.

Unamortized Discount is the discount balance which has not been expensed or discount balance for outstanding period of the bond to maturity.

Discount Balance = $540,052

Date   Interest Paid  Interest Expense  Amortization Book Value

7/1/19                                                                           11,859,948

6/30/20 1,116,000   1,185,995              69,995           11,929,943

6/30/21   1,116,000   1,192,994              76,994           12,006,937

Unamortized Discount = Total Discount - Discount amortized

Unamortized Discount = $540,052 - ($69,995 + $76,994)

Unamortized Discount = $393,063

The following data pertain to last year's operations at Tredder Corporation, a company that produces a single product: Units in beginning inventory 0 Units produced 20,000 Units sold 19,000 Selling price per unit $100.00 Variable costs per unit: Direct materials $12.00 Direct labor $25.00 Variable manufacturing overhead $3.00 Variable selling and administrative $2.00 Fixed expenses per year: Fixed manufacturing overhead $500,000 Fixed selling and administrative $600,000 What was the absorption costing net operating income last year?

Answers

Answer:

Net operating income= 27,000

Explanation:

Giving the following information:

Units produced 20,000

Units sold 19,000

Selling price per unit $100.00

Variable costs per unit:

Direct materials $12.00

Direct labor $25.00

Variable manufacturing overhead $3.00

Variable selling and administrative $2.00

Fixed expenses per year:

Fixed manufacturing overhead $500,000

Fixed selling and administrative $600,000

Under the absorption costing method, the fixed manufacturing overhead gets included in the unitary production cost. First, we need to calculate the unitary product cost.

Unitary product cost= (12 + 25 + 3) + (500,000/20,000)

Unitary product cost= 40 + 25= $65

Income statement:

Sales= 100*19,000= 1,900,000

COGS= 65*19,000= (1,235,000)

Gross profit= 665,000

Variable selling and administrative= (2*19,000)=(38,000)

Fixed selling and administrative= (600,000)

Net operating income= 27,000

Running Co. had an equity investment where it owned less than 20% of an investee, and therefore Running Co. was not able to exercise significant influence. Information about the investment is below: 20X1 20X2 Investment cost 170,000 170,000 Fair value 181,400 155,000 Total unrealized gain (loss) 11,400 (15,000) The company sold the investment during 20X3 for the below price: Sales price 192,400 What is the gain (loss) recorded in the income statement in the year of sale, in 20X3

Answers

Answer:

Gain or Loss to be reocrded in Financial Statement: 151600 - 155000= 3400 loss to be booked as Fair value recorded in the books as in year ended 20X2 is 155000.

Dinklage Corp. has 9 million shares of common stock outstanding. The current share price is $69, and the book value per share is $8. The company also has two bond issues outstanding. The first bond issue has a face value of $70 million, a coupon rate of 6 percent, and sells for 94 percent of par. The second issue has a face value of $55 million, a coupon rate of 5 percent, and sells for 106 percent of par. The first issue matures in 24 years, the second in 9 years.Suppose the most recent dividend was $4.25 and the dividend growth rate is 4.4 percent. Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues. Both bonds make semiannual payments. The tax rate is 25 percent. What is the company’s WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Answers

Answer:

10.83%

Explanation:

The simplest way to determine the if we use the Gordon growth model for determining the company's stock price:

stock price = [dividend x (1 + growth rate)] / (WACC - growth rate)

dividend = $4.25g = 4.4%stock price = $69

WACC - g = [dividend x (1 + g] / price

WACC = {[dividend x (1 + g] / price} + g

WACC = {[$4.25 x (1 + 4.4%] / $69} + 4.4% = 0.1083 or 10.83%

The predetermined overhead rate for Zane Company is $5, comprised of a variable overhead rate of $3 and a fixed rate of $2. The amount of budgeted overhead costs at normal capacity of $150000 was divided by normal capacity of 30000 direct labor hours, to arrive at the predetermined overhead rate of $5. Actual overhead for June was $9500 variable and $6050 fixed, and standard hours allowed for the product produced in June was 3000 hours. The total overhead variance is

Answers

Answer:

Total Overhead Variance= $500 unfavorable

Explanation:

The total overhead variance is the difference between actual overhead and the applied overhead.

