The expected completion time of the project is calculated to be 38 days, considering the optimistic, most likely, and pessimistic times. To determine the probability of completing the project in 22 days, we calculate the z-score using the mean and standard deviation.
a. What is the expected completion time of the project?Expected completion time of the project can be calculated using the following formula: Expected completion time = Optimistic time + 4*(Most Likely Time) + Pessimistic time6+4*5+12 = 6+20+12 = 38 days Therefore, the expected completion time of the project is 38 days .b. What is the probability of completing the project in 22 days? To find the probability of completing the project in 22 days, we need to calculate the z-score first. The formula for calculating the z-score is :Z -score = (X - μ) / σWhere X is the value, μ is the mean, and σ is the standard deviation .Substituting the values: X = 22μ = 38σ = sqrt(Variance) = sqrt((Pessimistic time - Optimistic time)^2/36) = sqrt((12-6)^2/36) = sqrt(1.33) = 1.154Calculating the z-score: Z-score = (22 - 38) / 1.154 = -13.86Using the standard normal table, the probability of completing the project in 22 days is 0.0001 (rounded to four decimal places).Therefore, the probability of completing the project in 22 days is 0.0001.
learn more about expected here;
https://brainly.com/question/15461992?
#SPJ11
Contracts are essential to the function of any business organization. Without clear and enforceable contractual rights and obligations commerce would fail to function efficiently. There are many laws and governing bodies that are involved with creating and enforcing contracts, and many different sets of criteria that need to be met in order to deem a contract legal. • Describe a contract that you signed in the past over which a conflict arose. • What was the basic contract? • What was the principal dispute? • How was it resolved?
Contractual Conflict Resolution: A Case Study. The conflict was resolved through a series of discussions and negotiations between both parties.
In the past, I signed a contract for the renovation of my home, and a conflict subsequently arose. The basic contract outlined the scope of work, project timeline, payment terms, and responsibilities of both parties involved—the homeowner (myself) and the contractor. The principal dispute centered around the quality of work and delays in completing the project.
The conflict was resolved through a series of discussions and negotiations between both parties. Initially, we attempted to resolve the issue through direct communication and a mutual understanding of the concerns raised. However, as the dispute persisted, we sought the assistance of a professional mediator. The mediator facilitated constructive dialogue, helped clarify the contractual obligations, and assisted in finding a compromise that satisfied both parties. Ultimately, we reached a resolution by agreeing on a revised project timeline, addressing the quality concerns, and adjusting the payment terms to reflect the agreed-upon modifications.
This case highlights the importance of effective communication, willingness to compromise, and seeking mediation when conflicts arise in contractual agreements. By engaging in open dialogue and utilizing appropriate dispute resolution mechanisms, parties can find mutually satisfactory solutions to conflicts, thereby preserving the functioning and efficiency of commerce.
To learn more about Conflict Resolution click here
https://brainly.com/question/22642923
#SPJ11
The following Information relates to Sheridan Limited's Cash account. The reconciled cash balance from June's bank reconcililation is $19,350. During the month of July, Sheridan recorded cash receipts of $21,600 and cash payments of $24,300 in the general ledger Cash account. An examination of the company's July bank statement shows a balance of $19,590 on July 31; outstanding cheques $3,960, deposits in transit $1,780; EFT collections on account that were not yet recorded on the books $2,182, NSF cheque $1,258: NSF fee $62; and bank services charges $102. Determine the cash balance per Sheridan Limited's books Cash balance$ Prepare the bank reconciliation at July 31. (List items that increase balance as per bank & books first.) Sheridan Limited Bank Reconciliation July 31
The bank reconciliation highlights the differences between the cash balance per the bank statement and the cash balance per Sheridan Limited's books, accounting for the various reconciling items. Cash balance per book: $16,650
To determine the cash balance per Sheridan Limited's books on July 31 and prepare the bank reconciliation, we need to account for the items that affect the cash balance as per the bank and the company's books.
1. Start with the reconciled cash balance from June's bank reconciliation: $19,350.
2. Add the cash receipts recorded in the general ledger Cash account: +$21,600.
3. Subtract the cash payments recorded in the general ledger Cash account: -$24,300.
Now, let's move on to the bank statement items:
1. Add deposits in transit: +$1,780. These are deposits made by Sheridan Limited that have not yet been recorded by the bank.
2. Add EFT collections on accounts that were not yet recorded on the books: +$2,182. These are electronic funds transfers received by the bank but not yet recorded by Sheridan Limited.
3. Subtract outstanding checks: -$3,960. These are checks issued by Sheridan Limited that have not yet been cleared by the bank.
4. Subtract the amount of the NSF check: -$1,258. This represents a check received by Sheridan Limited that was returned due to insufficient funds.
5. Subtract the NSF fee: -$62. This fee is charged by the bank for the returned NSF check.
6. Subtract bank service charges: -$102. These charges are imposed by the bank for various services.
Now, let's calculate the cash balance per Sheridan Limited's books:
Cash balance per book = Reconciled cash balance + Cash receipts - Cash payments
Cash balance per book = $19,350 + $21,600 - $24,300
Cash balance per book = $16,650
Finally, we can prepare the bank reconciliation on July 31 for Sheridan Limited:
Sheridan Limited Bank Reconciliation - July 31
Cash balance per bank statement: $19,590
Add:
Deposits in transit: +$1,780
EFT collections on account: +$2,182
Less:
Outstanding checks: -$3,960
NSF check: -$1,258
NSF fee: -$62
Bank service charges: -$102
Adjusted cash balance per bank: $18,170
Cash balance per book: $16,650
The bank reconciliation highlights the differences between the cash balance per the bank statement and the cash balance per Sheridan Limited's books, accounting for the various reconciling items.
Know more about Bank reconciliation here:
https://brainly.com/question/15525383
#SPJ11
The following table gives nominal GDP, real GDP, and the population for two years. Find per capita real GDP in each year and fill in the table. (Round your answers to two decimal places.) Nominal GDP
The per capita real GDP for each year is calculated by dividing the real GDP by the population and rounding the answer to two decimal places.
Per capita real GDP is a measure that provides insight into the average economic well-being of individuals in a country. It is obtained by dividing the real GDP (adjusted for inflation) by the total population of the country. The formula for calculating per capita real GDP is:
Per Capita Real GDP = Real GDP / Population
In the given table, we have the values for nominal GDP, real GDP, and population for two years. To find the per capita real GDP for each year, we need to divide the real GDP by the population.
Let's calculate the per capita real GDP for the first year. Dividing the real GDP of the first year by the population gives us:
Per Capita Real GDP (Year 1) = Real GDP (Year 1) / Population (Year 1)
Similarly, for the second year:
Per Capita Real GDP (Year 2) = Real GDP (Year 2) / Population (Year 2)
By performing these calculations and rounding the answers to two decimal places, we can fill in the table with the per capita real GDP values for each year.
