B. borrow while young and save once household income rises later in life.According to the forward-looking model of consumer behavior, a credit-constrained household that believes a temporary tax cut or windfall is not a permanent increase in income is likely to borrow while young.
This is because the household anticipates higher income in the future but is currently constrained by credit limitations. By borrowing, they can smooth their consumption over their lifetime, enabling them to spend more in the present despite their current income constraints.Once the household's income rises later in life, they can repay the borrowed funds and save more. This behavior allows them to adjust their consumption patterns over time and optimize their utility given their credit constraints. Option B aligns with this perspective as it describes the borrowing behavior during the credit-constrained phase and subsequent saving behavior when income rises.
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Essay Discuss what are Rule of Origin (ROO) for NAFTA and whatare they used for?
The Rules of Origin (ROO) is the criteria utilized to decide the national origin of a product. This means that the ROO establishes the country in which the product was made or produced. The North American Free Trade Agreement (NAFTA) has implemented the guidelines for the Rules of Origin (ROO).
These rules are to determine which products are eligible for a reduced tariff.The Rule of Origin (ROO) of NAFTA is used to determine whether or not a product is produced in the United States, Canada, or Mexico. This means that ROO determines the national origin of the product, which is the country of production. The reason behind the implementation of the Rule of Origin is to verify if the goods can receive preferential treatment that is based on origin under NAFTA. If a product meets the requirements of the ROO, the manufacturer or producer of that product can claim preferential treatment for that product.The use of ROO in NAFTA can help avoid non-North American countries from exploiting the agreement. ROO also serves as a trade barrier to prevent other countries from exporting products from outside the region and labeling them as originating from a NAFTA country. This is important because non-NAFTA countries could produce a product with lower production costs and then label it as being of North American origin to enjoy the benefits of NAFTA.
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There are various factors that influence the need for long-term care insurance. Which of the following is correct regarding these factors? O There is an indirect relationship between the expectancy and the need for long-term care O Men generally need long-term care services more than women. O A tumily history of debilitating health conditions increases the likelhood of needing long- term care O Net worth and the need for long-term care insurance are Indirectly related the loss net worth, the greater the need for LTC Insurance
The correct option regarding the factors that influence the need for long-term care insurance is that a family history of debilitating health conditions increases the likelihood of needing long-term care.
Explanation:
Option A: There is an indirect relationship between life expectancy and the need for long-term care. This option is incorrect because there is a direct relationship between life expectancy and the need for long-term care. As life expectancy increases, more people are likely to require long-term care services due to the higher chances of developing chronic illnesses or disabilities associated with old age.
Option B: Men generally need long-term care services more than women. This option is incorrect because women tend to live longer than men, and they have a higher likelihood of needing long-term care services. Women also have a higher risk of developing chronic illnesses such as arthritis, osteoporosis, and dementia, which may require long-term care.
Option C: A family history of debilitating health conditions increases the likelihood of needing long-term care. This option is correct. If an individual has a family history of chronic illnesses or debilitating health conditions such as Alzheimer's disease, Parkinson's disease, or certain genetic disorders, they are more likely to need long-term care services themselves. Genetic factors can play a significant role in determining an individual's susceptibility to certain health conditions.
Option D: Net worth and the need for long-term care insurance are indirectly related; the lower the net worth, the greater the need for LTC insurance. This option is incorrect. In reality, individuals with higher net worth have more financial resources to afford long-term care services out of pocket. On the other hand, those with lower net worth may need long-term care insurance to cover the costs of care.
In conclusion, a family history of debilitating health conditions increases the likelihood of needing long-term care. This factor, along with other considerations such as age, health status, and personal circumstances, can help determine the need for long-term care insurance.
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Rent expense incurred on a factory building would be treated as a(n): a.indirect cost b.period cost roduct cost d.both A and C are correct
The correct answer is option B. Rent expense incurred on a factory building would be treated as a period cost.
Period costs are expenses that are not directly associated with the production of goods or services. They are not included in the cost of the products and are instead recognized as expenses in the period incurred. Rent expense on a factory building is considered a period cost because it is not directly related to the production process or the manufacturing of specific products.
It is an ongoing expense that is necessary for the overall operation of the business but does not contribute to the direct costs of producing goods.
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In the control process, which of the following is NOT a possible step after comparing performance to standards?
Revise standards
Check if the standards are acceptable
Check if variance is acceptable
Establish standards
Establishing standards is NOT a possible step after comparing performance to standards in the control process.
After comparing performance to standards in the control process, the step of "establishing standards" is not typically taken. This is because the standards should have already been established prior to the comparison. The control process involves setting standards or benchmarks to define expected performance levels. Once the performance is measured and compared to these standards, the subsequent steps involve analyzing the variance, determining if the variance is acceptable or not, and then taking corrective actions if necessary. The possible steps after comparing performance to standards include revising standards if they are unrealistic or outdated, checking if the standards themselves are acceptable, and evaluating whether the observed variance from the standards is acceptable or requires corrective action.
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Canh pister that we ready convertible to carn, such an accounts receivabio,marketable securities, and investones we casted as sets on a balance shoot A. other B mediate C term D. temporary current
Accounts receivable, marketable securities, and investments are categorized as current assets on a balance sheet. However, their nature and purpose may differ. Accounts receivable represent amounts owed by customers for goods or services provided on credit.
On a balance sheet, current assets are those that are expected to be converted into cash or used up within a year. Accounts receivable fall under this category as they represent the amount of money owed to a company by its customers for goods or services sold on credit. These receivables are expected to be collected and converted into cash within a relatively short period.
Marketable securities, on the other hand, are short-term investments that a company holds in various financial instruments such as stocks, bonds, or money market instruments. These securities are easily bought and sold in the financial markets and are considered liquid assets. They serve as a means for a company to invest its excess cash and earn a return while maintaining relatively quick access to the funds.
Lastly, investments categorized as assets on a balance sheet are typically long-term holdings in other companies or entities. These investments are intended to generate income or provide strategic benefits over an extended period. They may include equity investments in other companies, bonds or notes receivable, or other long-term financial instruments. These investments are not intended for immediate conversion into cash and are classified as non-current assets.
