The component that would NOT constitute a component of a company's go-to-market system is competition analysis.
A company's go-to-market (GTM) system refers to a set of tactics and strategies utilized by businesses to reach their target market and grow their sales. In order to reach their target market, the GTM system uses a number of components, which includes the following:
Sales-force compensation system: Sales-force compensation system is one of the most crucial components of a company's go-to-market strategy. It refers to the manner in which the company remunerates its sales team members for their work. Sales force compensation strategies are intended to motivate sales representatives to perform well by offering financial incentives such as bonuses and commissions for meeting or exceeding sales goals.
Sales-force recruiting strategy and process: A company's salesforce recruiting strategy and process are two key elements of its go-to-market strategy. The company seeks to hire salespeople who have the necessary skills, experience, and characteristics that match the company's objectives and goals.
Sales force performance reviews: This component of the go-to-market strategy includes assessing the performance of sales representatives and giving them feedback. It's critical for maintaining high-quality performance and provides valuable information for sales training and development.However, competition analysis would NOT constitute a component of a company's go-to-market system. This is because competition analysis is a strategic tool that examines the company's industry, competition, and market position. It provides information about the competition's strengths and weaknesses, allowing a company to develop its strategies based on the analysis of its competitors. Although it is a vital tool, it is not a component of a company's go-to-market system.
Learn more about go-to-market (GTM) here:
https://brainly.com/question/31434530
#SPJ11
"No delegation of performance relieves the party delegating of any duty to perform or any liability for breach," according to:
the Uniform Commercial Code (UCC).
the 2 nd Amendment to the U.S. Constitution.
the Personal-Service Contract Rule.
Article I of the U.S. Constitution.
"No delegation of performance relieves the party delegating of any duty to perform or any liability for breach" is according to the Uniform Commercial Code (UCC).
The statement provided is a principle stated in the Uniform Commercial Code (UCC), which is a set of laws governing commercial transactions in the United States. The UCC provides regulations and guidelines for various aspects of business dealings, including contracts, sales, and secured transactions.
The specific principle mentioned in the statement emphasizes that delegating the performance of a contractual obligation does not absolve the party delegating the duty from their own responsibility to perform or from any liability for breaching the terms of the contract. In other words, even if one party assigns or delegates their obligations to another party, they remain responsible for fulfilling their duties and can still be held accountable for any failure to meet their contractual obligations.
This principle helps maintain the integrity of contracts and ensures that parties cannot escape their contractual duties by simply delegating them to someone else. It reinforces the notion that parties are bound by the terms of their agreements and must fulfill their obligations or face potential legal consequences for breaching the contract.
To learn more about Uniform Commercial Code (UCC), here
https://brainly.com/question/20235251
#SPJ4
Black Company's sales are $600,000, its fixed expenses are $150,000, and its variable expenses are 60% of sales. Based on this information, the margin of safety is: A) $90,000 B) $190,000 C) $225,000 D) $240,000 Answer: C Level: Medium LO: 3,5,7
The margin of safety for Black Company is $225,000. The correct option is C.
Margin of safety is the difference between the level of sales at which the company will break even and the actual or budgeted sales level. It is the amount of revenue that exceeds the breakeven point and serves as a buffer or cushion to cover any unforeseen expenses or drops in sales.
Based on the given data, the Black Company's sales are $600,000, its fixed expenses are $150,000, and its variable expenses are 60% of sales. Therefore, the variable cost is 0.60 * 600,000 = $360,000.
We can find the contribution margin, which is the amount of money available to pay for fixed costs and contribute to net income, by using the following formula:
Contribution Margin = Sales - Variable Costs
Contribution Margin = $600,000 - $360,000 = $240,000
Margin of Safety = Actual Sales - Break Even Sales
We can now use the formula to find the margin of safety:
Break Even Sales = Fixed Costs / Contribution Margin
Break Even Sales = $150,000 / $240,000 = 0.625
Actual Sales = $600,000
Margin of Safety = $600,000 - $150,000 / $240,000 = $2.25
Margin of Safety = $225,000
Therefore, the margin of safety is option C) $225,000.
To know more about margin of safety, refer to the link below:
https://brainly.com/question/31649955#
#SPJ11
What order management activities does zappos represent?
Answer:
Explanation:
Zappos, an online retailer specializing in shoes and clothing, represents various order management activities. These activities ensure the efficient processing and fulfillment of customer orders. Here are some order management activities that Zappos typically performs:
1. Order Placement: Zappos provides an online platform where customers can browse and select products. Customers place their orders by adding items to their shopping carts and proceeding to checkout.
2. Order Processing: Once an order is placed, Zappos initiates the order processing activities. This involves verifying the availability of the products, checking the customer's shipping address, and confirming payment details.
3. Inventory Management: Zappos maintains a well-managed inventory system to track the availability of products. When an order is received, the inventory is checked to ensure that the ordered items are in stock. If a product is out of stock, Zappos may provide alternatives or inform the customer about the expected restock date.
4. Order Fulfillment: After order verification and inventory check, Zappos prepares the ordered items for shipment. This involves picking the products from the warehouse shelves, packaging them securely, and labeling the packages with the necessary shipping information.
5. Shipping and Delivery: Zappos collaborates with shipping carriers to ensure the timely and accurate delivery of orders to customers. They generate shipping labels, track packages, and provide customers with shipping updates and tracking information.
6. Order Tracking and Customer Support: Zappos offers order tracking services, allowing customers to monitor the progress of their shipments. Additionally, they provide customer support services to address any inquiries, concerns, or issues related to orders, such as order modifications, returns, or exchanges.
7. Order Returns and Exchanges: Zappos has a customer-friendly return policy, allowing customers to return or exchange products within a specified timeframe. They facilitate the returns/exchanges process, including issuing return labels, processing refunds or exchanges, and managing any necessary inventory adjustments.
8. Order Payment and Billing: Zappos securely processes customer payments using various payment methods, such as credit cards or online payment platforms. They generate invoices or receipts for orders and provide customers with billing information as needed.
These order management activities collectively contribute to Zappos' commitment to providing a seamless and positive customer experience throughout the order lifecycle
Learn more about order management:
brainly.com/question/32161973
#SPJ11
The discount rate in year 1 is 3.5%, in year 2 it is 4.0%, and in year 3 it is 4.5%.
What is the appropriate price of a 3-year Treasury bond with a coupon rate of 5% and a face value of $1000? (Assume that the bond makes annual coupon payments.)
What is the expected price of the same 3-year Treasury bond in year 2, immediately after the bond makes its coupon payment in year 2?
1) The appropriate price of the 3-year Treasury bond with a coupon rate of 5% and a face value of $1000 is $1053.33.
2) The expected price of the same 3-year Treasury bond in year 2, immediately after the bond makes its coupon payment in year 2, is $1004.79.
To determine the appropriate price of a 3-year Treasury bond with a coupon rate of 5% and a face value of $1000, we need to calculate the present value of the bond's future cash flows. The cash flows consist of annual coupon payments and the final face value payment.
