Answer:
ok
Explanation:
The efficient market hypothesis suggests that: Multiple Choice while individuals can be irrational, collectively they will not. because individuals are rational, collectively they are also rational. irrationality must a part of every economic model. asset price bubbles are efficient.
Answer: asset price bubbles are efficient.
Explanation:
The efficient market hypothesis simply states that all information are reflected by the share prices.
The efficient market hypothesis suggests that asset price bubbles are efficient. We should note they economic bubbles take place when the price of assets increases more then their true economic value but late falls.
Umbarra Company bonds have a stated coupon rate of 5% and pay interest on an annual basis. They mature in 18 years and have a par value of $1,000. The market rate of interest on similar debt is 8%. The value of Umbarra bonds is (round to the nearest dollar).
Answer:
Value of Bond =$718.8
Explanation:
The value of the bond is the present value(PV) of the future cash receipts expected from the bond. The value is equal to present values of interest payment plus the redemption value (RV) discounted at the yield rate
Value of Bond = PV of interest + PV of RV
The PV of interest payment
A ×(1- (1+r)^(-n))/r
Interest payment = 5%× 1000 = 50
PV = 50× (1- 1.08^(-18))/0.08 = 468.59
PV of redemption value
PV = RV× (1+r)^(-n)
PV = 1000× 1.18^(-18) = 250.24
The value of bond = 468.59 + 250.24= 718.84
The value of Bond = $718.84
10. Identical wages
Which of the following is required for all workers to earn identical wages in the long run? Check all that apply.
All workers are protected by a union.
Workers can move from one labor market to another at zero cost.
All workers have equal ability and can be trained to do different types of employment at minimum cost.
All workers must have a bachelor's degree.
Answer:
hi how are you
Explanation:
If you travel a lot for work and use cash to pay for most purchases, which type of financial institution would you probably have your
account at?
O credit union
O national or regional bank
ohn Baker, a cash basis calendar year taxpayer, paid the following during the year:Social security tax (withheld from wages) $4,500Real estate taxes $3,200State income tax $3,400Special assessment for installation of sidewalks $1,140Penalty on tax underpayment $300Flat fee for automobile registration $90What itemized deduction may John claim for taxes on his return
Answer:
$6,600
Explanation:
Calculation to determine the itemized deduction that John may claim for taxes on his return
Real estate taxes $3,200
Add State income tax $3,400
Itemized deduction $6,600
($3,200+$3,400)
Therefore the itemized deduction that John may claim for taxes on his return is $6,600
You are attempting to value a call option with an exercise price of $100 and one year to expiration. The underlying stock pays no dividends, its current price is $100, and you believe it has a 50% chance of increasing to $130 and a 50% chance of decreasing to $70. The risk-free rate of interest is 10%. Calculate the call option's value using the two-state stock price model. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Answer:
$18.18
Explanation:
Calculation to determine the call option's value using the two-state stock price model
Based on the information given since the two possible stock prices are: S+ = $130 Increase and and S- = $70 decrease which means that If the exercise price is the amount of $100 the first step will be to determine the corresponding two possible call values.
First step is to determine the corresponding two possible call values.
Hence, the corresponding two possible call values are:
Cu = ($130-$100) and Cd = $0
Cu = $30 and Cd = $0
Second step is to Calculate the hedge ratio using this formula
Hedge ratio= (Cu - Cd)/(uS0 - dS0)
Hedge ratio= (30- 0)/(130 - 70)
Hedge ratio=30/60
Hedge ratio= 0.50
Third step is form the cost of the riskless portfolio and end-of-year value
Cost of the riskless portfolio = (S0 - 2C0)
Cost of the riskless portfolio = 100 - 2C0
End-of-year value =$70
Fourth step is to calculate the present value of $70 with a one-year interest rate of 10%:
Present value=$70/1.10
Present value= $63.64
Now let estimate the call option's value by first Setting the value of the hedged position to equal to the present value
Call option's value=$100 - 2C0 = $63.64
Hence,
C0=$100-$63.64/2
C0=$36.36/2
C0=$18.18
Therefore the call option's value using the two-state stock price model will be $18.18
Why is it difficult to maintain relations with multiple stakeholders?
