What accounting assumption, principle, or constraint would Target Corporation use in each of the situations below? (a) Target was involved in litigation over the last year. This litigation is disclosed in the financial statements. select an option (b) Target allocates the cost of its depreciable assets over the life it expects to receive revenue from these assets. select an option (c) Target records the purchase of a new Dell PC at its cash equivalent price. select an option

Answers

Answer 1

Answer:

a. ASC 450 (previously recognized as SFAS 5) includes the declaration of a risk in proceedings and there is at minimum a "fair probability" that a loss has been sustained, and the report must provide an estimation of the probable damage or extent of damage or a declaration that this very calculation is not practicable.

b. Three specific criteria dictate however much depreciation they can subtract: (1) the real estate value, (2) the property rehabilitation time and (3) the form of depreciation utilized. You can't actually subtract as an benefit the lease or interest contributions, or the cost of furniture, decorations and appliances. The depreciation will only be deducted on the specific property used during leasing purposes.

c. For overclockers as well as operation in the federation the Computer is still the obvious winner. If you want to change hardware to maintain the cutting edge of your program, then a Laptop is the way forward. Further software must be installed for the PC like a large and ever-growing free software computer collection. Even so, thanks to an embedded tool named "Boot camp," you can install a Windows ® operating system on a Mac along with PC applications

 


Related Questions

company is considering establishing a new machine to automate a packing process. The machine will save $ 50,000 in labor annually. The machine can be purchased for $ 250,000 today and will be used for 10 years. It has a salvage value of $5,000 at the end of its useful life. The new machine will require an annual maintenance cost of $ 11,000. The company has a minimum rate of return of 10%. What is the Net present worth and should they buy the machine

Answers

Answer:

NPV = $-8,434.17

The firm shouldn't buy the machine

Explanation:

Net present value is the present value of after tax cash flows from an investment less the amount invested.

NPV can be calculated using a financial calculator:

Cash flow in year 0 = $-250,000

Cash flow each year from year 1 to 9 = $50,000 - $11,000 = $39,000

Cash flow in year 10 = $39,000 + $5,000 = $44,000

I = 10%

NPV = $-8,434.17

The NPV 8s negative and this indicates that the investment would be unprofitable. The firm shouldn't invest in the project.

To find the NPV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

Melrose Company has an investment in bonds issued by Roscoe Industries that are classified as available-for-sale securities. The bonds were purchased at par. At December 31, Year 2, the Investment in Roscoe bonds account had a debit balance of $200,000, representing its amortized cost, and its Fair value adjustment account had a credit balance of $5,000. On December 31, Year 3, the amortized cost of those bonds had not changed, but the fair value of those bonds was $225,000.
Which of the following will be included in the related journal entry dated December 31, Year 3?

a. Debit to Fair value adjustment for $20,000.
b. Credit to Fair value adjustment for $20,000.
c. Debit to Fair value adjustment for $30,000.
d. Credit to Fair value adjustment for $30,000.

Answers

Answer:

c. Debit to Fair value adjustment for $30,000.

Explanation:

The Journal entry is shown below:-

On Dec 31,

Fair value adjustment account Dr, $30,000   ($225,000 + $5,000 - $200,000)

         To Unrealized holding gain on available for sale securities $30,000

(Being unrealized holding gain is recorded)

Here we debited the fair value adjustment account as it decreased the liabilities   and we credited the unrealized holding gain on available for sale securities as it increased the gain so the same is recorded .

Okun's law states that
a. a change in the output gap occurs with a change in the rate of unemployment that is smaller in magnitude and in the opposite direction.
b. a change in the output gap occurs with a change in the rate of unemployment that is larger in magnitude and in the opposite direction.
c. inflation causes a decrease in the value of money held by the public.
d. the government may temporarily suspend citizens' rights during periods of hyperinflation in an attempt to maintain security and stability.

Answers

Answer:

C, I think is the answer.