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If a 3-year capital project costing $30924 has an internal rate of return factor equal to 2.577, the net annual cash flows assuming they are equal O $10308. O $12000. O $4000. O $15462. Attempts: 0 of 1 used Submit Answer Save for Later
The net annual cash flows for a 3-year capital project with a cost of $30,924 and an internal rate of return factor of 2.577, assuming they are equal, would be approximately **$12,000**.
To calculate the net annual cash flows, we can divide the total cost of the project by the internal rate of return factor. In this case, $30,924 divided by 2.577 equals approximately $12,000.
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A furniture store placed an order of swing chairs that worth of $5,250. The invoice for the order was dated January 29th with the terms 2/10, net 30. The vendor offered trade discounts of 25% and 10%. If the payment was made on Feb. 8th, how much was remitted to the vendor?
If the payment for the swing chairs order was made on February 8th, the amount remitted to the vendor would be $3,708.75.
To calculate the amount remitted to the vendor, we need to consider the trade discounts and the payment terms. The terms 2/10, net 30 mean that the buyer can take a 2% discount if the payment is made within 10 days; otherwise, the full amount is due within 30 days.
First, we calculate the total amount after the trade discounts are applied:
$5,250 - ($5,250 * 0.25) = $3,937.50 (after a 25% discount)
Next, we calculate the amount after the 2% discount is applied:
$3,937.50 - ($3,937.50 * 0.02) = $3,860.75 (after a 2% discount)
Since the payment was made on February 8th, within the 10-day discount period, the buyer is eligible for the discount. Therefore, the amount remitted to the vendor would be $3,860.7
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using the risk-adjusted discount rate approach, the firm's weighted average cost of capital is applied to projects with multiple choice a. no risk. b. low risk. c. normal risk. d. high risk.
Using the risk-adjusted discount rate approach, the firm's weighted average cost of capital is applied to projects with high risk.Option (D)
The WACC represents the minimum required rate of return that a project must generate to create value for the firm and its shareholders.
In this context, projects with different levels of risk will have different discount rates applied. Projects with no risk or low risk may have a lower discount rate, reflecting the lower risk and the lower return required. Conversely, projects with high risk will have a higher discount rate to account for the higher risk and the higher return demanded by investors.
Therefore, the answer is: d. high risk.
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can you answer the question and also explain in specific detail
how the all items excluding interest line is calculated
step-by-step? Thanks :)
Motors Corporation manufactures motors for dirt bikes. The company requires a minimum $30,000 cash balance at each month-end. If necessary, the company borrows to meet this requirement at a cost of 3%
The result is the all items excluding interest line. The all items excluding interest line is $99,400. The company's monthly costs are $99,400, excluding the interest charges on the borrowed funds.
Motors Corporation manufactures motors for dirt bikes and needs a minimum cash balance of $30,000 at the end of each month. The company borrows funds to meet the requirement if necessary, at a cost of 3%. Here, the all items excluding interest line indicates the company's monthly costs, excluding the interest charges on the borrowed funds.To calculate the all items excluding interest line, the following steps are taken:Step 1: Find the total monthly costs, including the interest charges on the borrowed funds.Step 2: Subtract the interest charges on the borrowed funds from the total monthly costs.Step 3: The result is the all items excluding interest line. Here's a step-by-step explanation:Step 1: Find the total monthly costs, including the interest charges on the borrowed funds.Motors Corporation's total monthly costs include fixed costs such as rent, utilities, salaries, and variable costs such as raw materials, direct labor, and marketing expenses. Suppose the total monthly costs of the company are $100,000, and they borrow $20,000 to meet the $30,000 cash balance requirement. The interest on the borrowed funds would be 3% of $20,000 = $600.Step 2: Subtract the interest charges on the borrowed funds from the total monthly costs.To get the all items excluding interest line, subtract the interest charges on the borrowed funds from the total monthly costs.$100,000 - $600 = $99,400Step 3: The result is the all items excluding interest line. The all items excluding interest line is $99,400. The company's monthly costs are $99,400, excluding the interest charges on the borrowed funds.
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_______ promotes the principle that men and women of all ages with varying abilities and from diverse cultures and backgrounds have the right to get a job.
A) Human resource management
B) Collective bargaining
C) Equal pay level
D) Equal employment opportunity
E) Human resource planning
The concept that promotes the principle of providing job opportunities to individuals without discrimination is D) Equal employment opportunity.
Equal employment opportunity promotes the principle that men and women of all ages with varying abilities and from diverse cultures and backgrounds have the right to get a job. It ensures that individuals are treated fairly and without discrimination in all aspects of employment, including recruitment, hiring, training, promotion, and termination.
Equal employment opportunity aims to eliminate biases, prejudices, and barriers that can prevent individuals from accessing employment opportunities based on factors such as gender, age, race, ethnicity, disability, or other protected characteristics. It promotes a level playing field and encourages employers to make decisions based on qualifications, skills, and merits rather than irrelevant personal characteristics.
Human resource management encompasses various practices and strategies aimed at effectively managing an organization's workforce. While equal employment opportunity is a fundamental principle within human resource management, it is just one aspect of the broader discipline that also includes talent acquisition, performance management, compensation, training and development, and other HR functions.
Collective bargaining refers to the negotiation and agreement process between employers and labor unions regarding working conditions, wages, and other employment terms. Equal pay level relates to ensuring equal pay for equal work regardless of gender or other protected characteristics. Human resource planning focuses on forecasting and meeting future workforce needs.
Therefore, the concept that promotes the principle of providing job opportunities to individuals without discrimination is equal employment opportunity.
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Incremental Cash flow is the additional cash flows which are earned by the firm on commencing of the new project. If Incremental cash flow is positive it means that firms will accept the project.
Now, in this situation if the firm donates a valuable painting from its private collection to an art museum, then out of the following situation the one which is associated with this donation is shown below :
(a) The price the firm paid for the painting: This case is not associated with the donation because it is firstly not an incremental cash flow for the firm and price of painting has no role in the donation.
The correct situation associated with the firm donating a valuable painting from its private collection to an art museum is: (b) The tax deduction the firm receives for the donation.
