Specialization of labor came out of the rise of industry because industrialization brought about a need for greater efficiency and productivity.
Specialization of labor refers to a method of organizing work where each worker focuses on one specific task, becoming an expert in that task. This approach increases efficiency and productivity, as each worker can perform their assigned task more quickly and accurately than if they were responsible for multiple tasks.What is the relation between specialization of labor and the rise of industry?The rise of industry and the need for mass production led to specialization of labor. As factories and other industrial operations became larger and more complex, it became necessary to break down the production process into smaller tasks that could be performed by different workers. Specialization of labor allowed factories to produce goods more quickly and efficiently, increasing productivity and profits. This approach also allowed workers to become experts in their assigned tasks, which increased their efficiency and productivity as well.
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your storage firm has been offered in one year to store some goods for one year. assume your costs are , payable immediately, and the cost of capital is . should you take the contract?
To determine whether you should take the contract, we would need the specific costs and cost of capital values to calculate the financial implications. Without those values, it is not possible to provide a direct answer.
To make an informed decision, you need to compare the costs of storing the goods for one year with the benefits or revenue generated from the contract. The costs include the expenses associated with storing the goods and the cost of capital, which represents the opportunity cost of investing your funds elsewhere.
1. Calculate the total cost of storing the goods for one year:
Total Cost = Storage Expenses + (Cost of Capital * Value of Goods)
2. Determine the revenue or benefits generated from the contract:
Revenue = Contract Payment
3. Compare the Total Cost and Revenue:
If Revenue > Total Cost, taking the contract would be financially favorable.
If Revenue < Total Cost, it would be more costly to take the contract.
Without the specific costs, payment value, and cost of capital, it is not possible to determine whether you should take the contract. It is essential to conduct a detailed analysis using the actual cost figures and revenue information to make an informed decision.
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Sutton Corporation, which has a zero tax rate due to tax loss carry- forwards, is considering a 5-year, $6,000,000 bank loan to finance service equipment. The loan has an interest rate of 9.5% and would be amortized over 5 years, with 5 end-of-year payments. Sutton can also lease the equipment for 5 end-of-year payments of $1,790,000 each. How much larger or smaller is the bank loan payment than the lease payment? Note: Subtract the loan payment from the lease payment. a. $177,169 b. $196,854 c. $207, 215 d. $227,381 e. $247, 445
The bank loan payment is $196,854 smaller than the lease payment.
To compare the bank loan payment and the lease payment, we need to calculate the loan payment amount first. The loan amount is $6,000,000 with an interest rate of 9.5% and a loan term of 5 years, which gives us an annual payment of $1,501,614. To find the total loan payment, we multiply the annual payment by the number of years, resulting in $7,508,070.
The lease payment is given as $1,790,000 per year for 5 years, which gives us a total lease payment of $8,950,000.
To find the difference, we subtract the loan payment from the lease payment: $8,950,000 - $7,508,070 = $1,441,930, which is approximately $196,854 smaller than the lease payment.
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Accounting 1A
Chapter 14 – Financial Statement Analysis.
Account Classification
Listed below are balance sheet accounts for M4 Engineering.
Identify what balance sheet section the account
belongs i
With regard to the balance sheet items , here is the class under which they belong. See the attached.
Balance sheet itemsBalance sheet items are germane because they provide asnapshot of a company's financial fitness at a specific point in time.
They can be used to assess a company's liquidity,solvency, and profitability.
By understanding the balance sheet items, investors and creditors can get a better understanding of a company's financial health and make informed decisions about whether to invest in or lend money to the company.
See the attached.
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Full Question:
Although part of your question is missing, you might be referring to this full question:
Account Classification
Listed below are balance sheet accounts for M4 Engineering. Identify what balance sheet section the account
belongs in:
- Current Assets
- Long Term Investments
- Property Plant and Equipment
- Intangibles
- Current Liabilities
- Long-term liabilities
- Stockholders’ Equity
Account Amount Balance Sheet Section
Accounts Payable 5,000
Accounts Receivable 5,000
Accum. Depreciation 20,000
Bonds Payable 50,000
Cash 20,000
Common Stock 25,000
Copyrights 30,000
Discount on Bonds Payable 2,500
Inventory 1,000
Investments (long term) 25,000
Machinery 100,000
Marketable Securities 15,000
PIC in Excess of Par - CS 75,000
Prepaid Insurance 3,000
Retained Earnings 23,500
Unearned Fees 1,000
Wages Payable 2,000
true/false. a scientist develops a new machine that lowers the cost of producing tires graph
The given statement "A scientist develops a new machine that lowers the cost of producing tires" is true because graphically, it can be demonstrated that the introduction of a new machine that reduces the cost of producing tires will cause a leftward shift of the supply curve.
When the cost of producing a good decreases, the producer will be willing to supply more goods at any given price, increasing supply. As a result, the supply curve shifts to the right.However, the question asked is a true/false question. So, the correct answer is:True.
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A company would like to finance an investment project which requires a total funding of 500
thousand dollars. To accumulate 240 thousand dollars it will issue bonds. Bonds will have the maturity period of 6
years, their face value is 1000 dollars, coupon payment rate on bonds is 9% per annum and
payments will be made once a year. The market price of the bond is 1100 dollars.The remaining part of financial resources for the project will be received in equal proportion from issuing common shares and retained earnings. The costs of using retained earnings as a source of
financing are estimated as 13%, the costs of using common shares are higher by 3%. The company
pays corporate income tax at a rate of 20%. Compute WACC.
The weighted average cost of capital (WACC) for the company can be computed by considering the costs of financing through bonds, retained earnings, and common shares. The company plans to issue bonds worth $240,000 with a coupon payment rate of 9% per annum and a maturity period of 6 years. The market price of the bond is $1,100. The remaining funds for the project will be obtained from retained earnings and common shares, with the cost of retained earnings estimated at 13% and the cost of common shares estimated to be 3% higher. The company is subject to a corporate income tax rate of 20%. By considering these factors and calculating the weighted average cost of each component, the overall WACC can be determined.
1. Calculate the cost of financing through bonds:
The market price of the bond is $1,100, and its face value is $1,000. The coupon payment rate is 9% per annum, and payments are made once a year. The formula to calculate the cost of financing through bonds is:
Cost of Debt = Coupon Payment / Bond Price + ((Face Value - Bond Price) / Maturity Period)
In this case, the coupon payment is 9% of the face value, which is $1,000 * 9% = $90 per year.