Explanation:

The following costs are included in a recent summary of data for a company: advertising expense, $85,000; depreciation expense - factory building, $133,000; direct labor, $250,000; direct material used, $300,000; factory utilities, $105,000; and sales salaries expense, $150,000. Determine the dollar amount of conversion costs.

Answers

Answer:

Conversion costs= $488,000

Explanation:

Giving the following information:

depreciation expense - factory building, $133,000

direct labor, $250,000

factory utilities, $105,000

The conversion costs are the sum of direct labor and manufacturing overhead.

Manufacturing overhead= 133,000 + 105,000= 238,000

Direct labor= 250,000

Conversion costs= $488,000

A company used straight-line depreciation for an item of equipment that cost $15,350, had a salvage value of $3,200 and a six-year useful life. After depreciating the asset for three complete years, the salvage value was reduced to $1,535 but its total useful life remained the same. Determine the amount of depreciation to be charged against the equipment during each of the remaining years of its useful life: Multiple Choice $2,880. $5,672. $1,215. $2,580. $3,200.

Answers

Answer:

The correct answer is $2,580.

Explanation:

Under straight-line method, depreciation expense is (cost - residual value) / No of years = ($15,350 - $3,200) / 6 years = $2,025 yearly depreciation expense.

Accumulated depreciation at Year 3 = $2,025 x 3 = $6,075

Net book value (NBV) becomes $15,350 - $6,075 = $9,275

New depreciation is ($9,275 - $1,535) / 3 years = $2,580 yearly depreciation expenses

On January 2, 2018, Baltimore Company purchased 20,000 shares of the stock of Towson Company at $13 per share. Baltimore obtained significant influence as the purchase represents a 35% ownership stake in Towson Company. On August 1, 2018, Towson Company paid cash dividends of $25,000. Baltimore Company intended this investment to a long-term investment. On December 31, 2018, Towson Company reported $65,000 of net income for FY 2018. Additionally, the current market price for Towson Company's stock increased to $23 per share at the end of the year. Use this information to determine, how much Baltimore Company should report for its investment in Towson Company on December 31, 2018. (Round to the nearest dollar.)

Answers

Answer:

$344,000

Explanation:

The computation of value of investment is shown below:-

Initial Cost of investments         $260,000

(20,000 shares × $13)

Add: Share of profit                     $22,750

($65,000 × 35%)

Add: Increase in equity

reserves                                     $70,000

(($23 - $13) × 20,000 × 35%)

Less: Dividends received            $8,750

($25,000 × 35%)

Value of investment                    $344,000

Therefore the value of investment is $344,000

Journalize the following transactions assuming the perpetual inventory system:
July 3 Sold merchandise on account for $3,750 terms.
The cost of the goods sold was $2,000. July 5 Issued credit memo for $1,050 for merchandise returned from sale on July 3. The cost of the merchandise returned was $610. July 12 Received check for the amount due for sale on July 3 less return on July 5. July 17 Sold merchandise for $7,000 plus 6% sales tax to cash customers. The cost of the goods sold was $3,830.

Answers

Answer:

General Journal

Perpetual Inventory system

Date              Particulars                          Debit             Credit

July 3            Account Receivable        $3,750

                                                  Sales                         $3,750

Sold merchandise on account for $3,750 terms.

                        Cost of Goods Sold      $ 2000

                                 Merchandise Inventory            $2000

The cost of the goods sold was $2,000.

July 5         Sales Returns             $1,050

                                     Account Receivable         $1,050

Issued credit memo for $1,050 for merchandise returned from sale on July 3.

         

              Merchandise Inventory            $610

                                           Cost of Goods Sold      $ 610

The cost of the merchandise returned was $610.

July 12              Bank (cash)                  $2700

                                Account Receivable                 $2700

Received check for the amount due for sale on July 3 less return on July 5. ($3,750-  $1,050 )=$2700

July 17                      Cash                  $ 7420

                                        Sales                              $ 7420

Sold merchandise for $7,000 plus 6% sales tax to cash customers. As sales tax is added to the sales  a combined entry is made . ( 6%* 7000= $ 420)

                       Cost of Goods Sold      $ 3830

                                 Merchandise Inventory            $3830

The cost of the goods sold was $3,830.