A. Because different stakeholders may have conflicting goals.
B. Because not all stakeholder needs are well known.
C. Because stakeholders want to harm the organization.
D. Stakeholders don't understand the organization's goals.
Answer:
A
Explanation:
Bad Wolf Enterprises is recalling and reissuing an outstanding bond offering. The reissued bond offering will be 10 year 5% coupon bonds. The present value of the coupons savings of the new offering is $588,365, the future value of the extra principal payment of the new offering is $350,000, and the administrative fees associated with the recall and reissue are $112,394. Calculate the net benefit ( ) or cost (-) of the call and reissue for Bad Wolf Enterprises
Answer:
Bad Wolf Enterprises
The net benefit of the call and reissue for Bad Wolf Enterprises is:
= $261,071.
Explanation:
Data and Calculations:
Bond maturity period = 10 years
Coupon rate = 5%
Present value factor at 5% for 10 years = 0.614
Present value of the coupons savings of the new offering = $588,365
Future value of the extra principal payment of the new offering = $350,000
Present value of the extra principal payment = $214,900 ($350,000 * 614)
Administrative fees associated with the recall and reissue = $112,394
Total cost = $327,294 ($214,900 + $112,394)
The net benefit of the call and reissue = Total benefits minus total costs
= $261,071 ($588,365 - $327,294)
The aggregate supply curve Multiple Choice is explained by the interest rate, real-balances, and foreign purchases effects. gets steeper as the economy moves from the top of the curve to the bottom of the curve. shows the various amounts of real output that businesses will produce at each price level. is downsloping because real purchasing power increases as the price level falls.
Answer:
. shows the various amounts of real output that businesses will produce at each price level
Explanation:
Aggregate supply can be regarded as " domestic final supply" in domain of economics, it is the overall supply of services/ goods that is been produced at a particular overall price within an economy at a given period. It should be noted that aggregate supply shows the various amounts of real output that businesses will produce at each price level
What form do some schools, especially private schools, use in addition to the FAFSA to determine how to award aid? A) FAFSA II B) Core Residency Form C) CSS/Financial Aid PROFILE D) College Access Loan (CAL) Form
Answer:
C.) CSS/ Financial aid profile
Explanation:
I took the USA Test Prep quiz.
Early deadlines are imposed by many schools and universities that use the FAFSA to calculate financial aid. To decide how to distribute their own funds, certain institutions—mostly private colleges—use an additional form called the College Scholarship Service Profile, or CSS Profile. Therefore, choice (C) is the best one.
What is CSS Profile?College students can apply for non-federal financial aid through the CSS Profile, also known as the College Scholarship Service Profile, an online application developed and administered by the College Board, a company based in the United States.
Its main purpose is to provide College Board member institutions with a thorough assessment of students and their families financially and family circumstances for use in determining their eligibility for organizational financial aid. Compared to the Free Application for Federal Student Aid, or FAFSA, it is more comprehensive.
Hence, option (C) is the most accurate.
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Quantitative Problem 3: Assume today is December 31, 2019. Imagine Works Inc. just paid a dividend of $1.35 per share at the end of 2019. The dividend is expected to grow at 18% per year for 3 years, after which time it is expected to grow at a constant rate of 5.5% annually. The company's cost of equity (rs) is 9.5%. Using the dividend growth model (allowing for nonconstant growth), what should be the price of the company's stock today (December 31, 2019)
Answer:
The price of the company's stock today (December 31, 2019) is $49.27.
Explanation:
Note: See the attached file for the calculation of present values (PV) for year 1 to 3 dividends.