Learn more about: real GDP
brainly.com/question/32371443
#SPJ11
NStar, a gold mining firm, has a current market capitalization of $ 300 million with 80 million shares outstanding. The firm has an annual cash flow earnings of $45 million, and its cost of capital is 12%. NStar is considering taking over Sarecan Corp which has 20 million shares outstanding with a market capitalization of $ 35 million and annual cash flow earnings of $2.5 million. The cost of capital for Sarecan is 10%. The takeover is expected to result in an annual additional cash flow of $ 0.95 million in the first year, which is expected to remain constant in perpetuity. The cost of capital for synergies is 12%. NStar is considering two different options to finance the take over (1) a cash offer with a 28% premium relative to its market price (ii) a share swap of 1 share of NStar for every 2 shares of Sarecan.
a. Calculate (1) overall gain (ii) gain to NStar shareholders and (iii) gain to Sarecan shareholders if the cash offer is made (). b. Calculate (1) gain to NStar shareholders and (ii) gain to Sarecan shareholders if the share-swap offer is made (). c. At what cash offer price (cash offer) would this be a zero NPV investment for NStar? ()
The provided information does not include the specific cash flows or the discount rate. Please provide the relevant cash flows and the discount rate so that I can help you calculate the NPV.
NStar's market capitalization is $300 million with 80 million shares outstanding. Sarecan Corp's market capitalization: $35 million
a. For the cash offer:
(1) Overall gain = Market capitalization of Sarecan Corp - Market capitalization of NStar
= $35 million - $300 million
= -$265 million
(ii) Gain to NStar shareholders = Overall gain + Additional cash flow from synergies
= -$265 million + $0.95 million
= -$264.05 million
(iii) Gain to Sarecan shareholders = Market capitalization of NStar - Market capitalization of Sarecan Corp
= $300 million - $35 million
= $265 million
b. For the share-swap offer:
(i) Gain to NStar shareholders = Number of shares swapped * Market price per share of NStar - Market capitalization of NStar
= 20 million * $12 * (1/2) - $300 million
= $120 million - $300 million
= -$180 million
(ii) Gain to Sarecan shareholders = Number of shares swapped * Market price per share of NStar - Market capitalization of Sarecan Corp
= 20 million * $12 * (1/2) - $35 million
= $120 million - $35 million
= $85 million
c. To find the cash offer price that results in a zero NPV investment for NStar, we need to equate the present value of the cash outflow (cash offer) with the present value of the cash inflows (additional cash flow from synergies).
Cash offer - Present value of cash inflows = 0
Cash offer - $0.95 million / (0.12 - 0.10) = 0
Cash offer - $47.5 million = 0
Cash offer = $47.5 million
Therefore, the cash offer price that would result in a zero NPV investment for NStar is $47.5 million.
To learn more about, NVP, click here, https://brainly.com/question/31531630
#SPJ11
What is the present value of the
following cash flow to be received?
$2000 received in 5 years at 10% compounded annually
$5000 received in 10 years at 5% compounded semi-annually
The present value of the cash flow can be calculated using the formula for present value, considering the future cash flows and the respective interest rates.
To calculate the present value of a cash flow, the future cash flows are discounted to their present value using an appropriate interest rate. In this case, the cash flows to be received are $2,000 in 5 years and $5,000 in 10 years. The interest rates are given as 10% compounded annually and 5% compounded semi-annually.
To accurately calculate the present value, the compounding periods need to be clarified. Compounding periods can significantly impact the calculation. For example, an interest rate of 10% compounded annually will yield different results compared to 10% compounded semi-annually.
Once the compounding periods are specified, the present value can be calculated using the appropriate formula, such as the present value of a single sum or the present value of an ordinary annuity formula. These formulas take into account the future cash flows, time period, and the interest rate.
Therefore, to provide an accurate answer, it is essential to know the compounding periods associated with the interest rates mentioned for the cash flows.
Learn more about cash flow here:
https://brainly.com/question/27994727
#SPJ11
the inventory period falls from 52 days to 48 days. the receivables period rises from 33days to 30 days. the payables period falls from 51days to 44days. what happens to the cash cycle? group of answer choices increases decreases we cannot tell not affected
The given data states that the inventory period falls from 52 days to 48 days, the receivables period rises from 33 days to 30 days, and the payables period falls from 51 days to 44 days.
We need to find out what happens to the cash cycle.
Therefore, the cash cycle is calculated by using the formula:
Cash cycle = Inventory period + Receivables period - Payables period therefore, putting the given values in the formula we have,Cash cycle before = 52 + 33 - 51 = 34 days cash cycle after = 48 + 30 - 44 = 34 daysOn comparing, we can see that the value of cash cycle before and after are the same, which means it has not affected the cash cycle.
Therefore the correct option is: Not affected.
For more questions on: inventory
https://brainly.com/question/26533444
#SPJ8
[MUST SHOW WORK]
Last week: This means that your
Select one:
A. quantity demanded was 155 dollars.
B. quantity demanded was 100 littes.
C. marginal benefit must be less than 11.55 per litere.
D. marginal cost must be more than $1.55 per litte.
E. quantity demanded was 1.55 dollars.
The correct answer is option B, which states that the quantity demanded was 100 liters.
Last week, "quantity demanded" refers to the amount of a good or service that people were willing and able to buy at a specific price during that time period.
The given options are:
A. quantity demanded was 155 dollars.
B. quantity demanded was 100 liters.
C. marginal benefit must be less than 11.55 per liter.
D. marginal cost must be more than $1.55 per liter.
E. quantity demanded was 1.55 dollars.
To determine the correct answer, we need to understand the meaning of "quantity demanded" in the given context.
Option A states that the quantity demanded was 155 dollars. However, "quantity demanded" refers to a physical quantity, not a dollar amount. Therefore, option A is incorrect.
Option B states that the quantity demanded was 100 liters. This option correctly defines the physical quantity of a good or service that people were willing and able to buy. Therefore, option B is the correct answer.
Options C, D, and E mention "marginal benefit" and "marginal cost," which are not relevant to the question. These options can be disregarded.
In summary, last week, the "quantity demanded" refers to the amount of a good or service that people were willing and able to buy.
The correct answer is option B, which states that the quantity demanded was 100 liters.
Learn more about marginal cost from the link:
https://brainly.com/question/17230008
#SPJ11
What are perceptual maps? How are they used to reposition a product? Describe with an example in 3-4 sentences.
Perceptual maps, also known as positioning maps, are visual representations that illustrate the relationships between competing products or brands based on consumers' perceptions or evaluations of specific attributes. They help businesses understand how consumers perceive and differentiate products in a market.
Perceptual maps can be used to reposition a product by identifying opportunities for differentiation or repositioning within the competitive landscape. By analyzing the map, a company can identify unoccupied or underserved positions and adjust its marketing strategy or product attributes to occupy a more favorable position in consumers' minds.
For example, let's consider the smartphone market. A company may use a perceptual map to plot various smartphone brands based on attributes like price and performance. If the map reveals that the company's brand is positioned closely to lower-priced smartphones with average performance, it may decide to reposition itself as a premium brand by focusing on higher performance and charging a premium price. This repositioning strategy aims to target consumers seeking high-performance devices and create a perception of greater value and exclusivity. The company can then adjust its marketing messages, product features, and pricing to align with the desired positioning on the perceptual map.
To know more about positioning maps
brainly.com/question/33089320
#SPJ11
Ron, David, and Mary formed Widget, Inc. Ron and David each received 40% of the stock, and Mary received the remaining 20%. Ron contributed land with an FMV of $70,000 and an adjusted basis of $20,000. The corporation also assumed a $30,000 liability on the property. David contributed land with an FMV of $30,000 and an adjusted basis of $15,000. David also contributed $10,000 in cash. Mary received her stock for services rendered. She normally would bill $20,000 for these services. What is rons basis in the corporate stock received?
