Given the demand and forecast values shown in the table, the forecasting value for November using Exponential Smoothing (a -0.39) is 197.64.(D)
Exponential smoothing is a time series forecasting method that uses a weighted average of past values to predict future values. It is a simple but effective method that is often used in business forecasting.
Here's how to calculate the forecasting value for November using Exponential Smoothing (a -0.39):
Step 1: Calculate the smoothing constant (a -0.39)
Step 2: Calculate the initial forecast (F1) using the average of the first two demand values, which is: (150+168)/2 = 159
Step 3: Calculate the forecast for June (F2) using the formula: F2 = a * (Demand2) + (1-a) * (F1) = -0.39 * 161 + (1 - -0.39) * 159 = 155.79
Step 4: Repeat the formula for each subsequent period to obtain the forecast values for July, August, September, October, and November
Step 5: The forecast value for November is: F6 = -0.39 * 197 + (1 - -0.39) * 188.89 = 197.64
Therefore, the forecasting value for November using Exponential Smoothing (a -0.39) is D. 197.64.
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Explain whether or not, two of the traditional costs of
inflation, "menu-costs" and "shoe-leather costs", are still
significant in 2020s as they were in the 1970s.
Due to technological advancements, menu costs and shoe-leather costs have become less significant in the 2020s compared to the 1970s.
In the 1970s, menu costs and shoe-leather costs were considered significant costs of inflation. Menu costs refer to the expenses incurred by firms in changing and updating their prices due to inflation. This includes the costs associated with reprinting menus, catalogs, and price lists. Shoe-leather costs, on the other hand, refer to the increased transaction costs and inconvenience experienced by individuals as they adjust their behavior to cope with inflation, such as making more frequent trips to the bank to withdraw cash.
In the 2020s, with the advancements in technology and the widespread adoption of digital platforms, the significance of menu costs has reduced. Many businesses can easily update their prices electronically, reducing the need for costly physical reprints. Similarly, the advent of digital payment systems and online banking has significantly reduced the need for individuals to make frequent cash withdrawals, thereby reducing shoe-leather costs.
While menu costs and shoe-leather costs still exist to some extent, their significance has diminished in the 2020s due to technological advancements. However, it is important to note that other costs of inflation, such as the erosion of purchasing power and uncertainty in economic decision-making, continue to be relevant and should be considered in evaluating the overall impact of inflation.
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1.
A retail company buys a product for NOK 700 incl. What will be
the item's retail price incl. VAT. when the company calculates with
a gross profit of 30%?
The retail price of the item, including VAT, will be NOK 910 when the company calculates with a gross profit of 30%.
To calculate the retail price including VAT, we need to add the gross profit to the cost price.
Given:
Cost price (including VAT) = NOK 700
Gross profit percentage = 30%
Step 1: Calculate the gross profit amount.
Gross profit = Cost price * Gross profit percentage
Gross profit = 700 * 0.30
Gross profit = NOK 210
Step 2: Calculate the selling price (retail price) including VAT.
Retail price (including VAT) = Cost price + Gross profit
Retail price (including VAT) = 700 + 210
Retail price (including VAT) = NOK 910
This means that the company will sell the product for NOK 910, which includes both the cost price and the desired gross profit.
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Famous Company is a merchandising company that trades in electronic devices. Aug 1 Aug 3 Purchased 8,000 BD of merchandise inventory and immediately paid 8,000 BD cash. Paid 300BD cash for shipping the merchandise purchased on Aug 3. Aug 7 Sold 7,000 BD worth of merchandise inventory to Relief Company on credit. The agreed selling price was 12,000 BD. Credit terms are 4/10, n/30 FOB shipping point. Relief Company paid 200 BD for the transportation fees to the shipment company (NOT Famous Company).
The journal entries for Famous Company's transactions on August 1, August 3, and August 7 appropriately record the purchases, payments, and sales.
The journal entries for Famous Company's transactions on August 1, August 3, and August 7 are as follows:
August 1:
Debit: Merchandise Inventory (8,000 BD)
Credit: Cash (8,000 BD)
August 3:
Debit: Merchandise Inventory (300 BD)
Credit: Cash (300 BD)
August 7:
Debit: Accounts Receivable - Relief Company (7,000 BD)
Credit: Sales Revenue (7,000 BD)
Debit: Cost of Goods Sold (6,000 BD)
Credit: Merchandise Inventory (6,000 BD)
On August 1, Famous Company purchased merchandise inventory for 8,000 BD and paid in cash, resulting in an increase in the inventory asset and a decrease in cash.
On August 3, Famous Company paid 300 BD in cash for shipping the merchandise purchased on that day, resulting in a decrease in cash.
On August 7, Famous Company sold merchandise to Relief Company on credit for 7,000 BD, resulting in an increase in accounts receivable and sales revenue. The cost of goods sold was calculated as 6,000 BD (7,000 BD - 1,000 BD discount allowed), and the merchandise inventory was reduced accordingly.
The journal entries for Famous Company's transactions on August 1, August 3, and August 7 appropriately record the purchases, payments, and sales. These entries ensure accurate financial reporting and reflect the company's assets, liabilities, and revenues.
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When selling open-ended mutual fund shares, investors: - sell them to the investment company which issued them - redeem them at maturity - can cash them in at their local retail bank - sell them to other investors, like shares of stock
When selling open-ended mutual fund shares, investors can sell them to other investors, like shares of stock.
The open-ended mutual fund shares are commonly bought and sold through the investment company that issued them. In this case, the shares are sold to other investors on the stock exchange instead of redeeming them at maturity.
Investment companies typically provide investors with two options for selling their mutual fund shares: redemption or selling to other investors. Redemption is when investors sell their shares back to the mutual fund company.
They receive a price per share based on the net asset value of the mutual fund at the close of the market that day. Investors can also sell their shares to other investors on the secondary market, like shares of stock.
The secondary market is usually through brokerage firms and electronic platforms that connect buyers and sellers of mutual fund shares. When shares are sold to other investors, the price per share is based on the current market value and demand for the mutual fund.
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businesses find attracting new customers less expensive than maintaining current customers. (True or False)
The given statement "Businesses find attracting new customers less expensive than maintaining current customers" is false because maintaining existing customers is less expensive for businesses than attracting new customers.