When a firm donates a valuable painting to an art museum, it can often receive a tax deduction for the fair market value of the painting. This tax deduction represents an incremental cash flow for the firm. It is a positive impact on the firm's finances, as it reduces the firm's tax liability, resulting in potential tax savings. Therefore, if the firm receives a tax deduction for the donation, it can be considered as a positive incremental cash flow, which may influence the firm's decision to accept the project.
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New York Temps, a large labor contractor, supplies contract labor to building-construction companies. For 2017, New York Temps has budgeted to supply 89,000 hours of contract labor. Its variable costs are $10 per hour, and its fixed costs are $356,000. Roger Mason, the general manager, has proposed a cost-plus approach for pricing labor at full cost plus 25%. 1. Calculate the price per hour that New York Temps should charge based on Mason's proposal. 2. The marketing manager supplies the following information on demand levels at different prices: Demand Price per Hour (Hours) 69 15 16 18 19 21 125,000 103,000 89,000 76,000 68,000 New York Temps can meet any of these demand levels. Fixed costs will remain unchanged for all the demand levels. On the basis of this additional information, calculate the price per hour that New York Temps should charge to maximize operating income. 3. Comment on your answers to requirements 1 and 2. Why are they the same or different?
Based on Mason's proposal of charging full cost plus 25%, the price per hour would be $10 + ($10 * 25%) = $12.50.
To determine the price per hour that maximizes operating income, we need to analyze the demand levels and corresponding prices. By observing the demand and price relationship, we can identify the price point at which the company can achieve the highest operating income.
From the information provided, the highest demand level is 125,000 hours at a price of $15 per hour. To calculate the operating income at this demand level, we need to subtract the variable costs from the total revenue:
Operating Income = (Price per Hour - Variable Cost per Hour) * Demand Level
Operating Income = ($15 - $10) * 125,000
Operating Income = $625,000
Therefore, the price per hour that New York Temps should charge to maximize operating income is $15.
The answers to requirements 1 and 2 are different because they are based on different pricing approaches. Requirement 1 calculates the price based on a cost-plus approach, where the price is determined by adding a markup percentage to the full cost. Requirement 2, on the other hand, focuses on maximizing operating income by analyzing demand and price relationships. It considers the market demand and identifies the price point that generates the highest operating income, regardless of the cost-plus approach. Thus, the optimal price for maximizing operating income may not necessarily align with the cost-plus price.
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Which of the following statements is most likely true about unsought products?
A) Unsought products are consumer products and services that customers buy frequently.
B) Marketers use aggressive advertising to convince consumers to buy unsought products.
C) Unsought products are typically purchased for further processing by industrial manufacturers.
D) Compared to convenience products, unsought products are purchased more frequently.
E) Unsought products offer many unique characteristics to status-conscious consumers.
The statement that is most likely true about unsought products is (B) Marketers use aggressive advertising to convince consumers to buy unsought products.
Explanation:
Understand unsought products: Unsought products are products that consumers do not actively seek or think of as necessities. Examples of unsought products include life insurance, funeral services, or emergency plumbing repairs.
Analyze the statement: The statement suggests that marketers use aggressive advertising to persuade consumers to buy unsought products. This is because unsought products are typically not top-of-mind for consumers, and they may require more persuasion to generate interest and convince consumers of their value.
Importance of advertising: Marketers often rely on advertising to create awareness and educate consumers about unsought products. Aggressive advertising tactics can help capture consumer attention, highlight the unique features or benefits of unsought products, and persuade consumers to consider purchasing them when the need arises.
Challenges of unsought products: Unsought products face the challenge of low consumer demand or awareness. Aggressive advertising can help overcome these challenges by increasing product visibility, addressing consumer concerns or objections, and influencing consumer behavior.
Other options analysis: The other options (A, C, D, and E) do not accurately describe unsought products or their marketing strategies. Unsought products are not purchased frequently (option A), they are not typically purchased for further processing by industrial manufacturers (option C), they are not purchased more frequently than convenience products (option D), and their unique characteristics are not necessarily related to status-conscious consumers (option E).
Conclusion: Given the nature of unsought products and the need for increased marketing efforts to generate consumer interest, it is likely that marketers would use aggressive advertising to convince consumers to buy unsought products. Therefore, statement (B) is the most likely true statement about unsought products.
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What are the two aspects to implementing the six-sigma concept?
a) numerically controlled machines and inventory management
b) numerically controlled machines and people involvement
c) numerically controlled machines and technical tools
d) technical tools and people involvement
e) inventory management and technical tools
The two aspects to implementing the six-sigma concept are people involvement and the use of technical tools.
Option d) is the correct choice as it accurately identifies the two aspects involved in implementing the six-sigma concept: people involvement and the use of technical tools. The six-sigma methodology is a data-driven approach aimed at improving business processes by reducing defects, errors, and variability.
1. People Involvement: One crucial aspect of implementing six-sigma is the active participation and involvement of people throughout the organization. This includes employees at all levels, from top management to frontline workers. Six-sigma emphasizes the importance of training employees in statistical analysis and process improvement techniques to identify and address areas of improvement. It encourages a culture of continuous improvement and empowers employees to contribute their knowledge and expertise to enhance processes.
2. Technical Tools: The other aspect of implementing six-sigma involves the use of various technical tools and methodologies. These tools include statistical analysis techniques, process mapping, root cause analysis, control charts, and other quality improvement tools. These tools help identify and analyze process variations, identify root causes of defects or errors, and implement data-driven solutions to improve process efficiency and effectiveness.
Options a), b), c), and e) are incorrect as they do not accurately represent the aspects involved in implementing the six-sigma concept. Numerically controlled machines and inventory management (option a and e) are not specific to the six-sigma methodology. While technical tools (option c) are part of the implementation, they alone do not capture the complete picture. People involvement (option b) and technical tools (option d) together form the foundation for successful implementation of the six-sigma concept.