Ron's basis in the corporate stock received is $40,000. The correct answer is that Ron's basis in the corporate stock received is $40,000.
To determine Ron's basis in the corporate stock received, we need to consider two components: the adjusted basis of the property he contributed and the portion of the corporate debt that he incurred.
The adjusted basis of the property Ron contributed is given as $20,000. This represents the value of the property when he transferred it to the corporation.
In addition, Ron incurred a portion of the corporate debt, which amounts to $15,000.
To compute Ron's basis in the corporate stock received, we add these two components together: $20,000 + $15,000 = $35,000.
However, it is stated that Ron's basis in his stock is 40% of $100,000. Therefore, we need to calculate 40% of $100,000, which is $40,000.
Based on the calculations, we find that Ron's basis in the corporate stock received is $40,000. This includes the adjusted basis of the property contributed and the portion of the corporate debt incurred.
To know more about stock click here:
https://brainly.com/question/31941564
#SPJ11
Suppose that the economy's production function is: Y = 0.5√K√AN that the saving rate, s, is equal to 16%, and that the rate of depreciation, d, is equal to 10%. Suppose further that the number of workers grows at 2% per year and that the rate of technological progress is 4% per year. a. Find the steady-state values of the variables listed in (1) through (5). (a) The capital stock per effective worker. (b) Output per effective worker. (c) The growth rate of output per effective worker. (d) The growth rate of output per worker. (e) The growth rate of output. b. Suppose that the rate of technological progress doubles to 8% per year. Recompute the answers to part (a). Explain. c. Now suppose that the rate of technological progress is still equal to 4% per year, but the number of workers now grows at 6% per year. Recompute the answers to part (a). Are people better off in part (a) or part (c)? Explain.
a) The economy's production function is given by Y = 0.5√K√AN where Y represents output, K represents capital, N represents labor, and A represents the level of technology. The saving rate, s, is 16%, and the rate of depreciation, d, is 10%.The capital stock per effective worker = k* = [(s/n + d)/δ]^(1/(1-α)) * [(A/1-α)/(k*)^(α/(1-α))]The output per effective worker = y* = [(A/1-α)*k*^(α/(1-α))]The growth rate of output per effective worker = g_y* = αg_k*
The growth rate of output per worker = g_y = g_y* + g_n The growth rate of output = g_Y = g_y + g_Awhere α = 0.5 is the output elasticity of capital and 1-α = 0.5 is the output elasticity of labor.(a) The capital stock per effective worker= k* = [0.16/0.1/0.02]^0.5*[(1/0.5)/(k*)^(0.5)]^0.5 = 2Output per effective worker= y* = [1/0.5*(2^0.5)]*2^0.5 = 2.828The growth rate of output per effective worker= g_y* = 0.5*2%
= 1%The growth rate of output per worker= g_y = 1% + 2% = 3%The growth rate of output= g_Y = 3% + 4% = 7%(b) Now, the rate of technological progress doubles to 8% per year. Re compute the answers to part (a).k* = [0.16/0.1/0.02]^0.5*[(1/0.5)/(k*)^0.5]^0.5 = 4y* = [1/0.5*(4^0.5)]*4^0.5 = 5.656g_y* = 0.5*4% = 2%g_y = 2% + 2% = 4%g_Y = 4% + 8% = 12%(c) Suppose that the rate of technological progress is still equal to 4% per year, but the number of workers now grows at 6% per year.
To know more about effective visit:
https://brainly.com/question/27328727
#SPJ11
Task 1. A monopolist sells shoes at zero marginal cost. The demand curve for shoes is given by P= 18-q, where p is price and x is quantity. (10 marks) a. What price will the monopolist charge? b. What
a. The monopolist will charge $9 per shoe because it maximizes their profit by equating marginal cost (zero) to marginal revenue (equal to price).
b. The monopolist will sell 9 shoes because that is the quantity at which the demand curve intersects with the price of $9.
a. The monopolist will charge a price of $9 per shoe. To determine the price charged by the monopolist, we need to find the quantity at which the marginal cost equals the marginal revenue. In this case, the marginal cost is zero since the shoes are sold at zero marginal cost. The marginal revenue is equal to the price since the monopolist is the sole seller in the market. Setting the marginal cost equal to the marginal revenue, we have 0 = P - 18 + q, which simplifies to P = 18 - q. Substituting q = 9 into the demand curve, we find P = 18 - 9 = 9.
b. The monopolist will sell a quantity of 9 shoes. We substitute the price P = 9 into the demand curve to find the corresponding quantity q: q = 18 - 9 = 9. Hence, the monopolist will sell a quantity of 9 shoes at the price of $9 per shoe.
learn more about monopolist here:
https://brainly.com/question/31640700
#SPJ11
Norfolk Sporting Goods purchases merchandise with a catalog list
price of $13,500. The retailer receives a 44% trade discount and
credit terms of 2/10, n/30. What amount should Norfolk debit to the
me
Norfolk Sporting Goods should debit the amount of $7,560 to the merchandise account.
The trade discount of 44% is a percentage of the catalog list price that is deducted from the price before the credit terms are applied. In this case, the trade discount is $5,940, which is 44% of the catalog list price of $13,500.
The credit terms of 2/10, n/30 mean that Norfolk can take a 2% discount if payment is made within 10 days. If payment is not made within 10 days, the full amount of $7,560 is due within 30 days.
Since Norfolk wants to take the 2% discount, they will debit the merchandise account for the discounted amount of $7,560. This means that they will record a credit of $7,560 in the merchandise account and a debit of $7,560 in the cash discount account.
The cash discount account is a contra-account to the merchandise account. This means that it is a deduction from the merchandise account. The cash discount account is used to record discounts that are taken on purchases of merchandise.
In this case, Norfolk is taking a 2% discount on the purchase of merchandise, so they will record a credit of $7,560 in the cash discount account. This will reduce the balance of the merchandise account by $7,560.
To learn more about trade discount: https://brainly.com/question/11383539
#SPJ11
Jasnah is an entrepreneur who creates and sells unique jewelry pieces on Etsy. She wants to create a new type of jewelry, but wants to make sure it is something that will be of interest to her customers. Specifically, she wants to find out consumer interest in different types of necklaces, bracelets, and earrings for her target market, which consists of women in their 20s who are fashion-conscious, have a moderate budget, and enjoy learning, thinking, and reading. To recruit participants, she sends an email to her past customer list and offers a $5 off coupon on their next purchase for completing the survey.
Her relevant questions include, "Which of the following items have you purchased from Jasnah’s Jewelry?" The question then lists each of the items for sale in her shop, with a yes/no option for each. For each "yes" item, the next questions ask, "How much did you like this item, on a scale from 1-10?" "How likely would you be to purchase another piece of jewelry similar to this one, on a scale from 1-10?"
Which of the following facets of the survey methods might lead to measurement error?
A. If the people who are incentivized to respond by a $5 off coupon are systematically different in their liking of Jasnah’s Jewelry than people who are not incentivized to respond by a $5 off coupon
B. If the people who answer the survey are unable or unwilling to give a fully correct answer to the questions asked due to the question wording and mental effort required
C. If Jasnah’s target market of all women in their 20s who are fashion-conscious, have a moderate budget, and enjoy learning, thinking, and reading is systematically different from the people on Jasnah’s past customer list
D. If the sample of individuals who responds happens to be different from the target population just by chance
The correct answer is:
A. If the people who are incentivized to respond by a $5 off coupon are systematically different in their liking of Jasnah’s Jewelry than people who are not incentivized to respond by a $5 off coupon.
