Answer and Explanation:
The preparation of the asset section of the classified balance sheet is presented below;
ASSETS
Current assets:
Cash and cash equivalents $686
Accounts receivable $1,119
Less: Allowance for doubtful accounts ($35)
Accounts receivable (net) $1,084
Inventory $356
Prepaid rent $361
Total current assets $2,487
Property, Plant and Equipment:
Land $10
Buildings $246
Equipment $496
Property, Plant and Equipment (at cost) $752
Less: Accumulated depreciation ($506)
Total Property, Plant and Equipment (net) $246
Other assets
Licensing rights $1,846
Goodwill $601
Less: Accumulated amortization ($751)
Other assets (Net) $1,691
Total assets $4,424
Describe an important difference in the way an economist and a businessperson might view a monopoly.
Answer:
An economist would view a monopoly as not beneficial and optimal to society. A businessperson would view monopolies as a great idea to maximize profits due to the lack of competitionExplanation:
hope it's helps you if i am sorry if my answer is wrong
When there is a capacity constraint :_________
A. firms are not maximizing their profits during high season.
B. consumers will avoid the producer and go with a firm that has extra capacity.
C. firms face sunk costs when deciding whether or not to expand.
D. firms can use peakload pricing to increase profits during periods of high demand.
Answer:
The answer is "Option D".
Explanation:
Capacity restrictions are indeed a regulation that restricts the number of items that a supplier could be assigned. Trade could be allocated to a leading provider through the constraint, or the amount of trade can be restricted for a supplier, therefore companies having resource constraints may employ peak price and increase revenue during peak times.
William owns 1 share of Park stock. He purchased the stock three years ago for $17.50. The stock is currently trading for $40 per share. The stock has paid the following dividends over the past three years. o Year 1: $1.00. o Year 2: $2.00. o Year 3: $3.00. What is the compounded rate of return (IRR) that William has earned on this investment
Answer:
sim eu também preciso desta respota
Which subscription level(s) in QuickBooks Online include the Receipt Capture feature?
Oriole Inc. had beginning inventory of $11,400 at cost and $20,600 at retail. Net purchases were $127,926 at cost and $181,000 at retail. Net markups were $9,500, net markdowns were $6,900, and sales revenue was $148,900. Compute ending inventory at cost using the conventional retail method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)
Answer:
Ending inventory at cost using the conventional retail method is $36,498.
Explanation:
Note: See the attached excel file for the computation of Goods available for sales and Ending inventory at Retail.
From the attached excel file, we have:
Goods available for sales at Cost = $139,326
Goods available for sales at Retail = $211,100
Ending inventory at Retail = $55,300
Therefore, we have:
Ratio of goods available for sales of Cost to Retail = Goods available for sales at Cost / Goods available for sales at Retail = $139,326 / $211,100 = 0.66, or 66%
Ending inventory at Cost = Ending inventory at Retail * Ratio of goods available for sales of Cost to Retail = $55,300 * 66% = $36,498
Therefore, ending inventory at cost using the conventional retail method is $36,498.
XYZ Industries makes heavy construction equipment. The standard for a crane calls for 20 direct labor-hours at $24 per direct labor-hour. During a recent period 875 cranes were made. The labor efficiency variance was $1,200 Unfavorable. How many actual direct labor-hours were worked
Answer:
17,550
Explanation:
Labor efficiency variance = Standard rate * (Actual hours - Standard hours)
$1200 = $24 * (Actual hours - 875*20)
50 = Actual hours - 17,500
Actual hours = 17,500 + 50
Actual hours = 17,550
So, the actual direct labor-hours which were worked is 17,550.
A corporation had the following assets and liabilities at the beginning and end of this year. Assets Liabilities Beginning of the year $124,500 $53,373 End of the year 172,000 69,660 Owner made no investments in the business, and no dividends were paid during the year. Owner made no investments in the business, but dividends were $550 cash per month. No dividends were paid during the year, but the owner did invest an additional $45,000 cash in exchange for common stock. Dividends were $550 cash per month, and the owner invested an additional $35,000 cash in exchange for common stock. Determine the net income earned or net loss incurred by the business during the year for each of the above separate cases: (Decreases in equity should be indicated with a minus sign.).
Answer:
Hence, the net income earned or net loss incurred by the business during the year $102,340.