Answer:

Please see the Journal entries below.

Explanation:

July 3

Debit: Accounts Receivables $3,750

Debit: Cost of Goods Sold $2,000

         Credit: Sales Revenue $3,750

         Credit: Inventory $2,000

To record sales on Account.

July 5:

Debit: Sales Revenue $1,050

Debit: Inventory $610

         Credit: Cost of Goods Sold $610

         Credit: Accounts Receivables $1,050

To record credit memo.

July 12

Debit: Cash ($3,750 - $1,050) $2,700

         Credit: Accounts Receivables $2,700

To record payment of sales.

July 17

Debit: Accounts Receivables $7,420

Debit: Cost of Goods Sold $3,830

         Credit: Sales Revenue $7,000

         Credit: Sales Tax Payable $420

         Credit: Inventory $3,830

To record sales and cost of goods sold.

In the market for lock washers, a perfectly competitive market, the current equilibrium price is $5 per box. Washer King, one of the many producers of washers, has a daily short-run total cost given by TC = 190 + 0.20Q + 0.0025Q2, where Q measures boxes of washers. Washer King's corresponding marginal cost is MC = 0.20 + 0.005Q. How many boxes of washers should Washer King produce per day to maximize profit?

Answers

Answer:

The number of boxes of washers Washer King should produce per day to maximize profit = 960 boxes.

And the corresponding maximum daily profit = $2,114

Explanation:

The daily, short-run total cost of producing Q boxes of the product is given as

TC = 190 + 0.20Q + 0.0025Q²

The unit price of the product = $5.

Total revenue = (Unit Price) × (Quantity sold) = 5Q

Profit = (Revenue) - (Total Cost)

Profit = 5Q - (190 + 0.20Q + 0.0025Q²)

Profit = P(Q) = -190 + 4.8Q - 0.0025Q²

To maximize the profits, we just obtain the point where the profit function reaches a Maximum.

At the maximum of a function, (dP/dQ) = 0 and (d²P/dQ²) < 0

Profit = P(Q) = -190 + 4.8Q - 0.0025Q²

(dP/dQ) = 4.8 - 0.005Q

At maximum point,

(dP/dQ) = 4.8 - 0.005Q = 0

Q = (4.8/0.005) = 960 boxes

(d²P/dQ²) = -0.005 < 0 (hence, showing that the this point corresponds to a maximum point truly)

Hence, the number of boxes of washers Washer King should produce per day to maximize profit = 960 boxes.

The corresponding maximum profit is then obtained from

P(960) = -190 + (4.8×960) - 0.0025(960²)

Maximum daily profit = $2,114

Hope this Helps!!!

Salud Company reports the following information. Use the indirect method to prepare only the operating activities section of its statement of cash flows for the year ended December 31, 2017. (Amounts to be deducted should be indicated with a minus sign.)

Selected 2017 Income Statement Data Selected Year-End 2017 Balance Sheet Data
Net income $ 440,000 Accounts receivable increase $ 47,600
Depreciation expense 84,500 Prepaid expenses decrease 16,800
Gain on sale of machinery 25,100 Accounts payable increase 6,200
Wages payable decrease 2,900
Cash flows from operating activities
Adjustments to reconcile net income to operating cash flow
$
0
$0

Answers

Answer:

Salud's cash flows from operating activities is $471,900.