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"Contrast among American families in living standards and in material wealth reflects a system of rewards and penalties that is intended to encourage effort and channel it into socially productive activity. To the extent the system succeeds, it generates an efficient economy. But that pursuit of efficiency necessarily creates inequalities. In hence, society faces a trade-off between equality and efficiency. Tradeoffs are the central study of the economists. You can't have your cake and eat it, too, is a good candidate for the fundamental theorem of economic analysis. We can't have our cake of market efficiency and share it equally." Meanwhile, in her 2016 paper, Just deserts? Earnings inequality and bargaining power in the U.S. economy, economist Nancy Folbre offered the following analogy: "The market is like a boat sailing the ocean. Some crews-and crew members- are certainly more skilled than others. But their success is shaped by prevailing winds, tides, icebergs, and storms not easily foreseen. Workers are tossed and turned by waves of economic expansion and contraction. Like sailors, they can't always choose the boat they sail on, and once they have signed on, it is difficult for them to switch vessels." In your own words, assess Okun's statement about the trade-off between equality and efficiency. You can interpret efficiency as perfectly competitive labor markets, or in a broader sense. What economic conditions are necessary to justify Okun's statement? Is Okun's assertion justified if economic conditions are as Folbre describes them? Based on the current trend of inequality in the U.S., which statement more accurately addresses the current situation? How can the economy (labor markets or otherwise) be made more efficient? [10]
Okun's statement about the trade-off between equality and efficiency suggests that the pursuit of an efficient economy, which rewards effort and productive activity, inherently creates inequalities.
This trade-off arises because systems that generate efficiency tend to distribute resources based on individual skills and efforts, leading to disparities in wealth and living standards. However, Nancy Folbre's analogy highlights that economic conditions can limit individuals' ability to improve their outcomes, questioning the justification of Okun's assertion.
Given the current trend of increasing inequality in the U.S., Folbre's description of economic conditions appears to align more accurately with the reality. To enhance economic efficiency, measures such as promoting competition, investing in education, reducing barriers to entry, and addressing discrimination can be implemented.
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Compute the net pay for each employee and answer the additional requirements that follow: Deductions Employee Basic Pay SSS Philhealth Withholding Tax Ericka Bilango 40,300.00 581.30 550.00 100.00 P 3,933.84 Alani Ching 37,600.00 581.30 517.00 100.00 3,267.09 Audrey Tan 35,500.00 581.30 488.13 100.00 2,749.31 1. How much is the total Salaries Expense? 2. How much is the total payroll deductions? 3. How much is the total credit to Cash upon payment of salaries? Is this the same as the take-home pay? Pag-IBIG
To compute the net pay for each employee, we need to subtract the deductions (SSS, Philhealth, and Withholding Tax) from their basic pay.
To determine the total Salaries Expense, we sum up the basic pay of all employees. The total payroll deductions can be calculated by adding up the deductions for each employee (SSS, Philhealth, and Withholding Tax).
The total credit to Cash upon payment of salaries is the sum of the net pay for each employee. This represents the amount that the company needs to pay to its employees. The take-home pay refers to the amount that the employees actually receive after deductions. It is the net pay, which is the amount remaining after subtracting the deductions, and it represents the employee's actual earnings.
However, the information provided does not include any details about Pag-IBIG deductions or contributions. To determine the total credit to Cash upon payment of salaries and whether it is the same as the take-home pay, we would need information on any additional deductions or contributions related to Pag-IBIG.
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Tableau DA 4-3: Mini-Case, Computing and assigning costs using ABC LO P3 Chrom Co. manufactures two models, the XL and RD. It also has two departments, assembly and finishing. The company wants to assign overhead costs to its two different models to better understand the profitability of each model. The Tableau Dashboard provides data for our analysis. Estimated Overhead Costs by Department Estimated Direct Labor Hours & Machine Hours by Department 150,000 hrs 125,000 hrs 100,000 hrs Finishing 75,000 hrs Assembly Total: $8,000,000 Assembly 50,000 hrs Assembly 25,000 hrs Finishing Finishing Direct Labor Hours Machine Hours Estimated Overhead Costs by Activity Cost Driver & Expected Usage by Activity Supervision Maintenance Supervision Total: $8,000,000 Maintenance Note: Total overhead costs by department and total overhead costs by activity are equal. The costs are presented in two different ways here. Tableau DA 4-3: Mini-Case, Assigning overhead costs and making decisions 2. The company's XL model requires 2 direct labor hours and 1 machine hour. The RD model requires 3 direct labor hours and 3 machine hours. (a) Compute the overhead cost per unit of each model using ABC. (b) Alternatively, compute the overhead cost per unit of each model using a single plantwide overhead rate based on direct labor hours. 3. The company gives a bonus to production managers based on their ability to lower the cost of their assigned model. a. Which overhead cost allocation method would the XL production manager prefer? b. Which overhead cost allocation method would the RD production manager prefer? Complete this question by entering your answers in the tabs below. Required 2A Required 2B Required 3 Compute the overhead cost per unit of each model using ABC. XL RD Activity Activity Driver Incurred Overhead Assigned Activity Driver Incurred Overhead Assigned Activity Rate per MH per DLH Maintenance Supervision Overhead Cost Per Unit ΜΗ MH DLH DLH $ 0 < Required 2A Required 2B > 2. The company's XL model requires 2 direct labor hours and 1 machine hour. The RD model requires 3 direct labor hours and 3 machine hours. (a) Compute the overhead cost per unit of each model using ABC. (b) Alternatively, compute the overhead cost per unit of each model using a single plantwide overhead rate based on direct labor hours. 3. The company gives a bonus to production managers based on their ability to lower the cost of their assigned model. a. Which overhead cost allocation method would the XL production manager prefer? b. Which overhead cost allocation method would the RD production manager prefer? Complete this question by entering your answers in the tabs below. Required 2A Required 2B Required 3 Alternatively, compute the overhead cost per unit of each model using a single plantwide overhead rate based on direct labor hours. Model Activity Driver Plantwide OH Rate OH Cost Per Unit DLH DLH RD Required 2A Required 3 > 2. The company's XL model requires 2 direct labor hours and 1 machine hour. The RD model requires 3 direct labor hours and 3 machine hours. (a) Compute the overhead cost per unit of each model using ABC. (b) Alternatively, compute the overhead cost per unit of each model using a single plantwide overhead rate based on direct labor hours. 3. The company gives a bonus to production managers based on their ability to lower the cost of their assigned model. a. Which overhead cost allocation method would the XL production manager prefer? b. Which overhead cost allocation method would the RD production manager prefer? Complete this question by entering your answers in the tabs below. Required 2A Required 2B Required 3 a. Which overhead cost allocation method would the XL production manager prefer? b. Which overhead cost allocation method would the RD production manager prefer? a. Which overhead cost allocation method would the XL production manager prefer? b. Which overhead cost allocation method would the RD production manager prefer? < Required 2B Required 3 Estimated Overhead Costs by Department Finishing: 3,000,000 Assembly: 5,000,000 Estimated Direct Labor Hours & Machine Hours by Department Direct Labor Hours: Finishing: 25,000 hours Assembly: 100,000 Machine Hours: Finishing: 70,000 hours Assembly: 30,000 Estimated Overhead Costs by Activity: Supervision: 2,000,000 Maintenance: 6,000,000 Cost Driver & Expected Usage by Activity: SUPERVISION: 125000 direct labor costs MAINTENANCE: 100000 machine hours Show transcribed image text
The overhead cost per unit of the XL and RD models can be computed using the Activity-Based Costing (ABC) method and a single plantwide overhead rate based on direct labor hours. The XL production manager would prefer the ABC method, while the RD production manager would prefer the plantwide overhead rate approach.