Explanation:
The December 31, 2009, balance sheet of Anna’s Tennis Shop, Inc., showed current assets of $2,584 and current liabilities of $1,191. The December 31, 2010, balance sheet showed current assets of $2,644 and current liabilities of $1,048. What was the company’s 2010 change in net working capital, or NWC?
Answer: ($203)
Explanation:
The company’s 2010 change in net working capital will be calculated thus:
Net working capital = current assets - current liabilities
For 2009, net working capital will be:
= $2,584 - $1,191
= $1393.
For 2010, net working capital will be:
= $2,644 - $1,048
= $1596
Change in net working capital will be:
= $1393 - $1596
= ($203)
The Play It Again Sports chain carries all kinds of sports equipment at much lower prices than the typical sporting goods store. Typically, merchandise sold in the store has little, if any, wear. Being both a place for people to get rid of unwanted equipment and a source for people to buy affordable equipment and a source of new-to-you equipment,what is Play It Again Sports emphasizing? A) geographic lifestyles.B) public relations.C) the family life cycle.D) positioning.
Answer:
D) positioning.
Explanation:From the question we are informed about The Play It Again Sports chain who carries all kinds of sports equipment at much lower prices than the typical sporting goods store. Typically, merchandise sold in the store has little, if any, wear. Being both a place for people to get rid of unwanted equipment and a source for people to buy affordable equipment and a source of new-to-you equipment. In this case, Play It Again Sports is emphasizing positioning.
Positioning can be regarded as concept used by companies which involves association as well as development of a mental position in public consciousness concerning their brand as well as their products and services. minds of are usually been stuffed with different information, therefore it is important to choose a unique position in peoples mind.
Johnson thermal products used austenitic nickel chromium alloys to manufacture resistance heating wire. The company is considering a new annealing drawing process to reduce costs. Assume that the companies mar is a real 12% per year and the inflation rate is 3% per year. If the new process will cost $3.7 million now, how much must be saved each year to recover the investment in 5 years? a. $2,103,784.b. $603,784.c. $1,103,784.d. $1,603,784.
Answer:
The correct option is c. $1,103,784.
Explanation:
This can be calculated using the formula for calculating the present value of an ordinary annuity as follows:
PV = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)
Where;
PV = Present value or cost of the new process = $3.7 million = $3,700,000
P = Annual savings to recover the investment in 5 years = ?
r = interest rate = MARR + Inflation rate = 12% + 3% = 15%, or 0.15
n = number of years = 5
Substitute the values into equation (1) and solve for P, we have:
$3,700,000 = P * ((1 - (1 / (1 + 0.15))^5) / 0.15)
$3,700,000 = P * 3.3521550980114
P = $3,700,000 / 3.3521550980114
P = $1,103,768
From the options, the closet figure to $1,103,768 is c. $1,103,784. The difference is due the difference I rounding. Therefore, the correct option is c. $1,103,784. That is, the amount that must be saved each year to recover the investment in 5 years is $1,103,784.
Stout Corporation had net income of $200,000 and paid dividends to common stockholders of $40,000 in 2012. The weighted average number of shares outstanding in 2012 was 50,000 shares. Stout Corporation's common stock is selling for $75 per share on the New York Stock Exchange. Stout Corporation's price-earnings ratio is Group of answer choices 3.8 times. 15 times. 18.8 times. 12 times.
Answer:
18.8 times
Explanation:
Calculation to determine what Stout Corporation's price-earnings ratio is
Using this formula
Price-Earning Ratio = Price Per Share ÷ (Net Earnings ÷ Outstanding Shares)
Let plug in the formula
Price-Earning Ratio= $75 ÷ ($200,000 ÷ 50,000)
Price-Earning Ratio= 75 ÷ 4
Price-Earning Ratio= 18.75
Price-Earning Ratio=18.8 times (Approximately)
Therefore Stout Corporation's price-earnings ratio is 18.8 times
hãy lựa chọn 1 công ty sử dụng dịch vụ nghiên cứu của marketing của các nhà cung cấp bên ngoài.
1. tìm hiểu lý do công ty phải thuê ngoài
2. những tổ chức nào đã cung cấp dịch vụ marketing cho công ty?
3. công ty thuê một phần hay thuê toàn bộ các hoạt động nghiên cứu marketing
Answer:
may I know which language
Venus International makes customized furniture and uses job order costing. During a period, its beginning raw materials inventory was $10,000. It purchased raw materials of $20,000 and ended the period with ending raw materials inventory of $3,000. What is the cost of raw materials transferred to Work in Process Inventory
Answer:
the cost of raw materials transferred to Work in Process Inventory is $27,000
Explanation:
The computation of the cost of raw materials transferred to Work in Process Inventory is shown below
= opening inventory + purchases made - ending inventory
= $10,000 + $20,000 - $3,000
= $27,000
Hence, the cost of raw materials transferred to Work in Process Inventory is $27,000
The same should be considered
What is the process of project appraisal?