Actual Overhead = Variable + Fixed= $9500 + $6050= $ 15,550

Budgeted Overhead for 30000 direct labor hours = $ 150,000

Applied Overhead for 3000 hours = 3000 *$5= $15000

Total Overhead Variance= Actual Overhead Less Applied Overhead

                                    = $15,500- $ 15000= $500 unfavorable

As actual is greater than applied it is unfavorable.

Answer:

$550 unfavorable.

Explanation:

Total actual overhead = $9,500 + $6,050 = $15,550

Total predetermined overhead = Predetermined overhead rate * Standard hours = $5 * 3,000 = $15,000

Total overhead variance = $15,550 - $15,000 = $550 unfavorable.

Note: It is unfavorable because total actual is greater than total predetermined overhead.

The conversion rate is restated for all stock dividends and splits. Coffee had the following stock transactions in 2005 and 2006:

1/1/2005 - Sold 30,000 shares of common stock at $20 per share.
1/1/2005 - Sold 10,000 shares of preferred stock at $100 per share.
4/1/2005 - Issued at 50 percent stock dividend when the market price is $26 per share.
9/1/2005 - Purchased 4,000 treasury shares at $30 per share.
10/1/2005 - Sold 1,000 of the treasury shares at $32 per share.
11/1/2005 - Sold 2,000 of the treasury shares at $25 per share.
12/1/2005 - Issued a 2-1 for stock split.
12/20/2005 - Declared the required dividend to preferred stock holders and a $.25 per share dividend to common stockholders. Dividends are payable on 12/31/2005.

Prepare journal entries to record all of the above business events

Answers

Answer and Explanation:

The journal entries are shown below:

On Jan 1

Cash (30,000 Shares × $20)   $600,000

    To  Common Stock (30,000 Shares × $2)    $60,000

    To Paid In Capital in Excess of Par - Common Stock $540,000

(Being the sale of the common stock is recorded)

On Jan 1

Cash (10,000 Shares × $100)     $600,000

         To Preferred Stock (10,000 Shares × $100)  $1,000,000

(Being the sale of the preferred stock is recorded)

On Jan 4

Retained Earnings (30,000 × 50% × $26)   $390,000

         To Common Stock (15,000 shares × $2)   $30,000

         To Paid In Capital in Excess of Par - Common Stock $360,000

(Being the issued of the stock dividend is recorded)

On Jan 9

Treasury Stock (4,000 Shares × $30)   $120,000

        To Cash   $120,000

(Being the purchase of treasury stock is recorded)

On Jan 10

Cash (1,000 Shares × $32)   $32,000

   To  Treasury Stock (1,000 Shares × $30)  $30,000

     To Paid in Capital from Treasury Stock $2,000

(Being the sale of the treasury stock is recorded)

On Jan 11

Cash (2,000 Shares × $25)     $50,000

Paid in Capital - Treasury Stock   $2,000

Retained Earnings $8,000

           To Treasury Stock (2,000 Shares × $30)    $60,000

(Being the sale of the treasury stock is recorded)

On Jan 12

Since the shares are issued for  2 to 1 i.e the number of shares is rises from 29,000 shares to 58,000 shares due to which the par value is decreased from $2 to $1 per share. So the new 29,000 shares were to be distributed

On Dec 20

Retained Earnings  $74,500

     To Dividend Payable - Preferred Stock (10,000 Shares × 100 × 6%)    $60,000

     To Dividend Payable - Common Stock (58,000 Shares × $0.25)   $14,500

(Being the dividend is declared)

On January 1, a company issued and sold a $408,000, 9%, 10-year bond payable, and received proceeds of $403,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The journal entry to record the first interest payment is:

Answers

Answer and Explanation:

The Journal entry is shown below:-

Bond interest expense Dr, $18,610

         To Cash $18360

           To Discount on bonds $250

(Being first interest payment is recorded)

For recording the first interest payment we simply debited the bond interest expenses as it increased the expenses and we credited cash and discount on bonds as  it reduced the assets and the discount should be credited

Working Note

Total discount on bonds issued = Sold bonds - Received proceeds

= $408,000 - $403,000

= $5,000

Amortization of Semi Annual Discount = Total discount on bonds issued ÷ Number of periods

= $5,000 ÷ 20

= $250

Cash interest paid = Sold bonds × Interest rate × From Jan to June ÷ Total number of months in a year

= $408,000 × 9% × 6 ÷ 12

= $18,360

Total Interest expense = Cash interest paid + Amortization of Semi Annual Discount