From the attached excel file, we have:
Previous year dividend in year 1 = Dividend just paid = $1.35
Total of dividends from year 1 to year 3 = $4.71193752458119
Year 3 dividend = $2.2180932
Therefore, we have:
Year 4 dividend = Year 3 dividend * (100% + Constant dividend growth rate) = $2.2180932 * (100% + 5.5%) = $2.340088326
Share price at year 3 = Year 4 dividend / (Cost of equity - Constant dividend growth rate) = $2.340088326 / (9.5% - 5.5%) = $58.50220815
PV of share price at year 3 = Share price at year 3 / (100% + Cost of equity)^Number of years = $58.50220815 / (100% + 9.5%)^3 = $44.55843215078
Therefore, we have:
The price of the company's stock today = Total of dividends from year 1 to year 3 + PV of share price at year 3 = $4.71193752458119 + $44.55843215078 = $49.27
You are a seller of farm equipment. Sidney Lanier puts in an order for a new combine harvester, which costs $425,000. Under the terms of the agreement, Mr. Lanier has to forward you a certified check for 25% of the purchase price within 15 days of the signing of the purchase agreement. Meanwhile you are preparing the combine harvester for shipment to Sidney Lanier's farm.
On the 15th day, you do not receive a check from Mr. Lanier. You do not receive a check on the 16th, 17th, or 18th day either. Meanwhile, another farmer has come into your office to ask about buying the combine harvester.
What can you do in this situation?
A. Since you and Mr. Lanier have a contract, you have to wait until he sends you the check before you can do anything.
B. Mr. Lanier had a duty to send you a check by the 15th. He's breached that duty under the contract, and it appears to be a material breach, so you have the right to rescind the contract.
Answer: B. Mr. Lanier had a duty to send you a check by the 15th. He's breached that duty under the contract, and it appears to be a material breach, so you have the right to rescind the contract.
Explanation:
Material breach occurs when a particular party fails to fulfill his or her part in a contract and this can lead to the other party rescinding the contract or sue for a breach of contract.
Since under the terms of the agreement, Mr. Lanier has to forward a certified check for 25% of the purchase price within 15 days of the signing of the purchase agreement but he didn't send the check, this means that the there's a breach in the contract, and the contract can be rescinded.
What is the impact on the accounting equation when an accounts receivable is collected?
A gold processor has two sources of gold ore, source A and source B. In order to keep his plant running, at least three tons of ore must be processed each day. Ore from source A costs $20 per ton to process, and ore from source B costs $10 per ton to process. Costs must be kept to less than $80 per day. Moreover, Federal Regulations require that the amount of ore from source B cannot exceed twice the amount of ore from source A. If ore from source A yields 2 oz. of gold per ton, and ore from source B yields 3 oz. of gold per ton, how many tons of ore from both sources must be processed each day to maximize the amount of gold extracted subject to the above constraints
Answer:
that is letter A
Im sorry beacause wrong
Assume the following information appears in the standard cost card for a company that makes only one product: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 5 pounds $ 11.00 per pound $ 55.00 Direct labor 2 hours $ 18.30 per hour $ 36.60 Variable manufacturing overhead 2 hours $ 3.00 per hour $ 6.00 During the most recent period, the following additional information was available: 20,000 pounds of material was purchased at a cost of $10.50 per pound. All of the material that was purchased was used to produce 3,900 units. 8,000 direct labor-hours were recorded at a total cost of $132,000. What is the direct labor rate variance
Answer:
Direct labor rate variance= $14,400 favorable
Explanation:
Giving the following information:
Direct labor 2 hours $ 18.30 per hour $ 36.60
8,000 direct labor hours were recorded at a total cost of $132,000
To calculate the direct labor rate variance, we need to use the following formula:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Direct labor rate variance= (18.3 - 16.5)*8,000
Direct labor rate variance= $14,400 favorable
Actual rate= 132,000/8,000= $16.5
Suppose Fiat recently entered into an Agreement and Plan of Merger with Case for $4.3 billion. Prior to the merger, the market for four-wheel-drive tractors consisted of five firms. The market was highly concentrated, with a Herfindahl-Hirschman index of 3,195. Case’s share of that market was 16 percent, while Fiat comprised just 8 percent of the market. If approved, by how much would the postmerger Herfindahl-Hirschman index increase?