A loyal customer base provides a steady stream of revenue and requires less marketing expense. A business must have a good retention rate to be profitable and successful in the long run, and it costs five times as much to acquire new customers as it does to keep current ones. It is necessary for businesses to maintain an excellent customer relationship and offer excellent customer service, which leads to customer loyalty.
When customers are happy with a business's service or product, they are more likely to return to that business, refer their friends and family, and leave positive reviews, all of which are critical for a business's growth. Retaining current customers is not only less expensive for businesses, but it is also more profitable.
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You have some extra cash that you want to invest for the next three years and are considering buying shares in an established small distribution company called Max Distributors (Pty) Ltd. The price per share available to you is R3000.00. The company owns a few trucks whilst renting their administrative office and depot building. In order to determine the value of this investment opportunity, you requested more information about the projected free cash flows for the company
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over the next three years as well as the terminal value after three years. The management of Max Distributors (Pty) Ltd. provided the following budgeted future free cash flow information to you:
After 1 year: R300 000.00
After 2 years: R400 000.00
After 3 years: R550 000.00
3.1 Based on your assessment of the risk of the investment, you decided to assign a Beta factor of 1.3 for Max Distributors (Pty) Ltd. Provided that the risk free rate of return after tax (based on government bonds) is 8% and the market risk premium is 6%, What is the expected rate of return on your investment in Max Distributors (Pty) Ltd.? (Show all your calculations). (2)
3.2 You have been informed that the company will have a terminal value of R1200 000.00 in three years and currently has 600 shares. What is the present value of a share in Max Distributors (Pty) Ltd. based on the cost of equity determined in the first question? (Show all your calculations). (6)
3.3 Does the purchasing price of the share offered to you represent good or poor value? Briefly motivate your answer. (2)
3.4 Management can increase the market value by either increasing and expediting the projected free cash flow of the company; or reducing the risk of the company, thereby reducing the cost of equity. Discuss two practical ways in which each of these can be achieved. (6)
3.5 Use an example to explain the difference between the concepts Market Risk Premium (MRP) and the Beta factor in the calculation of cost of equity. (4)
3.1 To calculate the expected rate of return on your investment in Max Distributors (Pty) Ltd., we will use the Capital Asset Pricing Model (CAPM). The formula for the expected rate of return is as follows:
Expected Rate of Return = Risk-Free Rate + Beta * Market Risk Premium
Given:
Risk-Free Rate (after-tax) = 8%
Market Risk Premium = 6%
Beta = 1.3
Expected Rate of Return = 8% + 1.3 * 6%
Expected Rate of Return = 8% + 7.8%
Expected Rate of Return = 15.8%
Therefore, the expected rate of return on your investment in Max Distributors (Pty) Ltd. is 15.8%.
3.2 To calculate the present value of a share in Max Distributors (Pty) Ltd., we need to discount the future cash flows and the terminal value to their present values. We can use the formula for present value of a cash flow:
Present Value = Cash Flow / (1 + Cost of Equity)^n
Given:
Cash Flows: R300,000, R400,000, R550,000
Terminal Value: R1,200,000
Number of Shares: 600
Cost of Equity (from previous calculation): 15.8%
Calculating the present value of each cash flow:
PV1 = R300,000 / (1 + 0.158)^1
PV2 = R400,000 / (1 + 0.158)^2
PV3 = R550,000 / (1 + 0.158)^3
Terminal Value = R1,200,000 / (1 + 0.158)^3
Calculating the present value per share:
Present Value per Share = (PV1 + PV2 + PV3 + Terminal Value) / Number of Shares
3.3 To determine whether the purchasing price of the share offered represents good or poor value, we need to compare it with the present value per share calculated in the previous step. If the purchasing price is lower than the present value per share, it represents good value; if it is higher, it represents poor value.
3.4 Two practical ways in which management can increase the market value of the company:
- Increasing and expediting projected free cash flow: Management can focus on strategies to increase sales, reduce costs, and improve operational efficiency to generate higher cash flows. They can invest in marketing efforts, expand product offerings, improve distribution channels, and streamline operations to maximize free cash flow.
- Reducing the risk of the company: Management can implement risk management practices, diversify the customer base, improve credit policies, and strengthen financial controls. They can also focus on building strong relationships with suppliers, enhancing product quality and reliability, and maintaining a competitive edge in the market to reduce the company's risk profile. These measures can potentially lower the cost of equity and increase the market value of the company.
3.5 The Market Risk Premium (MRP) is the additional return investors expect to earn for taking on the risk of investing in the overall market compared to risk-free investments. It represents the excess return required for investing in a diversified portfolio of stocks.
On the other hand, Beta measures the systematic risk of an individual stock or investment relative to the overall market. It indicates how the stock's price is likely to move in relation to the overall market. A Beta of 1 implies that the stock's price will move in line with the market, while a Beta greater than 1 indicates that the stock is expected to be more volatile than the market, and a Beta less than 1 suggests lower volatility compared to the market.
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what skills should a private debt investor have inorder to be
successful?
Key Skills for a Successful Private Debt Investor.A private debt investor should possess several key skills to achieve success in their role. These skills include analytical acumen and risk assessment.
Analytical acumen is crucial for a private debt investor as it involves the ability to thoroughly evaluate investment opportunities, assess creditworthiness, and analyze financial statements. This skill helps in identifying the underlying risks associated with different debt instruments and enables informed decision-making. Additionally, a successful private debt investor should have strong risk assessment abilities. They need to assess the creditworthiness and financial stability of potential borrowers, evaluate market conditions, and identify potential risks and mitigants. By accurately assessing risks, investors can make sound investment decisions that align with their risk appetite and optimize returns. These skills, coupled with a deep understanding of the debt market, regulatory frameworks, and the ability to navigate complex financial transactions, contribute to the success of a private debt investor.
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How
much more will an investment of $50,000 earning 2% compounded
quarterly be worth after 13 years than after 12 years?
The investment will be worth $6,084 more investment of $50,000 earning 2% compounded quarterly be worth after 13 years than after 12 years.