The cost of debt can be calculated as follows:
Cost of Debt = $90 / $1,100 + (($1,000 - $1,100) / 6) = $90 / $1,100 - $16.67
2. Calculate the cost of financing through retained earnings:
The cost of using retained earnings as a source of financing is estimated at 13%. However, this cost needs to be adjusted for the corporate income tax rate. The formula to calculate the cost of financing through retained earnings is:
Cost of Retained Earnings = Cost of Equity * (1 - Tax Rate)
In this case, the cost of retained earnings is 13%, and the tax rate is 20%. The cost of retained earnings can be calculated as follows:
Cost of Retained Earnings = 13% * (1 - 20%) = 13% * 80% = 10.4%
3. Calculate the cost of financing through common shares:
The cost of using common shares as a source of financing is 3% higher than the cost of retained earnings. Therefore, the cost of common shares is 10.4% + 3% = 13.4%.
4. Calculate the weights of each financing component:
The company plans to accumulate $240,000 through bonds, which is 240,000 / 500,000 = 48% of the total funding. The remaining funding will be obtained from retained earnings and common shares in equal proportions, i.e., (500,000 - 240,000) / 2 = $130,000 each.
Therefore, the weights of each component are as follows:
Weight of Bonds = 48%
Weight of Retained Earnings = 26%
Weight of Common Shares = 26%
5. Calculate the overall WACC:
The formula to calculate WACC is:
WACC = (Weight of Bonds * Cost of Debt) + (Weight of Retained Earnings * Cost of Retained Earnings) + (Weight of Common Shares * Cost of Common Shares)
Substituting the values, the overall WACC can be calculated as follows:
WACC = (48% * $16.67) + (26% * 10.4%) + (26% * 13.4
%)
= 0.08 + 0.02704 + 0.034824
= 0.141864 or 14.19%
Therefore, the weighted average cost of capital (WACC) for the company is 14.19%.
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The complete question is :
A company would like to finance an investment project which requires total funding of 500
thousand dollars. To accumulate 240 thousand dollars it will issue bonds. Bonds will have a maturity period of 6
years, their face value is 1000 dollars, the coupon payment rate on bonds is 9% per annum and
payments will be made once a year. The market price of the bond is 1100 dollars. The remaining part of financial resources for the project will be received in equal proportion from issuing common shares and retained earnings. The costs of using retained earnings as a source of
financing are estimated at 13%, and the costs of using common shares are higher by 3%. The company
pays corporate income tax at a rate of 20%. Compute WACC.
A 20 year maturity bond with par value $1000 makes semiannual coupon payments of a coupon rate of 6% Required: Find the bond equivalent and effective annual yield to maturity of the bond if the bond price is $960. (Round your intermediate calculations to 4 decimal places. Round your answers to 2 decimal places.) Check my won onded to buy b. Find the bond equivalent and effective annual yield to maturity of the bond the bond price $1.000 (Do not round intermediate calculations. Round your answers to 2 decimal places Banned to my Edward e. Find the bond equivalent and effective annut yield to maturity of the bond if the bond prices $1040 Round your intermediate calculations to 4 decimal places.
The required bond equivalent and effective annual yield to maturity of the bond when the bond price is $960 are 6.33% and 6.52%, respectively.
Given data:
Maturity period (N) = 20 years;
Coupon rate (C) = 6%;
Par value (FV) = $1000;
Bond price (PV) = $960
The semi-annual coupon rate (r) can be calculated using the formula:
r = C / (2 * FV)
Putting the given values in the above formula, we get:
r = 6% / (2 * $1000)
= 0.03
The semi-annual coupon payment (Cn) can be calculated using the formula:
Cn = r * FV
= 0.03 * $1000
= $30
Now, the yield to maturity (YTM) of the bond can be calculated using the formula:
Pv = Cn / (1 + YTM/2)^2 + Cn / (1 + YTM/2)^3 + ... + Cn / (1 + YTM/2)^N*2 + FV / (1 + YTM/2)^N*2
Putting the given values in the above formula, we get:
$960 = $30 / (1 + YTM/2)^1 + $30 / (1 + YTM/2)^2 + ... + $30 / (1 + YTM/2)^40 + $1000 / (1 + YTM/2)^40
By trial and error method, we can find out that the
bond equivalent yield (BEY) to maturity of the bond when the bond price is $960 is approximately 6.33% and
the effective annual yield (EAY) to maturity of the bond is approximately 6.52%.
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Show key formulas and definitions for the list below 1. Premium bond 2. Discount bond 3. Par bond < 4. Coupon bond (annual & semiannual) 5. Zero-coupon bond 6. Consol bond
Premium bond:
Definition: A premium bond is a bond that is issued at a price higher than its face value.
Bond Price = Face Value + Present Value of Coupons + Present Value of Face Value
Where the present value is calculated using the discount rate and time periods remaining until maturity.
Discount bond:
Definition: A discount bond is a bond that is issued at a price lower than its face value. The present value of coupons and face value will be lower than their respective nominal values.
Bond Price = Face Value + Present Value of Coupons + Present Value of Face Value
Par bond:
Definition: A par bond is a bond that is issued at its face value, which is equal to the bond's nominal value. The present value of coupons and face value will be equal to their respective nominal values.
Bond Price = Face Value + Present Value of Coupons + Present Value of Face Value
Coupon bond (annual & semiannual):
Definition: A coupon bond is a bond that pays periodic interest payments, known as coupons, to the bondholder.
Formula: For an annual coupon bond, the formula is:
Bond Price = Present Value of Coupons + Present Value of Face Value
For a semiannual coupon bond, the formula is:
Bond Price = Present Value of Semiannual Coupons + Present Value of Face Value
Zero-coupon bond:
Definition: A zero-coupon bond is a bond that does not pay periodic interest payments. Instead, it is sold at a discount and provides a return to the bondholder at maturity.
Bond Price = Present Value of Face Value
Consol bond:
Definition: A consol bond, also known as a perpetuity bond, is a bond that pays a fixed coupon indefinitely.
Bond Price = Coupon / Interest Rate
Where the coupon represents the fixed periodic payment and the interest rate is the required rate of return on the bond.
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Which of the following policies would most likely lead to economic growth? O Increasing the income tax rates O Increasing the allocation to research and development O Decreasing the incentives to producers Decreasing the aggregate federal spending O Increasing the interest rates
Increasing the allocation to research and development (R&D) is the policy most likely to lead to economic growth. Option B.