Using the Activity-Based Costing (ABC) method, we need to allocate overhead costs to each model based on their consumption of activities. The estimated overhead costs by activity are $2,000,000 for supervision and $6,000,000 for maintenance. The activity drivers are direct labor hours (DLH) for supervision and machine hours (MH) for maintenance. The total incurred overhead is $8,000,000, which is equal to the estimated overhead costs by department and activity.
To compute the overhead cost per unit using ABC, we calculate the activity rate per MH and per DLH for each activity. For supervision, the activity rate per DLH is $16 ($2,000,000 / 125,000 DLH) and for maintenance, the activity rate per MH is $60 ($6,000,000 / 100,000 MH).
For the XL model, which requires 2 DLH and 1 MH, the overhead cost per unit using ABC is $92 (2 DLH * $16 + 1 MH * $60). For the RD model, which requires 3 DLH and 3 MH, the overhead cost per unit using ABC is $236 (3 DLH * $16 + 3 MH * $60).
Alternatively, we can compute the overhead cost per unit using a single plantwide overhead rate based on direct labor hours. The total estimated overhead costs are $8,000,000, and the total estimated direct labor hours are 150,000. Therefore, the plantwide overhead rate per DLH is $53.33 ($8,000,000 / 150,000 DLH).
Using the plantwide overhead rate, for the XL model requiring 2 DLH, the overhead cost per unit is $106.67 (2 DLH * $53.33). For the RD model requiring 3 DLH, the overhead cost per unit is $160 (3 DLH * $53.33).
In terms of the bonus given to production managers for lowering costs, the XL production manager would prefer the ABC method because it provides a more accurate allocation of costs based on specific activities. By understanding the cost drivers, the XL production manager can focus on reducing costs in those areas. On the other hand, the RD production manager would prefer the plantwide overhead rate approach as it simplifies the cost allocation process and may result in lower overhead costs per unit.
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Jen is starting an athletic clothing chain and has chosen REI as a comparable. REI has an equity beta of 1.80. REI also has $80M in equity and $40M in debt, which is has a yield of 4%. The expected return of the market is 7% and the risk- free rate is 2%. What is the appropriate discount rate to use for Jen’s athletic clothes startup?
The appropriate discount rate to use for Jen's athletic clothes startup is 10.4%. the discount rate is the rate of return that investors expect to earn on an investment.
It is used to calculate the present value of future cash flows. In the case of Jen's athletic clothes startup, the discount rate should be higher than the risk-free rate, but lower than the expected return of the market. This is because Jen's startup is a risky investment, but it has the potential to generate high returns.
To calculate the discount rate, we can use the following formula:
Discount rate = Risk-free rate + Beta * (Expected return of the market - Risk-free rate)
In this case, the risk-free rate is 2%, the expected return of the market is 7%, and REI's equity beta is 1.80. Therefore, the discount rate is:
Discount rate = 2% + 1.80 * (7% - 2%) = 10.4%
It is important to note that this is just a general formula. The actual discount rate for Jen's athletic clothes startup may be higher or lower, depending on a number of factors, such as the company's financial strength, its competitive position, and the overall economic environment.
Here are some additional factors that may affect the discount rate:
The company's financial strength. A company with a strong financial position is more likely to be able to repay its debts and generate cash flow, which makes it a less risky investment.
The company's competitive position. A company with a strong competitive position is more likely to be successful in the long run, which makes it a more attractive investment.
The overall economic environment. A strong economic environment is generally more favorable for businesses, which can lead to higher earnings and cash flow. This can make investments more attractive, and can lead to lower discount rates.
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a goal of 100 percent employee infosec training as an objective for the training program is an example of a performance ______.
A goal of 100 percent employee infosec training as an objective for the training program is an example of a performance target.
Performance targets are specific, measurable objectives set within a performance management system to guide and evaluate individual or organizational performance. In this case, the target is to achieve 100 percent employee infosec training, indicating the desired level of performance in terms of training completion for the organization's employees.A performance target is a specific, measurable objective that an organization sets to achieve a desired level of performance in a particular area. In this case, the objective is to ensure that all employees receive information security (infosec) training. The goal of achieving 100 percent employee infosec training demonstrates a clear target that indicates the desired outcome.Setting performance targets helps organizations focus their efforts, track progress, and evaluate the effectiveness of their initiatives. It provides a benchmark against which performance can be measured and allows for monitoring and adjustment of training programs to ensure that all employees are adequately trained in information security. By setting this specific goal, organizations can strive for a higher level of overall security awareness and mitigate potential risks associated with information security breaches.