Answer:
Đánh giá sự cần thiết của dự án , Thẩm định kỹ thuật, Thẩm định khả năng vốn tài chính dự án
Explanation:
Which of the following statements is incorrect regarding the process of building a company's brand, particularly for young firms?
a. A firm's name, logo, Web site design, and even its letterhead are part of its brand.
b. One of the keys to effective branding is to create a strong personality for a firm.
c. Some companies monitor the integrity of their brands through brand management.
d. Startups must build a brand from scratch, which starts with selecting the company's name.
e. Most experts recommend a heavy reliance on advertising in building a firm's brand.
Answer: e. Most experts recommend a heavy reliance on advertising in building a firm's brand.
Explanation:
There are many ways to build a brand and while advertising is one of them, it is not the major one and experts would not recommend that a heavy reliance is placed on it.
Rather a brand can be built by instituting a robust brand management system to ensure that the brand grows through actions that show integrity and personality that will attract people to the brand regardless of if it is being advertised or not.
Waggoner Company has a cash balance of $44,000 on April 1. The company is required to maintain a cash balance of $25,000. During April expected cash receipts are $174,000. Expected cash disbursements during the month total $200,800. During April the company will need to borrow:____.
a. $2,500.b. $3,500.c. $4,000.d. $6,000.
Answer: $7,800
Explanation:
The amount that the company needs to borrow can be found using the formula:
= Opening balance + Cash receipts - Cash to be maintained - Cash disbursement
= 44,000 + 174,000 - 25,000 - 200,800
= -$7,800
Amount to be borrowed is the shortfall of $7,800
Better Corp. (BC) began operations on January 1, Year 1. During Year 1, BC experienced the following accounting events: 1. Acquired $7,000 cash from the issue of common stock. 2. Borrowed $12,000 cash from the State Bank. 3. Collected $47,000 cash as a result of providing services to customers. 4. Paid $30,000 for operating expenses. 5. Paid an $8,000 cash dividend to the stockholders. 6. Paid $20,000 cash to purchase land.Required:a. Record the events in an accounting equation like the one shown next. Record the ined Earnings column. b. As of December 31, Year 1, determine the total amount of assets, liabilities, and stockholders’ equity and prepare a balance sheet.
c. What is the amount of total assets, liabilities, and stockholders’ equity as of January 1, Year 2?
d. Assume that the land has a market value of $22,000 as of December 31, Year 1. At what amount will the land be shown on the December 31, Year 1, balance sheet? Why is this amount used in the balance sheet?
Answer:
Better Corp. (BC)
a. Accounting Equation
Assets = Liabilities + Equity
1. Cash $7,000 Common stock $7,000
2. Cash $12,000 Bank loan payable $12,000
3. Cash $47,000 Service Revenue $47,000
4. Cash ($30,000) Op. expenses ($30,000)
5. Cash ($8,000) Cash dividend ($8,000)
6. Land $20,000 Cash ($20,000)
Assets $28,000 = Liabilities $12,000 + Equity $16,000
b. Total assets = $28,000
Total liabilities = $12,000
Stockholders' equity = $16,000
Balance Sheet as of December 31, Year 1
Assets:
Cash $8,000
Land $20,000
Total assets $28,000
Liabilities:
Bank loan $12,000
Equity:
Common stock $7,000
R/Earnings 9,000
Total equity $16,000
Liabilities and
Equity $28,000
c. Total assets = $28,000
Total liabilities = $12,000
Total equity = $16,000
d. The Land will be shown on the December 31, Year balance sheet at $20,000. The reason is that this is the acquisition cost and the land is not held for trading (no information provided).
Explanation:
a) Data and Analysis based on the Accounting Equation:
1. Cash $7,000 Common stock $7,000
2. Cash $12,000 Bank loan payable $12,000
3. Cash $47,000 Service Revenue $47,000
4. Cash ($30,000) Operating expenses ($30,000)
5. Cash ($8,000) Cash dividend ($8,000)
6. Land $20,000 Cash ($20,000)
Juanita is the sole shareholder of Belize Corporation (a calendar-year S corporation). She is considering revoking the S election. It is February 1, year 1. What options does Juanita have for timing the effective date of the S election revocation
Answer:
January 1 Year 2 would be an effective date.