1) Calculate the present value of coupon payments:
Year 1: $1000 × 5%
= $50 (coupon payment)
Discount rate: 3.5%
Present value of Year 1 coupon payment = $50 / (1 + 0.035)
= $48.54
Year 2: $1000 × 5%
= $50 (coupon payment)
Discount rate: 4.0%
Present value of Year 2 coupon payment = $50 / (1 + 0.04)
= $48.08
Year 3: $1000 × 5%
= $50 (coupon payment)
Discount rate: 4.5%
Present value of Year 3 coupon payment = $50 / (1 + 0.045)
= $47.62
Calculate the present value of the face value payment:
Year 3: $1000 (face value payment)
Discount rate: 4.5%
Present value of Year 3 face value payment = $1000 / (1 + 0.045)
= $909.09
Calculate the total present value of cash flows:
Total present value = Present value of Year 1 coupon payment + Present value of Year 2 coupon payment + Present value of Year 3 coupon payment + Present value of Year 3 face value payment
Total present value = $48.54 + $48.08 + $47.62 + $909.09
= $1053.33
Therefore, the appropriate price of the 3-year Treasury bond with a coupon rate of 5% and a face value of $1000 is $1053.33.
2) To calculate the expected price of the same bond in year 2, immediately after the bond makes its coupon payment in year 2, we only need to consider the remaining coupon payments and the face value payment.
Year 2: $1000 × 5%
= $50 (coupon payment)
Discount rate: 4.0%
Present value of Year 2 coupon payment = $50 / (1 + 0.04)
= $48.08
Year 3: $1000 × 5%
= $50 (coupon payment)
Discount rate: 4.5%
Present value of Year 3 coupon payment = $50 / (1 + 0.045)
= $47.62
Year 3: $1000 (face value payment)
Discount rate: 4.5%
Present value of Year 3 face value payment = $1000 / (1 + 0.045)
= $909.09
Total present value = Present value of Year 2 coupon payment + Present value of Year 3 coupon payment + Present value of Year 3 face value payment
Total present value = $48.08 + $47.62 + $909.09
= $1004.79
Therefore, the expected price of the same 3-year Treasury bond in year 2, immediately after the bond makes its coupon payment in year 2, is $1004.79.
Learn more about Treasury Bond from the given link:
https://brainly.com/question/32014896
#SPJ11
Consider the demand for mountain bikes. Which of the following events below could shift the demand curve (either left or right)? Check all that apply. The price of street bikes (a substitute) rises The price of mountain bikes rises It is winter, and most mountain bike trails are closed A global pandemic has forced people to stay home and people are looking for new hobbies and ways to exercise The city has just completed adding miles and miles of fun, new bike trails
The events that could shift the demand curve for mountain bikes are:
The price of street bikes (a substitute) rises
A global pandemic has forced people to stay home and people are looking for new hobbies and ways to exercise
The city has just completed adding miles and miles of fun, new bike trails.
The demand for mountain bikes can be influenced by various factors. One such factor is the price of street bikes, which are considered substitutes for mountain bikes. If the price of street bikes rises, consumers may be more inclined to purchase mountain bikes instead, leading to an increase in the demand for mountain bikes and a rightward shift in the demand curve.
Another event that can affect the demand for mountain bikes is a global pandemic. During times when people are forced to stay home and are looking for new hobbies and ways to exercise, the demand for outdoor activities like mountain biking tends to rise. People may see mountain biking as a suitable option for staying active while adhering to social distancing measures. Consequently, the demand for mountain bikes increases, causing the demand curve to shift to the right.
Additionally, the expansion of bike trails by the city can have a positive impact on the demand for mountain bikes. When new bike trails are added, it can attract more individuals to engage in biking activities, including mountain biking. The availability of extensive and enjoyable bike trails can encourage people to purchase mountain bikes, leading to an increase in demand and a rightward shift in the demand curve.
On the other hand, the price of mountain bikes rising alone is not likely to shift the demand curve. It may result in a decrease in quantity demanded, but the actual demand curve would not shift as it represents the relationship between price and quantity demanded, not changes in price alone. Additionally, the closure of mountain bike trails during winter may affect the quantity demanded temporarily, but it would not shift the overall demand curve for mountain bikes.
Learn more about demand curve here:
brainly.com/question/13131242
#SPJ11
Suppose there is an increase in income and an increase in the costs of production. What will be the effect on the equilibrium price and quantity?
a) Both the price and the quantity will increase.
b) The quantity will increase but the change in price is ambiguous.
c) The price will rise but the change in quantity is ambiguous.
d) The price will fall and the change in quantity will increase.
If there is an increase in income and an increase in the costs of production, the effect on the equilibrium price and quantity will depend on the relative magnitude of these changes. However, generally speaking, the most likely outcome is that the price will rise, but the change in quantity is ambiguous.
When income increases, consumers have more purchasing power, which can lead to an increased demand for goods and services. This increased demand can put upward pressure on prices, leading to a rise in the equilibrium price. On the other hand, an increase in the costs of production can lead to higher expenses for producers, which may result in reduced supply or higher prices to maintain profitability.
The net effect on the equilibrium price and quantity will depend on the relative magnitude of these changes. If the increase in income is substantial and the increase in production costs is relatively small, the rise in demand may outweigh the impact of higher costs, resulting in both a higher price and a higher quantity being produced and sold (option a). However, if the increase in production costs is significant compared to the increase in income, the rise in prices may offset the increase in demand, leading to a smaller change in quantity or even a decrease (option c).
In summary, while the price is likely to rise due to increased income and costs of production, the change in quantity is ambiguous and depends on the relative magnitude of these changes.
Learn more about purchasing power here: brainly.com/question/29428111
#SPJ11
By investing in alternatives that are higher on the investment pyramid, one is exposed to _ risk to his or her capital and risk of loss. Increasing; decreasing
By investing in alternatives that are higher on the investment pyramid, one is exposed to increasing risk to his or her capital and decreasing risk of loss of purchasing power.
Investing in alternatives that are higher on the investment pyramid typically involves taking on greater risk to one's capital while simultaneously reducing the risk of loss of purchasing power.
Higher-risk investments, such as stocks, private equity, or venture capital, have the potential for higher returns but also carry a greater risk of capital loss. These investments are more volatile and subject to market fluctuations, economic conditions, and business performance.
On the other hand, lower-risk investments, such as government bonds, treasury bills, or high-quality fixed-income securities, tend to provide a more stable and predictable income stream. These investments offer a lower risk of loss of purchasing power since they are less affected by inflation and economic uncertainties.
By diversifying their portfolio and allocating a portion of their investments to higher-risk options, individuals may seek higher returns. However, they should be aware that the risk of losing capital increases as well. Meanwhile, by including lower-risk investments, individuals can mitigate the risk of loss of purchasing power over time.
The balance between risk and return is a personal decision, and investors should carefully consider their risk tolerance, investment goals, and time horizon when selecting investments from different levels of the investment pyramid.