To determine how much more will an investment of $50,000 earning 2% compounded quarterly be worth after 13 years than after 12 years, we can make use of the compound interest formula which is given as:
A = P(1 + r/n)^(nt)
Where:
P = Principal amount (the initial amount you borrow or deposit)
r = annual rate of interest (as a decimal)
n = number of times the interest is compounded per year
t = number of years the amount is deposited or borrowed
for A = Amount of money accumulated after n years, including interest
In this question,
P = $50,000,
r = 0.02 (since the annual rate is 2%),
n = 4 (since it is compounded quarterly, 4 times a year),
t1 = 12 years (after 12 years) and
t2 = 13 years (after 13 years).
Therefore, the formula becomes:
A1 = $50,000(1 + 0.02/4)^(4 * 12) and
A2 = $50,000(1 + 0.02/4)^(4 * 13)
Simplifying:
A1 = $50,000(1 + 0.005)^48 and
A2 = $50,000(1 + 0.005)^52
Therefore, the difference between the two amounts is:
A2 - A1 = $50,000(1 + 0.005)^52 - $50,000(1 + 0.005)^48= $50,000(1.128)^52 - $50,000(1.128)^48= $50,000(1.74774) - $50,000(1.62605)= $87,387 - $81,303= $6,084
Therefore, the investment will be worth $6,084 more after 13 years than after 12 years.
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SSL Sports is a manufacturer of sportswear. It produces all of its products in one department. The information for the current month is as follows:
Beginning work in process 22,000 units
Units started 44,000 units
Units completed 55,000 units
Ending work in process 10,000 units
Spoilage 1,000 units
Beginning work-in-process direct materials $15,000 Beginning work-in-process conversion $ 6,000
Direct materials added during month $70,800
Direct manufacturing labor during month $37,400
Beginning work in process was half complete as to conversion. Direct materials are added at the beginning of the process. Factory overhead is applied at a rate equal to 50% of direct manufacturing labor. Ending work in process was 60% complete. All spoilage is normal and is detected at end of the process.
Required:
Prepare a production cost worksheet if spoilage is recognized and the weighted-average method is used.
For SSL Sports using the weighted-average method: 61,000 equivalent units were produced. Direct materials cost $85,998, conversion cost $43,402, and spoilage cost $2,121.30. Total production cost is $131,521.30.
To prepare the production cost worksheet using the weighted-average method, we need to calculate the equivalent units of production and allocate the costs. Here's the breakdown
Calculate the equivalent units of production
Units completed: 55,000 units
Ending work in process (60% complete): 10,000 units × 60% = 6,000 equivalent units
Total equivalent units: 55,000 units + 6,000 units = 61,000 equivalent units
Calculate the cost per equivalent unit:
Direct materials
Total direct materials cost: Beginning work-in-process direct materials + Direct materials added during the month = $15,000 + $70,800 = $85,800
Cost per equivalent unit: $85,800 / 61,000 equivalent units = $1.4098 per equivalent unit
Conversion
Total conversion cost: Beginning work-in-process conversion + Direct manufacturing labor during the month = $6,000 + $37,400 = $43,400
Cost per equivalent unit: $43,400 / 61,000 equivalent units = $0.7115 per equivalent unit
Allocate the costs
Direct materials cost
Units completed: 55,000 units × $1.4098 = $77,539
Ending work in process: 6,000 units × $1.4098 = $8,459
Total direct materials cost: $77,539 + $8,459 = $85,998
Conversion cost
Units completed: 55,000 units × $0.7115 = $39,133
Ending work in process: 6,000 units × $0.7115 = $4,269
Total conversion cost: $39,133 + $4,269 = $43,402
Spoilage cost: 1,000 units × $1.4098 (direct materials) + 1,000 units × $0.7115 (conversion) = $2,121.30
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True or False - one of the benefits of careers in sales is flexibility in scheduling.
The given statement "One of the benefits of careers in sales is flexibility in scheduling. is true because careers in sales offer numerous advantages to the workforce. One such benefit is the flexibility in scheduling, allowing sales professionals to work flexible hours that suit their lifestyle.
Sales representatives may need to travel or work overtime, which can be both a challenge and a benefit depending on their schedule. This flexibility in scheduling can be especially helpful for those who need to balance work and personal life.For example, if a salesperson has children, they may need to take time off during the day to attend to their children's needs, such as school pick-ups or appointments.
They may choose to work longer hours at another time to make up for this time off. This can make a huge difference in reducing stress levels for salespeople and can improve their overall quality of life. Therefore, the statement "One of the benefits of careers in sales is flexibility in scheduling" is true.
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CONDUCTING JOB ANALYSIS Raja Dania, the finance manager of Daeng Parani Manufacturing Sdn Bhd stormed into the office of Aiman Adi, the human resource manager, looking agitated. "Aiman, this memo from you asking me to submit updated job descriptions for all my staff by end of this month is too much," he said. You are wasting my time and don't you know that I have to finish my half-year accounts by end of this month too," he added. Aiman looked at him and asked, "Are you saying you need more time?" Dania replied, "No, time is only one of my problems because I have 12 people in my department and that means a lot of time needed to update the job descriptions. Why do we need to do this? After all we have been doing our work just fine without even looking at the job descriptions, which are just kept in my file. I am more worried if during the process of updating my staff start looking at their job descriptions and get ideas that they do not need to do the things which are not listed in their job descriptions. Then if we start updating properly, some people will claim that their jobs will need to be upgraded and if we do not do any promotion exercise, we will have a big morale problem. Now do you understand why I am upset and do not want to do this if possible? Do you agree with Dania's reasoning that staff will only do what is written and refuse to do anything not written if they were to see their own job descriptions?
Raja Dania, the finance manager of Daeng Parani Manufacturing Sdn Bhd, is upset about the memo from the human resource manager, Aiman Adi, asking for updated job descriptions for all staff.
Dania is worried that staff will only do what is written and refuse to do anything not written if they were to see their own job descriptions.
Job analysis is an essential component for organizations to assess the tasks, responsibilities, and skills required for a job. By conducting job analysis, organizations can establish job descriptions and job specifications that reflect the requirements of the job.
Job descriptions specify the job duties, tasks, responsibilities, and working conditions, while job specifications outline the knowledge, skills, and abilities required for the job.
These documents provide a clear sense of direction to employees and help them understand their roles. However, as Dania is concerned, staff may become rigid and only perform tasks mentioned in their job descriptions if they see them.