Answer:
the increase resulting from this merger = 256
Explanation:
before the merger, both Fiat and Case's contribution to Herfindahl-Hirschman index = 16² + 8² = 320
after the merger, Fiat and Case's contribution to Herfindahl-Hirschman index = 24² = 576
the increase resulting from this merger = 576 - 320 = 256
Comcast (CMCSA) is trading at 54.33. You decide to short sell 100 shares of their stock, providing 2850 in collateral to your broker. You hold the short position for one year and expect Comcast to pay a dividend of 1 per share. In one year, the stock price is 56. Assuming the brokerage account pays no interest on your cash, what is your return, relative to your collateral
Answer: =-9.34%
Explanation:
Assuming the brokerage account pays no interest on your cash, the return, relative to the collateral will be calculated as:
= (Short sell price - dividend - Share buy price)/Capital employed
= (5433 - 100 - 5600) / 2850
= -267 / 2850
= -0.09368
=-9.34%
Note:
Short sell price = 54.33 × 100 = 5433
Dividend = 100
Share buy price = 56 × 100 = 5600
Bushard Company (buyer) and Schmidt, Inc. (seller) engaged in the following transactions during February 2019:
Bushard Company
DATE TRANSACTIONS
2019
Feb. 10 Purchased merchandise for $5,000 from Schmidt, Inc., Invoice 1980, terms 1/10, n/30.
13 Received Credit Memorandum 230 from Schmidt, Inc., for damaged merchandise totaling $200 that was returned; the goods were purchased on Invoice 1980, dated February 10.
19 Paid amount due to Schmidt, Inc., for Invoice 1980 of February 10, less the return of February 13 and less the cash discount, Check 2010. Schmidt, Inc.
DATE TRANSACTIONS
2019
Feb. 10 Sold merchandise for $5,000 on account to Bushard Company, Invoice 1980, terms 1/10, n/30.
13 Issued Credit Memorandum 230 to Bushard Company for damaged merchandise totaling $200 that was returned; the goods were purchased on Invoice 1980, dated February 10.
19 Received payment from Bushard Company for Invoice 1980 of February 10, less the return of February 13 and less the cash discount, Check 2010.
Required:
Journalize the transactions above in a general journal for both Bushard Company and Schmidt, Inc.
Answer:
Bushard Company (buyer) and Schmidt, Inc. (seller)
Journal Entries:
Bushard Company
Feb. 10 Debit Inventory $5,000
Credit Accounts payable (Schmidt, Inc.) $5,000
To record the purchase of goods on account, via Invoice 1980, terms 1/10, n/30.
13 Debit Accounts payable (Schmidt, Inc.) $200
Credit Inventory $200
To record the return of damaged goods and received Credit Memorandum 230.
19 Debit Accounts payable (Schmidt, Inc.) $4,800
Credit Cash $4,752
Credit Cash Discounts $48
To record the payment on account and discounts.
Schmidt, Inc.
Feb. 10 Debit Accounts receivable (Bushard Company) $5,000
Credit Sales revenue $5,000
To record the sale of goods on account, Invoice 1980, terms 1/10, n/30.
13 Debit Sales returns $200
Credit Accounts receivable (Bushard Company) $200
To record the return of damaged, issuing Credit Memorandum 230.
19 Debit Cash $4,752
Debit Cash Discounts $48
Credit Accounts receivable (Bushard Company) $4,800
To record the receipt of cash from customer, including discounts.
Explanation:
a) Data and Analysis:
Bushard Company
Feb. 10 Inventory $5,000 Accounts payable (Schmidt, Inc.) $5,000, Invoice 1980, terms 1/10, n/30.
13 Accounts payable (Schmidt, Inc.) $200 Inventory $200 Credit Memorandum 230, damaged merchandise.
19 Accounts payable (Schmidt, Inc.) $4,800 Cash $4,752 Cash Discounts $48
Schmidt, Inc.
Feb. 10 Accounts receivable (Bushard Company) $5,000 Sales revenue $5,000, Invoice 1980, terms 1/10, n/30.
13 Sales returns $200 Accounts receivable (Bushard Company) $200 Credit Memorandum 230, damaged merchandise.
19 Cash $4,752 Cash Discounts $48 Accounts receivable (Bushard Company) $4,800
Suppose that the U.S. government decides to charge cola consumers a tax. Before the tax, 25 billion cases of cola were sold every year at a price of $5 per case. After the tax, 18 billion cases of cola are sold every year; consumers pay $6 per case (including the tax), and producers receive $3 per case.
The amount of the tax on a case of cola is ___________ $ per case. Of this amount, the burden that falls on consumers is __________$ per case, and the burden that falls on producers is ____________$ per case.