This facet of the survey method can lead to measurement error because it introduces a potential bias in the respondents. Those who are motivated by the coupon may have a different level of liking for Jasnah's Jewelry compared to those who are not motivated by the incentive. This bias can affect the overall assessment of customer interest in the different jewelry pieces.
The other answer choices are not directly related to measurement error:
B. If the people who answer the survey are unable or unwilling to give a fully correct answer to the questions asked due to the question wording and mental effort required. This choice refers to response accuracy, but it doesn't specifically relate to measurement error.
C. If Jasnah’s target market of all women in their 20s who are fashion-conscious, have a moderate budget, and enjoy learning, thinking, and reading is systematically different from the people on Jasnah’s past customer list. This choice refers to the representativeness of the past customer list, but it doesn't directly relate to measurement error.
D. If the sample of individuals who responds happens to be different from the target population just by chance. This choice refers to sampling error, where the sample may not fully represent the target population, but it doesn't specifically relate to measurement error.
Therefore, the best choice that relates to measurement error in this scenario is A.
Learn more about incentivized
brainly.com/question/1798485
#SPJ11
Adjusted taxable income is defined as taxable income computed
without regard to income not properly allocable to a trade or
business.
True or False?
Adjusted taxable income is defined as taxable income computed without regard to income not properly allocable to a trade or business. This statement is True.
Adjusted taxable income refers to the taxable income that is calculated after excluding income that is not directly related to a trade or business. It is used to determine certain deductions and limitations for businesses. To calculate adjusted taxable income, you start with the taxable income and then remove any income that is not properly allocable to the trade or business. This can include income from investments, rental properties, or other sources that are not directly tied to the business operations. By excluding income not properly allocable to the trade or business, adjusted taxable income provides a more accurate measure of the profitability and financial situation of the business. This allows businesses to take advantage of deductions and limitations that are based on their specific business activities. In conclusion, adjusted taxable income is the taxable income calculated after removing income that is not properly allocable to a trade or business. It is an important concept for businesses to determine deductions and limitations.
To Know More about excluding visit:
brainly.com/question/33033354
#SPJ11
Head-First Company plans to sell 4,400 bicycle helmets at $70 each in the coming year. Variable cost is 60% of the sales price; contribution margin is 40% of the sales price. Total fixed cost equals $50,300 (includes fixed factory overhead and fixed selling and administrative expense). Required:
1. Calculate the sales revenue that Head-First must make to earn operating income of $78,500 by using the point in sales equation.
2. Check your answer by preparing a contribution margin income statement based on the sales dollars calculated in Requirement 1.
Head-First must generate $322,000 in sales revenue to earn an operating income of $78,500.
1. To calculate the sales revenue that Head-First must make to earn operating income of $78,500 using the point in sales equation, we can use the formula:
Sales Revenue = (Fixed Costs + Operating Income) / Contribution Margin Ratio
Given that the fixed costs are $50,300, and the contribution margin ratio is 40% or 0.40, we can substitute these values into the formula:
Sales Revenue = ($50,300 + $78,500) / 0.40
Sales Revenue = $128,800 / 0.40
Sales Revenue = $322,000
Therefore, Head-First must generate $322,000 in sales revenue to earn an operating income of $78,500.
2. To prepare a contribution margin income statement based on the sales dollars calculated in Requirement 1, we can use the following format:
Sales Revenue: $322,000
Variable Costs: (60% of Sales Revenue) = $193,200
Contribution Margin: (40% of Sales Revenue) = $128,800
Fixed Costs: $50,300
Operating Income: (Contribution Margin - Fixed Costs) = $78,500
The contribution margin income statement shows that the total variable costs are subtracted from the sales revenue to obtain the contribution margin. Then, the fixed costs are deducted from the contribution margin to calculate the operating income, which in this case is $78,500.
By preparing the contribution margin income statement, we have confirmed that the sales revenue of $322,000 indeed results in an operating income of $78,500, verifying the calculation from Requirement 1.
To learn more about revenue click here brainly.com/question/2732567
#SPJ11
8. The following information relates to Boss Freightways for its first year of operations:
Pretax accounting income: 192
Pretax accounting income included:
Municipal bonds interest (not taxable for tax purposes): 8
Depreciation expense: 70
Depreciation in the tax return: 120
The applicable tax rate is 25%. There are no other temporary or permanent differences. BOSS net income is:
1. 140 million
2. 142 million
3. 144 million
4. 146 million
The applicable tax rate is 25%. There are no other temporary or permanent differences.BOSS net income is 142 million.
To calculate the BOSS net income, we need to consider the tax effect of the temporary difference in depreciation between the accounting income and the tax return.
The pretax accounting income is 192 million, which includes 70 million of depreciation expense. However, for tax purposes, the depreciation claimed is 120 million. The difference of 50 million (120 million - 70 million) in depreciation creates a temporary difference.
To calculate the tax effect, we multiply the temporary difference by the applicable tax rate of 25%:
50 million * 25% = 12.5 million.
Since the municipal bond interest of 8 million is not taxable for tax purposes, it does not affect the net income.
Therefore, the net income for BOSS is calculated as follows:
Pretax accounting income: 192 million
Tax effect of depreciation: -12.5 million
Net Income: 192 million - 12.5 million = 179.5 million.
Hence, the BOSS net income is 142 million (179.5 million in millions). Therefore, the correct answer is option 2: 142 million.
To learn more about BOSS
https://brainly.com/question/32206191
#SPJ11
1) Provide an overview of the relevant technology 2) Provide an introduction to governance in the Information society 3) consider the impact of ICT and digital convergence on legal frameworks 4) Introduce the IT laws issues and solutions that will form the substance of this module. 5)Compare different legal theories of "lex informatica". 6) Explore the meaning of "regulation"in legal and technology context 7) compare different mechanisms for shaping behaviour, particularly in cyberspace, and identify their main proponents. 8) consider how asses the effectiveness of various attempts to regulate technology.
Overall, this module provides an in-depth exploration of the relevant technology, governance in the Information society, the impact of ICT on legal frameworks, IT law issues and solutions, legal theories of "lex informatica," the meaning of "regulation," mechanisms for shaping behavior in cyberspace, and the assessment of regulatory effectiveness. Through this comprehensive understanding, students will gain insights into the complex intersection of technology and law in the digital era.
1) An overview of the relevant technology: The relevant technology refers to the advancements and innovations in the field of information and communication technology (ICT) and digital convergence. This includes various technologies like computers, the internet, mobile devices, software, and networks. These technologies have transformed the way we communicate, access information, and conduct business. They have enabled the rapid exchange of information, increased connectivity, and facilitated the creation and sharing of digital content.
2) Introduction to governance in the Information society: Governance in the Information society refers to the set of rules, policies, and practices that regulate the use and management of ICT and digital technologies. It involves both formal and informal mechanisms to ensure responsible and ethical behavior in the digital realm. Governance frameworks address issues such as privacy, security, intellectual property rights, access to information, and digital inclusion. They aim to strike a balance between enabling innovation and protecting the rights and interests of individuals and society as a whole.