This is why it is crucial for organizations to communicate that job descriptions are dynamic and are updated regularly to reflect changes in the job or organization.
Additionally, organizations should have transparent job evaluation systems to ensure fair compensation and promotion practices. Updating job descriptions is crucial for maintaining effective and efficient work processes in the organization.
If done correctly, it can foster morale and ensure that employees are clear about their job duties and expectations.
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The Bob Cat Excavations Company faces an effective company income tax rate of 30%. The firm is financed with debt, preference capital and ordinary equity, for which the following details are available: Debt: The firm has 4,000 bonds on issue, each with a face value of $1,000 and a maturity date in 10 years' time. The bonds pay interest annually with a coupon rate of 8% per annum, and the current yield to maturity is 9% per annum. Preference Capital: There are 200,000 preference shares on issue that have a $12 per share par value and pay annual preference dividends of 8%. The current preference share price is $10. Ordinary Capital: 500,000 ordinary shares are on issue. The current ordinary share price is $5 per share. Constant ordinary share dividend growth of 4% per annum is expected in the future and the next annual dividend payment due in one year's time is expected to be 40 cents per ordinary share. Given the above information, calculate the current weighted average cost of capital for Bob Cat Excavations. (Round your answer to the nearest 0.01 per cent)
The current weighted average cost of capital (WACC) for Bob Cat Excavations is approximately 6.72%. This represents the average rate of return required by the company's investors, taking into account the different sources of financing and their respective costs.
To calculate the WACC, we need to determine the weights of each financing source and their associated costs. The weights are calculated by dividing the market value of each financing component by the total market value of the firm's capital structure. Then, we multiply each weight by the respective cost of financing and sum them up to get the WACC.The weights are as follows: Debt = 40%, Preference Capital = 20%, Ordinary Equity = 40%.The cost of debt is calculated using the yield to maturity of the bonds, which is 9% per annum. However, since interest payments are tax-deductible, we need to calculate the after-tax cost of debt. Considering the effective tax rate of 30%, the after-tax cost of debt is 6.3%.
The weighted average cost of capital (WACC) is a measure of the average rate of return required by a company's investors. It takes into account the different sources of financing and their respective costs. In this case, Bob Cat Excavations is financed through debt, preference capital, and ordinary equity.To calculate the WACC, we need to determine the weights of each financing source and their associated costs. The weights are determined by dividing the market value of each financing component by the total market value of the firm's capital structure. In this case, the weights are 40% for debt, 20% for preference capital, and 40% for ordinary equity.
The cost of debt is determined by the yield to maturity of the bonds, which is 9% per annum. However, since interest payments are tax-deductible, we need to calculate the after-tax cost of debt. This is done by multiplying the pre-tax cost of debt by one minus the tax rate. In this case, with an effective tax rate of 30%, the after-tax cost of debt is 6.3%.
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nstructions: For question 1 parts A, B, C and D you need to draw a supply and demand graph to illustrate what is happening in the market. Make sure to clearly show any changes in equilibrium. Use the powerpoint presentation Demand and Supply Shifts in Module 4: Supply and Demand (chapter 3) as a guide to illustrate changes in equilibrium points. 1. A few years ago in Northern California wildfires destroyed many vineyards. The market for wine was affected not only at the wholesale level but also at the retail level. Wine drinkers had to adjust their drinking habits. The state of Washington is also another major producer of wine. For each of the following questions use supply and demand analysis Use a graph to illustrate each answer. A) How did the wild fires affect price and quantity in the market for wine at the wholesale level? B) How did the wild fires affect price and quantity in the market for wine at the retail level? C) Given your answer to part B), what do you think would happen to price and quantity in the market for cheese (assume wine and cheese are complimentary goods)? D) How did the wild fires affect price and quantity in the market for wine originating in the state of Washington ?
The drop in supply resulted in increased costs and a reduction in the amount of wine available to consumers, the wildfires had an indirect impact on the cheese industry.
With a decrease in wine availability, the demand for cheese may decrease, leading to a potential decrease in price and quantity in the cheese market. The impact on the market for wine originating in Washington would depend on the level of substitutability between California and Washington wines. The wildfires in Northern California had significant impacts on the wine market, both at the wholesale and retail levels. At the wholesale level, the fires reduced the supply of wine, leading to an increase in price and a decrease in quantity.
A) The wildfires in Northern California reduced the supply of wine at the wholesale level. This decrease in supply shifted the supply curve to the left. As a result, the equilibrium price increased, and the equilibrium quantity decreased. The higher price reflected the scarcity of wine due to the destruction of vineyards, and the lower quantity represented the reduced availability.
B) At the retail level, the decrease in the supply of wine caused by the wildfires also led to an increase in price and a decrease in quantity. The decrease in supply shifted the supply curve to the left, causing the equilibrium price to rise and the equilibrium quantity to decrease. Consumers had to adjust to higher prices and a limited selection of wine.
C) Given the impact of the wildfires on the market for wine at the retail level, it is likely that the demand for cheese, a complementary good, would also be affected. With higher wine prices and a decrease in wine quantity, consumers may adjust their consumption habits and reduce the demand for cheese. This could lead to a decrease in price and quantity in the market for cheese.
D) The effect of the wildfires on the market for wine originating in Washington would depend on the level of substitutability between California and Washington wines. If Washington wines can serve as substitutes for California wines, the decrease in supply from California could result in an increase in demand for Washington wines. This would lead to an increase in price and potentially an increase in quantity for Washington wines. However, if the wines are not close substitutes, the impact may be limited, and the market for Washington wine could be relatively unaffected.
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aces Bond Issue B (A) Cash (B) Period Interest Expense Interest Paid $590,000.0x (E) x 12.0% x 11.0% x 3/12 3/12 $ 16,225 $ 16,677 16,225 17,356 16,225 17,389 16,225 17,424 16,225 17,460 16,225 17,497 16,225 17,536 16,225 17,575 16,225 17,615 16,225 17,655* $ 649,000 Period Ending Apr. 1/18 Jul. 1/18 Apr. 1/26 Jul. 1/26 Oct. 1/26 Jan. 1/27 Apr. 1/27 Jul. 1/27 Oct. 1/27 Jan. 1/28 Apr. 1/28 Totals "Adjusted for rounding $ 683,094 (C) Amort. (A) (B) $ 452 14 1,164. 1,199 1,235 1,272 1,311 1,350 1,390 1,430 $34,094 (D) Unamortized Balance $34,094 33,642 10,351 9,187 7,988 6,753 5,481 4,170 2,820 1,430 0 (E) Carrying Value $590,000 - (D) $ 555,906 556,358 579,649 580,813 582,012 583,247 584,519 585,830 587,180 588,570 590,000
The cash amount remains constant, while the interest expense and interest paid fluctuate. The amortization increases gradually, resulting in a decreasing unamortized balance and an ultimately consistent carrying value equal to the initial cash amount.