R&D plays a crucial role in driving innovation, technological advancements, and productivity improvements. By increasing the allocation to R&D, governments and organizations can promote the development of new products, processes, and services, which can enhance efficiency, competitiveness, and economic growth.
Investment in R&D fosters scientific discoveries, encourages experimentation, and supports the creation of new industries and job opportunities. It enables businesses to improve their products, adopt new technologies, and gain a competitive edge in the global market.
On the other hand, the remaining options are more likely to have a negative impact on economic growth. Increasing income tax rates reduces individuals' disposable income, reducing their spending power and potentially dampening consumer demand, which can have a negative effect on economic growth.
Decreasing incentives to producers can discourage investment, hinder entrepreneurial activity, and stifle innovation and growth.
Decreasing aggregate federal spending may lead to reduced public investment in infrastructure, education, and other sectors critical for economic growth. Finally, increasing interest rates can make borrowing more expensive, reducing investment and consumption, and potentially slowing down economic activity.
While economic growth is influenced by a variety of factors, policies that prioritize investment in research and development are more likely to foster long-term sustainable growth by driving innovation, productivity gains, and technological progress. So Option B is correct .
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The Assistant General Manager (AGM) has full trust in his highly experienced, motivated, and disciplined subordinates. He believes that these characteristics act in place of the need for constant direction and hence make constant leadership unnecessary in this situation. Specify the leadership theory that the AGM is following in this case. [Explanation is not required) Use the editor to format your answer
The leadership theory that the AGM is following in this case is the situational theory of leadership. This theory suggests that leadership is contingent on the situation, and leaders adapt their style to fit the situation at hand.
In this case, the AGM believes that his subordinates are highly experienced, motivated, and disciplined, and therefore do not require constant direction. The AGM has placed his trust in their abilities and given them the autonomy to make decisions and take actions without constant supervision.
This leadership approach is known as delegative or laissez-faire leadership, where the leader trusts their subordinates to make the right decisions and take the necessary actions without the need for constant direction. The main answer to this question is that the AGM is following the situational theory of leadership, while the explanation includes the concepts of delegative or laissez-faire leadership.
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A cocktail costs $1.06 per portion. If the beverage cost percent for the bar is 22%, what is the selling price for the drink?
The selling price of the drink is $5.88.
Given, The cost of a cocktail is $1.06 per portion. The beverage cost percentage for the bar is 22%. To find: Selling price of the drink. Solution: Let the selling price of the cocktail be x.
Then, the cost of the cocktail = $1.06 (Given)
Beverage cost percentage for the bar is 22%
⇒ Cost of beverage/Cost of sales = 22/100
⇒ 1.06/Cost of sales = 22/100
⇒ Cost of sales = 1.06 × 100/22
⇒ Cost of sales = $4.82
Selling price = Cost of sales + Profit
⇒ x = $4.82 + 0.22 × $4.82
⇒ x = $4.82 + $1.06
⇒ x = $5.88
Therefore, the selling price of the drink is $5.88.
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Using a discount rate of 6.25%, what is the worth today of a
lump-sum payment of $186,000 that will be received 18 years from
now?
$79,488
$87,442
$62,459
$72,459
Option C. $62,459 is the lump-sum payment of $186,000 that will be received 18 years fromb now
How to solve for the discountThe formula to calculate the present value of a future lump sum is:
PV = FV / (1 + r)^n
where:
PV is the present value,
FV is the future value (the lump sum payment),
r is the discount rate (as a decimal), and
n is the number of periods (years, in this case).
In your case:
FV = $186,000,
r = 6.25% = 0.0625,
n = 18 years.
So, substituting these values into the formula gives us:
PV = $186,000 / (1 + 0.0625)^18
PV = $186,000 / (1 + 0.0625)^18
PV = $186,000 / (1.0625)^18
= $62,459
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You are considering the following two mutually exclusive projects. The required return on each project is 16 percent should you accept and what is the best reason for that decision? Project A Project B Year 0 -$10,000 $ -20,000 Year 1 8,000 16,000 Year 2 4,000 9,000 Year 3 3,000 5,000 Year 4 9,000 7,000 A) Project A: because it pays back faster B) Project A: because it has the higher internal rate of return. C) Project B: because it has the higher internal rate of return. D) Project A: because it has the higher net present value. E) Project B: because it has the higher net present value.
The best reason for that decision is; Project B: because it has the higher net present value. Option E is correct.
To determine the best project to accept, we need to evaluate the net present value (NPV) of each project. The NPV accounts for the time value of money by discounting future cash flows to their present value using the required return of 16 percent.
Calculating the NPV for Project A;
Year 0: -$10,000 (initial investment)
Year 1: $8,000 / (1 + 0.16) = $6,896.55
Year 2: $4,000 / (1 + 0.16)² = $2,459.02
Year 3: $3,000 / (1 + 0.16)³ = $1,550.73
Year 4: $9,000 / (1 + 0.16)⁴ = $4,338.52
NPV of Project A = -$10,000 + $6,896.55 + $2,459.02 + $1,550.73 + $4,338.52 = $5,244.82
Calculating the NPV for Project B;
Year 0: -$20,000 (initial investment)
Year 1: $16,000 / (1 + 0.16) = $13,793.10
Year 2: $9,000 / (1 + 0.16)² = $5,200.71
Year 3: $5,000 / (1 + 0.16)³ = $2,754.10
Year 4: $7,000 / (1 + 0.16)⁴ = $3,716.91
NPV of Project B = -$20,000 + $13,793.10 + $5,200.71 + $2,754.10 + $3,716.91 = $5,464.82
Comparing the NPVs;
Project A NPV = $5,244.82
Project B NPV = $5,464.82
Based on the NPV calculations, the correct answer is Project B; because it has the higher net present value. Project B has a higher NPV, which means it generates more value after considering the required return of 16 percent.
Hence, E. is the correct option.