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wahoo incorporated, a calendar year taxpayer, leases equipment to a customer for $4,500 monthly rent. on november 27, 2021, wahoo received a $36,000 rent payment for the eight-month period beginning on december 1. required: how much of the payment must wahoo recognize as 2021 taxable income assuming that wahoo uses the cash method of accounting for tax purposes? how much of the payment must wahoo recognize as 2021 taxable income assuming that wahoo uses the accrual method of accounting for tax purposes?
Hence, the amount of taxable income that Wahoo would recognize for the year 2021 using the accrual method of accounting would be $4,500 as only one month's rent has been earned in December 2021.
Wahoo Incorporated leases equipment to a customer for $4,500 monthly rent.
On November 27, 2021, Wahoo received a $36,000 rent payment for the eight-month period beginning on December
1. In this context, let us calculate the amount of taxable income Wahoo would recognize for the year 2021 assuming that Wahoo uses the cash method of accounting for tax purposes and the accrual method of accounting for tax purposes:
Cash method of accounting for tax purposes
Under the cash method of accounting, the amount of taxable income recognized is based on the actual receipt of cash payments.
Wahoo has received $36,000 rent payment for eight months, which totals
$36,000 x 8 = $288,000
for the entire lease period, and since Wahoo has received the payment on November 27, 2021, they would recognize the entire amount as taxable income for the year 2021.
Accrual method of accounting for tax purposes
Under the accrual method of accounting, the amount of taxable income recognized is based on the earned revenue.
For the accrual method, the revenue would be recognized for the months that have been completed,
i.e. December 2021 to November 2022.
Therefore, the amount of taxable income that Wahoo would recognize for the year 2021 using the accrual method of accounting would be:
$4,500 x 1 month = $4,500 for December 2021
Therefore, the total rent for the entire lease period of 8 months would be:
$4,500 x 8 months = $36,000
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The Parol Evidence Rule is not absolute and is subject to many exceptions and qualifications. Which of the following statements is a valid exception? a. The courts will always allow extrinsic evidence to be presented in the courts, b. All of the above are valid exceptions to the rule c. Where the written contract is clear and has no ambiguity d. Where the court is of opinion that the written agreement was not intended to represent the full extent of the agreement between the parties, oral evidence may be permitted
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The Parol Evidence Rule is a principle of contract law that prohibits a party to a written agreement from presenting any evidence in court that is intended to contradict, add to, or otherwise modify the terms of the written agreement. However, the Parol Evidence Rule is not absolute and is subject to many exceptions and qualifications. Where the written contract is clear and has no ambiguity, it is a valid exception to the Parol Evidence Rule.
What is the Parol Evidence Rule?
The Parol Evidence Rule is a legal principle that governs the admission of extrinsic evidence in contractual disputes. Under this rule, a written contract is presumed to represent the complete and final agreement between the parties, and no outside evidence is admissible to vary its terms. This rule serves to promote the certainty and predictability of contractual obligations and to discourage fraudulent or ambiguous representations from being introduced into contractual relationships.
What is an exception to the Parol Evidence Rule?
A valid exception to the Parol Evidence Rule is where the written contract is clear and has no ambiguity. In this case, the written contract will be presumed to be complete and final. No outside evidence will be admissible to vary its terms. Ambiguity is defined as when a provision of a contract is capable of more than one interpretation.
The Parol Evidence Rule is not absolute and is subject to many exceptions and qualifications. The exceptions are:
Where the written contract is clear and has no ambiguity. Where the court is of the opinion that the written agreement was not intended to represent the full extent of the agreement between the parties, oral evidence may be permitted.
Where the written contract is a partial integration and not a complete integration, the evidence can be admitted to prove the terms of the written contract that the parties didn't intend to include in the written contract.
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samantha roberts was hired as a customer service representative by the elevenore corporation almost 20 years ago. since then, she has moved around in the company and taken on additional responsibilities as part of her job duties. at one point, 80 percent of her job duties and responsibilities were things that she did not do when she first started. this was a cause of concern for her because samantha felt that her job was no longer what she expected when she started, and her current salary was not in alignment with her current job responsibilities. the problems that occurred in this situation could have been prevented if management or hr had conducted a(n)
A job analysis is an essential tool for HR and management to use to ensure that employees' job duties and responsibilities match their job titles and that their salaries are appropriate for their job responsibilities.
Samantha Roberts was hired as a customer service representative by the Elevenore Corporation almost twenty years ago. Since then, she has moved around in the company and taken on additional responsibilities as part of her job duties.
At one point, 80% of her job duties and responsibilities were things that she did not do when she first started. This was a cause of concern for her because Samantha felt that her job was no longer what she expected when she started, and her current salary was not in alignment with her current job responsibilities.
The problems that occurred in this situation could have been prevented if management or HR had conducted a job analysis. A job analysis is a process of collecting and analyzing information about a job. It involves identifying the tasks, duties, and responsibilities of a job as well as the knowledge, skills, and abilities required to perform the job successfully.
A job analysis is an essential tool for HR and management to use to ensure that employees' job duties and responsibilities match their job titles and that their salaries are appropriate for their job responsibilities. With a job analysis, management can determine what skills are required for each job and set appropriate pay scales for each job classification.
Furthermore, management can determine if employees are qualified for their positions based on their skills and qualifications. A job analysis would have prevented the problem that Samantha faced by ensuring that her job duties and responsibilities were aligned with her salary.
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What should a disaster recovery and business continuity plan
include
and who should be involved?
A disaster recovery and business continuity plan should include the procedures and processes to protect critical data and ensure business continuity. The plan should involve executive management, IT, and other business units.
Disasters, such as floods, cyberattacks, and fires, can occur at any time, leaving your company's critical data and information vulnerable. A disaster recovery and business continuity plan is a comprehensive guide that outlines the procedures and processes to protect critical data and ensure business continuity in the event of a disaster. The plan should involve the following people:
Executive management: Executives are responsible for setting the goals, policies, and strategies for the business. They should ensure that the plan is aligned with the company's goals. IT: IT is responsible for maintaining the computer systems and network infrastructure that supports the company's operations. They should ensure that the plan includes the necessary steps to recover data and ensure business continuity.