Explanation:

Salud Company

Cash flows from operating activities

Adjustments to reconcile net income to operating cash flow

Net income                                                      $440,000

Add: Depreciation expense                               84,500

Less: Gain on sale of machinery                       (25,100)

Less: Accounts receivable increase                 (47,600)

Add: Prepaid expenses decrease                      16,800

Add:  Accounts payable increase                        6,200

Less: Wages payable decrease                         (2,900)

Net cash flows from operating activities    $471,900

Cost pools should be charged to responsibility centers by using: budgeted amounts of allocation bases because the cost allocation to one responsibility center should influence the allocations to others. some other approach. budgeted amounts of allocation bases because the cost allocation to one responsibility center should not influence the allocations to others. actual amounts of allocation bases because the cost allocation to one responsibility center should not influence the allocations to others. actual amounts of allocation bases because the cost allocation to one responsibility center should influence the allocations to others.

Answers

Answer: budgeted amounts of allocation bases because the cost allocation to one responsibility center should not influence the allocations to others

Explanation:

A cost pool is a collection of homogeneous costs thqt are to be assigned. Cost pools is an accounting term which refers to the groups of accounts serving used to express the cost of goods and service that are allocatable within a business or a manufacturing organization. The allocation base for a cost pool is a cost driver.

Cost pools should be charged to the responsibility centers by using the budgeted amounts of allocation bases. This is because the cost allocation to a responsibility center should not influence allocations to others.

Vaughn Manufacturing purchased the assets of Ivanhoe Company at an auction for $5465000. An independent appraisal of the fair value of the assets is listed below: Land $1795000 Building 2840000 Equipment 2180000 Trucks 3180000 Assuming that specific identification costs are impracticable and that Vaughn allocates the purchase price on the basis of the relative fair values, what amount would be allocated to the Building

Answers

Answer:

$1,552,836

Explanation:

As the auction price is determined for whole company, which includes all the assets in the company. Auction price can be allocated to an asset based on its fair value ratio to total fair value of all assets.

As per given data

Fair Value of Assets

Land            $1,795,000

Building       $2,840,000

Equipment  $2,180,000

Trucks         $3,180,000

Total           $9,995,000

Auction price allocation = (Fair value / Total Fair value of all assets) x Auction price

Placing values in the formula

Building = ( $2,840,000 / $9,995,000) x $5,465,000

Building = $1,552,836

gravitational field​

Answers

Answer:

The region of space surrounding a body in which another body experiences a force of gravitational attraction.

Please mark as brainlist.

The attractive effect, considered as extending throughout space, of matter on other matter.

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

Answers

Answer:

b. $995,000

Explanation:

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

The formula is

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

Date                                 Calculation                              Amount

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

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

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

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

Total                                                                    $995,000  

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

Indicate whether each of the following is either True/Fasle:
1. An S Corporation is a taxpaying entity.
2. If shareholders elect S Corporation status, the corporation generally pays no tax.
3. Stock received by a transferor in exchange for services does not count in determining whether the 80% control test has been met.
4. Under Sec. 351, no gain or loss is recognized by those who exchange property solely for stock of the recipient corporation.
5. When boot is received by a taxpayer transferring assets in a Sec. 351 exchange, gain must be recognized to the extent of the smaller of the realized gain or the FMV of the boot received.

Answers

Answer:

The following are the answers,

False - S organization could be a taste unit which suggests all the financial gain of the S company are going to be relocated to stockholders and also the tax is to be compensated by the stockholders and not the S organization. True – As per constant rationalization on top of you'll be able to settle this. False – Stock acknowledged on either methodology are going to be enclosed for control purpose. True – The profit or loss is merely predictable once the transmission isn't for sole perseverance. True - When boot is acknowledged by a remunerator shifting possessions in a very Sec. 351 discussion, gain should be documented to the level of the lesser of the complete expansion

On December 31, 2019, Irey Co. has $3,000,000 of short-term notes payable due on February 14, 2020. On February 8, 2020, Irey borrowed $1,200,000 (long-term loan) from County Bank and used $1,000,000 additional cash to liquidate $2,200,000 of the short-term notes payable. The amount of the short-term notes payable that should be reported as current liabilities on the December 31, 2019 balance sheet which is issued on March 5, 2020 is

Answers

Answer:

$1,800,000

Explanation:

Given short term notes payable = $3,000,000

Total amount used to liquidate short term notes = $2,200,000

Balance = $3,000,000 - $2,200,000 = $800,000

The additional $1,200,000 which is borrowed from Country Bank will not increase the short term notes payable because it's a long term credit

The additional $1,000,000 cash used will now be added to the balance amount

Amount to be reported as current liabilities = $1,000,000 + $800,000

= $1,800,000

Therefore the amount of the short-term notes payable that should be reported as current liabilities on the December 31, 2019 balance sheet which is issued on March 5, 2020 is $1,800,000

"Vaughn Corporation is considering the issue of commercial paper and would like to know the yield it should offer on its commercial paper. The corporation believes that a 0.2 percent credit risk premium, a 0.1 percent liquidity premium, and a 0.3 percent tax adjustment are necessary to sell its commercial paper to investors. Furthermore, annualized T-bill rates are 7 percent. Based on this information, Vaughn should offer ____ percent on its commercial paper."

Answers

Answer:

7.6 percent

Explanation:

Vaughn should offer 7.6 percent on its commercial paper.

This is calculated by adding the 0.2 credit risk premium to 0.1 percent liquidity premium + 0.3 percent tax adjustment + 7 percent annualized t bills rate.

= 0.1 + 0.2 + 0.3 + 7

= 7.6

Based on this Vaughn would offer 7.6 percent on its commercial paper.

Assume that the electricity from nuclear power has become a preferred source of electricity because it is cleaner than electricity produced by burning coal. At the same time, new regulations make it more expensive to produce electricity from nuclear power. What are the consequences?

Answers

Answer:

The answer to this question can be described as follows:

Explanation:

In the given statement some information is missing that is choices so, the correct choice can be described as follows:

The most important source of electricity is nuclear energy. It will boost demand for the nuclear energy century of electric power. The demand curve also is moving to the right.  At the very same time, it increases in power generation rates would also increase the cost of  energy generation via nuclear power plant. This will lead to a shift to the left. The nuclear demand curve will change to just the right and the nuclear power source will switch to the left. It will lead to an increase in the balance cost value with an uncertain shift in the balance quantities.

Pharoah Company has had 4 years of record earnings. Due to this success, the market price of its 500,000 shares of $4 par value common stock has increased from $15 per share to $55. During this period, paid-in capital remained the same at $6,000,000. Retained earnings increased from $4,500,000 to $30,000,000. CEO Don Ames is considering either (1) a 15% stock dividend or (2) a 2-for-1 stock split. He asks you to show the before-and-after effects of each option on (a) retained earnings, (b) total stockholders’ equity, and (c) par value per share.

Answers

Answer and Explanation:

According to the scenario, computation of the given data are as follow:-

1) 15% Stock Dividend-

Retained Earnings = Increase Value of Retained Earnings - (Total Shares × 15% Stock Dividend × Increase Value of Per Share)

= $30,000,000 - (500,000 × 15% × $55)

= $30,000,000 - $4,125,000

= $25,875,000

2)  2-for-1 stock split-

Retained earnings = $30,000,000

The 2-for-1 stock split will not impact retained earnings.

a and b) The before, after effects of each option are shown in the attachment below

c) Par value per share  

Par value per share of stock dividend = $4

Par value per share of 2-for-1 stock split = $4  ÷ 2 = $2

According to the analysis, stock dividend will not make any impact.

       

Question 2--/20 View Policies Current Attempt in Progress Stellar Company sponsors a defined benefit pension plan. The corporation’s actuary provides the following information about the plan. January 1, 2020 December 31, 2020 Vested benefit obligation $1,610 $1,910 Accumulated benefit obligation 1,910 2,590 Projected benefit obligation 2,400 3,120 Plan assets (fair value) 1,680 2,430 Settlement rate and expected rate of return 10 % Pension asset/liability 720 ? Service cost for the year 2020 400 Contributions (funding in 2020) 660 Benefits paid in 202- 180 (a) Compute the actual return on the plan assets in 2020.