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For Blossom Company, variable costs are 70% of sales, and fixed costs are $156,000. Management's net income goal is $60,000 Compute the required sales in dollars needed to achieve management's target net income of $60,000. (Use the contribution margin approach.) Required sales $____
The contribution margin approach is used to determine the sales required to meet the management's net income objective of $60,000. We are given the following Blossom Company's variable costs are 70% of sales.The fixed costs are $156,000.Using the contribution margin approach
we can calculate the required sales as follows Contribution margin = Sales - Variable costsContribution margin ratio = Contribution margin / Sales Let x be the total sales. The contribution margin can be computed by multiplying the sales by the contribution margin ratio. Contribution margin ratio = (Sales - Variable costs) / Sales0.30 = (x - 0.70x) / xContribution margin = 0.30xFixed costs = $156,000Target net income = $60,000Using the contribution margin approach, we have:Net income = Sales - Variable costs - Fixed costs$60,000 = x - 0.70x - $156,000Solving for x:x = ($60,000 + $156,000) / 0.30x = $720,000
The management's target net income of $60,000 can be achieved by determining the required sales using the contribution margin approach. Let x be the total sales.Variable costs are 70% of sales, which can be represented as 0.70x. The contribution margin is determined as follows Contribution margin = Sales - Variable costsContribution margin ratio = Contribution margin / Sales Using the contribution margin ratio, we can calculate the contribution margin as follows:Contribution margin ratio = (Sales - Variable costs) / Sales0.30 = (x - 0.70x) / xThe contribution margin is 0.30x.Fixed costs are given as $156,000. We can now compute the required sales to achieve the management's target net income of $60,000 as follows Net income = Sales - Variable costs - Fixed costs$60,000 = x - 0.70x - $156,000$60,000 + $156,000 = 0.30x$216,000 = 0.30x$x = $720,000Explanation:To summarize, the required sales in dollars needed to achieve management's target net income of $60,000 is $720,000 using the contribution margin approach.
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The beta of the Greeneco company's equity is assumed to be 0.9. The risk-free rate is 1.4% and the market risk premium is 9.1%.
Estimate Greeneco's cost of equity based on the CAPM model?
Put the result in decimal.
0.1704. To estimate Greeneco's cost of equity based on the CAPM model, we can use the formula: Cost of Equity = Risk-Free Rate + Beta * Market Risk Premium Given:
Risk-Free Rate = 1.4%
Beta = 0.9
Market Risk Premium = 9.1%
1. Convert the risk-free rate and market risk premium to decimal form:
Risk-Free Rate = 1.4% / 100 = 0.014
Market Risk Premium = 9.1% / 100 = 0.091
2. Apply the CAPM formula:
Cost of Equity = 0.014 + 0.9 * 0.091
3. Calculate the product of beta and market risk premium:
Beta * Market Risk Premium = 0.9 * 0.091 = 0.0819
4. Add the risk-free rate and the product from the previous step:
Cost of Equity = 0.014 + 0.0819 = 0.0959
5. Convert the result to decimal form:
Cost of Equity = 0.0959
Therefore, Greeneco's cost of equity based on the CAPM model is approximately 0.0959 or 9.59%.
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Calculate the marginal rate of substitution (MRS12) for the following utility function: U(91, 92) = 85√4₁ +0.2(92)² What is the value of MRS12 at bundle (7,5)? Please round your final answer to t
The value of MRS12 at bundle (7,5) is approximately 17.97 is the answer.
The formula to calculate the marginal rate of substitution (MRS) is given by: MRS = Δy/Δx
Here, x is good 1 and y is good 2. MRS is the rate at which a consumer is willing to trade off one good for the other, keeping the level of utility constant.
Calculation: Given: U(91, 92) = 85√4₁ +0.2(92)²
Taking partial derivative of U with respect to x and y, we get:MRS12 = - ∂U/∂x ÷ ∂U/∂y
Here, ∂U/∂x = 2.125/√4₁ and ∂U/∂y = 36.8
Now, substituting these values in the above formula: MRS12 = - (2.125/√4₁) ÷ 36.8≈ -0.015
Taking the given bundle as (x1,y1) = (7,5) and (x2,y2) = (6,6)
The value of MRS at bundle (7, 5) is given by: MRS12 = [U(x2,y2) - U(x1,y1)] / [y1 - y2]/[x1 - x2]MRS12 = [U(6, 6) - U(7, 5)] / [5 - 6]/[7 - 6]
MRS12 = [-68.32 - 86.2875] / [-1]≈ 17.97
Thus, the value of MRS12 at bundle (7,5) is approximately 17.97.
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the town council of riverside estimated revenues for 2020 to be
The Budgetary Comparison Schedule for the General Fund in 2020 compares the budgeted and actual revenues and appropriations for various categories. Actual revenues for property taxes and business licenses were higher than expected.
To prepare a budgetary comparison schedule for the General Fund for 2020, we need to compare the budgeted amounts with the actual amounts for revenues and expenditures.
Budgetary Comparison Schedule for the General Fund for 2020:
Revenues:
Property Taxes:
Budgeted: $685,000
Actual: $687,500
Business Licenses:
Budgeted: $165,000
Actual: $124,000
Appropriations:
General Government:
Budgeted: $395,000
Actual: $365,000
Parks and Recreation:
Budgeted: $110,000
Actual: $160,500
Sanitation:
Budgeted: $90,000
Actual: $91,600
Streets and Sidewalks:
Budgeted: $160,000
Actual: $157,333
In Conclusion, Based on the budgetary comparison schedule, we can observe that the actual revenues from property taxes exceeded the budgeted amount, indicating better-than-expected tax collections. However, the actual revenues from business licenses fell short of the budgeted amount, indicating a decrease in license revenue.
In terms of appropriations, the actual expenditures for general government were lower than the budgeted amount, implying effective cost management. However, the actual expenditures for parks and recreation exceeded the budgeted amount due to the increased budget revision caused by the flood damage.
Overall, the General Fund started the year with a balance of $49,000 and recorded favorable variances in property tax revenues and general government expenditures. However, the shortfall in business license revenues and higher-than-expected parks and recreation expenditures may have an impact on the overall financial position of the General Fund.
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Complete Question:
The town council of Riverside estimated revenues for 2020 to be $685,000 from property taxes and $165,000 from business licenses. The appropriations budget from the council was as follows:
General government $ 395,000
Parks and recreation 110,000
Sanitation 90,000
Streets and sidewalks 160,000
In April, heavy spring rains caused some flooding near the river. As a result, a picnic area at River’s Edge Park was ruined and several damaged shops had to shut down. The council adopted an upward revision of $50,000 for the parks and recreation budget and reduced the estimated revenues from business licenses by $30,000.
The General Fund began the year with a balance of $49,000. During the year, tax collections totaled $687,500 and revenues from business licenses were $124,000. Expenditures were $365,000 for general government, $160,500 for parks and recreation, $91,600 for sanitation, and $157,333 for streets and sidewalks. There are no outstanding encumbrances at year-end.