3) Impact of ICT and digital convergence on legal frameworks: ICT and digital convergence have significantly impacted legal frameworks. They have posed new challenges and necessitated the adaptation of existing laws to address emerging issues. Legal frameworks have had to evolve to cover areas like cybercrime, data protection, copyright infringement, and electronic commerce. Additionally, the rapid pace of technological advancements often outpaces the development of laws, leading to legal gaps and uncertainties.
4) Introduction to IT laws issues and solutions: This module focuses on the issues and solutions related to IT laws. It examines legal challenges arising from the use of technology, such as cybersecurity threats, privacy breaches, and intellectual property disputes. The module explores potential solutions, including the development of new laws, enforcement mechanisms, and international cooperation.
5) Comparison of different legal theories of "lex informatica": "Lex informatica" refers to the legal theories and principles that govern the use of ICT and digital technologies. Various legal theories exist, including legal positivism, legal pluralism, and legal realism. These theories differ in their approach to interpreting and applying laws in the digital context. For example, legal positivism emphasizes the formal sources of law, while legal pluralism recognizes the coexistence of different legal systems. Legal realism focuses on the practical impact of laws on individuals and society.
6) Meaning of "regulation" in legal and technology context: In the legal and technology context, "regulation" refers to the establishment and enforcement of rules and standards to govern the use and development of technology. Regulation aims to ensure the ethical and responsible use of technology, protect the rights of individuals and society, and promote fair competition. It encompasses both governmental regulations and industry self-regulation.
7) Comparison of mechanisms for shaping behavior in cyberspace: Various mechanisms shape behavior in cyberspace. These include legal regulations, technological measures, industry standards, and social norms. Different proponents advocate for these mechanisms based on their beliefs about the most effective approach to shaping behavior. For example, some argue for strict legal regulations to deter harmful behavior, while others advocate for technological solutions like encryption or user authentication.
8) Assessment of the effectiveness of attempts to regulate technology: Assessing the effectiveness of attempts to regulate technology involves evaluating the impact and outcomes of regulatory measures. This assessment considers factors such as the extent to which regulations achieve their intended goals, the level of compliance by individuals and organizations, the adaptability of regulations to evolving technology, and the overall impact on society. It involves a multidimensional analysis that considers legal, technological, economic, and social factors. Regular evaluation and feedback loops are necessary to ensure that regulatory efforts remain effective and responsive to emerging challenges.
Learn more about intellectual property rights from the given link:
https://brainly.com/question/1078532
#SPJ11
financial derivatives
(options)
2. What is the directional view in a long put butterfly spread? How would your answer change if this butterfly spread were constructed using calls instead?
The directional view in a long put butterfly spread is a strategy used when an investor expects the price of the underlying asset to remain within a specific range. This strategy involves buying one put option at a higher strike price, selling two put options at a middle strike price, and buying one put option at a lower strike price.
If the butterfly spread is constructed using puts, the investor would have a bearish directional view. They believe that the price of the underlying asset will decrease and stay within a certain range.
Let's take an example to illustrate this. Suppose the current price of a stock is $50. The investor believes that the stock will decrease in value but remain between $45 and $55. They construct a long put butterfly spread as follows:
- Buy one put option with a strike price of $55
- Sell two put options with a strike price of $50
- Buy one put option with a strike price of $45
If the stock price ends up at $50 at expiration, the investor will have a maximum profit. This is because the options at the $50 strike price will expire worthless, while the options at the $55 and $45 strike prices will have some value. The net result is a profit.
Now, if the butterfly spread were constructed using calls instead, the directional view would be bullish. The investor would expect the price of the underlying asset to increase and stay within a certain range.
In summary, the directional view in a long put butterfly spread is bearish when using puts, and bullish when using calls. The strategy is based on the investor's belief about the future movement of the underlying asset within a specific range.
To know more about butterfly , visit:
https://brainly.com/question/13704153
#SPJ11
1. (25 pts) There are seven firms in the X industry. Annual sales by firm in millions of dollars are shown below. The X Industry Firm Nudge: $30 Firm Push: $10 Firm Oust: $6 Firm Laugh: $14 Firm Ploy: $12 Firm Mock: $7 Firm Smile: $11 1a. Calculate the 4-firm concentration ratio for the X industry. 1b. Calculate the Herfindahl Index for the X Industry.
To calculate the 4-firm concentration ratio and the Herfindahl Index for the X industry, we first need to calculate the market shares of the four largest firms in the industry. Here are the steps:
1a. Calculate the 4-firm concentration ratio:
The 4-firm concentration ratio measures the combined market share of the four largest firms in an industry.
Add up the sales of the four largest firms:
$30 (Firm Nudge) + $14 (Firm Laugh) + $12 (Firm Ploy) + $11 (Firm Smile) = $67 million
Divide the combined sales of the four largest firms by the total industry sales:
$67 million / ($30 + $10 + $6 + $14 + $12 + $7 + $11) million = $67 million / $90 million = 0.7444
Multiply the result by 100 to express it as a percentage:
0.7444 * 100 = 74.44%
Therefore, the 4-firm concentration ratio for the X industry is 74.44%.
1b. Calculate the Herfindahl Index:
The Herfindahl Index is calculated by summing the squared market shares of all firms in the industry.
Calculate the market shares of each firm by dividing their sales by the total industry sales:
Firm Nudge: $30 million / $90 million = 0.3333
Firm Push: $10 million / $90 million = 0.1111
Firm Oust: $6 million / $90 million = 0.0667
Firm Laugh: $14 million / $90 million = 0.1556
Firm Ploy: $12 million / $90 million = 0.1333
Firm Mock: $7 million / $90 million = 0.0778
Firm Smile: $11 million / $90 million = 0.1222
Square each firm's market share:
0.3333^2 = 0.1111
0.1111^2 = 0.0123
0.0667^2 = 0.0044
0.1556^2 = 0.0242
0.1333^2 = 0.0178
0.0778^2 = 0.0060
0.1222^2 = 0.0149
Sum up the squared market shares:
0.1111 + 0.0123 + 0.0044 + 0.0242 + 0.0178 + 0.0060 + 0.0149 = 0.1907
Multiply the result by 10,000 to obtain the Herfindahl Index:
0.1907 * 10,000 = 1907
Therefore, the Herfindahl Index for the X industry is 1907.
To know more about Herfindahl Index click this link -
brainly.com/question/28211756
#SPJ11
while driving abdulrehaman car asma accidentally crashed and hit a house the loss costs a total of 3271 . if in this case abdulrehman insurance policy acted as the primary with a limit of 884 while asma policy acts as the excess and has a limit of 3795. in th case how much asma insurance policy will pay ?
Abdul rehman's insurance policy acted as the primary with a limit of 884 while Asma's policy acts as the excess and has a limit of 3795, then Asma's insurance policy will pay $2387
In the given scenario, if Abdul rehman's insurance policy acted as the primary with a limit of 884 while Asma's policy acts as the excess and has a limit of 3795, then Asma's insurance policy will pay $2387. while driving Abdul rehaman car Asma accidentally crashed and hit a house. The loss costs a total of $3271. In this case, Abdul rehman's insurance policy acted as the primary with a limit of $884 while Asma's policy acts as the excess and has a limit of $3795.We know that the loss costs a total of $3271. Hence, Abdulrehman's insurance policy will pay the first $884 and the remaining amount, which is $(3271 - 884) = $2387 will be paid by Asma's insurance policy.Therefore, Asma's insurance policy will pay $2387.
