(a) Final balances -$1,000 -$4,600 $34,600 $0 $0 $0
b. Journalize the entry to distribute the remaining cash.
Austin Lowes, Capital $11,350
Austin Lowes, Drawing $11,350
Fairchild, Lowes, and Howard
Statement of Partnership Liquidation
For the Period April 10–30
Capital
Cash + Noncash Assets = Liabilities + Fairchild (1/4) + Lowes (1/4) + Howard (2/4)
Balances before realization $44,100 $7,800 $34,600 $0 $0 $0
Sale of assets and division of loss -$46,100 -$0 -$0 -$0 -$11,525 -$34,575
Balances after realization -$1,000 $7,800 $34,600 $0 -$11,525 -$34,575
Payment of liabilities $0 -$12,400 $0 -$12,400 -$2,925 -$9,475
Balances after payment of liabilities -$1,000 -$4,600 $34,600 -$12,400 -$14,450 -$43,050
Receipt of deficiency $0 $0 $0 $12,400 $3,100 $9,300
Balances -$1,000 -$4,600 $34,600 $0 -$11,350 -$33,750
Cash distributed to partners $0 $0 $0 $0 -$11,350 -$33,750
Final balances -$1,000 -$4,600 $34,600 $0 $0 $0
2. Assume that the partner with the capital deficiency declares bankruptcy and is unable to pay the deficiency.
a. Journalize the entry to allocate the partner's deficiency.
Account Debit Credit
Austin Lowes, Capital $4,600
Austin Lowes, Drawing $4,600
Amber Howard, Capital $9,300
Amber Howard, Drawing $9,300
b. Journalize the entry to distribute the remaining cash.
Account Debit Credit
Austin Lowes, Capital $11,350
Austin Lowes, Drawing $11,350
Amber Howard, Capital $0
Amber Howard, Drawing $0
Know more about Capital here:
https://brainly.com/question/26339998
#SPJ11
Fairchild, Lowes, and Howard's capital accounts are $44,100, $7,800, and $34,600, respectively. The cash and noncash assets total $12,000 and $86,900, while amounts owed to creditors total $12,400.
The partners share income and losses in the ratio of 1:1:2. Between April 10 and April 30, the noncash assets are sold for $46,100, the partner with the capital deficiency pays the deficiency to the partnership, and the liabilities are paid.
1. Statement of Partnership Liquidation:
a) Sale of assets and division of loss:
The noncash assets are sold for $46,100. The loss is divided according to the income and loss sharing ratio. Fairchild's share is $23,050, Lowes' share is $23,050, and Howard's share is $46,100.
b) Payment of liabilities:
The liabilities of $12,400 are paid. Fairchild pays $3,100, Lowes pays $3,100, and Howard pays $6,200.
c) Receipt of the deficiency:
The partner with the capital deficiency, Lowes, pays the deficiency of $3,250 to the partnership.
d) Distribution of cash:
The remaining cash of $20,950 is distributed among the partners according to their capital account balances.
2. Journalize the entry to allocate the partner's deficiency:
a) Austin Lowes' deficiency is allocated to Fairchild and Howard. Fairchild is debited for $1,625, and Howard is debited for $1,625.
b) Journalize the entry to distribute the remaining cash:
The remaining cash of $20,950 is distributed among the partners. Fairchild is credited for $5,238, Lowes is credited for $5,238, and Howard is credited for $10,474.
Learn more about capital accounts from the given link:
https://brainly.com/question/13275642
#SPJ11
Camacho Enterprises purchased a $100,000 bond on January 1, 2019. The bond matures on December 31, 2023, and pays interest annually (on December 31), at 6%. Camacho purchased the bond at a price to yield an 8% return and properly recorded the bond as a held-to-maturity security. Camacho uses the effective interest method to determine interest revenue. What was the carrying value of the investment at December 31, 2019? How much interest revenue was reported in 2021? Select one:
a. Investment Carrying Value Interest Revenue $94,846 $7,715
b. Investment Carrying Value Interest Revenue $100,000 $8,160
c. Investment Carrying Value Interest Revenue $92,015 $7,470
d. Investment Carrying Value Interest Revenue $93,376 $7,588
e. Investment Carrying Value Interest Revenue $108,425 $9,119
A: Investment Carrying Value $94,846 and Interest Revenue $7,715 - is the correct answer.
Revenue, which is determined by multiplying the average sales price by the number of units sold, is the money made from regular business operations.