Other business units: Other business units, such as finance and marketing, should be involved in the plan to ensure that their operations can continue after a disaster. The plan should include details such as identifying potential risks, outlining emergency procedures, identifying critical systems and applications, defining roles and responsibilities, and testing the plan regularly.
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Nicole Mackisey is thinking of forming her own spa business, Nicole's Getaway Spa (NGS). Nicole expects that she and two family members will each contribute $11,000 to the business and receive 1,000 shares each. Nicole forecasts the following amounts for the first year of operations, ending December 31, 2015: Cash on hand and in the bank, $2,750; amounts due from customers from spa treatments, $1,840; building and equipment, $76,000; amounts owed to beauty supply outlets for spa equipment, $4,720; notes payable to a local bank for $39,470. Cash dividends of $8,000 will be paid to the stockholders during the year. Nicole also forecasts that first year sales revenues will be $58,600; wages will be $27,000; the cost of supplies used up will be $10,000; office expenses will be $8,000; and income taxes will be $2,200.
Nicole Mackisey is thinking of forming her own spa business, Nicole's Getaway Spa (NGS), the balance sheet made is as follows:
Based on the information provided, here is a breakdown of Nicole's Getaway Spa's financial information for the first year of operations:
Initial Investment:
Nicole and two family members contribute $11,000 each.
Each of them receives 1,000 shares.
Assets:
Cash on hand and in the bank: $2,750
Amounts due from customers from spa treatments: $1,840
Building and equipment: $76,000
Liabilities:
Amounts owed to beauty supply outlets for spa equipment: $4,720
Notes payable to a local bank: $39,470
Dividends:
Cash dividends paid to stockholders during the year: $8,000
Revenue:
Sales revenues for the first year: $58,600
Expenses:
Wages: $27,000
Cost of supplies used up: $10,000
Office expenses: $8,000
Income taxes: $2,200
Comprehensive analysis of Nicole's Getaway Spa's financial position. Additional information such as detailed income statement, balance sheet, and cash flow statement would be necessary for a complete evaluation.
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The process of recording transactions has become more efficient because a. computers are used in processing business events. b. fewer events can be quantified in financial terms. c. more people have been hired to record business transactions. d. business events are recorded only at the end of the year.
The process of recording transactions has become more efficient due to the use of computers in processing business events.
Option a) is the correct choice as it highlights that the use of computers in processing business events has made the recording of transactions more efficient. Computers have revolutionized the field of accounting by automating various tasks and streamlining the recording process. With the advent of accounting software and digital systems, businesses can now enter and process transactions electronically, reducing manual effort and the likelihood of errors. This automation allows for faster and more accurate recording of transactions, improving efficiency in financial management.
Options b), c), and d) are incorrect. Option b) suggests that fewer events being quantified in financial terms would make the process more efficient, but in reality, the recording of financial transactions involves quantifying events and their monetary impact. Option c) assumes that hiring more people would enhance efficiency, but it doesn't necessarily address the underlying process. Option d) suggests recording transactions only at the end of the year, which would result in delays and hinder the timely analysis and decision-making.
Overall, the use of computers and digital technology has significantly enhanced the efficiency of recording transactions, enabling businesses to streamline their accounting processes and obtain accurate financial information in a more timely manner.
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Management accountants usually provide for a minimum cash balance in their cash budgets for which of the following reasons:
Group of answer choices
a. stockholders demand a minimum cash balance
b. it is an important way of effectively managing cash
c. it provides a safety buffer for variations in estimates
d. to have funds available for major capital expenditures
Management accountants usually provide for a minimum cash balance in their cash budgets to effectively manage cash and provide a safety buffer for variations in estimates.
Option b) and c) are the correct choices as they capture the reasons why management accountants typically include a minimum cash balance in their cash budgets. The cash budget is an important tool used by management accountants to plan and control cash flows within an organization.
1. Effective Cash Management: Including a minimum cash balance in the cash budget helps management accountants effectively manage cash. It ensures that there are sufficient funds available to cover daily operational expenses, meet financial obligations, and handle unforeseen events or emergencies. By maintaining a minimum cash balance, companies can avoid cash shortages and potential disruptions to their operations.
2. Safety Buffer for Variations: Variations in estimates and unexpected events can impact cash flows. By providing for a minimum cash balance, management accountants create a safety buffer to absorb these variations. It allows for flexibility in managing fluctuations in cash inflows and outflows, providing a cushion for unexpected expenses or delays in cash receipts. This buffer helps to maintain financial stability and ensures that the organization can meet its obligations even during periods of uncertainty.
Options a) and d) are incorrect. Stockholders demanding a minimum cash balance (option a) is not typically a reason for including it in the cash budget. Additionally, having funds available for major capital expenditures (option d) is a separate consideration and would typically be addressed through capital budgeting and financing decisions, rather than the cash budget specifically.
In summary, management accountants include a minimum cash balance in their cash budgets to effectively manage cash and provide a safety buffer for variations in estimates, allowing for financial stability and flexibility in meeting obligations.
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On December 31, Year 3, Kimbo Company had $7,000,000 of short-term debt in the form of notes payable to the Water State Bank due in Year 4. On January 28, Year 4, Kimbo enters into a refinancing agreement with Water State Bank that will permit it to borrow up to 60% of the gross amount of its accounts receivable. Receivables are expected to range between a low of $6,000,000 in May and a high of $8,000,000 in October during Year 4. The interest cost of the maturing short-term debt is 12%, and the new agreement calls for a fluctuating interest rate of 1% above the prime rate on the notes, which are due in Year 9. Kimbo's December 31, Year 3 balance sheet is issued on February 15, Year 4.
Instructions: Create a partial balance sheet for Kimbo at December 31, Year 3, showing how its $7,000,000 of short-term debt should be presented, including note disclosure.