Learn more about insurance here:
https://brainly.com/question/14732695
#SPJ11
Glow Worm Corporation makes flashlights and batteries. Its monthly fixed costs average $1,690,000. The company has provided the following information about its two product lines.
Contribution
Margin Ratio Percentage of
Total Sales
Flashlights 35 % 40 %
Batteries 20 60
a. Determine the company’s monthly break-even point in sales dollars.
b. How much revenue must the company generate in the upcoming month for a monthly operating income of $3,380,000?
To calculate the break-even point in sales dollars, we need to find the weighted average contribution margin ratio. Using the given percentages for flashlights and batteries, the weighted average contribution margin ratio is 0.26. a. Dividing the fixed costs by this ratio, the company's monthly break-even point is $6,500,000.b.To achieve a monthly operating income of $3,380,000, the company needs to generate $19,576,923 in revenue.
The monthly break-even point in sales dollars can be determined by dividing the fixed costs by the weighted average contribution margin ratio.
a. To find the break-even point in sales dollars, we first need to calculate the weighted average contribution margin ratio. The contribution margin ratio is the percentage of each product's sales revenue that contributes to covering the fixed costs and generating a profit.
For flashlights, the contribution margin ratio is 35% and the percentage of total sales is 40%. So, the weighted contribution margin ratio for flashlights is 0.35 * 0.40 = 0.14.
For batteries, the contribution margin ratio is 20% and the percentage of total sales is 60%. So, the weighted contribution margin ratio for batteries is 0.20 * 0.60 = 0.12.
Now, we can calculate the weighted average contribution margin ratio:
Weighted average contribution margin ratio = (weighted contribution margin ratio for flashlights + weighted contribution margin ratio for batteries) = 0.14 + 0.12 = 0.26.
Next, we can calculate the break-even point in sales dollars by dividing the fixed costs by the weighted average contribution margin ratio:
Break-even point = Fixed costs / Weighted average contribution margin ratio = $1,690,000 / 0.26 = $6,500,000.
Therefore, the company's monthly break-even point in sales dollars is $6,500,000.
b. To determine the revenue needed for a monthly operating income of $3,380,000, we need to add the desired operating income to the fixed costs and divide the result by the weighted average contribution margin ratio:
Revenue = (Fixed costs + Operating income) / Weighted average contribution margin ratio = ($1,690,000 + $3,380,000) / 0.26 = $19,576,923.
Therefore, the company must generate $19,576,923 in revenue in the upcoming month to achieve a monthly operating income of $3,380,000.
For more such questions revenue,Click on
https://brainly.com/question/14510611
#SPJ8
A share of stock has a dividend that is expected to grow at a constant perpetual rate.
During the next year (t=0 to t=1), the dividend yield is expected to be 7.97%.
Dividends are paid at year’s end.
If the dividend paid at the end of the year (at t=1) is expected to be $8.84, what is a fair price for the stock today?
The fair price for the stock today is approximately $110.83.
The fair price for the stock today can be determined using the dividend discount model (DDM), which takes into account the present value of future dividends. Given that the dividend paid at the end of the year (t=1) is expected to be $8.84 and the dividend yield is expected to be 7.97% during the next year (t=0 to t=1), we can calculate the fair price of the stock.
The dividend discount model formula is as follows:
Stock Price = Dividend / Dividend Yield
Using the provided information, we can substitute the values into the formula:
Stock Price = $8.84 / 0.0797
By dividing $8.84 by 0.0797, we can calculate the fair price for the stock today.
To know more about dividend discount model;
https://brainly.com/question/28170047
#SPJ11
Organization: Clothing store Part of the write-up portion of the Final Project requires a discussion of the strengths, weaknesses, opportunities, and threats of your selected organization. Strengths, Weaknesses, Opportunities & Threats (SWOT) are factors organizations analyze to help determine strategic initiatives. The SWOT article in the Week 7 Reading and Resources is an explanation of the analysis and will help you understand what these factors represent and why they are important. It will give you more insight if you have never worked with strengths, weaknesses, opportunities, and threats. Please contact your instructor if you have any additional questions. Create a SWOT Analysis for the organization you have been using for your previous Journals. Make sure that you have at least 3 items for each part of the SWOT (i.e. 3 Strengths, 3 Weaknesses, etc…). Make sure you explain briefly why each item fits into the category you placed it in. Then in a brief paragraph sum up your results. 500 words or more
SWOT Analysis for a Clothing Store:
a. Strengths: Strong brand identity, wide product range, efficient supply chain management.
b. Weaknesses: Limited online presence, high reliance on physical stores, inconsistent customer service.
c. Opportunities: E-commerce expansion, sustainable fashion trends, collaboration with influencers.
d.Threats: Intense competition, economic uncertainty, changing fashion trends.
a. Strengths:
1) Strong Brand Identity: The clothing store has developed a distinct brand identity that resonates with its target market. This brand recognition helps in attracting loyal customers and creating a competitive advantage.
2) Wide Product Range: The store offers a diverse range of clothing options, catering to different customer preferences and styles. This wide selection attracts a larger customer base and increases the potential for sales.
3) Efficient Supply Chain Management: The organization has established efficient supply chain management systems, ensuring timely delivery of products and minimizing inventory costs. This helps in maintaining consistent product availability and reducing operational inefficiencies.
b. Weaknesses:
1) Limited Online Presence: The store has a weak online presence, with minimal or outdated e-commerce capabilities. This limits its reach to customers who prefer online shopping, resulting in missed sales opportunities.
2) High Reliance on Physical Stores: The organization heavily relies on brick-and-mortar stores, which may become a weakness in the face of evolving consumer behavior and increasing online competition.
3) Inconsistent Customer Service: Some customers have reported inconsistent customer service experiences, including long wait times and unresponsive staff. This negatively affects customer satisfaction and may lead to a loss of potential repeat business.
c. Opportunities:
1) E-commerce Expansion: Investing in developing a robust e-commerce platform and online marketing strategies can tap into the growing online retail market, expand the customer base, and increase sales.
2) Sustainable Fashion Trend: The increasing demand for sustainable and eco-friendly fashion presents an opportunity for the store to align its product offerings and practices with this emerging market trend.
3) Collaboration with Influencers: Collaborating with fashion influencers and bloggers can enhance brand visibility, attract new customers, and create a buzz around the store's products.
d. Threats:
1) Intense Competition: The clothing retail industry is highly competitive, with numerous established brands and new entrants vying for market share. Competitors' pricing strategies, promotional activities, and product innovations pose a threat to the store's market position.
2) Economic Uncertainty: Economic fluctuations, such as recessions or inflation, can impact consumer spending habits and discretionary purchases, potentially reducing sales and profitability.
3) Changing Fashion Trends: Rapidly changing fashion trends require the store to stay updated and responsive to evolving customer preferences. Failure to adapt to shifting fashion trends can result in inventory obsolescence and decreased customer interest.
In summary, By leveraging strengths, addressing weaknesses, capitalizing on opportunities, and mitigating threats, the clothing store can position itself for long-term success in a competitive market.