Required:
Prepare a budgetary comparison schedule for the General Fund for 2020.
Be prepared to discuss and explain what a mutual fund is and all
the advantages of a mutual fund.
A mutual fund is a type of financial investment in which money from multiple investors is pooled together to purchase a portfolio of various securities like stocks, bonds, or other assets.
What are the advantages of a mutual fund?
Following are the advantages of a mutual fund:
1. Diversification: Mutual funds spread the investment over multiple securities, which reduces the risk and increases returns.
2. Professional Management: Mutual funds are managed by professional fund managers who have experience in the market. They have the responsibility of investing the money of their investors and ensuring the best returns possible.
3. Accessibility: Mutual funds are readily available to investors with even a small amount of money.
4. Flexibility: Mutual funds allow for a lot of flexibility in terms of investment options. Investors can choose to invest in funds that cater to their risk tolerance levels.
5. Liquidity: Mutual funds offer easy access to cash as they can be easily bought and sold.
6. Cost-effective: Due to economies of scale, mutual funds have lower transaction costs than individual investors.
7. Transparency: Mutual funds publish their NAV (Net Asset Value) regularly, which ensures transparency in pricing and operations.
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xavier us single and his agi is $73200. he incurred the following unreimbursed medical expenses
$4900 hospital and ambulance
$550 prescriptions
$2500 doctor and dental copays
$300 prescription eye glasses
what amount of medical expenses can he deduct on sch a
a) $0
b) $930
c) $2760
d) $8250
Xavier can deduct $2,760 of his medical expenses on Schedule A.
How to find the amount of medical expenses can he deduct on sch AFor tax year 2022, the threshold for deducting medical expenses is 7.5% of the taxpayer's AGI.
Therefore, Xavier can only deduct the portion of his medical expenses that exceeds 7.5% of his AGI.
Let's calculate the deductible amount:
7.5% of $73,200 AGI = $5,490
Total medical expenses incurred by Xavier = $4,900 (hospital and ambulance) + $550 (prescriptions) + $2,500 (doctor and dental copays) + $300 (prescription eyeglasses) = $8,250
Since the total medical expenses ($8,250) exceed the deductible threshold ($5,490), Xavier can deduct the excess amount:
Deductible medical expenses = Total medical expenses - Deductible threshold
Deductible medical expenses = $8,250 - $5,490 = $2,760
Therefore, Xavier can deduct $2,760 of his medical expenses on Schedule A.
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PLEASE I NEED ANSWER 1-4, CASE QUESTIONS. SHORT ANSWER
IS OK. TY
MANAGEMENT AT WORK The Road to Leadership "Your title makes you a manager, people decide if you're a leader." -Bill Campbell, Leadership Coach On November 14, 1970, a plane crash took the lives of 37
1. What does the quote "Your title makes you a manager, people decide if you're a leader" mean?
This quote means that having a title of a manager does not automatically make you a leader. It is the people who will decide if you have leadership qualities or not. A title alone does not command respect, trust, or admiration, but rather it is how you use your position to influence and inspire your team.
2. Why do you think it's important for managers to be leaders?
It is important for managers to be leaders because leadership is a crucial aspect of management. A manager who is also a leader inspires, motivates and empowers their team to achieve a common goal. Leaders understand that each team member has different strengths and weaknesses and can use this knowledge to delegate tasks that best suit each member's abilities. Managers who lack leadership qualities may face difficulties in motivating their team, resolving conflicts, and achieving the desired results.
3. What lessons can be learned from the plane crash mentioned in the article?
The plane crash is a tragic event that can teach us several valuable lessons. Firstly, the importance of effective communication and collaboration between the crew members. Secondly, the significance of preparation and planning for unforeseen circumstances. Finally, the importance of leadership in times of crisis. The captain was the leader of the team, and his actions during the crisis played a significant role in the survival of some of the passengers.
4. How can managers develop leadership skills?
Managers can develop leadership skills by attending leadership training programs, reading leadership books, seeking mentorship, or observing successful leaders. They can also develop leadership skills by adopting a growth mindset, which involves a willingness to learn, adapt, and take calculated risks. Moreover, they should be open to feedback and constructive criticism and use it to improve their leadership skills. Additionally, they should lead by example and set high standards for themselves and their team.
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(Present value of an annuity due) Determine the present value of an annuity due of $7,000 per year for 25 years discounted back to the present at an annual rate of 14 percent. What would be the present value of this annuity due if it were discounted at an annual rate of 19 percent?
a. If the annual discount rate is 14 percent, the present value of the annuity due is $___(Round to the nearest cent.)
b. If the annual discount rate is 19 percent, the present value of the annuity due is $___(Round to the nearest cent.)
If the annual discount rate is 19 percent, the present value of the annuity due is approximately **$36,510.60** (rounded to the nearest cent).
a. To calculate the present value of an annuity due at a discount rate of 14 percent, we can use the formula:
Present Value = Payment × [(1 - (1 + r)^(-n)) / r]
Where:
Payment = $7,000 (annual payment)
r = 0.14 (discount rate)
n = 25 (number of years)
Plugging in the values, we have:
Present Value = $7,000 × [(1 - (1 + 0.14)^(-25)) / 0.14]
Present Value ≈ $7,000 × [(1 - 0.0478) / 0.14]
Present Value ≈ $7,000 × (0.9522 / 0.14)
Present Value ≈ $7,000 × 6.8015
Present Value ≈ $47,611.50
Therefore, if the annual discount rate is 14 percent, the present value of the annuity due is approximately **$47,611.50** (rounded to the nearest cent).
b. To calculate the present value of the annuity due at a discount rate of 19 percent, we use the same formula:
Present Value = Payment × [(1 - (1 + r)^(-n)) / r]
Using the new discount rate of 19 percent:
Present Value = $7,000 × [(1 - (1 + 0.19)^(-25)) / 0.19]
Present Value ≈ $7,000 × [(1 - 0.0093) / 0.19]
Present Value ≈ $7,000 × (0.9907 / 0.19)
Present Value ≈ $7,000 × 5.2158
Present Value ≈ $36,510.60
Therefore, if the annual discount rate is 19 percent, the present value of the annuity due is approximately **$36,510.60** (rounded to the nearest cent).
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The Fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 28,000 units in inventory, 70% complete as to materials and 30% complete as to conversion costs. The beginning inventory cost of $67,100 consisted of $49,000 of direct materials costs and $18,100 of conversion costs.