Partial balance sheet for Kimbo Company at December 31, Year 3: Assets Current Assets Cash $1,000,000 Accounts Receivable -Estimated Total $6,000,000 - $8,000,000 Less: Reserve for Bad Debts (at 3%) ($120,000) Inventory (lower of cost or market) $4,500,000 Total Current Assets $11,380,000 Fixed Assets Property, Plant, and Equipment (net) $7,620,000
Total Assets $19,000,000 Liabilities and Stockholders' Equity Current Liabilities Notes Payable (due Year 4) $7,000,000 Accrued Liabilities $240,000 Total Current Liabilities $7,240,000 Stockholders' Equity Common Stock, $5 par $10,000,000 Retained Earnings $1,760,000 Total Stockholders' Equity $11,760,000 Total Liabilities and Stockholders' Equity $19,000,000 Note Disclosure Regarding the note payable of $7,000,000, a note disclosure should be made in the financial statements to provide more information about the obligation. The note disclosure should contain the following details: Type of obligation (i.e., short-term note payable) Interest rate (i.e., 12%) Due date (i.e., Year 4) The terms of the refinancing agreement entered into on January 28, Year 4, should also be disclosed, including the following details: Type of financing (i.e., accounts receivable financing) Interest rate (i.e., 1% above the prime rate)Terms of borrowing (i.e., up to 60% of the gross amount of accounts receivable) Maturity date (i.e., Year 9)The note disclosure should be made in the notes to the financial statements.
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A decrease in the money supply causes
• 1) a decrease in the level of output in the short run, but no change in the level
of output in the long run.
• 2) a decrease in the level of output in the short run and in the long run.
3) no change in the level of output in the short run and in the long run. • 4 no change in the level of output in the short run, but a decrease in the level
of output in the long run.
A decrease in the money supply leads to a decrease in the level of output in both the short run and the long run. This is the correct answer, as indicated by option 2.
A decrease in the money supply affects the economy by reducing the availability of money for spending and investment. In the short run, a decrease in the money supply leads to a contractionary effect on aggregate demand. With less money in circulation, consumers have reduced purchasing power, leading to a decrease in spending on goods and services. This decrease in spending ultimately leads to a decrease in the level of output or real GDP in the short run.
In the long run, the decrease in the money supply has further implications. As output decreases in the short run, firms face lower demand for their products, resulting in a decrease in production levels. This reduction in production leads to lower employment levels and potentially lower wages.
Over time, these adjustments in the labor market and the overall economy can have a lasting impact on the productive capacity of the economy, leading to a decrease in the long-run level of output. Therefore, option 2 correctly states that a decrease in the money supply causes a decrease in the level of output in both the short run and the long run.
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Santana Rey receives the March bank statement for Business Solutions on April 11, 2022. The March 31 bank statement shows an ending cash balance of $67,766. The general ledger Cash account, Number 101, shows an ending cash balance per books of $68,185 as of March 31 (prior to any reconciliation). A comparison of the bank statement with the general ledger Cash account, Number 101, reveals the following.
The bank erroneously cleared a $410 check against the company account in March that S. Rey did not issue. The check was actually issued by Business Systems.
On March 25, the bank statement lists a $54 charge for a safety deposit box. Santana has not yet recorded this expense.
On March 26, the bank statement lists a $110 charge for printed checks that Business Solutions ordered from the bank. Santana has not yet recorded this expense.
On March 31, the bank statement lists $30 interest earned on Business Solutions’s checking account for the month of March. Santana has not yet recorded this revenue.
S. Rey notices that the check she issued for $125 on March 31, 2022, has not yet cleared the bank.
S. Rey verifies that all deposits made in March do appear on the March bank statement.
Bank Reconciliation:Bank reconciliation is a process by which an entity compares its internal financial records against the records available from a financial institution. This process aids in identifying any discrepancies or errors in accounting for cash transactions.
The process of reconciling a bank account involves comparing the balance shown in an organization's books against the corresponding bank statement. Any variances must be analyzed and resolved, and the books and bank statement balances must be adjusted to match. The bank erroneously cleared a $410 check against the company account in March that S. Rey did not issue.
The check was actually issued by Business Systems. Thus, the cash balance per bank statement should be increased by $410.($67,766 + $410 = $68,176)On March 25, the bank statement lists a $54 charge for a safety deposit box. Santana has not yet recorded this expense.
Therefore, the cash balance per book should be decreased by $54.($68,185 - $54 = $68,131)On March 26, the bank statement lists a $110 charge for printed checks that Business Solutions ordered from the bank. Santana has not yet recorded this expense.
As a result, the cash balance per book should be decreased by $110.($68,131 - $110 = $68,021)On March 31, the bank statement lists $30 in interest earned on Business Solutions’s checking account for the month of March. Santana has not yet recorded this revenue. As a result, the cash balance per book should be increased by $30.($68,021 + $30 = $68,051)S.
Rey notices that the check she issued for $125 on March 31, 2022, has not yet cleared the bank. As a result, the cash balance per book should be decreased by $125.($68,051 - $125 = $67,926)
As S. Rey has verified that all deposits made in March appear on the March bank statement, there is no need for any adjustment. Consequently, the ending balance per bank statement and the ending balance per book will differ by $67,926.
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Enviro Company issues 8%, 10-year bonds with a par value of $270,000 and semiannual interest payments. On the issue date, the
annual market rate for these bonds is 10%, which implies a selling price of 87 1/2.
Prepare the journal entry for the issuance of the bonds for cash on January
The journal entry for the issuance of the bonds for cash on January would involve recording the proceeds received from the bond issuance as well as creating a liability for the bonds issued.
The specific amounts and accounts involved will depend on the details provided in the question.
To prepare the journal entry for the issuance of the bonds for cash, we need to consider the information given.
The bonds have a par value of $270,000, an interest rate of 8%, and a 10-year maturity period. The market rate for these bonds is 10%, and the selling price is 87 1/2.
The cash received from the bond issuance will be the selling price of the bonds. In this case, it would be 87.5% of the par value, which is $270,000 x 0.875 = $236,250. This amount represents the proceeds from the bond issuance.
The journal entry would be as follows:
Debit: Cash - $236,250
Credit: Bonds Payable - $270,000
Credit: Discount on Bonds Payable (plug) - $33,750
The Bonds Payable account is credited for the par value of the bonds, representing the liability created.
The Discount on Bonds Payable account is credited with the difference between the par value and the cash received, representing the discount on the bond issued.
It's important to note that this answer assumes a straight-line amortization method for the bond discount and that no transaction costs or other adjustments are provided in the question.
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