The effect of the tax on the quantity sold would have been larger if the tax had been levied on consumers.
a. True
b. False
Answer:
$1
$2
false
Explanation:
A tax is a compulsory sum levied on goods and services by the government. Taxes increases the price of goods
Tax = amount consumers pay - amount producers receive
$6 - $3 = $3
Tax paid by consumers = Price after tax - tax before tax
$6 - $5 = $1
Amount received by producers = tax - tax paid by consumers
$3 - $1 = $2
In the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. Several theories explain how this might happen.
For example, the misperceptions theory asserts that changes in the price level can temporarily mislead firms about what is happening to their output prices. Consider a soybean farmer who expects a price level of 100 in the coming year. If the actual price level turns out to be 90, soybean prices will _________, and if the farmer mistakenly assumes that the price of soybeans declined relative to other prices of goods and services, she will respond by ____________the quantity of soybeans supplied. If other producers in this economy mistake changes in the price level for changes in their relative prices, the unexpected decrease in the price level causes the quantity of output supplied to __________ the natural level of output in the short run. Suppose the economy's short-run aggregate supply (AS) curve is given by the following equation:
Answer:
1. A fall in prices of soybean
2. Reduce quantity she supplies
3. Falls below
Explanation:
We are to fill in the blanks here
1. In this question the farmer expected price level of 100 but the actual price realized was 90 so there would be a fall in the price of soybean.
2. If farmer feels that price of other goods caused this fall, she would reduce the quantity of soybean that she supplies
3. The quantity supplied is then going to fall below natural level in the short run
What is the proper order to eliminate debt?
Stoltenberg Co. had the following information for the month of June: Work in process beginning inventory, June 12,300units Units transferred in16,900units Work in process ending inventory, June 304,300units Beginning work-in-process inventory is 30 percent complete as to conversion. Ending work-in-process inventory is 50 percent complete as to conversion. Materials are added at the end of the process. How many units were started and completed in June
Answer:
the number of units started and completed in June is 24,900 units
Explanation:
The computation of the number of units started and completed in June is shown below;
= Opening work in process inventory + transferred units - ending work in process units
= 12,300 units + 16,900 units - 4,300 units
= 24,900 units
hence, the number of units started and completed in June is 24,900 units
The Electrotech Corporation manufactures two industrial-sized electrical devices: generators and alternators. Both of these products require wiring and testing during the assembly process. Each generator requires 2 hours of wiring and 1 hour of testing and can be sold for a $250 profit. Each alternator requires 3 hours of wiring and 2 hours of testing and can be sold for a $150 profit. There are 260 hours of wiring time and 140 hours of testing time available in the next production period and Electrotech wants to maximize profit. Formulate an LP model for this problem. Sketch the feasible region for this problem. Determine the optimal solution to this problem using level curves.
Answer:
Given that generators generate greater profit with less consumption of hours, the maximum profit would be building 130 generators, obtaining $ 32,500 of profit, and there would be 10 hours of testing left over.
Explanation:
Since the Electrotech Corporation manufactures two industrial-sized electrical devices: generators and alternators, and both of these products require wiring and testing during the assembly process, and each generator requires 2 hours of wiring and 1 hour of testing and can be sold for a $ 250 profit, while each alternator requires 3 hours of wiring and 2 hours of testing and can be sold for a $ 150 profit, and there are 260 hours of wiring time and 140 hours of testing time available in the next production period and Electrotech wants to maximize profit, to determine this situation the following mathematical logical reasoning must be carried out:
260/2 = 130
140 - 130 = 10
130 generators = 32,500
Thus, given that generators generate greater profit with less consumption of hours, the maximum profit would be building 130 generators, obtaining $ 32,500 of profit, and there would be 10 hours of testing left over.