= $18,360 + $250

= $18,610

The management of Ballard MicroBrew is considering the purchase of an automated bottling machine for $74,000. The machine would replace an old piece of equipment that costs $19,000 per year to operate. The new machine would cost $9,000 per year to operate. The old machine currently in use could be sold now for a salvage value of $31,000. The new machine would have a useful life of 10 years with no salvage value. Required: 1. What is the annual depreciation expense associated with the new bottling machine

Answers

Answer:

$7,400 per year

Explanation:

Data provided for computing the annual depreciation expense is here below:-

Automated bottling machine = $74,000

Useful life = 10 years

The calculation of annual depreciation expense is given below:-

Annual depreciation expense = Automated bottling machine ÷ Useful life

= $74,000 ÷ 10

= $7,400 per year

Therefore for computing the annual depreciation expense we simply divide the automated bottling machine by useful life.

Suppose the economy is in long-run equilibrium. In a short span of time, there is a sharp rise in the stock market, an increase in government purchases, an increase in the money supply and a decline in the value of the dollar. In the short run a. the price level and real GDP will both rise. b. the price level and real GDP will both fall. c. neither the price leave nor real GDP will change. d. All of the above are possible.

Answers

Answer:

All of the above are possible.

Explanation:

Discussions here center on equilibrium of an economy in a long run, and here after the government activities, their is a decline in dollar value; therefore in the short run, the price level and real GDP will both rise in as much as the price level and real GDP will also both fall. It is also gathered that neither the price leave nor real GDP will change.

The transition from the short run to the long run may be done by considering some short run equilibrium that is also a long run equilibrium as to supply and demand, then comparing that state against a new short run and long run equilibrium state from a change that disturbs equilibrium, say in the sales tax rate, tracing out the short run adjustment first, then the long run adjustment.

Farrugia Corporation produces two intermediate products, A and B, from a common input. Intermediate product A can be further processed into Product X. Intermediate product B can be further processed into Product Y. The common input is purchased in batches that cost $89 each and the cost of processing a batch to produce intermediate products A and B is $36. Intermediate product A can be sold as is for $53 or processed further for $33 to make Product X that is sold for $79. Intermediate product B can be sold as is for $113 or processed further for $66 to make Product Y that is sold for $158.
Required:
A. Assuming that no other costs are involved in processing potatoes or in selling products, how much money does the company make from processing one batch of the common input into the end products X and Y?
B. Should each of the intermediate products, A and B, be sold as is or processed further into an end product?

Answers

Answer:

Explanation:

                                  Product A              Product B     Total

Incremental rev.           79                       158                  237

Incremental cost           33                        66                   99

Contribution                  46                        92                  138

common cost                                                                    (89)

Cost of Processing                                                           (36)

Net income                                                                        13

B

Financial advantage - Incremental revenue- Incremental cost -Initial revenue

Product A

79-33-53 = - 7

Product B

158-66-113 = -21.

The two products are better sold at it is without further processing.

As no other cost is involved in the processing or selling and the initial selling price is greater than the incremental contribution , it is advisable that they are sold as they are

We learned in class that Starbucks uses its baristas as front line “brand ambassadors”. This is an example of ________________?

A.
top management not doing their jobs

B.
Inverted Organization Structure

C.
Management by Objectives MBO

D.
Giving uneducated employees too much responsibility

Answers

Answer:

Inverted Organization Structure

Explanation:

An Inverted Organization Structure is a structure where the employees are given more autonomy. Employees are given more prominent and important roles in the business.

I hope my answer helps you

Option B is correct because it is an example of inverted organization structure.

An Inverted Organization Structure is a organizational structure where employees are given more autonomy in their operation, that is, they are given more prominent and important roles in the company.

This type of structure is beneficial because the top hierarchy have lesser work and employee get more experience because of decision-makings.