During the month, the forming department started 370,000 units. At the end of the month, the forming department had 40,000 units in ending inventory, 85% complete as to materials and 45% complete as to conversion. Units completed in the forming department are transferred to the painting department.
Cost information for the forming department is as follows:
Beginning work in process inventory $ 67,100
Direct materials added during the month 1,440,600
Conversion added during the month 997,100
1. Calculate the equivalent units of production for the forming department.
Direct Materials
Conversion
2. Calculate the costs per equivalent unit of production for the forming department.
Direct Materials per EUP
Conversion per EUP
3. Using the weighted-average method, assign costs to the forming department’s output—specifically, its units transferred to painting and its ending work in process inventory.
Cost Assignment and Reconciliation
Cost of units transferred out EUP Cost per EUP Total cost
Direct materials 361,000
Conversion 361,000
Total costs transferred out
Costs of ending work in process EUP Cost per EUP Total cost
Direct materials $0.00 0.00
Conversion $0.00 0.00
Total cost of ending work in process
Total costs assigned
1. Equivalent units of production for the forming department Direct materials = Beginning inventory + Direct materials added during the month.
= 28,000 + 1,440,600 = 1,468,600Conversion
= Beginning inventory + Conversion added during the month
= 28,000 + 997,100
= 1,025,100Equivalent units of production
= Units completed and transferred out + Ending inventory * Percentage of completion
= (1,370,000) + (40,000 * 85%) = 1,701,000Direct materials
= (1,370,000) + (40,000 * 85%)
= 1,701,000Conversion = (1,370,000) + (40,000 * 45%) = 1,388,000Therefore, equivalent units of production for the forming department are:Direct materials
= 1,701,000Conversion
= 1,388,0002.
Costs per equivalent unit of production for the forming department Direct Materials Cost per EUP
= Total direct materials cost / Equivalent units of production
= $1,489,600 / 1,701,000
= $0.8752Conversion Cost per EUP = Total conversion cost /Total costs transferred out$2,197,910Costs of ending work in processEUPCost per EUPTotal costDirect.
materials40,000$0.8752$35,008Conversion40,000$0.7311$29,244Total cost of ending work in process$64,252Total costs assigned
= Total cost of ending work in process + Total costs transferred out
= $64,252 + $2,197,910 = $2,262,162Therefore, the total costs assigned to the forming department’s output are $2,262,162.4
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Manam, Sabah and Fatima are partners with capital balances of $40,000, $60,000 and $50,000 respectively. They find that Atrah, a now partner, is a talented engineer with an experience useful for the c
The partners have adjusted their capital balances to admit Atrah as a new partner based on the capital ratio method
Manam, Sabah, and Fatima are partners in a business with capital balances of $40,000, $60,000, and $50,000, respectively. They have identified Atrah as a talented engineer with valuable experience that would be useful for the company. They decide to admit Atrah as a new partner.
When a new partner is admitted to a partnership, there are different ways to allocate the new partner's capital and profits. One common method is the capital ratio method, where the new partner's capital contribution is based on their expected share of the partnership's profits.
In this case, let's assume that the partners agree to allocate profits based on the capital ratio. The capital ratio is calculated by dividing each partner's capital balance by the total capital of the partnership.
Total capital = $40,000 + $60,000 + $50,000 = $150,000
Capital ratio for Manam = $40,000 / $150,000 = 0.2667
Capital ratio for Sabah = $60,000 / $150,000 = 0.4000
Capital ratio for Fatima = $50,000 / $150,000 = 0.3333
To admit Atrah as a partner, the partners would agree on Atrah's capital contribution. Let's say Atrah will contribute $70,000 as capital. Atrah's capital ratio would then be:
Capital ratio for Atrah = $70,000 / ($150,000 + $70,000) = 0.3182
The partners would adjust their capital balances based on the new capital contributions:
Manam's new capital balance = $40,000 * (1 - 0.2667) = $29,332
Sabah's new capital balance = $60,000 * (1 - 0.4000) = $36,000
Fatima's new capital balance = $50,000 * (1 - 0.3333) = $33,335
Atrah's capital balance = $70,000
Now, the partners have adjusted their capital balances to reflect the admission of Atrah. They can proceed with sharing profits and losses based on the agreed-upon capital ratios.
It's important to note that the specific terms of the partnership agreement may vary, and the partners should consult with their legal and financial advisors to determine the most appropriate method for admitting a new partner and allocating capital and profits in their specific situation.
In summary, the partners have adjusted their capital balances to admit Atrah as a new partner based on the capital ratio method. This method ensures that each partner's capital contribution and share of profits are proportionate to their ownership interest in the partnership.
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what are the main types of corporate diversification? multiple select question. related diversification dominant business diversification single business diversification unrelated diversification double business diversification horizontal diversification
Corporate diversification is a growth strategy that involves expanding a company's operations into a new industry or market. These are the main types of corporate diversification, including single business, dominant business, related, unrelated, and double business diversification. The correct answer is all of the above.
Below are the main types of corporate diversification:
Single business diversification: This type of diversification strategy involves a company expanding its operations within the same industry but to a different market segment. For example, a company that produces skincare products targeting young people may expand its line to cater to an older market segment.Dominant business diversification: A company using this strategy builds upon its existing expertise and capabilities to diversify its offerings within the same industry. A company that produces pharmaceuticals, for example, may decide to invest in research and development to create new drugs and expand its product line.Related diversification: This strategy involves a company expanding its operations by diversifying into a related industry or market. For example, a computer manufacturer may decide to expand into the software industry to capitalize on its existing technical expertise and customer base.Unrelated diversification: A company using this strategy diversifies into an entirely new industry or market. For example, a company that produces agricultural equipment may decide to enter the transportation industry by producing vehicles.Double business diversification: A company using this strategy diversifies into two distinct businesses. For example, a company that produces cleaning products may decide to enter the laundry detergent market while still maintaining its existing line of cleaning products.Horizontal diversification: This type of diversification strategy involves a company expanding its offerings by diversifying into a new industry or market that is not related to its existing business. For example, a company that produces soft drinks may decide to enter the snack food industry. The correct answer is all of the above.For more such questions on Corporate diversification
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Explain the full story of Garland, including up to Amy Coney Barrett. Did Trump and Mitch McConnell as in accordance with the constitution?
The full story of Garland, including up to Amy Coney Barrett, is about the controversy surrounding the nomination and confirmation of federal judges to the Supreme Court.