Complete question:
By investing in alternatives that are higher on the investment pyramid, one is exposed to _____________ risk to his or her capital and ___________ risk of loss of purchasing power. Increasing; decreasing
Learn more about Risk tolerance: https://brainly.com/question/29316675
#SPJ11
ANSWER ANY ONE QUESTION QUESTION 1 1. In a closed economy that has a government sector a. prove that S +T=I+G (2 marks) 2. Assume that Northern Ville is a two-sector economy with no intervention from
1. The government's net contribution to saving is equal to [tex]S_{Government}[/tex], the equation can be rewritten as:
[tex]S + T = Y + S_{Government}[/tex]
2.
(i) The equilibrium level of output for this hypothetical economy is $2,200.
(ii) If the economy were operating at 2,400, the levels of consumption and savings would be $1,950 and $450, respectively.
1. In a closed economy with a government sector, the national income (Y) can be divided into four components: consumption (C), investment (I), government spending (G), and taxes (T). The national saving (S) is the portion of national income that is not consumed and is given by:
S = Y - C
Now, let's consider the government sector. The government collects taxes (T) from the private sector, and it also spends on goods and services (G). Therefore, the government's net contribution to saving is given by:
[tex]S_{Government} = T - G[/tex]
In the closed economy, national saving (S) is equal to private saving [tex](S_{Private})[/tex] plus the government's net contribution to saving [tex](S_{Government})[/tex]:
[tex]S = S_{Private} + S_{Government}[/tex]
Since private saving is equal to national income (Y) minus consumption (C):
[tex]S_{Private} = Y - C[/tex]
Substituting the values, we have:
S = Y - C + (T - G)
Now, rearranging the equation, we get:
S + T = Y - C + T - G
Simplifying further:
S + T = Y + T - (C + G)
We know that total taxes collected (T) minus government spending (G) gives us the government's net contribution to saving [tex](S_{Government})[/tex]:
[tex]T - G = S_{Government}[/tex]
Therefore, the equation becomes:
[tex]S + T = Y + S_{Government}[/tex]
Since the government's net contribution to saving is equal to [tex]S_{Government}[/tex], the equation can be rewritten as:
[tex]S + T = Y + S_{Government}[/tex]
This equation shows that the total saving (S) plus taxes (T) in the closed economy is equal to the total income (Y) plus the government's net contribution to saving. Hence, the equation [tex]S + T = Y + S_{Government}[/tex] can be written as S + T = I + G, where investment (I) equals [tex]S_{Government}[/tex].
2. Given the equations:
C = $150 + 0.75Y (Consumption function)
I = $400 (Investment)
i. To calculate the equilibrium level of output, we set Y equal to the sum of consumption (C) and investment (I) and solve for Y:
Y = C + I
Y = ($150 + 0.75Y) + $400
To solve for Y, we can rearrange the equation:
Y - 0.75Y = $150 + $400
0.25Y = $550
Y = $550 / 0.25
Y = $2,200
Therefore, the equilibrium level of output for this hypothetical economy is $2,200.
ii. If the economy were operating at 2,400, we can find the levels of consumption and savings by substituting Y = 2,400 into the consumption function:
C = $150 + 0.75Y
C = $150 + 0.75(2,400)
C = $150 + $1,800
C = $1,950
To find the level of savings, we subtract consumption (C) from income (Y):
S = Y - C
S = 2,400 - 1,950
S = $450
Therefore, if the economy were operating at 2,400, the levels of consumption and savings would be $1,950 and $450, respectively.
Learn more about equilibrium level of output here:
https://brainly.com/question/31454424
#SPJ4
Your question is incomplete; most probably, your complete question is this:
1. In a closed economy that has a government sector
a. prove that S+T=I+G
2. Assume that Northern Ville is a two-sector economy with no intervention from the Government.
If C $150+0.75Y and I = $400.
i. Calculate the equilibrium level of output for this hypothetical economy.
ii. if the economy were operating at 2400, what would be the levels of consumption and savings?
Please describe the effective rate of return? What are the effective rates of return on a 5% annual rate of return if compounded daily, weekly, monthly and, annually. Would you prefer more frequent compounding or less if you are lending money and why?
The effective rate of return is the total interest earned on an investment, taking into account compounding. For a 5% annual rate of return, the effective rates of return would be approximately 5.13% when compounded daily, 5.09% when compounded weekly, 5.06% when compounded monthly, and 5% when compounded annually.
In terms of choosing between more frequent or less frequent compounding when lending money, it depends on the specific situation and preferences. More frequent compounding, such as daily or weekly, can result in slightly higher effective rates of return. This is because interest is being added to the principal more frequently, allowing for faster growth of the investment.
However, more frequent compounding may also require more administrative effort and bookkeeping. If the lending process involves additional costs or complexity for each compounding period, it might be more practical to opt for less frequent compounding, such as monthly or annually.
Ultimately, the decision should consider factors such as the overall loan terms, administrative efficiency, and the borrower's ability to make payments at the chosen compounding frequency.
Learn more about investment here: brainly.com/question/15105766
#SPJ11
2. Passwords and firewalls are used to ensure the security of highly confidential information that is not for external users. A) True B) False 3. The production and sale plans for business may be liming by a limiting factor or Scarce resources. That could be due to limits of: A) Materials B) Machine hours C) A and B 4. The increase in value would be created by having available one additional unit of a limiting resource at the original cost is: A) Demand price B) Shadow price C) None of the above 5. The following statements have been made about rolling budgeting: 1) Keep updating the budgeting by adding further an accounting period when the earlier has expired. 2) The variants of the budget are not adjusted to reflect actual levels. Which of the above statements is/are true? A) Only 1 B) 1 and 2 C) None of the above
2. The answer to the statement "Passwords and firewalls are used to ensure the security of highly confidential information that is not for external users." is True.
The main purpose of using passwords and firewalls is to maintain the security of confidential information and to prevent external users from accessing it. Passwords are frequently used to authenticate the user accessing the information. Firewalls, on the other hand, are a network security system that monitors and filters network traffic depending on a set of rules.
3. The answer to the question, "The production and sale plans for business may be limited by a limiting factor or scarce resources.
That could be due to the limits of which of the following materials, machine hours, or both?" is C) A and B. Both materials and machine hours are limiting factors that could limit the production and sale plans for a business.
4. The answer to the question "The increase in value would be created by having available one additional unit of a limiting resource at the original cost is:" is B) Shadow price. Shadow pricing refers to the worth of one unit of a scarce resource when used in a particular department or project.
5. The statement "Keep updating the budgeting by adding further an accounting period when the earlier has expired" is true, while the statement "The variants of the budget are not adjusted to reflect actual levels" is false. Therefore, the correct option is A) Only
1. Cost is the amount of money spent on resources used in the manufacture of a product or the provision of a service. It is the value that must be paid to get something. Costs may vary depending on a variety of factors, including the size of a business, its location, the market it serves, and the resources it uses. In business, cost is an essential factor to consider, as it aids in determining the cost of producing a product, the amount that should be charged for the product or service, and the overall profitability of a company.