Explanation:
Juanita have two ( 2 ) options and they are
Terminating the election after March 15th Terminating the Election at the beginning of the next Financial yearSince it is already February 1 Year 1 , The most effective date for the S election revocation would be January 1 year 2 ( calendar-year of S corporation ) .
Identify the events that relate to process gains. Event 1: A group of individuals who spend time together are seen as a group although their togetherness is not to achieve any goals. Event 2: A group of intelligent people work as a team to produce great results. Event 3: Two brilliant tennis players do not produce good results when they play as a team. Event 4: Workers produce more when they work in small groups.
Answer: Event 2: A group of intelligent people work as a team to produce great results.
Event 4: Workers produce more when they work in small groups.
Explanation:
Process gain occurs when groups work better than what is typically expected, based on the individuals who form the work.
The events relating to process gain include:
Event 2: A group of intelligent people work as a team to produce great results.
Event 4: Workers produce more when they work in small groups.
Other options such as event 1 and 4 are process loss.
Oltman Corporation uses a predetermined overhead rate based on machine-hours to apply manufacturing overhead to jobs. The Corporation has provided the following estimated costs for next year:
Direct materials $25,000
Direct labor $22,000
Advertising expense $15,000
Rent on factory building $13,500
Sales salaries $28,000
Depreciation on factory equipment $6,500
Indirect materials $10,000
Insurance on factory equipment $12,000
Oltman estimated that 40,000 direct labor-hours and 20,000 machine-hours would be worked during the year. The predetermined overhead rate per machine-hour will be:___________
a) $1.05 per machine hour
b) $1.00 per machine hour
c) $2.10 per machine hour
d) $1.60 per machine hour
Answer:
Predetermined manufacturing overhead rate= $2.1 per machine hour
Explanation:
First, we need to calculate the estimated total overhead:
Total estimated overhead= Rent on factory building + Depreciation on factory equipment + Indirect materials + Insurance on factory equipment
Total estimated overhead= 13,500 + 6,500 + 10,000 + 12,000
Total estimated overhead= $42,000
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= 42,000 / 20,000
Predetermined manufacturing overhead rate= $2.1 per machine hour
Given the following, the standard cost of this item is $_____per unit.
Direct materials per unit: 2 pounds
Direct material cost: $2.50 per pound
Direct labor per unit: .75 hours
Direct labor rate: $16.00 per hour
Variable overhead rate: $8.00 per hour
Answer:
$23 per unit
Explanation:
Standard cost = Direct materials + Direct labor + Variable overhead
Standard cost = (2 pounds*$2.50 per pound) + (0.75 hours*$16.00 per hour) + (0.75 hours*$8.00 per hour)
Standard cost = $5 + $12 + $6
Standard cost = $23
So, the standard cost of this item is $23 per unit.
An error in the physical count of goods on hand at the end of a period resulted in a $10,000 overstatement of the ending inventory. The effect of this error in the current period is (use the COGS equation for the Periodic System):__________
A. Cost of Goods Sold: Understated, and Net Income: Understated
B. Cost of Goods Sold: Overstated, and Net Income: Overstated
C. Cost of Goods Sold: Understated, and Net Income: Overstated
D. Cost of Goods Sold: Overstated, and Net Income: Understated
Answer:
C. Cost of Goods Sold: Understated, and Net Income: Overstated
Explanation:
The cost of goods can be defined as the amount that a business has to pay in other for them to get an inventory. the net income can be defined as the amount of money that is left from COGS and other expenditures that does not include taxes and payments of interest. Overstating the inventory causes the total amount of earnings to be overstated for that accounting period. while the cost of good sold would be understated
Find the APR, or stated rate, in each of the following cases (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.): Stated Rate (APR) Number of Times Compounded Effective Rate (EAR) % Semiannually 10.7 % Monthly 11.6 Weekly 9.3 Infinite 13.0
Answer:
EAR = (1+APR/m)^m - 1 where m=compounding periods
1. 0.116 = (1+APR/2)^2 - 1
(1+0.116) = (1+APR/2)^2
(1.116)^(1/2) = 1+APR/2
APR = [(1.107)^(1/2) - 1]*2
APR = [1.05214067501 - 1]*2
APR = 0.05214067501 * 2
APR = 0.10428135002
APR = 10.43%
2. 0.116 = (1+APR/12)^12-1
APR = [(1+0.116)^(1/12)-1]*12
APR = [1.116^(1/12) - 1] * 12
APR = [1.00918785692 - 1] * 12
APR = 0.00918785692 * 12
APR = 0.11025428304
APR = 11.05%
3. 0.093 = (1+APR/52)^52 - 1
APR = [(1+0.093)^(1/52) - 1] * 52
APR = [1.093^(1/52) - 1] * 52
APR = [1.0017115825 - 1] * 52
APR = 0.0017115825 * 52
APR = 0.08900229
APR = 8.90%
Explain how business can deal with unemployment as one of their initiative to address socio-economic issues
Answer:
Below is the required solution.