Answers

Answer:

$270

Explanation:

The computation of the actual return on plant asset is shown below:

Fair value of the Plan assets at Ending of the year $2,430

Less: Fair value of the Plan assets at beginning of the year $1,680

Change in Plan Assets $750

Less  Contribution made -$660

Add: Benefits Paid $180

Actual Return $270

We simply applied the above equation to determine the actual return on the plant assets

Nicholas Health Systems recently reported an EBITDA of $25.0 million and net income of $15.8 million. It had $2.0 million of interest expense, and its federal tax rate was 21% (ignore any possible state corporate taxes). What was its charge for depreciation and amortization

Answers

Answer:

Depreciation and Amortization= $3,000,000

Explanation:

Giving the following information:

Nicholas Health Systems recently reported an EBITDA of $25.0 million and a net income of $15.8 million. It had $2.0 million of interest expense, and its federal tax rate was 21%

We need to reverse engineer the net income calculation to determine the depreciation and amortization:

EBT= net income/(1-t)

EBT= 15,800,000/(1 - 0.21)

EBT= 20,000,000

EBIT= EBT + Interest

EBIT= 20,000,000 + 2,000,000

EBIT= 22,000,000

Now, we can determine D and A:

D and A= EBITDA - EBIT

DA= 25,000,000 - 22,000,000

DA= 3,000,000

On December 12, 2021, an investment in equity securities costing $77,000 was sold for $94,000. The total of the sale proceeds was credited to the investment in equity securities account. Required: 1. Prepare the journal entry to correct the error, assuming it is discovered before the books are adjusted or closed in 2021. (Ignore income taxes.) 2. Prepare the journal entry to correct the error assuming it is not discovered until early 2022. (Ignore income taxes.)

Answers

Answer:

1.

Dr. Investment Account $17,000

Cr. Gain on Sale             $17,000

2.

Dr. retained Earning      $17,000

Cr. Gain on Sale             $17,000

Explanation:

1.

If an assets is sold more than the book value, then there is a gain on the sales of asset.

Gain on Sale = Sales Proceeds - Book value of Investment = $94,000 - $77,000 = $17,000

As sales proceeds of $94,000 are credited in the Investment account, which needs to be credited by $77,000 only. The excessive amount of $17,000 should be recorded in the Gain on sale account.

2.

Error is not discovered until 2022 and earning for 2021 was transferred to retained earning. So, adjustment should me made in the retained earnings to eliminate the effect.

On January 1, 2019, Broker Corp. issued $2,200,000 par value 9%, 9-year bonds which pay interest each December 31. If the market rate of interest was 11%, what was the issue price of the bonds? (The present value factor for $1 in 9 periods at 9% is 0.4604 and at 11% is 0.3909. The present value of an annuity of $1 factor for 9 periods at 9% is 5.9952 and at 11% is 5.5370.)

Answers

Answer:

$ 1,956,306.00  

Explanation:

The issue price of the bonds issued is the present  value of all cash flows promised by the bonds  discounted using the market interest rate of 11%.

The cash flows which comprise of annual coupon payment for nine years as well as the repayment of the face value at the end of the ninth year as computed thus:

annual coupon payment=face value*coupon rate=$2,200,000*9%=$198,000.00  

The present value of $198,000 for nine years= 198,000*5.5370=$ 1,096,326

The present of $2,200,000 at the end of nine years=0.3909*2,200,000=$ 859,980.00  

Total present values=$ 859,980+$ 1,096,326=$1,956,306.00  

Which one of the following is NOT part of the estimated net investment (NINV) for a capital budgeting project? The estimated salvage value of the new assets at the end of their 10-year expected economic life. The immediate increase in net working capital required by the project. The after-tax salvage value of assets to be replaced by the project. The cost of new assets required by the project

Answers

Answer:

The correct answer to the following question will be Option A.