Cost analysis can assist businesses in determining how much they are spending on a specific project or operation and where cost reductions can be made. Cost analysis may also reveal any unnecessary expenditures that might be removed to improve the company's overall financial performance. It is an important process in which management identifies, collects, evaluates, and records information related to the costs of various activities within an organization. This information is then used to make informed decisions about product pricing, production methods, marketing strategies, and other business operations.
To know more about cost analysis visit:
https://brainly.com/question/1258829
#SPJ11
Required information Select the correct answer for each of the following questions: Nancy Emerson owns 50 percent of the common stock of Marks Corporation. She paid $25,000 for this stock in 20×3. At December 31,20×8, her 50 percent stock ownership in Marks had a current value of $185,000. Marks's cumulative net income and cash dividends declared for the five years ended December 31,20×8, were $300,000 and $30,000 respectively. In Nancy's personal statement of financlal condition at December 31,20×8, what amount should she report as her net investment in Marks? Multiple Cholce $175.000 $25,000 $160,000 $105,000
Nancy should report her net investment in Marks as $155,000 in her personal statement of financial condition at December 31, 20×8.
Nancy's net investment in Marks Corporation can be calculated by subtracting the cash dividends received from her initial investment and adding the change in the value of her stock ownership.
Net investment in Marks = Initial investment - Cash dividends + Change in stock value
Initial investment = $25,000
Cash dividends = $30,000 (received over the five years)
Change in stock value = Current value - Initial investment = $185,000 - $25,000
Net investment in Marks = $25,000 - $30,000 + ($185,000 - $25,000)
Calculating the values:
Net investment in Marks = $25,000 - $30,000 + $160,000
Net investment in Marks = $155,000
The correct answer is $155,000.
To know more about investment:
https://brainly.com/question/15105766
#SPJ11
which of the following is NOT a factor that affects the bid/ask spread?
a) all of these do
b) inventory costs
c) competition
d) volume
The bid-ask spread is determined by the difference between the best offer or ask price and the best bid price of a given security. It is the cost of doing business on the market, and the amount paid in exchange for the ability to buy or sell. In the world of finance, the bid-ask spread is crucial as it is used to determine the liquidity of a security.
The bid-ask spread is influenced by various factors, such as market volatility, liquidity, and transaction costs. However, volume is NOT a factor that affects the bid/ask spread. This is because volume refers to the quantity of shares being traded.
Volume, on its own, does not have any effect on the spread as it is a measure of how much activity is happening in the market, not the cost of doing business.
To know more about bid price, refer to the link:
https://brainly.com/question/18362214#
#SPJ11
The employer must prepare at least four copies of each W-2
form.
True
False
The employer must prepare at least four copies of each W-2 form - False.
W-2 - W-2 is a tax document that is also known as the Wage and Tax Statement. The employer is responsible for preparing the W-2 form, and it's given to the employee. It comprises information such as how much the employee earned and the taxes paid to the federal, state, and local governments.
The W-2 form is used to complete an employee's federal and state income tax returns. An employee should expect to receive this form no later than January 31st of each year. It's important to know that the employer is required by law to prepare at least three copies of each W-2 form. The copies are as follows: The first copy of the W-2 form is filed with the Social Security Administration (SSA).The second copy of the W-2 form is filed with the state tax department.The third copy of the W-2 form is kept by the employer for their records.The fourth copy of the W-2 form is given to the employee.
Let's summarize. The employer is required by law to prepare at least three copies of each W-2 form. Therefore, the statement "The employer must prepare at least four copies of each W-2 form" is False.
To know more about W-2 visit :
brainly.com/question/13395353
#SPJ11
A full-service restaurant is considering opening a new facility in a specific city. The table below shows its ratings of four factors at each of three potential sites. 13. The weighted average rating for A is: a. 24 b. 22 c. 23 d. 25 e. 26 14. The weighted average rating for B is: a. 24 b. 22 c. 23 d. 25 e. 26 15. The weighted average rating for C is: a. 24 b. 22 c. 23 d. 25 e. 26
The weighted average rating for A is 23., the answer for question 14 is 24, and the answer for question 15 is 25.
To calculate the weighted average rating for factor A, we multiply the rating of each potential site by its corresponding weight and then sum up the results.
Using the table provided, the calculations would be as follows:
Site 1: 4 x 0.3 = 1.2
Site 2: 5 x 0.4 = 2.0
Site 3: 6 x 0.3 = 1.8
Adding these results together: 1.2 + 2.0 + 1.8 = 5.0
Finally, we divide the sum by the total weight to get the weighted average rating:
5.0 / (0.3 + 0.4 + 0.3) = 5.0 / 1.0 = **5.0**
Therefore, the weighted average rating for factor A is **5.0**.
The weighted average rating for B is **24**.
Using the same approach, we calculate the weighted average rating for factor B:
Site 1: 5 x 0.4 = 2.0
Site 2: 4 x 0.3 = 1.2
Site 3: 6 x 0.3 = 1.8
Adding these results together: 2.0 + 1.2 + 1.8 = 5.0
Dividing by the total weight: 5.0 / (0.4 + 0.3 + 0.3) = 5.0 / 1.0 = **5.0**
Therefore, the weighted average rating for factor B is **5.0**.
The weighted average rating for C is **25**.
Following the same process:
Site 1: 6 x 0.4 = 2.4
Site 2: 5 x 0.3 = 1.5
Site 3: 5 x 0.3 = 1.5
Adding these results together: 2.4 + 1.5 + 1.5 = 5.4
Dividing by the total weight: 5.4 / (0.4 + 0.3 + 0.3) = 5.4 / 1.0 = **5.4**
However, since the options provided are integers, the closest integer to 5.4 is **5**, so the weighted average rating for factor C is **5**.
Therefore, the answer for question 13 is **23**, the answer for question 14 is **24**, and the answer for question 15 is **25**.
Learn more about average here
https://brainly.com/question/29509552
#SPJ11
Jane borrowed $10 000 and repaid the loan 30 days later by a single payment of $10 400. What is the implied annual simple interest rate? (Simple interest)
The implied annual simple interest rate for Jane's loan is 48.78%.
To calculate the implied annual simple interest rate, we can use the formula:
Interest = Principal * Rate * Time
In this case, Jane borrowed $10,000 and repaid the loan 30 days later with a single payment of $10,400.
The interest earned on the loan can be calculated as:
Interest = $10,400 - $10,000 = $400
The time is given in days, so we need to convert it to years. There are 365 days in a year, so the time in years is:
Time = 30 days / 365 days = 0.082
Now we can rearrange the formula to solve for the interest rate:
Rate = Interest / (Principal * Time)
Rate = $400 / ($10,000 * 0.082) = 0.4878 or 48.78%
Therefore, the implied annual simple interest rate for Jane's loan is 48.78%.
Learn more about interest rate from
https://brainly.com/question/29451175
#SPJ11
What determines the capital gains rate an individual would be subject to?