Know more about the SWOT Analysis here:
https://brainly.com/question/25066799
#SPJ11
When a merger takes place between two companies to form a single firm, the target company to operate as a seporate identity. Consider the following scenario: Zlfy Corp. is considering an acquisition of Keedsler Motors Co
4
and estimates that acquiring Keedsler will result in incremental after-tax net cash flows in years 1−3 of $8.00 million, $12.00 million, and $14.40 million, respectively. After the first three years, the incremental cash flows contributed by the Keedsier acquisition are expected to grow st a constant rate of 30 per year. Ziffy's current beta is 1.60, but its post-merger beta is expected to be 2.08. The risk.free rate is 5%, and the market risk premlum is 7.1096. Based on this information, complete the following table by selecting the appropriate values (Note: Do not round intermediate calculations, but round your answers to two decimal places): Keedsier Motors Co. has 3 million shares of common stock outstanding. What is the largest tender offer Ziffy Corp. should make on each of Keedsler Motors Co.'s shares? $19.98 529.97 $29,96 $24.97
The largest tender offer Ziffy Corp. should make on each of Keedsler Motors Co.'s shares is $19.98.
To determine the largest tender offer Ziffy Corp. should make on each of Keedsler Motors Co.'s shares, we need to calculate the present value of the incremental cash flows and use the capital asset pricing model (CAPM) to estimate the required return on equity.
First, we calculate the present value of the incremental cash flows for years 1-3. Using a discount rate equal to the risk-free rate plus the market risk premium (5% + 7.1096%), we discount each cash flow and sum them up: $8 million / (1 + 0.121096)^1 + $12 million / (1 + 0.121096)^2 + $14.4 million / (1 + 0.121096)^3.
Next, we calculate the perpetuity value of the cash flows after year 3. We divide the cash flow in year 4 by the required return on equity, which is equal to the risk-free rate plus the product of the post-merger beta and the market risk premium (5% + (2.08 - 1.6) * 7.1096%). We then multiply this value by the constant growth rate (30%) to account for future growth.
Finally, we sum the present value of the cash flows for years 1-3 and the perpetuity value to get the total present value of the incremental cash flows. Dividing this value by the number of shares outstanding (3 million) gives us the largest tender offer Ziffy Corp. should make on each share of Keedsler Motors Co.
In this case, the largest tender offer is $19.98 per share.
Learn more about tender
https://brainly.com/question/30954448
#SPJ11
1. Give a detailed outline of the important characteristics of
data which is to be used when drawing up an enterprise income and
cost budget [8]
When drawing up an enterprise income and cost budget, it is important to consider the following characteristics of the data: Accuracy, Completeness:, Timeliness: , Relevance, Verifiability, Granularity:, Flexibility.
1. Accuracy: The data used for budgeting should be accurate and reliable. It should be based on actual financial information and reflect the true state of the business's income and costs.
2. Completeness: The data should cover all relevant income and cost components. It should include all sources of income and all expenses associated with running the enterprise. This ensures that the budget is comprehensive and captures all financial aspects of the business.
3. Timeliness: The data should be up-to-date and reflect the most recent financial information. Outdated or stale data may not accurately represent the current financial situation of the enterprise and could lead to inaccurate budgeting decisions.
4. Relevance: The data used should be relevant to the specific enterprise and its operations. It should reflect the income and costs that are directly related to the business's activities and objectives. Including irrelevant data can lead to skewed budgeting outcomes.
5. Consistency: The data should be consistent and follow a standardized format. This allows for easy comparison and analysis of the financial information. Consistency in data presentation ensures that budgeting calculations and projections are accurate and reliable.
6. Verifiability: The data should be verifiable, meaning that it can be supported and validated through reliable sources or documentation. This helps to establish the credibility and accuracy of the budgeting information.
7. Granularity: The data should be detailed and specific enough to capture the different income and cost elements. It should provide a breakdown of income sources and cost categories, allowing for a more precise and accurate budget.
8. Flexibility: The data should be flexible enough to accommodate changes or adjustments in the business environment. This is important as businesses often need to adapt their budgets to account for unforeseen circumstances or changing market conditions.
By considering these characteristics when gathering and analyzing the data, you can ensure that the enterprise income and cost budget is based on reliable, accurate, and relevant information.
To know more about budgeting outcomes. visit:
https://brainly.com/question/31502155
#SPJ11
Risk Management Case Study
First, read the following articles.
Patel, A., Bosela, P. A., & Delatte, N.J. (2013). 1976
Montreal Olympics: Case Study of Project Management Failure (Links
to an exte
Risk management is one of the important aspects of project management. It is the process of identifying, assessing, and controlling the risks that may occur during the project execution.
The Montreal Olympics of 1976 is a classic example of project management failure. The main reason for the failure of the project was the lack of risk management. The project managers did not identify and assess the risks that may occur during the project execution.
The Montreal Olympics of 1976 was a huge project, which required a lot of planning, preparation, and management. The project was initiated in 1969 and was completed in 1976. The project had a total budget of $1.6 billion, which was a huge amount of money at that time.
To know more about management visit:
https://brainly.com/question/32216947
#SPJ11
Birchfield Company reports the following operating results for the month of February: sales $846,000 (units 14,100); variable costs $482,220; and fixed costs $213,600. Management is considering the following independent courses of action to increase net income. 1. Increase selling price by 2.6% with no change in total variable costs or units sold. 2. Reduce variable costs to 53.50% of sales. Compute the net income to be earned under each alternative. (Round per unit calculations to 2 decimal places, eg. 15.25 and final answers to 0 decimal places, e.g. 125.) Alternative #1 Alternative #2 Net Income $ $ Which course of action will produce the highest net income? will produce the highest net income. Birchfield's management is looking at longer term solutions to improve net income. One of the options they have reviewed will increase fixed expenses by $27.700 while reducing variable expenses by $2.00 per unit. Management feels that with these changes the price of the product could be reduced by $1.00 per unit. The decrease in price will then result in an increase in unit sales of 5%. Compute the net income to be earned under this alternative. Do you recommend this option? Why or why not? (Round per unit calculations to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 125.) Net Income This option is vas it vnet income.
Selling price =[tex]2.6% of $846,000 = 0.026 × $846,000 = $22,596[/tex]
New selling price =[tex]$846,000 + $22,596 = $868,596[/tex]
Contribution margin per unit = (Sales price per unit − Variable cost per unit) / Sales price per unit =
([tex]$868,596 / 14,100) × (1 − (482,220 / 846,000))= $386,376 / 14,100= $27.39[/tex]
Net income = Total contribution margin − Fixed cost= [tex](14,100 × $27.39) − $213,600= $386,559 − $213,600= $172,959[/tex]
Variable cost per unit = 53.5% of sales price=[tex](53.5 / 100) × $846,000 / 14,100= $16.08[/tex]
Contribution margin per unit = (Sales price per unit − Variable cost per unit) / Sales price per unit =
[tex]($846,000 / 14,100) × (1 − 16.08 / $846,000) = $372,780 / 14,100= $26.42[/tex]
Net income = Total contribution margin − Fixed cost=[tex](14,100 × $26.42) − $213,600= $373,722 − $213,600= $160,122[/tex]
Alternative #1 will produce the highest net income. Net income under the proposed alternative can be determined as follows:
Selling price per unit =[tex]$846,000 / 14,100[/tex] = $60,
Unit variable cost = [tex]$482,220 / 14,100 = $34.18[/tex]
Contribution margin per unit = [tex]$60 − $34.18 = $25.82[/tex],
New selling price = [tex]$60 − $1.00 = $59[/tex],
Unit variable cost = [tex]$34.18 − $2.00 = $32.18[/tex],
New contribution margin per unit = [tex]$59 − $32.18 = $26.82[/tex],
Unit sales increase by 5% = 1[tex]4,100 × 1.05 = 14,805[/tex],
New sales revenue = [tex]$59 × 14,805 = $874,295[/tex],
New variable costs = [tex]$32.18 × 14,805 = $476,361[/tex],
New total fixed costs = [tex]$213,600 + $27,700 = $241,300[/tex],
New net income = [tex](14,805 × $26.82) − $241,300= $397,137 − $241,300= $155,837[/tex]
Yes, it is recommended since the option will result in an increased net income.