Windsor, Inc. purchased a delivery truck for $32,000 on January 1, 2022. The truck has an expected salvage value of $4,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 16,600 in 2022 and 13,100 in 2023. (a1) Calculate depreciable cost per mile under units-of-activity method. (Round answer to 2 decimal places, e.g. 0.50.) Depreciable cost
Answer:
Depreciable cost per mile= $0.28
Explanation:
Giving the following information:
Purchase price= $32,000
Salvage value= $4,000
Miles= 100,000
To calculate the depreciable cost per mile under the units-of-activity method, we need to use the following formula:
Depreciable cost per mile= (original cost - salvage value)/useful life of production in miles]
Depreciable cost per mile= (32,000 - 4,000) / 100,000
Depreciable cost per mile= $0.28
The December 31, 2021, post-closing trial balance for Strong Corporation is presented below:
Accounts Debit Credit
Cash $ 23,400
Accounts receivable 23,200
Prepaid insurance 4,300
Supplies 160,000
Long-Term Investments 57,000
Land 46,000
Buildings 278,000
Accumulated depreciation 83,000
Accounts payable 37,200
Notes payable, due 2022 62,000
Interest payable 11,000
Notes payable, due 2031 121,000
Common stock 210,000
Retained earnings 67,700
Totals $ 591,900 $ 591,900
Question Completion:
Prepare a classified balance sheet as of December 31, 2021.
Answer:
Strong Corporation
STRONG CORPORATION
Classified Balance Sheet
As of December 31, 2021
Assets
Current Assets:
Cash $ 23,400
Accounts receivable 23,200
Prepaid insurance 4,300
Supplies 160,000 $210,900
Total current assets
Long-Term Investments $57,000
Long-term assets:
Land 46,000
Buildings 278,000
Acc. depreciation 83,000 195,000 $241,000
Total assets $508,900
Liabilities and Equity
Current liabilities:
Accounts payable 37,200
Notes payable, due 2022 62,000
Interest payable 11,000 $110,200
Long-term liabilities:
Notes payable, due 2031 $121,000
Equity:
Common stock 210,000
Retained earnings 67,700 $277,700
Total liabilities and equity $508,900
Explanation:
a) Data and Analysis:
STRONG CORPORATION
Post-closing Trial Balance
December 31, 2021
Accounts Debit Credit
Cash $ 23,400
Accounts receivable 23,200
Prepaid insurance 4,300
Supplies 160,000
Long-Term Investments 57,000
Land 46,000
Buildings 278,000
Accumulated depreciation $83,000
Accounts payable 37,200
Notes payable, due 2022 62,000
Interest payable 11,000
Notes payable, due 2031 121,000
Common stock 210,000
Retained earnings 67,700
Totals $ 591,900 $ 591,900
b) The balance sheet is a summary of the financial position or assets, liabilities, and equity of Strong Corporation as at December 31, 2021.
Explain the effects of low price-guarantee on the price.
Answer:
Low price guarantees have adverse effects on consumer behavior. These strategies can cause consumers to become suspicious of the offer and may avoid making the purchase all together.
Low price guarantee is a policy where the seller offer a price is guaranteed to match or beat any other lower price in the market.
Usually, the low price guarantees does persuade the consumers to make purchase, but, it can also have adverse effects on consumer behavior at times.
The strategy of low price-guarantee on the price of the product can cause the consumers to become suspicious and thus, may lead to a decision to avoid making the purchase.
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University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. The following data appear in the company records for the current period:
Maintenance Personnel Printing Developing
Machine-hours — 1,800 1,800 5,400
Labor-hours 650 — 650 2,600
Department direct costs $4,000 $14,000 $15,900 $12,600
Required:
Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.)
Maintenance Personnel Printing Developing
service dept. costs
maintenance allocation
personnel allocation
total cost allocation
Answer:
Maintenance $0
Personnel $0
Printing $19,700
Developing $26,800
Explanation:
Calculation to allocate these service department costs to the operating departments Using the direct method
Particulars Allocation Basis Maintenance Personnel Printing Developing
Cost as per primary data
$4,000 $14,000 $15,900 $12,600
SERVICE DEPARTMENT COSTS:
Maintenance allocation (S)
$0 $0 $1,000 $3,000
Personnel allocation (S)
$0 $0 $2,800 $11,200
Total Costs Allocated
$0 $0 $19,700 $26,800
Computation for the allocation of costs:
Maintenance = $4,000 *1,800/(1,800+5,400)
Maintenance = $4,000 *1,800/7,200
Maintenance =$1,000
Personnel = $14,000 *650/650+2,600
Personnel=$14,000 *650/3,250
Personnel=$2,800
Maintenance = $4,000 *5,400/(1,800+5,400)
Maintenance = $4,000 *5,400/7,200
Maintenance = $3,000
Personnel = $14,000 *2,600/650+2,600
Personnel = $14,000 *2,600/3,250
Personnel = $11,200
Therefore allocation of these service department costs to the operating departments Using the direct method will be :
Maintenance $0
Personnel $0
Printing $19,700
Developing $26,800
True or False: A partner cannot legally bind the other partners to a business agreement.