Explanation:

Net investment or expenditure seems to be the total money that a business invests on financial assets, less the deferred revenue of those resources. This statistic gives people a sense of real spending on capital products such as plants, machinery, including technology used throughout the activities of the business.The effective improvement including its program's net income, after-tax recovery value of the properties to have been substituted by the task.

So that the above option A is not related to the given scenario.

Jiminy’s Cricket Farm issued a bond with 25 years to maturity and a semiannual coupon rate of 4 percent 3 years ago. The bond currently sells for 108 percent of its face value. The company’s tax rate is 22 percent. The book value of the debt issue is $30 million. In addition, the company has a second debt issue on the market, a zero coupon bond with 10 years left to maturity; the book value of this issue is $15 million, and the bonds sell for 73 percent of par. a.What is the company’s total book value of debt? (Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.)b.What is the company’s total market value of debt? (Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.)c.What is your best estimate of the aftertax cost of debt? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Answers

Answer:

Explanation:

a.What is the pre-tax cost of debt?This question is basically asking for the bond’s current yield to maturity, which is the pre-tax cost of long term debt in the capital markets for this company today.Price = 1.08 * 1000 = 1080+/- PV23 * 2 = 46 N.10 * 1000 = 100 / 2 = 50 PMT1000 FVSolve for i/y = 4.5801 is the semi-annual yield to maturity * 2 = 9.1601% annual YTM

b.What is the after-tax cost of debt?9.1601 * (1 - .35) = 5.9541 after tax cost of debt.This is the true cost of debt to the company because the company gets a tax deduction (a tax shield!) for paying interest on its debt.

January 1, 2021, Woody Forrest Corporation granted executive stock options to purchase 41,000 of its common shares at $9 each. The market price of common stock was $24 per share on December 31, 2021, and averaged $12 per share during the year then ended. There was no change in the 164,000 shares of outstanding common stock during the year. Net income for the year was $39,000. The number of shares to be used in computing diluted earnings per share for the quarter is:

Answers

Answer:

174,250 shares

Explanation:

The computation of the number of shares to be used in computing diluted earnings per share is shown below:

Proceeds from exercise of options (a)  $369,000  (41,000 shares × $9)

Used to repurchased for common stock (b) 30,750 shares (41,000 shares × $9 ÷ $12)

Number of shares for exercised (c)                           41,000 shares

Less: repurchased shares (d)                                    -30,750 shares

Diluted common shares {e = c - d}                             10,250 shares

Add: Common shares (f)                                             164,000 shares

Total number of shares for diluted earning per share 174,250 shares

We ignored the market price of common stock as it is not relevant.

The members of a wedding party have approached Imperial Jewelers about buying 26 of these gold bracelets for the discounted price of $367.00 each. The members of the wedding party would like special filigree applied to the bracelets that would require Imperial Jewelers to buy a special tool for $457 and that would increase the direct materials cost per bracelet by $7. The special tool would have no other use once the special order is completed. To analyze this special order opportunity, Imperial Jewelers has determined that most of its manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given period. However, $8.00 of the overhead is variable with respect to the number of bracelets produced. The company also believes that accepting this order would have no effect on its ability to produce and sell jewelry to other customers. Furthermore, the company could fulfill the wedding party’s order using its existing manufacturing capacity.

Answers

Answer:

this special order will result in a $2,637 profit, so the company should accept it

Explanation:

special order for 26 gold bracelets

discounted price of $367 per unit

normal production costs:

direct materials $143direct labor $90manufacturing overhead $31total $264

costs related to the special order

increase in direct materials = $7 per unit, total of $150 per unit

direct labor $90 per unit

variable overhead = $8 per unit

machine used for this project only $457

revenue generated by special order:

total revenue                                    $9,542

- variable costs                                ($6,448)

direct materials $3,900direct labor $2,340variable overhead $208

- special machine                              ($457)  

profit from special order                  $2,637

The three service departments (indirect costs) are payroll, sales supervision and maintenance. The actual costs of these service departments are as follows:

Payroll Sales Supervision Maintenance
Salaries and wages $41,000 $80,000 $52,000
Office supplies $3,500 $1,600 $400
Supplies 0 $2,400 $7,500

The two operating departments and their statistics are as follows:

Square Footage Number of Employees Net Assets
Machining 14,500 78 $ 420,000
Assembly 46,000 42 280,000

If you allocate payroll department costs by number of employees then how much payroll cost is allocated to the Machining Department?