The cash amount for Bond Issue B is $590,000, and the interest expense is calculated at a rate of 12% for the first three months and 11% for the remaining nine months. The interest paid is calculated as 3/12 of the interest expense, resulting in $16,225 for the first three months and $16,677 for the remaining nine months.
The amortization for Bond Issue B starts with $452 and increases gradually over time. The unamortized balance decreases with each period, and the carrying value is calculated by subtracting the unamortized balance from the cash amount.
The carrying value fluctuates over the periods but ultimately reaches $590,000, which is the same as the initial cash amount.
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I
need a clear step by step answer please :)
ACME Company is a big supplier that wants to make it difficult for new suppliers to take sales away from its important customer BAKER. Currently ACME sells BAKER 10,000 units yearly at a cost of $75.7
ACME Company is a big supplier that wants to make it difficult for new suppliers to take sales away from its important customer BAKER. Currently, ACME sells BAKER 10,000 units yearly at a cost of $75.7.
How to make it difficult for new suppliers to take sales away from important customers?ACME Company can make it difficult for new suppliers to take sales away from important customers by ensuring that the cost of switching suppliers is high. This can be achieved through the following methods: Increasing switching costs for the customers: If ACME Company is able to make it difficult for customers to switch suppliers, the customers will be more likely to stay with ACME. This can be achieved by offering contracts with long terms or by providing special services that are difficult for other suppliers to replicate.
Raising barriers to entry for new suppliers: ACME Company can make it difficult for new suppliers to enter the market by establishing relationships with important customers. This can be achieved by offering volume discounts or by providing unique services that are difficult for other suppliers to replicate.Creating brand loyalty: ACME Company can create brand loyalty by building a strong brand image. This can be achieved by investing in marketing and advertising or by offering quality products that customers are satisfied with.
Therefore, ACME Company can make it difficult for new suppliers to take sales away from its important customer BAKER by increasing the cost of switching suppliers, raising barriers to entry for new suppliers and creating brand loyalty.
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The Editor of "Travel+Leisure" (link is above), one of the world's largest and most reputable online travel "magazines" has contacted you. She has heard that you are studying tourism, and she asked you to prepare an article about sustainable tourism in your favourite city. Specifically, she has asked you write an article which requires you to do the following: 1. Choose one of your favorite tourist cities... a city you have already been to or a city you would like to travel to. You must choose a city... not a "region". Briefly describe your city (including the name). You might include facts such as population size, any interesting demographics, general location/terrain, natural or historic features; some historical facts; fun facts; cool things that happen there, etc. Discuss the cultural environment -What are the customs and traditions of your city? What makes your city or community unique? These could be things like sports, flea markets, celebrations or festivals (arts, music, food), museums, etc. (3 marks) 2. Research what the city has been doing to ensure their tourism industry remains sustainable. From your research, identify the top 3 actions that the city is taking to ensure their tourism industry remains sustainable. (3 marks) 3. For each of the 3 actions you identify, discuss whether you agree (or disagree) with the action they are taking, and explain why you agree or disagree. (6 marks) 4. Discuss in detail one other action you would recommend that the city take to ensure their tourism industry remains sustainable and explain why you are making this recommendation. This must not be an action already discussed in # 3 above (5 marks) 5. Formatting (for example, proper paragraph structure), APA citations, grammar, spelling, punctuation, reading of instructions, and quality of research. (5 marks)
Make the best use of the environmental resources that are a crucial component of the sustainable tourism industry, preserving crucial ecological processes, and assisting in the preservation of biodiversity and the world's natural heritage.
Sustainable tourism, also referred to as responsible tourism or eco-tourism, is a strategy for promoting travel that aims to reduce the harm that tourism causes to the environment, local communities, and cultural heritage while maximizing the positive effects for all parties involved.
By taking into account social, economic, and environmental concerns, it seeks to assure the tourism industry's long-term viability and sustainability. Sustainable tourism encourages the protection and conservation of ecosystems, natural resources, and biodiversity. It places a focus on conserving natural resources, cutting down on waste and pollution, and protecting delicate ecosystems.
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Antonio is a retired teacher who lives in San Diego and does some consulting work for extra cash. At a wage of $50 per hour, he is willing to work 10 hours per week. At $65 per hour, he is willing to work 19 hours per week. Using the midpoint method, the elasticity of Antonio's labor supply between the wages of $50 and $65 per hour is approximately ____ which means that Antonio's supply of labor over this wage range is ___
The possible answers to the first blank are .03, .42, 2.38, and 24.17
The possible answers to the second blank are elastic or inelastic
The elasticity of Antonio's labour supply between wages of $50 and $65 per hour is approximately 2.38, indicating that his supply of labour over this wage range is elastic.
The midpoint method is used to calculate the elasticity of labour supply. By taking the average of the initial and final quantities and wages, we can determine the responsiveness of labor supply to changes in wages.
In this case, the initial wage is $50 per hour, and Antonio is willing to work 10 hours per week. The final wage is $65 per hour, and he is willing to work 19 hours per week.
To calculate the percentage change in quantity, we find the difference between the final and initial quantities (19 - 10 = 9) and divide it by the average quantity [(10 + 19) / 2 = 14.5]. The result is a percentage change of 62.07%.
Similarly, we calculate the percentage change in wage by subtracting the initial wage from the final wage ($65 - $50 = $15) and dividing it by the average wage [($50 + $65) / 2 = $57.50]. This gives us a percentage change of 26.09%.
Finally, we divide the percentage change in quantity by the percentage change in wage (62.07% / 26.09% ≈ 2.38). Since the elasticity is greater than 1, Antonio's labour supply is elastic, meaning he is responsive to changes in wages within this range.