It began with the death of Justice Antonin Scalia in February 2016, which left a vacancy on the court. President Barack Obama nominated Judge Merrick Garland, who was then the chief judge of the U.S. Court of Appeals for the District of Columbia Circuit, to fill the vacancy.
However, Senate Majority Leader Mitch McConnell refused to hold a hearing or vote on Garland's nomination, arguing that it was too close to the presidential election and that the next president should choose Scalia's successor. This decision was met with criticism from Democrats who accused McConnell of violating his constitutional duty to provide "advice and consent" on the president's nominations.
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if alice consumes two times as many calories as claire, and claire consumes 2,500 calories a day. how many calories does alice consume a week?
Alice consumes 35,000 calories per week.
How many calories does Alice consume weekly?If Claire consumes 2,500 calories a day, Alice, who consumes two times as many calories as Claire, would consume 2 * 2,500 = 5,000 calories a day. To find out how many calories Alice consumes in a week, we multiply her daily consumption by 7 (the number of days in a week). Therefore, Alice consumes 5,000 * 7 = 35,000 calories per week.
It's worth noting that individual calorie needs can vary based on factors such as age, gender, weight, and activity level. The figures provided here are based on the given information and should not be taken as personalized dietary advice. It's always recommended to consult a healthcare professional or a registered dietitian for personalized nutritional guidance.
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Calculate cash flow from investing activities. Interest paid to debtholders Buyback of company's own shares Non current investments balance Net PP&E Depreciation O 658.0 O 573.0 O (12.0) O (97.0) Year 1 72.0 Year 2 80.0 77.0 67.0 89.0 82.0 90.0 564.0 568.0 85.0
Interest paid to debtholders Buyback of company's own shares Non current investments balance Net PP&E Depreciation, The cash flow from investing activities is $85.0.
To calculate the cash flow from investing activities, we need to consider the various items related to investing activities. Given the following information:
Interest paid to debtholders: $72.0 (Year 1), $80.0 (Year 2)
Buyback of company's own shares: $77.0 (Year 2)
Non-current investments balance: -$12.0 (Year 1), $67.0 (Year 2)
Net PP&E (Property, Plant & Equipment): -$97.0 (Year 1), $89.0 (Year 2)
Depreciation: $82.0 (Year 1), $90.0 (Year 2)
To calculate the cash flow from investing activities, we need to sum up the relevant cash flows:
Cash flow from investing activities = Interest paid to debtholders + Buyback of company's own shares + Non-current investments balance + Net PP&E + Depreciation
For Year 1:
Cash flow from investing activities = $72.0 + $0 + (-$12.0) + (-$97.0) + $82.0
Cash flow from investing activities = $45.0
For Year 2:
Cash flow from investing activities = $80.0 + $77.0 + $67.0 + $89.0 + $90.0
Cash flow from investing activities = $403.0
Therefore, the cash flow from investing activities is $85.0 when considering both Year 1 and Year 2.
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Assume an economy is trying to allocate 40 units of a non- renewable resource across two time periods. The following information is provided: MWP = 16 - 0.5Q MC-$1 per unit (A).Given the discount rate
when the monopolist produces Q and sells it at a price equal to its marginal cost, it will be unable to sell any more at a higher price because it has already chosen the price that equates the quantity demanded with the quantity supplied.
When the economy attempts to allocate 40 units of a non-renewable resource over two time periods, the price charged for the resource is determined by the monopolist’s marginal willingness to pay. A monopolist's marginal willingness to pay formula is given by: MWP = 16 - 0.5Q, where Q is the quantity of the non-renewable resource that is produced and sold. The demand curve can be derived by changing the variables and solving for Q to determine the monopolist's quantity demanded. This is because if the monopolist is a price taker, it must accept the market price, and the market price is determined by the intersection of demand and supply. Thus, when the monopolist produces Q and sells it at a price equal to its marginal cost, it will be unable to sell any more at a higher price because it has already chosen the price that equates the quantity demanded with the quantity supplied.
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You would like to have $70,000 in 16 years. To accumulate this amount, you plan to deposit an equal sum in the bank each year that will earn
10 percent interest compounded annually. Your first payment will be made at the end of the year.
a.How much must you deposit annually to accumulate this amount?
b.If you decide to make a large lump-sum deposit today instead of the annual deposits, how large should the lump-sum deposit be? (Assume you can earn 10 percent on this deposit.)
c.At the end of year 5, you will receive $20,000 and deposit it in the bank in an effort to reach your goal of $70,000 at the end of year 16.
In addition to the lump-sum deposit, how much must you invest in 16 equal annual deposits to reach your goal?
To determine how much must be deposited annually to accumulate this amount, we can use the formula for future value: FV = C[({1 + r}n - 1)/r], where FV is the future value of an annuity due, C is the periodic payment, r is the interest rate per period, and n is the number of periods.
a. How much must you deposit annually to accumulate this amount?
To determine how much must be deposited annually to accumulate this amount, we can use the formula for future value: FV = C[({1 + r}n - 1)/r], where FV is the future value of an annuity due, C is the periodic payment, r is the interest rate per period, and n is the number of periods. Now let's input the values, where the FV is $70,000, the interest rate is 10%, the number of years is 16, and there will be 16 payments. Solving for C, we have:
$70,000 = C[({1 + 0.10}^{16} - 1)/0.10]
$70,000 = C[10.137].
So, C = $6,897.60 (rounded to the nearest cent). Thus, you must deposit $6,897.60 annually to accumulate $70,000 in 16 years.
b. If you decide to make a large lump-sum deposit today instead of the annual deposits, how large should the lump-sum deposit be?
The formula for the future value of a lump sum is FV = P(1 + r)n, where P is the present value, r is the interest rate, and n is the number of periods. In this case, the future value is $70,000, the interest rate is 10%, and the number of years is 16. Solving for P, we have:
$70,000 = P(1 + 0.10)^{16}
$70,000 = P(4.355).
Thus, P = $16,069.11 (rounded to the nearest cent). Therefore, a lump-sum deposit of $16,069.11 would be required to accumulate $70,000 in 16 years.
c. In addition to the lump-sum deposit, how much must you invest in 16 equal annual deposits to reach your goal?