The top line (or gross income) figure is what is used to calculate net income by deducting costs.
Sales are another name for revenue in the income statement.
The carrying value of the investment on December 31, 2019, would be $94,846.
The interest revenue reported in 2021 would be $7,715.
So the correct answer is an option a: Investment Carrying Value $94,846 and Interest Revenue $7,715.
Know more about Investment here:
https://brainly.com/question/29547577
#SPJ11
Assume that TraeYoung, Inc. has: - Debt ratio =60% - Net profit margin =12.5% - Return on assets (ROA)=44% Find TraeYoung's Total Asset Turnover ratio. Enter answer as a ratio (that is, do not convert to a percent), rounded to 2 decimal places.
TraeYoung's Total Asset Turnover ratio is 1.408.
The formula for total asset turnover ratio is:
Total Asset Turnover Ratio = Net Sales / Average Total Assets
Given, Debt ratio = 60%,
Net profit margin = 12.5%,
Return on assets (ROA) = 44%.
First, we need to calculate the equity ratio.
Equity Ratio = (Equity / Total Assets) = 1 - Debt ratio= 1 - 0.60 = 0.40
Now, we can find ROE using DuPont Model.
ROE = Net profit margin × Total Asset Turnover ratio × Equity ratio
ROE = ROA × Equity ratio
Net profit margin = 12.5%
ROA = 44%
Equity ratio = 0.40
ROE = (12.5% × Total Asset Turnover ratio × 0.40) = 44%× 0.40
Total Asset Turnover ratio = ROE / Equity ratio / Net profit margin
= (44%× 0.40) / 0.40 / 12.5%
Total Asset Turnover ratio = 1.408 rounded to 2 decimal places
Learn more about Equity Ratio: https://brainly.com/question/28391877
#SPJ11
You were hired as an IS consultant by a small chain of stores that rent domestic appliances. Partly because operations are run with paper records, one store does not know what is going on in the other stores. The president of this small company feels that the chain doesn’t utilize its inventory efficiently. For example, if a customer needs a lawn mower, and the appliance is not available in Store A, the people who serve at the store cannot tell the customer if the mower is available at another outlet, or offer to bring it for the customer from another outlet where it is available. The president would like an IS that would allow the chain to serve the customers better, and that would help with tracking and billing too. List the questions you would ask in your fact-finding effort and indicate who in the organization would be asked each question.
The main question to ask during the fact-finding effort for the small chain of stores is: "What are the specific inventory management challenges the chain is facing?" This question is crucial as it helps identify the key issues related to inventory management, which is a core concern for the company.
By understanding the specific challenges faced by the chain in managing inventory, the IS consultant can gather valuable information about the gaps in the current system. This knowledge will guide the consultant in designing a suitable information system that addresses these challenges effectively. The question allows the consultant to gain insights into issues such as inventory visibility, inter-store communication, and tracking capabilities. By identifying these challenges, the consultant can propose solutions that enhance inventory management, streamline processes, improve customer service, and enable efficient tracking and billing throughout the chain of stores.
To learn more about inventory, Click here: brainly.com/question/31146932?
#SPJ11
Which index of economic freedom is based on 10 indicators?
1.
IMF Index
2.
Heritage Foundation on Index
3.
WTO Index
4.
Bloomberg Index
What law is the most widely practiced theocratic law?
1.
African law
2.
Russian law
3.
Islamic law
4.
Chinese law
Who argued that development should be assessed less by material output and more by opportunities that people enjoy?
1.
Milton Friedman
2.
Amartya Sen
3.
Adam Smith
4.
Bill Clinton
The index of economic freedom based on 10 indicators is the "Heritage Foundation Index." It measures the economic freedom of countries based on factors such as property rights, government integrity, tax burden, government spending, monetary freedom, trade freedom, investment freedom, financial freedom, business freedom, and labor freedom.
The most widely practiced theocratic law is "Islamic law" (option 3). Islamic law, also known as Sharia law, is a religious legal system derived from the teachings of the Quran and the Hadith (the sayings and actions of Prophet Muhammad). It is practiced in various countries with Muslim-majority populations.
The individual who argued that development should be assessed less by material output and more by opportunities that people enjoy is "Amartya Sen" (option 2). Amartya Sen is an Indian economist and philosopher who emphasized the importance of considering human capabilities and freedoms in evaluating development.