Explanation:
How can companies influence the crisis in jobs and skills? Nearly 80 case studies show three areas in which businesses can take the lead:
Work with educational and training providers to assist people in developing the skills they need in the world of workSupport startups and smaller companies to promote entrepreneurshipLink talent to markets by bridging the gap between employers and job-seekers.Eight factors that can make programmes and practises more effective also emerge from case studies.
Build multi-sector partnershipsDevelop win-win approachesUnderstand the talent value chainBe relevant to the contextCommit leadership to the causeDesign for the futureLeverage ICTTest first, scale second¿sí se vende mercancía en que tipo de cuenta debe registrar el IVA de dicha compra?
a) ingreso
b) costo de venta
c) costo de producción
d) pasivo
Answer:
the answer is cost of buying or cost of production
la respuesta es el costo de compra o el costo de producción
Explanation:
i speak Spanish and business is pretty easy
Better Corp. (BC) began operations on January 1, Year 1. During Year 1, BC experienced the following accounting events: 1. Acquired $7,000 cash from the issue of common stock. 2. Borrowed $12,000 cash from the State Bank. 3. Collected $47,000 cash as a result of providing services to customers. 4. Paid $30,000 for operating expenses. 5. Paid an $8,000 cash dividend to the stockholders. 6. Paid $20,000 cash to purchase land.Required:a. Record the events in an accounting equation like the one shown next. Record the ined Earnings column. Provide the appropriate titles for these accounts in the last column of the table. The first event is shown amounts of revenue, expense, and dividends in as an example.b. As of December 31, Year 1, determine the total amount of assets, liabilities, and stockholders’ equity and prepare a balance sheet.c. What is the amount of total assets, liabilities, and stockholders’ equity as of January 1, Year 2?d. Assume that the land has a market value of $22,000 as of December 31, Year 1. At what amount will the land be shown on the December 31, Year 1, balance sheet? Why is this amount used in the balance sheet?
Answer:
Better Corp. (BC)
a. Accounting Equation
Assets = Liabilities + Equity
1. Cash $7,000 Common stock $7,000
2. Cash $12,000 Bank loan payable $12,000
3. Cash $47,000 Service Revenue $47,000
4. Cash ($30,000) Op. expenses ($30,000)
5. Cash ($8,000) Cash dividend ($8,000)
6. Land $20,000 Cash ($20,000)
Assets $28,000 = Liabilities $12,000 + Equity $16,000
b. December 31, Year 1 Balances:
Total assets = $28,000
Total liabilities = $12,000
Stockholders' equity = $16,000
Balance Sheet as of December 31, Year 1
Assets:
Cash $8,000
Land $20,000
Total assets $28,000
Liabilities:
Bank loan $12,000
Equity:
Common stock $7,000
R/Earnings 9,000
Total equity $16,000
Liabilities and
Equity $28,000
c. January 1, Year 2 Balances:
Total assets = $28,000
Total liabilities = $12,000
Total equity = $16,000
d. The Land will be shown on the December 31, Year balance sheet at $20,000. The reason is that this is the acquisition cost and the land is not held for trading (no information provided).
Explanation:
a) Data and Analysis based on the Accounting Equation:
1. Cash $7,000 Common stock $7,000
2. Cash $12,000 Bank loan payable $12,000
3. Cash $47,000 Service Revenue $47,000
4. Cash ($30,000) Operating expenses ($30,000)
5. Cash ($8,000) Cash dividend ($8,000)
6. Land $20,000 Cash ($20,000)
A firm's stock recently earned $5 per share and the firm distributed sixteen percent of its earnings as cash dividends. Its dividends grow annually at 4 percent.
a. What is the stock's price if the required rate of return is 9 percent?b. The firm borrows funds and, as a result, its per-share earnings and dividends increase by 20 percent. What happens to the stock's price if the growth rate and the required return are unaffected? What will the stock's price be if after using financial leverage and increasing the dividend to $1, the required return rises to 10 percent? What may cause this required return to rise?