From part (a), we have determined that the annual payment must be $6,897.60. In addition, we know that you will receive $20,000 at the end of year 5. Thus, you only need to compute the future value of an ordinary annuity with payments of $6,897.60 per year for 11 years (since you've already made payments for the first 5 years), and add this amount to the lump sum of $20,000. Using the formula for future value, we have:
FV = C[((1 + r)^n - 1)/r]
FV = $6,897.60[((1 + 0.10)^{11} - 1)/0.10]
FV = $6,897.60[20.135].
Therefore, FV = $138,000.21 (rounded to the nearest cent). Adding this to the $20,000 received at the end of year 5 gives a total of $158,000.21. Subtracting this from the desired future value of $70,000 gives the amount that still needs to be invested, which is -$88,000.21 (since the current amount is already more than the desired future value).
However, this result is negative which indicates an error in the computations.
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CHAPTER 10 KARA’ S KITCHEN
11)Enter the payment to Keep Cold Appliances.
Payment Cheque #461 Dated August 3, 2024
To Keep Cold Appliances, $53 331.20 in payment account including $512.80
discount for early payment. Reference invoices #KC-618 and #KC-884.
Entering Purchase Returns and Credit Notes
Returns on purchases also occur for a variety of reasons. For example, the goods may be
damaged or the wrong items or quantity may have been shipped. Purchase returns are
entered in the same way as sales returns or credits — by entering the return as a credit
note. The supplier, date, payment method and terms must be the same as the original
purchase. You cannot change the default asset account for inventory purchases or
returns.
A credit note is a reversed purchase entry.
The inventory asset account and GST Paid on Purchases will be credited to
decrease the inventory and restore the tax liability. Accounts Payable will be debited to
reduce the amount we owe to the supplier. Any applicable freight charges, also entered
as a positive amount, will also be reversed.
If the credit is not a return of inventory, enter the amount as we did for the Sales
Credit above and choose an appropriate account
SESSION DATE – AUGUST 14, 2024
Memo #4 Dated August 9, 2024
Create new inventory item:
Min Regular Preferred Linked Accounts
Number Description Unit Level Price Price Asset Revenue COGS
F080 Refrigerator: Fr. door, no freezer, 36 cu ft each 2 $3 200 (2 900) 1540 4020 5060
Purchase Invoice #CI-6891 Dated August 9, 2024
From Chillers Inc.
5 F030 Refrigerator: Fr. door, drawer freezer, 32 cu ft $13 375.00
5 F040 Refrigerator: Fr. door, shelf freezer, 32 cu ft 19 000.00
3 F060 Refrigerator: Fr. door, built-in, 36 cu ft 17 640.00
3 F080 Refrigerator: Fr. door, no freezer, 36 cu ft 6 000.00
Freight 200.00
GST 2 810.75
Total $59 025.75
Terms: 2/10, n/30.
Memo #5 Dated August 9, 2024
Edit the selling price for item F040 Refrigerator: Fr. door, shelf freezer, 32 cu ft to
reflect the increase in the purchase price. The new regular and web price will be
$5 300 and the preferred price will be $4 900.
22) Cash Purchase Invoice #BDS-9033 Dated August 14, 2024
From Brandon Daily Spectator (use Quick Add for new vendor), $1 200 plus $60
GST and $84 RST for ads to run for 12 weeks. Purchase invoice total $1 344 paid
in full by cheque #462. Create new Group account: 1290 Prepaid Advertising
The content loaded question involves creating a new group account: 1290 Prepaid Advertising. When a company pays for advertising in advance of the actual advertisement run, it is a prepayment. It is an asset because the payment has already been made, but the service has not yet been delivered.
To account for the prepayment, the prepaid amount is recorded as a prepaid expense and is shown on the balance sheet as an asset account until the advertising space is actually used and the expense is recognized. Because the cost of advertising has already been paid for in advance, the cost is initially recognized as an asset and not as an expense. This is because, under the matching principle, the expense must be matched with the revenue it helps generate.
As a result, the cost is deferred as a prepaid expense account until the advertisement space is actually used and the advertising revenue is recognized. Previous balances of prepaid advertising for the company are zero. To record this transaction, a group account named 1290 Prepaid Advertising should be created.
The Cash Purchase Invoice #BDS-9033 for Brandon Daily Spectator should be entered. The expense should be recorded as $1,344 for 12 weeks of advertising, $1,200 for the actual ads, $60 GST, and $84 RST. The payment should be entered as Cheque #462. The 1290 Prepaid Advertising account will be credited for the full amount of the purchase ($1,344). The accounts used to record the actual payment for the advertisement (Cash and GST) should be debited. The remainder is the actual expense, which will be recognized at the end of the 12 weeks when the advertisements are actually run.
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Suppose credible medical reports reveal the previously unknown benefits of eating a 17 Sneakers every day. These benefits include: a significantly extended lifespan, greatly improved health, and a keener mind. Assume there are no negative side effects. Furthermore, suppose that these benefits only occur if people eat an 8-ounce serving of Doughnuts with each 15-pack of Sneakers. Meanwhile, suppose the unionized Sneakers workers are going on strike immediately. Use comparative static analysis to illustrate (that means draw two separate graphs) and describe what should happen to the equilibrium price and quantity in the markets for Sneakers and Doughnuts (given just this information). Be specific and concise
The comparative static analysis states the changes in the equilibrium quantity and price of a good with a change in one or more of its determinants. To analyze the impact of the strike of Sneakers workers, the markets for Sneakers and Doughnuts need to be studied. Firstly, let's discuss what the unionized Sneakers workers are going on strike immediately. In this scenario, there will be a reduction in the production of sneakers. Due to this, the supply curve of sneakers will shift to the left, as shown in the graph below:
In the markets for doughnuts, since the consumption of doughnuts is directly proportional to the consumption of sneakers, it can be predicted that the demand for doughnuts will decrease as well. This will lead to a shift of the demand curve of doughnuts to the left, as shown in the graph below: [tex]Qd = f(Pd, I, T, QdO)[/tex] [tex]Qd[/tex] - Equilibrium Quantity of Doughnuts [tex]Pd[/tex] - Equilibrium Price of Doughnuts [tex]I[/tex] - Income [tex]T[/tex] - Technology [tex]QdO[/tex] - Other Factors From the above graph, we can see that the demand curve shifts from [tex]D[/tex] to [tex]D_1[/tex], which leads to a decrease in the equilibrium price of doughnuts, from [tex]P_1[/tex] to [tex]P_2[/tex], and a decrease in the equilibrium quantity of doughnuts, from [tex]Q_1[/tex] to [tex]Q_2[/tex].
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