He developed the concept of "human development," which focuses on enhancing people's well-being and expanding their choices and capabilities.
To know more about economic freedom here
https://brainly.com/question/32292577
#SPJ11
A closing is set for july 15. how will the unpaid property taxes be entered on the closing disclosure?
Unpaid property taxes will be entered as an adjustment on the closing disclosure.
How are unpaid property taxes addressed on the closing disclosure?On closing disclosure, unpaid property taxes are typically addressed as an adjustment. This means that the amount of unpaid taxes will be calculated and credited or debited to the appropriate party involved in the transaction.
The adjustment ensures that the buyer and seller are responsible for their respective share of property taxes up to the date of closing. By including this adjustment on the closing disclosure, it allows for an accurate representation of the financial obligations associated with the property being transferred.
Read more about closing disclosure
brainly.com/question/28483682
#SPJ4
Select the correct definition for the following costs. All direct manufacturing costs. All manufacturing costs other than direct material costs. All manufacturing costs related to the cost object but cannot be traced to the cost object. Compensation of all manufacturing labor that can be traced to the cost object. Costs of all materials that can be traced to the cost object.
The correct definition for "All direct manufacturing costs" is: Compensation of all manufacturing labor that can be traced to the cost object.
Direct manufacturing costs refer to the costs directly attributable to the production of a specific product or service. These costs can be easily traced to the cost object, such as a particular product or production department.
Direct manufacturing costs typically include direct labor costs, which are the wages or salaries of the employees directly involved in the production process. It may also include other direct costs such as direct materials, which are the costs of the materials that can be specifically identified with the cost object.
Therefore, the correct definition for "All direct manufacturing costs" is the compensation of all manufacturing labor that can be traced to the cost object.
Learn more about Compensation from the given link
https://brainly.com/question/30157900
#SPJ11
There are S=3 states and N=3 securities with payoffs D=
⎝
⎛
40
60
80
20
40
60
10
10
10
⎠
⎞
and prices p=[54,36,9]
′
(a) Describe the set of all state-price vectors. (b) Is this market complete? Explain. (c) Does this market permit arbitrage opportunities? Explain. (d) Consider two additional payoffs in this market, X=[150,200,250]
′
and Y=[100,275,400]
′
. Which of the following statements is/are true for all pairs of distinct state-price vectors Ψ
1
and Ψ
2
. (Distinct means that Ψ
1
=Ψ
2
.) (a) Ψ
1
⋅X=Ψ
2
⋅X (b) Ψ
1
⋅Y=Ψ
2
⋅Y
The set of all state-price vectors can be described by the equation Ψ⋅p=D, where Ψ is a vector representing the state prices and p is the vector of security prices. In this case, Ψ is a 3-dimensional vector.
To determine if the market is complete, we need to check if it is possible to replicate any arbitrary payoff using the given securities. If it is possible to replicate any payoff, the market is complete. If not, it is incomplete.
To check if this market permits arbitrage opportunities, we need to see if there is a state-price vector Ψ such that Ψ⋅D<0. If such a vector exists, it indicates the possibility of arbitrage.
(d) For any pairs of distinct state-price vectors Ψ1 and Ψ2, the following statements are true:
(a) Ψ1⋅X=Ψ2⋅X
(b) Ψ1⋅Y=Ψ2⋅Y
To know more about price vectors visit:
https://brainly.com/question/33493082
#SPJ11
Sara Obermeyer decides to open a pizza parlor near the local college campus that will operate as a corporation. Analyze the following transactions for the month of June in terms of their effect on the basic accounting equation. Record each transaction by increasing (+) or decreasing (-) the dollar amount of each item affected. Indicate the new balance of ea is recorded. It is not necessary to identify the cause of changes in stockholders' equity ch item after a transaction Transactions (1) Sara Obermeyer invests $25,000 cash in exehange-for-common stock to start a pizza parlor business on June 1 (2) Purchased equipment for $4,000 paying $2,000 in cash and the remainder due in 30 days (3) Purchased supplies for $1,200 cash. (4) Received a bill from Campus News for $200 for advertising in the campus newspaper. (5) Cash receipts from customers for pizza sales amounted to $1,500 (6) Paid salaries of $200 to student workers. (7) Billed the Tiger Football Team $300 for pizzas ordered (8) Paid $200 to Campus News for advertising that was previously billed in Transaction 4. Sara Obermeyer was paid dividends-of $1,20o. Drawings Incurred utility expenses for month on account, $100.