In conclusion, the Option B is correct because it is an example of inverted organization structure

Read more about inverted organization structure

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Marle Construction enters into a contract with a customer to build a warehouse for $950,000 on March 30, 2018 with a performance bonus of $50,000 if the building is completed by July 31, 2018. The bonus is reduced by $10,000 each week that completion is delayed. Marle commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by Probability July 31, 2018 65% August 7, 2018 5% August 14, 2018 5% August 21, 2018 The transaction price for this transaction, based on the expected value approach, is:_______.
a. $950,000
b. $995,000
c. $685,000
d. $652,500

Answers

Answer:

b. $995,000

Explanation:

The computation of the transaction price based on the expected value approach is shown below:

The formula is

= (Building cost of warehouse + bonus) × probability percentage

Date                                 Calculation                              Amount

July 31, 2018         ($950,000+$50,000) × 0.65    $650,000

August 7, 2018 ($950,000+$40,000) × 0.25           $247,500

August 14, 2018 ($950,000+$30,000) × 0.05          $49,000

August 21, 2018 ($950,000+$20,000) × 0.05   $48,500

Total                                                                    $995,000  

Since the bonus is reduced $10,000 each week so $10,000 is deducted for every delayed week

A company's income statement showed the following: net income, $117,000; depreciation expense, $31,500; and gain on sale of plant assets, $5,500. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $9,700; merchandise inventory increased $19,500; prepaid expenses increased $6,500; accounts payable increased $3,700. Calculate the net cash provided or used by operating activities. Multiple Choice $143,400. $141,400. $148,200. $130,400. $169,400.

Answers

Answer:

$130,400

Explanation:

The computation of net cash provided or used by operating activities is shown below:-

Net cash provided or used by operating activities

Net income                                   $117,000

Depreciation expense                  $31,500

Gain on sale of plant assets           ($5,500)

Accounts receivable decreased     $9,700

Increase inventory                           ($19,500)

Prepaid expenses increased          ($6,500)

Increase account payable                $3,700

Net cash flow from

operating activities                          $130,400

Therefore the Net cash flow from operating activities is $130,400

You are given the following information about 2 accounts: Account 1 Time Account Value before transactions Deposit Withdrawal 0 100 0.25 110 X 0.75 120 3X 1 82 Account 2 Time Account Value before transactions Deposit Withdrawal 0 100 0.5 120 2X 1 140 You are also told that the dollar weighted return over the year on account 1 is i. If the time weighted return over the year on account 2 is also i, what are X and i

Answers

Answer:

Check the explanation

Explanation:

For account 1:

Dollar weighted investment = 100 for entire year + X for three fourth of the year - 3X for one fourth of the year = 100 + 3X/4 - 3X/4 = 100

Dollar return = Closing balance - opening balance - (Total deposit - total withdrawal) = 82 - 100 - (X - 3X) = 2X - 18

Hence, dollar weighted return = i = Dollar return / Dollar weighted investment = (2X - 18) / 100

Or, 100i = 2X - 18 Or, 50i = X - 9

For account 2:

Time weighted return: It has two components:

100 growing to 120 in 0.5 year

Immediately after deposit of 2X, the capital becomes 120 + 2X that grows to become 140 in the next 0.5 year

Hence time weighted return = 1 + i = 120 / 100 x 140 / (120 + 2X) = 168 / (120 + 2X) = 84 / (60 + X)

From the first equation, i = (X - 9) / 50

Hence, from second equation, 1 + i = 1 + (X - 9) / 50 = (41 + X) / 50 = 84 / (60 + X)

Hence, (60 + X).(41 + X) = 50 x 84

Hence, X2 + 101X + 2,460 = 4,200

Or, X2 + 101X - 1,740 = 0

It's a quadratic equation that can be factorized as:

(X - 15).(X + 116) = 0

Hence, X = 15

Hence, i = (X - 9) / 50 = (15 - 9) / 50 = 0.12 = 12%

The common stock of Leaning Tower of Pita Inc., a restaurant chain, will generate payoffs to investors next year, which depend on the state of the economy, as follows: Dividend Stock Price Boom $ 10 $ 200 Normal economy 6 90 Recession 0 0 The company goes out of business if a recession hits. Assume for simplicity that the three possible states of the economy are equally likely. The stock is selling today for $80.
a. Calculate the rate of return to Leaning Tower of Pita shareholders for each economic state. (Negative amounts should be indicated by a minus sign. Enter your answers as a percent rounded to 2 decimal places.) Rate of return Boom Normal economy Recession a-2.
b. Calculate the expected rate of return and standard deviation of return to Leaning Tower of Pita shareholders. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Expected return Standard deviation

Answers

Answer:

a) Boom = 162.50%

Normal =20.00%

Recession = - 100.00%

b) Expected return = 27.50%

Standard deviation = 107.30%

Explanation:

a) To find the rate of return for each economy state, let's use:

Rate of return = (Dividend +Stock price next year-stock price today)/stock price today

i) For Boom:

[tex] \frac{10 + 200 - 80}{80} = 1.625 [/tex] = 162.50%

ii) Normal:

[tex]\frac{6 + 90- 80}{80} = 0.2 [/tex] = 20.00%

iii) Recession :

[tex]\frac{0 + 0 - 80}{80} = - 1 [/tex] = -100%

b) To calculate the expected rate of return, let's use:

Expected return = Sum of expected return in different scenario / number of economy states

[tex] = \frac{162.5 + 20 - 100}{3} = 27.50[/tex]

Standard deviation:

To find the standard deviation, let's use:

Standard deviation = √[(sum of square of expected return in each scenario -average return)/n]

[tex] = \sqrt{\frac{(162.50-27.50)^2+(20-27.50)^2+(-100-27.50)^2}{3}} [/tex]

[tex] = \sqrt{\frac{(135)^2 + (-7.50)^2 + (-127.50)^2}{3}} [/tex]

[tex] = \sqrt{\frac{18225+56.25+16256.25}{3} [/tex]

= 107.30%

Standard deviation = 107.30%

Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9-year useful life and no salvage value. By automating the process, the company would save $133,000 per year in cash operating costs. The new machine would replace some old equipment that would be sold for scrap now, yielding $21,200. The annual depreciation on the new machine would be $88,200. The simple rate of return on the investment is closest to
a. 5.80%
b. 11.12%
c. 16.72%
d. 5.12%

Answers

Answer:

Simple rate of return is 5.8%

Therefore option (a) is correct option.

Explanation:

It is given that purchase cost = $793800

Company saving per year = $133000

Yielding = $21200

Annual depreciation = $88200

Annual profit = $133000 - $88200 = $44800

Net investment is equal to = $793800 - $21200 = $772600

Simple rate of return [tex]=\frac{44800}{772600}=0.0579[/tex]

= 5.8%

Therefore simple rate of return is 5.8 %

So option (a) is correct.

Tom, Dan and Phil work indifferent teams at Springfield Automotive. Tom's team ensures that all the raw materials, machinery, tools and other production equipment are available for the employees around the clock. Any procurement needs have to be addressed to Tom, who also takes part in high-level decisions regarding the number of units to produced, exported and so on. Dan works as part of a team of eight members who concentrate the day-to-day productions; they also ensure that the quality checks are done and inspect each other's work. Phil is the operations manager, who works for 5 hours in the production department and then spends the rest of his time assisting management as an internal consultant on manufacturing issues. His input is crucial in improving the production process. Dan's contribution is toward the __________.

Answers

Answer: Work team

Explanation: Dan's contribution is towards the work team whereas Phil works in the parallel team while Tom is part of the management team. a work team which Dan is a member of is defined as a group of workers or employees with different set of skills that work together on a given task such as the day-to-day productions in a business, quality control and inspection, etc. Work teams are most efficient or useful where there is a frequent change in job content and employees with limited skills and a specific set of duties are unable to cope (work teams thus provide expert advice that will increase the ability of employees to participate in planning, problem-solving, and decision-making that are needed to complete a set of work and to better serve customers).

Assume that Parker Company will receive SF200,000 in 360 days. Assume the following interest rates: the 360-day borrowing rate in U.S. is 7% while the 360-day borrowing rate in Switzerland is 5%. The 360-day deposit rate in U.S. is 5% while the 360-day deposit rate in Switzerland is 4%. Assume the forward rate of the Swiss franc is $0.50 and the spot rate of the Swiss franc is $0.48. If Parker Company uses a money market hedge, it will receive ____ in 360 days.

Answers

Answer:

Company will receive = $96,000

Explanation:

As per the data given in the question,

Corresponding SF liability equals to pay SF200,000 including interest

= 200,000÷1.05 = SF190476.19

Now Convert the SF into $US at the current spot rate = $0.48×190476.19

= $91428.57

Now deposit the $ US at 5% and withdraw after 360 days =

= $91428.57 + $91428.57×5%

= $95999.99

This way the liability of SF 190476.19 + 190476.19×5% interest will be paid off when Parker company receives $200,000, Parker company will receive = $96,000 in 360 days.