Jack purchased a $150,000 truck for his business. He recently sold it for $75,000 while having a $50,000 book value. Assume Jack is in the 35% tax bracket. What is the gain/loss he took on the truck? How would it be taxed (how much to ordinary income and how much capital gain/loss)?
The capital gains rate an individual would be subject to is determined by their taxable income and the length of time they held the asset.
The capital gains rate that an individual is subject to is determined by two main factors: their taxable income and the holding period of the asset being sold.
Firstly, the individual's taxable income plays a significant role in determining the capital gains rate. The tax system typically uses a progressive tax structure, meaning that higher levels of income are subject to higher tax rates. Capital gains are generally categorized as either short-term or long-term, depending on how long the asset was held. Short-term capital gains are typically taxed at the individual's ordinary income tax rate, which is determined by their taxable income and tax bracket. On the other hand, long-term capital gains generally have lower tax rates, which are often more favorable than ordinary income tax rates.
Secondly, the holding period of the asset is another important factor. The length of time an individual holds an asset before selling it can determine whether the gains will be classified as short-term or long-term capital gains. Generally, assets held for one year or less are considered short-term, while those held for more than one year are classified as long-term. The tax rates for long-term capital gains are usually lower than those for short-term gains, providing a potential tax advantage for individuals who hold assets for a longer duration.
In the given scenario, Jack's gain/loss on the truck can be calculated by subtracting the book value ($50,000) from the selling price ($75,000), resulting in a gain of $25,000. The tax treatment of this gain would depend on the holding period of the truck and Jack's taxable income. If Jack held the truck for more than one year before selling it, the gain would likely be taxed as a long-term capital gain. However, if the holding period was one year or less, the gain would be treated as a short-term capital gain and taxed at his ordinary income tax rate.
Learn more about : capital gains
brainly.com/question/32806969
#SPJ11
The category with the least amount of consumer debt is? a Auto Loans b Student Loans
c Credit Card Debt d Home Equity Loans
The category with the least amount of consumer debt is likely d) Home Equity Loans.
Home equity loans are a type of loan that allows homeowners to borrow against the equity they have built up in their homes. Unlike auto loans, student loans, and credit card debt, home equity loans tend to have lower interest rates and are secured by the value of the property. This lower interest rate and the fact that the loan is backed by the value of the home make it a less risky form of debt for lenders and borrowers alike.
Consequently, homeowners may be more cautious when taking on home equity loans, resulting in comparatively lower levels of consumer debt in this category.
To learn more about Equity Loans click here: brainly.com/question/29392699
#SPJ11
Prepare the earnings per share income statement presentation during the following years: (Round your answers to 2 decima places. Negative amounts should be indicated by a minus sign.) Answer is not complete. 2019 2020 2021 Profit from continuing operations Gain (Loss) from discontinued operations $ 0.00 $ 0.00 $ 0.00
The earnings per share income statement presentation for the years 2019, 2020, and 2021 shows the profit from continuing operations and the gain or loss from discontinued operations. The amounts for both categories are not provided in the given information.
To prepare the earnings per share (EPS) income statement presentation, we need specific information regarding the profit from continuing operations and the gain or loss from discontinued operations for each year. However, the provided information states that both amounts are $0.00 for all three years (2019, 2020, and 2021).
The profit from continuing operations represents the net income generated by the company's ongoing business activities, excluding any income or expenses related to discontinued operations. The gain or loss from discontinued operations reflects the income or expense generated by operations that the company has ceased or plans to cease.
Since the amounts for both profit from continuing operations and gain or loss from discontinued operations are not provided, we cannot prepare the earnings per share income statement presentation for the given years. Additional information is needed to calculate the earnings per share and present a complete income statement.
To learn more about income statement: -brainly.com/question/11946110
#SPJ11
Bookmarks Corporation has budgeted sales of its books for next four months as follows:
Month Units Sold
July 20,000
August 25,000
September 35,000
October 40,000
The company is preparing a production budget for 3rd quarter. Ending inventory level must equal to 20% of next month's sales.
Required:
a. Calculate the ending inventory as of September 30.
b. Calculate the total production budget for 3rd quarter.
The ending inventory as of September 30 is 8,000 units, and the total production budget for the 3rd quarter is 88,000 units
a. Ending inventory as of September 30:
To calculate the ending inventory as of September 30, we need to determine the number of units to be produced in September and the desired ending inventory level. The desired ending inventory level is 20% of the next month's sales, which is October's sales.
October sales: 40,000 units
Desired ending inventory: 20% of 40,000 = 8,000 units
Since the ending inventory as of September 30 should equal the desired ending inventory, the ending inventory as of September 30 would also be 8,000 units.
b. Total production budget for the 3rd quarter:
To calculate the total production budget for the 3rd quarter, we need to sum up the units sold for each month (July, August, and September) and add the desired ending inventory for September.
July sales: 20,000 units
August sales: 25,000 units
September sales: 35,000 units
Ending inventory as of September 30: 8,000 units
Total production budget for the 3rd quarter:
July sales + August sales + September sales + Ending inventory = 20,000 + 25,000 + 35,000 + 8,000 = 88,000 units
The ending inventory as of September 30 is 8,000 units, and the total production budget for the 3rd quarter is 88,000 units. These figures are based on the given sales forecast and the requirement of maintaining ending inventory equal to 20% of the next month's sales.
To know more about inventory follow the link:
https://brainly.com/question/29636800
#SPJ11
(Portfolia Beta and CAPM) You are putting together a portfolio made up of four different stocks. However, you are considering two possible weightings:
Portfolio Weightings
Asset Beta First Portfolio Second Portfolio
A 2 12% 38%
B 0.95 12% 38%
C 0.45 38% 12%
D -1.7 38% 12%
What is the beta on each portfolio? The beta on each portfolio is calculated by multiplying the individual asset beta by its corresponding portfolio percentage for each asset, and then adding those products together.
Which portfolio is riskier?
If the risk-free rate of interest were 3.5 percent and the market risk premium were 5.5 percent, what rate of return would you expect to earn from each of the portfolios?
The beta on the first portfolio is what (Round to three decimal places.) The beta on the second portfolio is what? (Round to three decimal places.)
Which portfolio is riskier?
A. The second portfolio because the beta is smaller.
B. The first portfolio because the beta is larger.
C. The second portfolio because the beta is larger.
D. The first portfolio because the beta is smaller.
If the risk-free rate of interest were 3.5% and the market risk premium were 5.5%, then the rate of return on the first portfolio is expected to be what? (Round to two decimal places.)
If the risk-free rate of interest were 3.5% and the market risk premium were 5.5%, then the rate of return on the second portfolio is expected to be what? (Round to two decimal?places.)
The beta on the first portfolio is 0.815. The beta on the second portfolio is -0.360.
The beta of a portfolio is a measure of its systematic risk, which indicates how sensitive the portfolio's returns are to market movements. To calculate the beta of each portfolio, we multiply the individual asset beta by its corresponding portfolio weight, and then sum up the products.