Sure, here's an analysis of the transactions in terms of their effect on the basic accounting equation:
1) Sara Obermeyer invests $25,000 cash in exchange for common stock to start a pizza parlor business on June 1:
- Cash (+) $25,000
- Common Stock (+) $25,000
2) Purchased equipment for $4,000 paying $2,000 in cash and the remainder due in 30 days:
- Equipment (+) $4,000
- Cash (-) $2,000
- Accounts Payable (+) $2,000
3) Purchased supplies for $1,200 cash:
- Supplies (+) $1,200
- Cash (-) $1,200
4) Received a bill from Campus News for $200 for advertising in the campus newspaper:
- Accounts Payable (+) $200
- Advertising Expense (+) $200
5) Cash receipts from customers for pizza sales amounted to $1,500:
- Cash (+) $1,500
- Revenue (+) $1,500
6) Paid salaries of $200 to student workers:
- Salaries Expense (-) $200
- Cash (-) $200
7) Billed the Tiger Football Team $300 for pizzas ordered:
- Accounts Receivable (+) $300
- Revenue (+) $300
8) Paid $200 to Campus News for advertising that was previously billed in Transaction 4:
- Accounts Payable (-) $200
- Cash (-) $200
Sara Obermeyer was paid dividends of $1,200:
- Dividends (-) $1,200
- Cash (-) $1,200
10) Incurred utility expenses for the month on account, $100:
- Utilities Expense (+) $100
- Accounts Payable (+) $100
The new balances of each item after these transactions are recorded.
To know more about basic accounting equation visit:
https://brainly.com/question/32818601
#SPJ11
The following represents the financial information for Domingo Corporation for two months:
March April
Sales revenue $ 490,000 $ 440,000
Costs Process inspection $ 1,650 $ 1,880
Scra 1,850 1,930
Quality training 19,800 13,000
Warranty repairs 4,300 4,800
Testing equipment 7,000 7,000
Customer complaints 2,800 3,400
Rework 17,000 18,500
Preventive maintenance 13,500 9,500
Materials inspection 6,500 4,800
Field testing 9,400 12,400
Calculate the ratio of the prevention, appraisal, internal failure, and external failure costs to sales for March and April. (Enter your answers as a percentage rounded to 1 decimal place (i.e., 32.1).
For March: Prevention cost ratio = 4.0%,Internal failure cost ratio = 6.1%, External failure cost ratio = 1.4%, For April: Prevention cost ratio = 3.0%, Appraisal cost ratio = 2.4%, External failure cost ratio = 1.6% .
To calculate the ratios of prevention, appraisal, internal failure, and external failure costs to sales, we need to sum up the costs in each category for both months and then divide them by the respective sales revenue. The formulas for the ratios are as follows:
Let's calculate these ratios for March and April:
For March:
Prevention cost ratio = (19,800 / 490,000) * 100 = 4.0%
Appraisal cost ratio = (1,650 + 1,850 + 6,500) / 490,000) * 100 = 2.7%
Internal failure cost ratio = (17,000 + 13,500) / 490,000) * 100 = 6.1%
External failure cost ratio = (4,300 + 2,800) / 490,000) * 100 = 1.4%
For April:
Prevention cost ratio = (13,000 / 440,000) * 100 = 3.0%
Appraisal cost ratio = (1,880 + 1,930 + 4,800) / 440,000) * 100 = 2.4%
Internal failure cost ratio = (18,500 + 9,500) / 440,000) * 100 = 6.1%
External failure cost ratio = (4,800 + 3,400) / 440,000) * 100 = 1.6%
The ratios rounded to 1 decimal place are as follows:
For March: Prevention cost ratio = 4.0%, Appraisal cost ratio = 2.7%, Internal failure cost ratio = 6.1%, External failure cost ratio = 1.4%
For April: Prevention cost ratio = 3.0%, Appraisal cost ratio = 2.4%, Internal failure cost ratio = 6.1%, External failure cost ratio = 1.6%
To learn more about cost ratio
https://brainly.com/question/16849738
#SPJ11
You are hoping to buy a house in the future and recently received an inheritance of $20,000. You intend to use your inheritance as a down payment on your house.
a. If you put your inheritance in an account that earns 9 percent interest compounded annually, how many years will it be before your inheritance grows to $32,000?
b. If you let your money grow for 9.75 years at 9 percent, how much will you have?
c. How long will it take your money to grow to $32,000 if you move it into an account that pays 3 percent compounded annually? How long will it take your money to grow to $32,000 if you move it into an account that pays 11 percent?
d. What does all this tell you about the relationship among interest rates, time, and future sums?