Answer: False
Explanation: In many cases, a partner will be able to bind the partnership without the other owners' consent. However, steps can be taken to prevent any one partner from entering into an agreement without the consent of the others.
The payoff matrix supplied shows outcomes of various strategies that two firms might follow in response to action on the part of the other company. This payoff matrix describes actions in developing vaccines for not-too-rare but also not-too-common diseases. Each element shows the payoffs to a set of strategies as the payoff to the domestic firm, then a comma, then the payoff to the foreign firm.
Foreign firm
Enter Not Enter
Domestic firm Enter -3,-3 183,0
Not Enter 0,183 0,0
Required:
What is the minimum subsidy the US must offer the domestic firm to ensure that it will choose to produce the vaccine?
Answer:
Subsidy per unit must be equal to 3.
Explanation:
The payoff matrix shows that the Domestic firm can earn -3 or 183 from entering into the market. While, it will get only 0 from not entering. So it will be beneficial for it to enter provided the government can bear the negative payoff it gets from entering as the foreign firm also enters.
Thus, if the government can subsidise the domestic firm's negative payoff of $3 from entering such that its payoff becomes, 0 or 186 from entering and 0 from not entering. Like this the domestic firm will be more likely to enter and produce the vaccine.
Thus, the amount of the subsidy must be $3.
Treasury Stock Coastal Corporation issued 25,000 shares of $9 par value common stock at $21 per share and 6,000 shares of $54 par value, eight percent preferred stock at $82 per share. Later, the company purchased 3,000 shares of its own common stock at $24 per share. a. Prepare the journal entries to record the share issuances and the purchase of the common shares. b. Assume that Coastal sold 2,000 shares of the treasury stock at $30 per share. Prepare the general journal entry to record the sale of this treasury stock. c. Assume that Coastal sold the remaining 1,000 shares of treasury stock at $19 per share. Prepare the journal entry to record the sale of this treasury stock.
Answer:
Treasury Stock Coastal Corporation
a. Journal Entries:
Debit Cash $525,000
Credit Common stock $225,000
Credit Additional Paid-in Capital - Common Stock $300,000
To record the issuance of 25,000 shares of $9 par value at $21.
Debit Cash $492,000
Credit 8% Preferred Stock $324,000
Credit Additional Paid-in Capital - Preferred Stock $168,000
To record the issuance of 6,000 shares of $54 par value at $82.
Debit Treasury Stock $27,000
Debit Additional Paid-in Capital - Common Stock $45,000
Credit Cash $72,000
To record the repurchase of 3,000 shares at $24.
b. Journal Entry
Debit Cash $60,000
Credit Treasury Stock $18,000
Credit Additional Paid-in Capital - Common Stock $42,000
To record the re-issuance of 2,000 treasury shares at $30.
c. Journal Entry:
Debit Cash $19,000
Credit Treasury STock $9,000
Credit Additional Paid-in Capital - Common Stock $10,000
To record the re-issuance of 1,000 treasury shares at $19.
Explanation:
a) Data and Calculations:
Cash $525,000 Common stock $225,000 Additional Paid-in Capital - Common Stock $300,000
Cash $492,000 8% Preferred Stock $324,000 Additional Paid-in Capital - Preferred Stock $168,000
Treasury Stock $27,000 Additional Paid-in Capital - Common Stock $45,000 Cash $72,000
b. Cash $60,000 Treasury Stock $18,000 Additional Paid-in Capital - Common Stock $42,000
c. Cash $19,000 Treasury STock $9,000 Additional Paid-in Capital - Common Stock $10,000