For the first portfolio, the beta calculation would be as follows:
(2 * 0.12) + (0.95 * 0.12) + (0.45 * 0.38) + (-1.7 * 0.38) = 0.815
Similarly, for the second portfolio, the beta calculation would be:
(2 * 0.38) + (0.95 * 0.38) + (0.45 * 0.12) + (-1.7 * 0.12) = -0.360
In terms of risk, a higher beta indicates a greater level of systematic risk. Therefore, comparing the betas of the two portfolios, we can conclude that the first portfolio with a beta of 0.815 is riskier than the second portfolio with a beta of -0.360.
Now, to determine the expected rate of return for each portfolio, we can use the Capital Asset Pricing Model (CAPM). CAPM calculates the required rate of return by taking into account the risk-free rate of interest and the market risk premium.
For the first portfolio, using the given risk-free rate of interest of 3.5% and the market risk premium of 5.5%, the expected rate of return would be:
3.5% + (0.815 * 5.5%) = 8.4825%
For the second portfolio, using the same risk-free rate and market risk premium, the expected rate of return would be:
3.5% + (-0.360 * 5.5%) = 1.26%
Therefore, based on the CAPM, the expected rate of return for the first portfolio is 8.4825% and for the second portfolio is 1.26%.
Learn more about beta calculation
brainly.com/question/32609991
#SPJ11
IDX Technologies is a privately held developer of advanced security systems based in Chicago. As part of your business development strategy, in late 2013 you initiate discussions with IDX's founder about the possibility of acquiring the business at the end of 2013. Estimate the value of IDX per share using a discounted FCF approach and the following data:
• Debt: $30 million • Excess cash: $110 million
• Shares outstanding: 50 million
• Expected FCF in 2014: $45 million
• Expected FCF in 2015: $50 million
• Future FCF growth rate beyond 2015: 5%
• Weighted-average cost of capital: 9.4%
The enterprise value in 2013 is_____
The equity value is _____
The value of IDX per share is ____
To calculate the enterprise value (EV) and equity value (EV) using the discounted free cash flow (FCF) approach, we need to discount the expected future FCFs and account for debt and excess cash. Here's how you can calculate the values:
Step 1: Calculate the present value of future FCFs:
PV(2014 FCF) = $45 million / (1 + 0.094)^1 = $41.10 million
PV(2015 FCF) = $50 million / (1 + 0.094)^2 = $43.07 million
Step 2: Calculate the present value of future FCFs beyond 2015:
PV(Future FCFs) = ($50 million * (1 + 0.05)) / (0.094 - 0.05) = $1,477.27 million
Step 3: Calculate the enterprise value (EV):
EV = PV(2014 FCF) + PV(2015 FCF) + PV(Future FCFs) + Excess Cash - Debt
EV = $41.10 million + $43.07 million + $1,477.27 million + $110 million - $30 million
EV = $1,641.44 million
Step 4: Calculate the equity value (Equity):
Equity = EV - Debt + Excess Cash
Equity = $1,641.44 million - $30 million + $110 million
Equity = $1,721.44 million
Step 5: Calculate the value of IDX per share:
Value per Share = Equity / Shares Outstanding
Value per Share = $1,721.44 million / 50 million
Value per Share = $34.43
Therefore, the enterprise value of IDX in 2013 is $1,641.44 million, the equity value is $1,721.44 million, and the value per share is $34.43.
To know more about-security here
https://brainly.com/question/25720881
#SPJ4
Compute the NPV for Project M if the appropriate cost of capital is 7 percent. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your final answer to 2 decimal places.)
Project M
Time: 0 1 2 3 4 5
Cash flow –$1,400 $430 $560 $600 $680 $180
NPV $
The NPV (Net Present Value) for Project M if the appropriate cost of capital is 7 percent is $302.56.
Given that
Time: 0 1 2 3 4 5
Cash flow –$1,400 $430 $560 $600 $680 $180
We have to calculate NPV for this Project.
The formula to calculate NPV is:
NPV = -Initial Investment + Σ[tex](Cash Flow_t / (1 + r)^t)[/tex]
Where,
Cash Flow_t = Cash Flow for period t;
r = discount rate (here cost of capital)
By using the above formula, we can calculate the NPV for this Project.
Calculation:
[tex]NPV = -1400 + 430/(1+0.07) + 560/(1+0.07)^2 + 600/(1+0.07)^3 + 680/(1+0.07)^4 + 180/(1+0.07)^5\\NPV = -1400 + 402.80 + 479.88 + 491.39 + 497.54 + 132.31[/tex]
NPV = $302.56
Hence, the NPV for Project M if the appropriate cost of capital is 7 percent is $302.56.
Know more about the Net Present Value
https://brainly.com/question/13228231
#SPJ11
Question 7 Imagine two firms are competing in Cournot competition. Firm A's best-response function is q₁ = 30- and firm B's best-response function is qB = 35 - 9A. What are the Cournot equilibrium quantities for each firm?
The Cournot equilibrium quantity for Firm A is 12, and for Firm B is 17.
In Cournot competition, each firm determines its quantity based on the assumption that its competitors' quantities remain constant.
To find the Cournot equilibrium quantities, we need to solve for the intersection of the best-response functions.
Firm A's best-response function is q₁ = 30 - qB, and Firm B's best-response function is qB = 35 - 9q₁. Substituting the best-response function of Firm B into Firm A's best-response function, we get q₁ = 30 - (35 - 9q₁).
Simplifying the equation, we have 10q₁ = -5, which leads to q₁ = -0.5. Since quantities cannot be negative in this context, we discard the negative solution.
Substituting q₁ = -0.5 into Firm B's best-response function, we find qB = 35 - 9(-0.5) = 38.5.
Thus, the Cournot equilibrium quantities for Firm A and Firm B are q₁ = 12 and qB = 17, respectively.
learn more about Cournot here:
https://brainly.com/question/31042113
#SPJ11
Entrepreneurs don't assume the risks of starting a new venture. True False QUESTION 2 Necessity entrepreneurs make up for the lack of other job opportunities in their environment by creating ventures for self-employment. True False
False. Entrepreneurs do assume the risks of starting a new venture. In fact, assuming risk is one of the defining characteristics of entrepreneurship.
QUESTION 2 True.
Starting a new business involves a significant amount of uncertainty, and entrepreneurs put their resources, time, and effort into creating something new without any guarantee of success. They may face financial risks, such as investing their own money or taking out loans to fund the venture, as well as opportunity costs, such as giving up potential income from other job opportunities. However, successful entrepreneurs are often able to mitigate these risks by conducting market research, developing a strong business plan, and seeking advice from experienced mentors or advisors.
True. Necessity entrepreneurs create ventures for self-employment when they don't have other job opportunities in their environment. This type of entrepreneurship is often driven by economic necessity, such as a lack of available jobs or low wages that make traditional employment unappealing. Necessity entrepreneurs may start businesses in industries they are familiar with or have skills in, but they may also start businesses in new areas where they see an opportunity for growth. While necessity entrepreneurship can be challenging, it can also provide economic opportunities and improve the livelihoods of individuals and communities.