It will take approximately 3.487 years for the money to grow to $32,000 at an 11% interest rate.
a. To calculate the number of years it will take for the inheritance to grow to $32,000 at a 9% interest rate compounded annually, we can use the future value formula:
Future Value = Present Value * (1 + Interest Rate)^Number of Years
Plugging in the values:
Present Value = $20,000
Future Value = $32,000
Interest Rate = 9%
$32,000 = $20,000 * (1 + 0.09)^Number of Years
Dividing both sides by $20,000:
1.6 = (1.09)^Number of Years
To solve for the number of years, we can take the logarithm of both sides:
log(1.6) = log(1.09)^Number of Years
Using logarithm properties, we can bring down the exponent:
log(1.6) = Number of Years * log(1.09)
Dividing both sides by log(1.09):
Number of Years = log(1.6) / log(1.09)
Using a calculator, we find:
Number of Years ≈ 4.667
So, it will take approximately 4.667 years for the inheritance to grow to $32,000.
b. To calculate the future value after 9.75 years at a 9% interest rate compounded annually, we can use the future value formula:
Future Value = Present Value * (1 + Interest Rate)^Number of Years
Plugging in the values:
Present Value = $20,000
Number of Years = 9.75
Interest Rate = 9%
Future Value = $20,000 * (1 + 0.09)^9.75
Using a calculator, we find:
Future Value ≈ $46,195.94
So, after 9.75 years, you will have approximately $46,195.94.
c. To calculate how long it will take for the money to grow to $32,000 at a 3% interest rate and an 11% interest rate compounded annually, we can rearrange the future value formula:
Number of Years = log(Future Value / Present Value) / log(1 + Interest Rate)
For 3% interest rate:
Number of Years = log(32,000 / 20,000) / log(1 + 0.03)
Using a calculator, we find:
Number of Years ≈ 6.413
So, it will take approximately 6.413 years for the money to grow to $32,000 at a 3% interest rate.
For 11% interest rate:
Number of Years = log(32,000 / 20,000) / log(1 + 0.11)
Using a calculator, we find:
Number of Years ≈ 3.487
d. The calculations in parts a, b, and c demonstrate the relationship among interest rates, time, and future sums. As the interest rate increases, the time it takes for the money to grow to a specific future sum decreases. Conversely, as the interest rate decreases, the time it takes for the money to reach the same future sum increases. Time is inversely related to interest rates when considering the growth of a sum of money.
Learn more about the interest rate here:
https://brainly.com/question/33504223
#SPJ11
Is GDP a good measure of economic activity? More importantly, is GDP a good measure of well being? GDP growth is a major policy focus, if it isn't the best measure of well-being is there another that might be better?
GDP is a measure of the economic activity of a nation. It's the total value of all goods and services produced within a nation in a given period. GDP, though, has its drawbacks.
The most significant disadvantage is that it does not consider the effects of non-monetary activities, such as volunteer work or barter trade, on the economy. GDP also fails to take into account whether or not an increase in economic activity benefits the well-being of the citizens. It merely measures economic activity.
Another issue is that the GDP of a nation may increase while its citizens' living conditions worsen. As a result, the connection between GDP growth and improved well-being is far from ideal.Apart from GDP, there are other ways to measure economic activity and well-being. A good measure of well-being considers more than just monetary factors and includes various factors that can help determine an individual's or nation's well-being.
To know more about GDP visit:
https://brainly.com/question/30504843
#SPJ11
Calculate the US labor force given the following: There are 95 adults working full-time. There are 35 adults working part-time. There are 70 adults not currently working for pay and not currently seeking employment. There are 50 adults not currently working for pay and actively seeking employment. What is the size of the labor force?
The size of the labor force is 180 adults. The labor force includes those who are working (full-time or part-time) and those who are not working but are seeking employment.
In this scenario, the labor force can be calculated by adding the number of adults working full-time to the number of adults working part-time to the number of adults who are not currently working for pay but are actively seeking employment.
Given that there are:
95 adults working full-time.
35 adults working part-time.
70 adults not currently working for pay and not currently seeking employment.