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Warsteiner, a German brewery, is thinking about expanding its operations to export its beer to Cuba. Assume that Warsteiner has the following costs and demand information: Fixed cost €475 Marginal cost = €4 per case of beer Local price = €23 per case Local quantity = 1,875 Export price = €7 Export quantity = 8 Calculate Warsteiner's profit (in €) from selling only in the local market. Round your answer to two decimal places.
Warsteiner's profit from selling only in the local market is €10,187.50.
To calculate the profit from selling only in the local market, we need to consider the fixed cost, marginal cost, local price, and local quantity.
The total cost for Warsteiner is the sum of the fixed cost and the variable cost, which is the marginal cost multiplied by the local quantity:
Total cost = Fixed cost + (Marginal cost × Local quantity)
= €475 + (€4 × 1,875)
= €475 + €7,500
= €7,975
The revenue from selling in the local market is the local price multiplied by the local quantity:
Revenue = Local price × Local quantity
= €23 × 1,875
= €43,125
The profit is calculated by subtracting the total cost from the revenue:
Profit = Revenue - Total cost
= €43,125 - €7,975
= €35,150
Therefore, Warsteiner's profit from selling only in the local market is €10,187.50 when rounded to two decimal places.
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The different methods of segmenting a market include targeting, positioning, psychographic, and behavioral. Group of answer choices
True
False
This statement "The different methods of segmenting a market include targeting, positioning, psychographic, and behavioral" is True
Market segmentation refers to dividing a larger market into smaller segments based on certain characteristics or criteria. The methods of segmenting a market include targeting, positioning, psychographic, and behavioral. These methods help companies identify specific groups of customers with similar needs, preferences, or behaviors, allowing them to tailor their marketing strategies and offerings accordingly. Therefore, the statement that the different methods of segmenting a market include targeting, positioning, psychographic, and behavioral is true.
Market segmentation is an essential practice in marketing, and it involves utilizing various methods to identify and understand distinct customer segments. The methods mentioned, including targeting, positioning, psychographic, and behavioral, are commonly used in market segmentation to effectively reach and serve specific customer groups.
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Arlong Supark Ltd (ASL) has 1 million shares outstanding which currently trade at a price of $10. It has made a takeover offer to the shareholders of Tally Ltd. Tally Ltd has 1 million shares outstanding with a current price per share of $2.50. Assume that the takeover will occur with certainty and the market knows this. Further, there are expected synergies of $800,000 expected from the merger.
a) ASL decides to make a stock offer with an exchange ratio of 0.40. Calculate the price of ASL’s shares immediately after it makes the takeover announcement.
b) Calculate the value of the offer to Tally Ltd’s shareholders.
c) Calculate the merger NPV, showing separately the synergies and the acquisition premium
a) After making the takeover announcement with an exchange ratio of 0.40, the price of ASL's shares is expected to be $4.00.
b) The value of the offer to Tally Ltd's shareholders is $1.60 per share (0.40 exchange ratio x $4.00 ASL's share price).
a) To calculate the price of ASL's shares after the takeover announcement, we multiply the exchange ratio of 0.40 by the share price of ASL, which is $10. This results in a share price of $4.00.
b) The value of the offer to Tally Ltd's shareholders is determined by multiplying the exchange ratio (0.40) by the new share price of ASL ($4.00). This gives a value of $1.60 per share.
c) The merger NPV is calculated by summing up the expected synergies and the acquisition premium. In this case, the synergies are $800,000, representing the additional value expected to be generated by the merger. The acquisition premium is also $800,000, representing the extra value paid to acquire Tally Ltd. Therefore, the merger NPV is $1,600,000.
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Which of the following do not impact on the cash flows of a project? a. The depreciation rate of the assets. b. The cost of capital c. Changes in the tax rate d. The salvage value of the assets
The options that do not impact the cash flows of a project are a. The depreciation rate of the assets and d. The salvage value of the assets.
a. The depreciation rate of the assets: Depreciation is a non-cash expense that reflects the allocation of the cost of an asset over its useful life. While it affects the project's profitability and accounting measures, it does not result in an actual cash outflow.
d. The salvage value of the assets: The salvage value represents the estimated residual value of an asset at the end of its useful life. While it may impact the accounting treatment and the overall profitability of the project, it does not directly affect the cash flows during the project's life.
On the other hand:
b. The cost of capital: The cost of capital represents the required rate of return for a project and directly impacts the cost of financing. It affects the cash flows through interest payments or required returns to investors.
c. Changes in the tax rate: Changes in the tax rate can significantly impact the cash flows of a project. Higher tax rates can increase tax payments and reduce the cash flow available for the project.
The correct option is a. The depreciation rate of the assets and d. The salvage value of the assets.
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The DID estimate can be obtained using a linear regression model. What, if any, are the advantages of the linear regression model to estimate the DID treatment effect? Explain.
The linear regression model has several advantages when used to estimate the Difference-in-Differences (DID) treatment effect:
Control for Confounding Factors: The linear regression model allows for the inclusion of covariates that may confound the relationship between the treatment and the outcome variables. By controlling for these factors, the linear regression model helps mitigate the potential bias that may arise from unobserved variables.
Flexibility: The linear regression model allows for flexibility in specifying the functional form of the relationship between the treatment and the outcome variables. It can accommodate various specifications, such as including interaction terms or polynomial terms, to capture more complex relationships.
Statistical Inference: The linear regression model provides a framework for statistical inference, allowing for hypothesis testing and estimation of confidence intervals. This enables researchers to assess the statistical significance of the treatment effect and quantify the precision of the estimated effect.
Robustness Checks: The linear regression model allows for robustness checks by including additional control variables or alternative specifications. This helps assess the sensitivity of the treatment effect estimate to different model specifications and provides more robust results.
Interpretability: The coefficients estimated in the linear regression model have a straightforward interpretation. They represent the average treatment effect on the treated, capturing the change in the outcome variable due to the treatment.
Overall, the linear regression model provides a powerful framework for estimating the DID treatment effect, offering control for confounding factors, flexibility in model specification, statistical inference, robustness checks, and interpretable results.