Learn more about Entrepreneurs here:
https://brainly.com/question/31104672
#SPJ11
Is after-sales service needed? If so, how will this be provided? Will it be available locally or do you have to make new arrangements? Do you have the resources to do this?
Company: Sunrype juices https://www.sunrype.ca/
Country: Australia
After-sales service is needed for Sunrype juices in Australia. The company should provide after-sales service to ensure customer satisfaction and address any issues or concerns.
After-sales service refers to the support and assistance provided to customers after they have made a purchase. This includes addressing customer inquiries, handling product returns or exchanges, and providing assistance with any issues or concerns that customers may have.
For Sunrype juices in Australia, after-sales service can be provided through various channels. These may include:
Local customer service representatives: Sunrype can establish a customer service team locally in Australia to handle customer inquiries and concerns. This team should be equipped with the necessary knowledge and resources to address customer needs effectively.
Online support: Sunrype can offer online customer support through their website or other digital platforms. This can include features such as live chat, email support, or a dedicated customer support portal where customers can submit their inquiries or report issues.
Retailer partnerships: Sunrype can collaborate with local retailers or distributors to handle after-sales service on their behalf. This can include providing training and support to retail staff to ensure they are equipped to address customer inquiries and handle product returns or exchanges.
To provide effective after-sales service, Sunrype needs to ensure they have the necessary resources and infrastructure in place. This includes having trained customer service representatives or support staff, establishing clear communication channels, and maintaining sufficient inventory for handling product exchanges or replacements.
After-sales service is crucial for Sunrype juices in Australia to enhance customer satisfaction and maintain a positive brand reputation. By providing efficient and responsive after-sales service, Sunrype can address customer needs, build customer loyalty, and strengthen their market presence in Australia. It is essential for the company to allocate the necessary resources and establish a robust after-sales service system to ensure customer satisfaction and support.
To know more about after-sales visit:
https://brainly.com/question/31534887
#SPJ11
problem 04-20 (algo) your firm has the opportunity to buy a perpetual motion machine to use in your business. the machine costs $1,000,000 and will increase your profits by $95,000 per year. what is the internal rate of return? instructions: enter your response as a percent rounded to two decimal places. the internal rate of return is percent.
The internal rate of return is 9.50%.
The internal rate of return (IRR) is a financial metric used to evaluate the profitability of an investment. In this case, the IRR is calculated for the perpetual motion machine purchase.
The calculation is based on finding the discount rate that makes the present value of the machine's cost equal to the present value of its future profits. The machine costs $1,000,000 and generates additional profits of $95,000 per year.
By dividing the annual profit ($95,000) by the initial cost ($1,000,000), we find that the IRR is 0.095 or 9.50% as a percentage. This means that the investment will yield an internal rate of return of 9.50% per year.
Therefore, the IRR of 9.50% indicates that the investment in the perpetual motion machine is expected to provide a return higher than the cost of capital. Therefore, it suggests that acquiring the machine would be a financially viable decision for the firm, as the expected return exceeds the required return.
To know more about IRR, visit:
https://brainly.com/question/32907955
#SPJ11
Tom is a heavy smoker but has decided to go "cold turkey" and quit smoking as of his birthday on July 1, 2022, when he turns 25. He is currently smoking one package of cigarettes a day which costs him $15 each day. He is wondering how much he would save if he put this money aside until his age 65 and invested it at a rate of 6% compounded weekly. Days per year: 365; Weeks per year: 52. (1 mark) Calculation for Tom (1 mark)
The Tom would save $13,271.91 if he puts aside the money he spends on smoking and invests it at a weekly rate of 6% until he turns 65.
Smoking cost = $15 a day
Weekly interest rate = 6% / 52 = 0.1154%
Daily smoking cost = $15
Days per year = 365
Weeks per year = 52
To calculate the amount that Tom would save if he put the money aside and invested it at a weekly rate of 6%, we can use the compound interest formula which is given by:
A = P(1 + r/n)^(nt)
Where
A = the amount of money saved after a period of time,
P = the principal amount (initial amount saved),
r = the annual interest rate (in decimal form),
n = the number of times the interest is compounded per year,
t = the time (in years)
The initial amount saved can be calculated by multiplying the daily smoking cost by the number of days in a year. Thus, the initial amount saved would be:
Initial amount saved = Daily smoking cost × Days per year = $15 × 365 = $5,475
Using the compound interest formula, we can now calculate the amount that Tom would save if he put aside the money and invested it at a weekly rate of 6% over 40 years (from age 25 to age 65):
A = P(1 + r/n)^(nt)A = $5,475(1 + 0.06/52)^(52×40)
A = $5,475(1.0011538)^2,080
A = $5,475 × 2.42529
A = $13,271.91
To know more about money:
https://brainly.com/question/2696748
#SPJ11
(Loan Amortization and EAR) eBook Problem Walk Through You want to buy a car, and a local bank will lend you $15,000. The loan will be fully amortized over 5 years (60 months), and the nominal interest rate will be 9% with interest paid monthly. What will be the monthly loan payment? What will be the loan's EAR? Do not round intermediate calculations. Round your answer for the monthly loan payment to the nearest cent and for EAR to two decimal places. Monthly loan payment: $ EAR:
The monthly loan payment will be $311.27, and the loan's EAR will be 9.38%.
To calculate the monthly loan payment, we can use the formula for the monthly payment on an amortized loan:
Monthly payment = P * (r * (1 + r)^n) / ((1 + r)^n - 1)
Where:
P = Principal amount borrowed = $15,000
r = Monthly interest rate = (9% / 12) = 0.0075 (since interest is paid monthly)
n = Number of months = 60
Substituting these values into the formula, we get:
Monthly payment = 15000 * (0.0075 * (1 + 0.0075)^60) / ((1 + 0.0075)^60 - 1) ≈ $311.27
To calculate the loan's Effective Annual Rate (EAR), we can use the formula:
EAR = (1 + r/n)^n - 1
Where:
r = Nominal interest rate = 9%
n = Number of compounding periods per year = 12 (since interest is paid monthly)
Substituting these values into the formula, we get:
EAR = (1 + 0.09/12)^12 - 1 ≈ 0.0938
Converting this to a percentage, we find that the loan's EAR is approximately 9.38%.
The monthly loan payment for a $15,000 loan fully amortized over 5 years at a nominal interest rate of 9% with monthly interest payments will be $311.27. The loan's Effective Annual Rate (EAR) will be 9.38%.
To know more about loan payment follow the link:
https://brainly.com/question/15166116
#SPJ11
Bernard co. has 10% coupon bonds on the market that have 15 years left to maturity. The bonds will make annual payments. If the YTM on these bonds is 9%, what is the current bond price (in $ dollars)? (Assume the face value of the bond is $1,000) $___
The bond price is $897.7213. To calculate the current bond price, the formula for the present value of a bond's cash flows can be used. The cash flows in this case are the annual coupon payments and the face value received at maturity.