Darrin’s Auto Northern Division is currently purchasing a part from an outside supplier. The company's Southern Division, which has no excess capacity, makes and sells this part for external customers at a variable cost of $15 and a selling price of $27. If Southern begins sales to Northern, it (1) will use the general transfer-pricing rule and (2) will be able to reduce variable cost on internal transfers by $3. On the basis of this information, Southern would establish a transfer price of:

Answers

Answer:

Transfer price = $24

Explanation:

As per the data given in the question,

The excess capacity of Company's Southern division is nill therefore for transferring the units the division will have to decrease its external sales.The Loss occurred due to reduction in external sales should be from inter divisional transfer price. Therefore,

Transfer price = variable cost + Loss of contribution

= ($15 - $3) + ($27 - $15)

= $24

Which of the following is true of a stock dividend? Multiple Choice It is a liability on the balance sheet. The decision to declare a stock dividend resides with the shareholders. Transfers a portion of equity from retained earnings to a cash reserve account. Does not affect total equity, but transfer amounts between the components of equity. Reduces a corporation's assets and stockholders' equity.

Answers

Answer:

Yes it is true that a stock dividend does not affect total equity.

Explanation:

A stock dividend is a non cash payment given to shareholders. Instead of cash, additional shares that is equivalent to the earnings that accrue is given to shareholders.

While this may increase the number of shares held, it does not affect total equity.

One of the benefits of stock dividends tax exemption and retained equity which translates to additional investment.

However, the additional; shares created could dilute the share prices.

CSUSM is a zero growth company. It currently has zero debt and its earnings before interest and taxes (EBIT) are $85,000. CSUSM 's current cost of equity is 11%, and its tax rate is 21%. The firm has 15,000 shares of common stock outstanding. Assume that CSUSM is considering changing from its original capital structure to a new capital structure with 39% debt and 61% equity. This results in a weighted average cost of capital equal to 8.7% and a new value of operations of $576,345. Assume CSUSM raises $165,000 in new debt and purchases T-bills to hold until it makes the stock repurchase. What is the stock price per share immediately after issuing the debt but prior to the repurchase?

Answers

Answer:

Check the explanation

Explanation:

Calculation of CSUSM 's New value of Operation :

For the purpose of Calculation of New Value of Operation we need to first calculate new WACC

Given :

Debt value ( Wd) = 30% or 0.30

Equity Value ( We)= 70% or 0.70

Cost of Debt ( Kd) =8%

New cost of equity (Ke) =12%

WACC =Kd(1-T) * Wd + Ke* We

WACC =[8%(1-0.40) * 0.30] + [12% * 0.70]

= [4.80% * 0.30 ] + [8.4 %]

= 1.44% + 8.4%

= 9.84 %

Given EBIT = $ 80,000

Tax rate = 40%

Currently the company has no growth. Therefore growth rate is 0 %

Value of New Operation =FCF / WACC

=EBIT (1-T) / WACC

=$80,000 (1-0.40)/ 9.84%

= $ 487,804.88

Purdum Farms borrowed $16 million by signing a five-year note on December 31, 2017. Repayments of the principal are payable annually in installments of $3.2 million each. Purdum Farms makes the first payment on December 31, 2018 and then prepares its balance sheet. What amount will be reported as current and long-term liabilities, respectively, in connection with the note at December 31, 2018, after the first payment is made?

Answers

Answer:

Current liabilities   $3.2 million

long-term liabilities =$16 million-$3.2 million-$3.2 million=$9.6 million

Explanation:

The amount classified as current liabilities as at 31st December 2018 is the portion of the loan repayable within a year,that the repayment due at 31st December 2019 which is $3.2 million.

The amount to be classified as long term liabilities is the balance of the loan after having taken out the payment in year 1 as well as the repayment to be made in year 2

EHW Office Supplies, Inc. uses the perpetual inventory system. On September 4, 2019,EHW sold merchandise inventory on account at a price of $50,000 with payment terms of 1/10, n/30. The merchandise cost EHW $40,000. On September 12, 2019, the customer pays the proper amount due for the merchandise based on the credit terms. How much will be credited to Accounts Receivable when recording the collection

Answers

Answer:

$50,000

Explanation:

The cash payment was made within the discount period of 10 days,hence the amount received in respect of the sales on account is face value minus discount of 1%.

When sales was made EHW would have debited accounts receivable with $50,000 and credited same to sale revenue.

Cash received=$50,000*(1-1%)=$49,500

discount =$50,000-$49,500=$500

The appropriate entries for cash collection:

Dr cash    $49,500

Dr discount allowed  $500

Cr accounts receivable    $50,000

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