50 adults not currently working for pay and actively seeking employment.
The labor force includes the number of people who are working (either full-time or part-time) and those who are not working but are seeking employment.
In this case, the labor force can be calculated by adding the number of adults working full-time to the number of adults working part-time and adding to this the number of adults who are not currently working for pay but are actively seeking employment. Therefore, the size of the labor force is as follows:
95 (adults working full-time) + 35 (adults working part-time) + 50 (adults not working for pay and actively seeking employment)
= 180 adults
Therefore, the size of the labor force is 180.
Learn more about the labor force: https://brainly.com/question/13962639
#SPJ11
Which of the following is true of frictional unemployment? A) It is an inevitable part of a market economy. B) It is a result of the time needed to mateh people seeking employment with job vacancies. C) It often involves people seeking "the right job" rather than "just a job." D) All of the above.
Frictional unemployment is a situation where individuals are temporarily unemployed as they shift from one job to another or are searching for jobs.
In this context, the statement that is true about frictional unemployment is that it often involves people seeking "the right job" rather than "just a job. Thus, option C is the correct answer. Frictional unemployment is not an inevitable part of a market economy, but rather it is an outcome of people seeking to advance their career prospects.
It is a result of the time needed to mate people seeking employment with job vacancies. Furthermore, as individuals seek jobs that meet their skill level, they could remain unemployed for a longer time. In this case, people might become choosier about the jobs they apply to and the ones they accept.
Therefore, frictional unemployment often involves people seeking "the right job" rather than "just a job."Thus, the statement that is true about frictional unemployment is that it often involves people seeking "the right job" rather than "just a job."
To know more about jobs visit:
https://brainly.com/question/33493208
#SPJ11
A local agribusiness enterprise has employed a consultant to estimate its supply curve for new hybrid corn seed and to estimate the demand faced for this seed in its local marketplace. The consultant has determined the following (note P is $ and Q is bags of seed): Demand: Q=890−P Supply: Q=50+3P Given these two equations, solve for the market equilibrium price and quantity.
890−1p=50+3p
890=50+4p
840=4p
890−210=680
680=Q= Quantity
$210=P= equilibrium price This hybrid corn seed is often chosen for its stress tolerance. What happens to the supply and demand curves for the hybrid corn seed if the drought outlook anticipates drought will develop across the sales region? Given the original demand price-quantity relationships, calculate the elasticity of demand when: (a) Prices increase from $150 to $200 (b) Prices increase from $450 to $500 Based on the elasticities of demand calculated in (5) explain how the price change in 5(a) and 5(b) will impact total revenue. As an agribusiness what price would you set for the seed? Are there other factors that need to be considered? Explain.
The new information on the drought outlook will have an effect on the supply and demand curves. Supply will decrease because of a reduction in output as the drought impacts the production of hybrid corn seed.
When the price rises from $150 to $200, the elasticity of demand is calculated as follows: Q1 = 890 - 150 = 740; Q2 = 890 - 200 = 69
Price Elasticity of Demand (PED) = % change in quantity demanded / % change in price%
change in quantity demanded = (Q2 - Q1) / Q1 x 100%
change in quantity demanded = (690 - 740) / 740 x 100%
change in quantity demanded = - 6.76%
change in price = (200 - 150) / 150 x 100%
change in price = 33.33%PED = - 6.76 / 33.33PED = - 0.202
The value of PED is negative, which means that demand is inelastic, indicating that a price increase will result in a less-than-proportional reduction in the quantity demanded. As a result, there will be a small rise in overall revenue.
When prices rise from $450 to $500, the PED is calculated as follows: Q1 = 890 - 450 = 440; Q2 = 890 - 500 = 390
Price Elasticity of Demand (PED) = % change in quantity demanded / % change in price%
change in quantity demanded = (Q2 - Q1) / Q1 x 100%
change in quantity demanded = (390 - 440) / 440 x 100%
change in quantity demanded = - 11.36%
change in price = (500 - 450) / 450 x 100%
change in price = 11.11%PED = - 11.36 / 11.11PED = - 1.022
The value of PED is negative and greater than one, which means that demand is elastic, indicating that a price increase will result in a more-than-proportional reduction in the quantity demanded. As a result, there will be a fall in overall revenue.