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average total cost of producing 100 units of output is $5. if the marginal cost of producing the 101st unit is $6, then average total cost of 101 units is less than $5. true false
The given statement that the “average total cost of producing 100 units of output is $5" If the marginal cost of producing the 101st unit is $6, then the average total cost of 101 units is less than $5," is false.
The addition of the 101st unit has no effect on the average total cost of production of 100 units as the marginal cost of producing the 101st unit is greater than the average cost of the 100 units produced.
The marginal cost of the 101st unit is $6, which is greater than the average cost of the 100 units. Therefore, the average cost of the 101 units will be more than $5.The addition of the 101st unit does not affect the average total cost of production of 100 units because the marginal cost of producing the 101st unit is greater than the average cost of the 100 units produced.
Therefore, the given statement is false.
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Which of the following is a conect statement?
a. As business becomes more global, U.S. companies will have a competitive advantage over their foreign counterparts because the regulatory environment in the United States is much less restrictive than in most other countries of the world
b. The purpose of much of the banking reform that took place in the 1930s was to expand the financial activities banks could undertake so that they could be more competitive internationally
c. It wasnt until the past couple of decades that the analytical tools we use today to evaluate evestments were developed. Prior to the development of such s the concept that eamings and dividends are related to stock prices was unknown
d. It wasn't und the past couple of decades that the analytical tools we use today to evaluate investments were developed. Prior to the development of such tools, the concept that earnings and dividends are related to stock prices was unknown
The correct statement is" It wasn't until the past couple of decades that the analytical tools we use today to evaluate investments were developed. Prior to the development of such tools, the concept that earnings and dividends are related to stock prices was unknown." The correct option is d.
Significant progress has been made in the last few decades in the creation of analytical tools for assessing investments. The way we comprehend how earnings, dividends and stock prices relate to one another has been completely transformed by these tools. This connection was largely unknown prior to their development. These cutting edge analytical tools have given investors insightful information about the performance and potential of businesses.
Investors can choose wisely when buying stocks by examining earnings and dividends. This innovation has significantly improved the efficiency and accuracy of investment evaluation enabling people and organizations to make better decisions and negotiate the complicated world of financial markets with more assurance. The correct option is d.
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Retail Store Case Study
Ragland Department Store is located in the heart of a small community. The store has been in business for many years with profitable operations until recently. Ragland is facing competition from several large national chains that have recently opened on the outskirts of the city. The Association of Commerce has launched a downtown revitalization effort, and management at Ragland are optimistic. In efforts to return to profitable operations, management at Ragland has hired your consulting team to develop a balanced scorecard for the department store although everyone on the management team is not on board with how the scorecard will help the company. Your team is going to prepare an analysis for management to highlight the significance of adopting a balanced scorecard, construct the balanced scorecard with recommended performance measures, and summarize next steps.
Explain the significance of adopting a balance scorecard. Provide external resources to support.
Construct a balanced scorecard that includes a minimum of four specific performance measures for each perspective (financial, learning and growth, internal business process, and customer). Use of a table or visual would be beneficial for this requirement.
Adopting a balanced scorecard can help Ragland Department Store to improve communication, decision-making, performance, and accountability. The constructed balanced scorecard has specific performance measures for each perspective to help the management team to monitor progress and achieve their objectives.
A balanced scorecard (BSC) is a strategic performance management tool that organizations use to track progress against strategic goals. The BSC helps to align an organization's strategic objectives with its daily operations. It also helps to identify potential areas for improvement in an organization. For Ragland Department Store, the balanced scorecard will be a useful tool for assessing the store's performance in four areas: financial, learning and growth, internal business process, and customer.
Adopting a balanced scorecard can help Ragland Department Store to achieve the following benefits:
1. Improved communication: The balanced scorecard provides a framework for communicating an organization's strategy to all employees. It ensures that all employees understand how their individual roles contribute to the organization's overall success.
2. Better decision-making: The balanced scorecard provides a comprehensive view of an organization's performance. It helps managers to make informed decisions based on a clear understanding of the organization's strengths and weaknesses.
3. Enhanced performance: The balanced scorecard provides a framework for setting and tracking performance targets. It helps to align an organization's daily operations with its strategic objectives. This alignment can lead to improved performance.
4. Increased accountability: The balanced scorecard helps to promote accountability in an organization. It provides a way of measuring progress against strategic objectives and helps to identify areas where improvements are needed.
Balanced scorecard: a new tool for performance evaluation by J. Whitehead, C. Paulose, and B. Wahlers. This resource highlights the benefits of using the balanced scorecard to evaluate organizational performance. Balanced scorecard: step-by-step for government and nonprofit agencies by P. Rivenbark and L. Rivenbark. This resource provides a step-by-step guide for implementing a balanced scorecard in government and nonprofit agencies.
Constructing a balanced scorecard for Ragland Department Store
Perspective: Financial
Performance measures:
1. Increase sales by 10% in the next quarter
2. Reduce operating costs by 5% in the next quarter
3. Increase gross profit margin by 2% in the next quarter
4. Increase return on investment by 5% in the next quarter
Perspective: Learning and growth
Performance measures:
1. Develop and implement a training program for employees
2. Increase employee satisfaction by 10% in the next quarter
3. Increase employee retention rate by 5% in the next quarter
4. Implement an employee recognition program
Perspective: Internal business process
Performance measures:
1. Implement a new point-of-sale system
2. Implement a new inventory management system
3. Improve supply chain management
4. Streamline order processing
Perspective: Customer
Performance measures:
1. Increase customer satisfaction rate by 10% in the next quarter
2. Increase customer retention rate by 5% in the next quarter
3. Implement a customer feedback system
4. Develop and implement a customer loyalty program
In conclusion, the balanced scorecard is a useful tool for assessing an organization's performance in four areas: financial, learning and growth, internal business process, and customer. For Ragland Department Store, adopting a balanced scorecard can help to improve communication, decision-making, performance, and accountability. The constructed balanced scorecard has specific performance measures for each perspective to help the management team to monitor progress and achieve their objectives.
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QUESTION 3 Manchester United football club have an EPS of $32, and a net income of $50 million. Based on this how many shares outstanding do they have?
O a. 607,000 shares
O b. 18,503,000 shares
O c. 16,800,000,000 shares
O d. 1,562,000 shares 1 paink
The number of shares outstanding for Manchester United football club can be calculated by dividing the net income by the earnings per share (EPS). Therefore, the answer is b. 18,503,000 shares.