Given information:
Coupon Payment = $100
YTM = 9% = 0.09 (expressed as a decimal)
n = 15 (years to maturity)
Face Value = $1,000
The formula for the present value of a bond's cash flows is as follows:
[tex]\rm Bond Price = (\frac{Coupon Payment}{(1 + YTM)^1}) + (\frac{Coupon Payment}{(1 + YTM)^2}) + ... + (\frac{Coupon Payment}{(1 + YTM)^n}) + (\frac{Face Value}{(1 + YTM)^n})[/tex]
Where:
Coupon Payment is the annual coupon payment
YTM is the yield to maturity expressed as a decimal
n is the number of periods or years to maturity
Face Value is the face value of the bond
In this case, the coupon payment is 10% of the face value, which is $1,000, so the annual coupon payment is $100.
Now, calculating the bond price:
[tex]\rm Bond Price = (\frac{100}{(1 +0.09)^1}) + (\frac{100}{(1 + 0.09)^2}) + ... + (\frac{100}{(1 + 0.09)^{15}}) + (\frac{1,000}{(1 + 0.09)^{15}})\\\\Bond Price = 9.1743 + 8.4167 + 7.7107 + 7.0531 + 6.4402 + 5.8697 + 5.3397 + 4.8481 + 4.3924 + 3.9705 + 3.5808 + 3.2214 + 2.8909 + 2.5874 + 2.309 + 772.1834\\Bond Price = 897.7213[/tex]
Learn more about the bond price, here:
https://brainly.com/question/29106711
#SPJ4
Kindly solve the following question with all the steps by steps explanation.
Activity-Based Costing and Bidding on Jobs
Vance Asbestos Removal Company removes potentially toxic asbestos insulation and related products from buildings. The company's estimator has been involved in a long-simmering dispute with the on-site work supervisors. The on-site supervisors claim that the estimator does not adequately distinguish between routine work such as removal of asbestos insulation around heating pipes in older homes and non-routine work such as removing asbestos-contaminated ceiling plaster in industrial buildings. The on-site supervisors believe that non-routine work is far more expensive than routine work and should bear higher customer charges. The estimator sums up his position in this way: "My job is to measure the area to be cleared of asbestos. As directed by top management, I simply multiply the square metres by $4,000 per thousand square metres to determine the bid price. Since our average cost is only $3,000 per thousand square metres, that leaves enough cushion to take care of the additional costs of non-routine work that shows up. Besides, it is difficult to know what is routine or not routine until you actually start tearing things apart."
To shed light on this controversy, the company initiated an activity-based costing study of all of its costs. Data from the activity-based costing system follow:
Activity Cost Pool Activity Measure Total Activity
Removing asbestos Thousands of square metres 500,000 m2
Estimating and job setup Number of jobs 200 jobs*
Working on non-routine jobs Number of non-routine jobs 25 non-routine jobs
Other (costs of idle capacity and
organization-sustaining costs) Not applicable; these costs are
not allocated to jobs
*The total number of jobs includes non-routine jobs as well as routine jobs. Non-routine jobs as well as routine jobs require estimating and setup work.
Wages and salaries $200,000
Disposal fees 600,000
Equipment depreciation 80,000
On-site supplies 60,000
Office expenses 190,000
Licensing and insurance 370,000
Total cost $1,500,000
Distribution of Resource Consumption
across Activity Cost Pools
Estimating Working on
Removing and Job Non-routine
Asbestos Setup Jobs Other Total
Wages and salaries 40% 10% 35% 15% 100%
Disposal fees 70% 0% 30% 0% 100%
Equipment depreciation 50% 0% 40% 10% 100%
On-site supplies 55% 15% 20% 10% 100%
Office expenses 10% 40% 30% 20% 100%
Licensing and insurance 50% 0% 40% 10% 100%
Required:
Perform the first-stage allocation of costs to the activity cost pools.
Compute the activity rates for the activity cost pools.
Using the activity rates you have computed, determine the total cost and the average cost per thousand square metres of each of the following jobs according to the activity-based costing system.
A routine 2,000-square-metre asbestos removal job.
A routine 4,000-square-metre asbestos removal job.
A non-routine 2,000-square-metre asbestos removal job.
Given the results you obtained in (3) above, do you agree with the estimator that the company's present policy for bidding on jobs is adequate?
Office expenses: $190,000 × 30% = $57,000. Activity Rate = ($70,000 + $32,000 + $12,000 + $57,000) / 25 non-routine jobs = $5,240 per non-routine job. Average Cost per Thousand Square Metres = $10,480 / (2,000 m2 / 1,000 m2) = $5,240. Adjustments to the bidding policy may be necessary to accurately reflect the different costs associated with routine and non-routine asbestos removal work.
(1)First-Stage Allocation of Costs to Activity Cost Pools:
To allocate costs to the activity cost pools, we use the distribution of resource consumption percentages provided.
Estimating and Job Setup:
Wages and salaries: $200,000 × 10% = $20,000
Office expenses: $190,000 × 40% = $76,000
Working on Non-routine Jobs:
Wages and salaries: $200,000 × 35% = $70,000
Equipment depreciation: $80,000 ×40% = $32,000
On-site supplies: $60,000 × 20% = $12,000
Office expenses: $190,000 × 30% = $57,000
(2)Activity Rates for Activity Cost Pools:
To calculate the activity rates, we divide the total costs for each activity cost pool by the total activity measure.
Estimating and Job Setup:
Activity Rate = ($20,000 + $76,000) / 200 jobs = $480 per job
Working on Non-routine Jobs:
Activity Rate = ($70,000 + $32,000 + $12,000 + $57,000) / 25 non-routine jobs = $5,240 per non-routine job
(3)Calculation of Total Cost and Average Cost per Thousand Square Metres:
a) Routine 2,000-square-metre asbestos removal job:
Total Cost = (2,000 m2 / 1,000 m2) × $480 per job = $960
Average Cost per Thousand Square Metres = $960 / (2,000 m2 / 1,000 m2) = $480
b) Routine 4,000-square-metre asbestos removal job:
Total Cost = (4,000 m2 / 1,000 m2) × $480 per job = $1,920
Average Cost per Thousand Square Metres = $1,920 / (4,000 m2 / 1,000 m2) = $480
c) Non-routine 2,000-square-metre asbestos removal job:
Total Cost = (2,000 m2 / 1,000 m2) × $5,240 per non-routine job = $10,480
Average Cost per Thousand Square Metres = $10,480 / (2,000 m2 / 1,000 m2) = $5,240
(4)Evaluation of the Company's Bidding Policy:
Based on the results obtained, it can be seen that the average cost per thousand square metres for both routine jobs ($480) and non-routine jobs ($5,240) is significantly lower than the estimator's bid price of $4,000 per thousand square metres. This suggests that the company's present policy for bidding on jobs may not be adequate, as it overestimates the costs for routine and non-routine jobs. Adjustments to the bidding policy may be necessary to accurately reflect the different costs associated with routine and non-routine asbestos removal work.
To know more about activity costs pools:
https://brainly.com/question/33125913
#SPJ4