Solution :
Given :
a). Value of stock earned per share = $5
Percentage of dividends distributed = 16%
Growth of dividend annually = 4%
Calculating the value of the common stock :
[tex]$$D_0[/tex] = 16% of $5
= 0.16 x 5
= 0.8
k = 0.09
g = 0.04
Therefore, the stock's value is give by,
[tex]$=\frac{D_0(1+g)}{k-g}$[/tex]
[tex]$=\frac{0.8(1+0.04)}{0.09-0.04}$[/tex]
=$16.64
b). Therefore, the value of the common stock when the growth rate increases is,
[tex]$$D_0[/tex] = 0.8+20% of 0.8
= 0.96
k = 0.09
g = 0.04
Value of stock [tex]$=\frac{D_0(1+g)}{k-g}$[/tex]
[tex]$=\frac{0.96(1+0.04)}{0.09-0.04}$[/tex]
=$19.96
Dianne Ruth withdrew $8,000 from her educational savings account and used $6,000 to pay for qualified higher education expenses. The remaining balance of $2,000 was used to purchase clothes. On the date of the distribution, her educational savings account had $25,000 balance including $20,000 she had contributed.
How much of the $8,000 is tax free?
Answer:
$7,600
Explanation:
Calculation to determine How much of the $8,000 is tax free
Step 1 is to calculate the % using this formula
%=Savings ratio ROC Contributed/Total balance
Let plug in the formula
%=$20,000/$25,000
%= .80*100
%=80%
Step 2 is to calculate the ROC tax free using this formula
ROC tax free=% x Distribution
Let plug in the formula
ROC tax free=.80x 8000
ROC tax free=$6,400
Step 3 is to Contained earnings in distribution using this formula
Contained earnings in distribution=Distribution - ROC tax free
Let plug in the formula
Contained earnings in distribution=$8,000-$6,400
Contained earnings in distribution= $1,600
Step 4 is to calculate Excludable earning using this formula
Excludable earning=(Qualified exp/distribution ) x Earning contained
Let plug in the formula
Excludable earning=($6,000/$8,000) x $1,600
Excludable earning= $1,20/
Step 5 is to calculate the Taxable amount using this formula
Taxable =Earnings - Excludable
Let plug in the formula
Taxable=$1,600-$1,200
Taxable =$400
Now let determine the Tax free using this formula
Tax free = Distribution- Taxable
Let plug in the formula
Tax free=$8,000- $400
Tax free=$7,600
Therefore How much of the $8,000 is tax free will be $7,600
Houston Fashions is considering a new product line that would require an investment of $ 140,000 in fixtures and displays and $ 180,000 in working capital. Store managers expect the following pattern of net cash inflows from the new product line over the life of the investment.
Year Amount
1 ......... $70,000
2 ......... 78,000
3 ......... 72,000
4 ......... 56,000
5 ......... 50,000
6 ......... 48,000
7 ......... 44,000
a. Compute the payback period for the proposed new product line. Houston Fashions requires a four- year pre-tax payback period on its investments. (Round to one decimal point.) Should the company make this investment? Explain.
b. Should Houston Fashions use any other capital project evaluation method(s) before making an investment decision? Explain.
Answer:
4.88 years
other methods should be used because payback method does not account for the time value of money
Explanation:
When President Obama was president he had discussed raising income taxes for individuals earning over $250,000 in income. Explain how these higher income taxes will affect the aggregate demand curve. What variables cause the short-run aggregate supply curve to shift
Answer:
A) Higher income taxes will cause a decrease in disposable income and this will affect personal expenditure which will cause the aggregate demand curve to shift leftwards ( decrease in price level and real GDP )
B)
i) Change in input price
ii) Change in production cost
iii) Increase in labor supply or increase in capital stocks
Explanation:
A) Effects of higher income taxes on aggregate demand curve
i) Higher income taxes will cause a decrease in disposable income and this will affect personal expenditure which will cause the aggregate demand curve to shift leftwards ( decrease in price level and real GDP )
B) The factors that will cause the short-run aggregate supply curve to shift
a) Change in input price
b) Change in production cost
c) Increase in labor supply or increase in capital stocks