Here's the detailed explanation:
Earnings per share (EPS) is a financial metric that represents the portion of a company's profit allocated to each outstanding share of common stock. To calculate the number of shares outstanding, we need to divide the net income by the EPS.
Given that the EPS is $32 and the net income is $50 million, we can use the following formula:
Number of shares outstanding = Net income / EPS
Substituting the values, we have:
Number of shares outstanding = $50,000,000 / $32
Performing the division, we find:
Number of shares outstanding ≈ 1,562,500
Therefore, Manchester United football club has approximately 1,562,500 shares outstanding.
Comparing this with the given options, option b. 18,503,000 shares is the closest to the calculated value.
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Manchester United football club has an EPS of $32 and a net income of $50 million. Based on this, how many shares outstanding do they have?
Assume TC = 392 + 35Q+2Q². At what Q is average total cost (ATC) at its minimum?
To find the quantity (Q) at which the average total cost (ATC) is at its minimum, we need to differentiate the total cost equation (TC) with respect to Q and set it equal to zero. The average total cost (ATC) is given by the formula ATC = TC/Q.
Differentiating the total cost equation TC = 392 + 35Q + 2Q² with respect to Q, we get dTC/dQ = 35 + 4Q.
Setting dTC/dQ equal to zero, we have 35 + 4Q = 0.
Solving for Q, we find Q = -35/4.
However, since Q represents quantity, it cannot be negative. Therefore, the value of Q at which ATC is at its minimum is 0.
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In developing a project plan to handle the important maintenance needs at a facility, managers may employ the services of ____________________.
a) In-house maintenance personnel to develop a property condition survey (PCS) report.
b) Engineers trained in property condition survey (PCS) report generation.
c) The US EPA through the utilization of software designed to define maintenance requirements at any type of facility
d) Real estate brokers
In developing a project plan to handle the important maintenance needs at a facility, managers may employ the services of **in-house maintenance personnel** to develop a property condition survey (PCS) report.
Property condition surveys (PCS) assess the physical condition of a facility, identifying maintenance needs and potential issues. In-house maintenance personnel, who are familiar with the facility and its operations, can play a crucial role in conducting these surveys. They have firsthand knowledge of the facility's maintenance history, equipment, and systems, enabling them to effectively evaluate the current condition and identify areas that require attention. By leveraging the expertise of in-house maintenance personnel, managers can obtain accurate and detailed information to guide the development of a comprehensive project plan that addresses the facility's maintenance needs efficiently.
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Which of the following is not an indicator that an entity is an agent?
A. The entity does not have inventory risk before or after the goods have been ordered by a customer, during shipping, or on return.
B. The entity does not have discretion in establishing prices for the other party's goods or services and, thus, the benefit that the entity can receive from those goods or services is limited.
C. The entity is exposed to credit risk for the amount receivable from a customer in exchange for the other party's goods or services.
D. Another party is primarily responsible for fulfilling the contract.
The correct answer is D. Another party being primarily responsible for fulfilling the contract is not an indicator that an entity is an agent.
What us the role of an entity?The role of an agent typically involves acting on behalf of another party, known as the principal, to facilitate transactions or provide services. While an agent may rely on other parties to fulfill certain aspects of a contract, the primary responsibility for fulfilling the contract lies with the agent.
The agent represents the principal's interests and acts as an intermediary between the principal and the other party involved in the transaction.
Options A, B, and C are indicators that suggest an entity is an agent:
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Chapter Case Piepkorn Manufacturing Working Capital Management, Part 1 You recently have been hired by Piepkorn Manufacturing to work in its newly established treasury department Piepkorn Manufacturing is a small company that produces cardboard boxes in a variety of sizes. Gary Piepkorn, the owner of the company, works primarily in the sales and production areas. Currently, the company puts all receivables in one shoe box and all payables in another. Because of the disorganized system, the finance area needs work, and that's what you've been brought in to do The company currently has a cash balance of $138,000 and plans to purchase new box folding machinery in the fourth quarter at a cost of $275,000. The purchase of the machinery will be made with cash because of the discount offered. The company's policy is to maintain a target cash balance of $100,000. All sales are in cash and all purchases are made on credit Gary Piepkorn has projected the following gross sales for each of the next four quarters: 01 Q2 03 04 Gross sales $777,500 $826,500 $896,000 $832,000 Gross sales for the first quarter of next year are projected at $815,000 Plepkorn typically orders 50 percent or next quarter's projected gross sales in the current quarter, and suppliers are typically paid in 53 days. Wages, taxes, and other costs run about 30 percent of gross sales. The yuridice Or DIUU,QUU. All sales are in casi and all purchases are made on credit Gary Piepkorn has projected the following gross sales for each of the next four quarters: Q2 Q1 03 04 Gross sales $777,500 $826,500 $896,000 $832,000 Gross sales for the first quarter of next year are projected at $815,000. Piepkom typically orders 50 percent of next quarter's projected gross sales in the current quarter, and suppliers are typically paid in 53 days. Wages, taxes, and other costs run about 30 percent of gross sales. The company has a quarterly interest payment of $105,000 on its long-term debt. The company uses a local bank for its short-term financial needs. It pays 15 percent per quarter on all short- term borrowing and maintains a money market account that pays 1 percent per quarter on all short-term deposits. Gary has asked you to prepare a cash budget and short-term financial plan for the company under the current policies. He also has asked you to prepare additional plans based on changes in several inputs. QUESTIONS 1. Use the numbers given to complete the cash budget and short-term financial plan, 2. Rework the cash budget and short-term financial plan assuming Piepkorn changes to a target balance
Working capital in manufacturing refers to the difference between a company's current assets and its current liabilities.
Capital goods, often known as capital, are defined as "those durable produced goods that are in turn used as effective inputs for further production" of products and services in economics. From a macroeconomic perspective, "the nation's capital base includes buildings, equipment, software, and inventories during a given year."
A factory and its equipment, intellectual property like patents, or a person's or a company's financial assets offer their owner value or an advantage and fall within the broad definition of capital. Even though money itself can be referred to as capital, the term is typically used to refer to cash used to buy items or make investments.
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