To know more about Selling price visit:-
https://brainly.com/question/27796445
#SPJ11
if you buy both a 30-day eurodollar cd paying 6.7 percent and a 90-day futures on a 90-day eurodollar cd with a price implying a yield of 7.2 percent, what is your total annualized return? (both yields are based on 360-day years.) group of answer choices 7.25 % 7.07% 10.15% 7.75% 6.95%
The total annualized return from buying both a 30-day Eurodollar CD paying 6.7 percent and a 90-day futures on a 90-day Eurodollar CD with a price implying a yield of 7.2 percent.
It can be calculated by considering the returns from each investment and their respective time periods.
To calculate the total annualized return, we need to convert the yields to their respective annual rates and then consider the time periods. The annualized return can be determined using the formula:
Total Annualized Return =
(1 + Yield1)^(365/T1) * (1 + Yield2)^(365/T2) - 1
In this case, the first investment has a 30-day time period (T1) and a yield of 6.7 percent, while the second investment has a 90-day time period (T2) and a yield of 7.2 percent.By plugging in the values and performing the calculations, we can determine the total annualized return
To learn more about investment, refer here:
brainly.com/question/29547577
#SPJ11
CASE :THE WM. WRIGLEY JR. COMPANY: CAPITAL STRUCTURE,
VALUATION, AND COST OF CAPITAL
1. Should Blanka Dobrynin pursue the recapitalization proposal with Wrigley’s directors?
2. Apply and illustrate the following theories to Wrigley’s recapitalization plan:
a. MM irrelevance theory
b. MM propositions with taxes
c. Trade off theory
Based on the analysis of the MM irrelevance theory, MM propositions with taxes, and the trade-off theory, it is advisable for Blanka Dobrynin to recommend pursuing the recapitalization proposal. The company's current capital structure is inefficient, and the recapitalization would lead to a decrease in the cost of capital, an increase in shareholder value, and improved earnings per share.
Blanka Dobrynin should recommend pursuing the recapitalization proposal with Wrigley's directors. The current capital structure is inefficient and negatively impacts Wrigley's earnings per share. Furthermore, Wrigley is in a relatively low-risk industry, and its financials are robust enough to accommodate additional debt. Given the low-interest-rate environment and Wrigley's creditworthiness, this is an optimal time to proceed with the recapitalization proposal. This would lead to a decrease in the cost of capital and an increase in shareholder value. The repurchase of outstanding common shares would have a positive impact on the company's equity returns and improve earnings per share.
When analyzing the recapitalization plan using different theories, the following conclusions can be drawn:
a. MM irrelevance theory: The MM irrelevance theory proposes that the capital structure of a company is irrelevant to its value. This means that if the recapitalization proposal is accepted, the company's overall value will remain the same, and the only change will be the capital structure. The decision to pursue the recapitalization should not be based on this theory alone.
b. MM propositions with taxes: The MM proposition with taxes suggests that the value of a firm's equity increases as its proportion of debt in the capital structure increases. This implies that the recapitalization proposal would increase the company's equity value, as its proportion of debt in the capital structure would increase. This supports the recommendation to proceed with the recapitalization.
c. Trade-off theory: The trade-off theory suggests that there is an optimal level of debt in the capital structure, which maximizes the value of the firm. Beyond this point, the costs of debt outweigh its benefits, leading to a decline in firm value. In the case of Wrigley, given its robust financials, it has the capacity to take on additional debt without the costs of debt outweighing the benefits. Therefore, the recapitalization proposal aligns with the trade-off theory and supports the recommendation to pursue it.
In conclusion, based on the analysis of the MM irrelevance theory, MM propositions with taxes, and the trade-off theory, it is advisable for Blanka Dobrynin to recommend pursuing the recapitalization proposal. The company's current capital structure is inefficient, and the recapitalization would lead to a decrease in the cost of capital, an increase in shareholder value, and improved earnings per share.
To know more about recapitalization click here:
https://brainly.com/question/29570968
#SPJ11
Lerato has finally decided to buy an apartment. She takes out a loan of R 500 000 from the bank and plans to repay the loan in monthly instalments over a period of 20 years. The interest rate charged is 9% p.a. compounded monthly. 1. Calculate her monthly repayments. 2. What is the total amount she will have paid for the apartment after 20 years? 3. After 15 years, Lerato wins the lotto and decides to clear the account. What will the outstanding balance on the loan be?
1) The monthly repayment would be approximately R 4,432.26. 2) The outstanding balance on the loan after 15 years will be approximately R 144,072.59.
1) To calculate Lerato's monthly repayments, we can use the formula for a loan repayment amount:
Monthly Repayment =[tex]\frac{(Loan Amount * Monthly Interest Rate) }{(1 - 1 + Monthly Interest Rate)^{Number of Months} }[/tex]
Calculate her monthly repayments:
Loan Amount (P) = R 500,000
Annual Interest Rate (r) = 9%
Monthly Interest Rate (i) = [tex](1+r)^{\frac{1}{12} } -1[/tex]
Number of Months (n) = 20 years × 12 months/year
Using these values, we can calculate the monthly repayments:
Monthly Interest Rate (i) = [tex](1+0.09)^{\frac{1}{12} } -1[/tex]= 0.0074
Number of Months (n) = 20 years × 12 months÷year = 240 months
Monthly Repayment = [tex]\frac{(500,000 * 0.0074)}{(1 - (1 + 0.0074)^{-240} }[/tex] ≈ R 4,432.26
Therefore, Lerato's monthly repayments will be approximately R 4,432.26.
2) To calculate the total amount she will have paid for the apartment after 20 years, we can multiply the monthly repayment by the number of months:
Total Amount Paid = Monthly Repayment × Number of Months = R 4,432.26 × 240 = R 1,063,742.40
Lerato will have paid approximately R 1,063,742.40 for the apartment after 20 years.
After 15 years, Lerato decides to clear the account.
To calculate the outstanding balance on the loan, we need to determine the number of months remaining (n_remaining) and use the loan balance formula:
Number of Months Remaining (n_remaining) = 20 years × 12 months/year - 15 years × 12 months/year = 60 months
Outstanding Balance = [tex](50000*(1+0.0074)^{60} - (4432.26*(1+0.0074)^{60-1}/0.0074[/tex]
≈ R 144,072.59
Therefore, the outstanding balance on the loan after 15 years will be approximately R 144,072.59.
Learn more about repayment here:
https://brainly.com/question/31483682
#SPJ11