Answers

Answer:

$26,700

Explanation:

The solution of allocation of cost to machining department is provided below:-

First we need to find out the total payroll cost and total number of employees to reach the allocation of cost to machining department which is here below:-

Total Payroll costs = Payroll of salaries and wages + Payroll of office supplies

= $41,000 + $3,500

= $44,500

Total Number of employees = Machining number of employees + Assembly number of employees

= 78 + 52

= 130

Allocation of cost to Machining Department = Total Payroll costs ÷ Total Number of employees × Machining number of employees

= 44,500 ÷ 130 × 78

= $26,700

To reach allocation of cost to machining department we simply put the values into formula.

The relationship between recycling, economics, and energy consumption is demonstrated in the case of aluminum, where ________. it costs more than 10 times as much to produce items from recycled aluminum than from virgin ore the U.S. failure to recycle aluminum has caused energy to be lost in mining new ore it requires over 20 times more energy to mine and extract aluminum from bauxite ore than from recycled materials all of the metal recycling industries in the United States went bankrupt by 2009 new cheap mining technologies and huge newly discovered aluminum deposits have made recycling unprofitable

Answers

Answer:

It requires over 20 times more energy to mine and extract aluminum from bauxite ore than from recycled materials.

Explanation:

The relationship between recycling, economics, and energy consumption is demonstrated in the case of aluminum, where it requires over 20 times more energy to mine and extract aluminum from bauxite ore than from recycled materials.

Also, the relationship between recycling, economics, and energy consumption is demonstrated in the case of aluminum, where energy expended to mine and produce items from virgin ore is saved by recycling for about 95%.

Recycling is one of the most effective ways of prolonging our supply of mineral resources.

Breckenridge Ski and Snow Board Rental Co. charges 67 for a one day rental. At that price they average renting 159 sets of apparatus. Their yield management consultant recommended they lower their price to 56. At that price the consultant expects their average daily rental will be 205 sets of apparatus. At those prices and demand, what elasticity of demand can be expected? (Solve to two decimal places.)

Answers

Answer:

Price elasticity of demand = 1.76

Explanation:

Price elasticity of demand (PED) is the degree of responsiveness of demand to a change in price.

Where a percentage change in price produces a more than a proportional change in quantity, we say the product is price elastic. On the other hand, where a change in price produces a less than a proportional change in quantity demand, then demand is price inelastic

PED is computed as follows:

PED = % change in quantity /% change in Price

% change in demand  =   (56- 67)/67 × 100 = 28.93081761

% change in price =16.41791045

PED = 28.93/16.4179 = 1.762

Price elasticity of demand = 1.76

Public policy toward monopolies Suppose that a government that is skeptical of efforts to regulate prices charged by private companies is nevertheless concerned that an electric utility company is taking advantage of consumers with unfair pricing policies. Which of the following policy options might most effectively enable the government to achieve its objectives in this situation?
A. Do nothing at all.
B. Use antitrust laws to increase competition.
C. Turn the company into a public enterprise.
D. Regulate the firm's pricing behavior.

Answers

Answer:

C.

Explanation:

State Owned Enterprises are those enterprises that is legally taken by the government. This entity is formed by the government to take authority over the commercial activities. It is also known as SOE and Government Owned Corporations (GOC). These enterprises are formed to function on account of government. It helps in avoiding the unfair pricing policies by private companies in some markets.

In the given situation, the government should use the policy of turning the company into a public enterprise through SOE policy. With this, the government will be able to regulate the prices and avoid unfair pricing by the private companies.

So, the correct answer is option C.

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