To know more about elasticity of demand, visit:
brainly.com/question/30704413
#SPJ11
The historical returns for two investments—A and B—are summarized in the following table for the period 2016 to 2020, Use the data to answer the questions that follow. a. On the basis of a review of the return data, which investment appears to be more risky? Why? b. Calculate the standard deviation for each investment's returns. conclusion to your observation in part a. i Data Table Why? (Choose the best answer below.) average relative to investment A, whose returns are farther from the h the average relative to investment A, whose returns show less deviation same. A B Year Rate of Return 2016 19.8% 10.7% 2017 3.2% 12.6% 2018 11.8% 14.3% 2019 27.9% 16.5% 2020 9.8% 18.4% Average 14.5% 14.5% (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) h the average relative to investment B, whose returns show less deviation Print Done
The standard deviation of investment A's returns is approximately 12.29%, while the standard deviation of investment B's returns is approximately 2.98%.
a. On the basis of a review of the return data, investment B appears to be more risky. This is because investment B's returns vary more widely from the average compared to investment A. The returns of investment B show a higher degree of variability, indicating a higher level of risk.
b. To calculate the standard deviation for each investment's returns, we can use the following formula:
[tex]Standard deviation = \sqrt(\sum ((Ri - Ravg)^2) / (n - 1))[/tex]
Where Ri represents each individual return, Ravg is the average return, and n is the number of data points.
For investment A:
Average return (Ravg) = 14.5%
Standard deviation
[tex]= \sqrt{(((19.8 - 14.5)^2 + (3.2 - 14.5)^2 + (11.8 - 14.5)^2 + (27.9 - 14.5)^2 + (9.8 - 14.5)^2) / 4)}[/tex]
≈ 12.29%
For investment B:
Average return (Ravg) = 14.5%
Standard deviation =[tex]\sqrt {(((10.7 - 14.5)^2 + (12.6 - 14.5)^2 + (14.3 - 14.5)^2 + (16.5 - 14.5)^2 + (18.4 - 14.5)^2) / 4)}[/tex]
≈ 2.98%
The standard deviation of investment A's returns is approximately 12.29%, while the standard deviation of investment B's returns is approximately 2.98%. This confirms our observation from part a that investment B is less risky than investment A.
Investment B's returns show less deviation from the average, indicating lower volatility and lower risk compared to investment A.
Learn more about the investment here:
https://brainly.com/question/27994820
#SPJ11
Phillip Morris is: The owner of a cigarette company The name of the tobacco division of the Altria Group company A manager at the Marlboro company A cartoon Camel used to advertise cigarettes A research scientist working for RJ Reynolds Tobacco company
EPLAN is a comprehensive computer-aided engineering (CAE) software solution designed specifically for electrical engineering and automation. It provides a range of powerful tools and features to streamline the entire electrical design process, from schematic creation to documentation and production.
With EPLAN, engineers can create detailed electrical schematics, control cabinet layouts, and panel designs in a highly intuitive and efficient manner. The software offers an extensive library of pre-defined components, symbols, and macros, making it easier to generate accurate and standardized designs.
EPLAN's functionality extends beyond the design phase. It facilitates seamless integration with other engineering disciplines, such as mechanical and fluid engineering, enabling interdisciplinary collaboration and improving overall project coordination.
To know more about engineering , visit:
https://brainly.com/question/31140236
#SPJ11
Create a 4-year CCA depreciation table using the following information: The Faculty of Arts IT Department has just bought 200 new computers at a total cost (including installation) of $200,000. The computers are considered Class 10 or 30 percent for CCA purposes. The firm has a marginal tax rate of 25% and capital gains are taxed at 50% of the gain. (25\% 550%)(4 marks) a. If the IT Department sells them for $50,000 after the four years, will there be a terminal loss, a CCA recapture, or a capital gain? If so, how much? (2 marks) b. If the IT Department sells them for $100,000 after the four years, will there be a terminal loss, a CCA recapture, or a capital gain? If so, how much? (2 marks) c. If the IT Department sells them for $250,000 after the four years, will there be a terminal loss, a CCA recapture, or a capital gain? If so, how much?
The amount of the loss is the initial cost of the computers minus the cumulative CCA deductions: $200,000 - ($60,000 + $42,000 + $29,400 + $20,580) = $48,020.
Since capital gains are taxed at 50% of the gain, the taxable amount would be $99,020 x 0.5 = $49,510.
To create a 4-year CCA depreciation table, we need to calculate the annual CCA deduction for the computers.
First, determine the CCA rate for Class 10, which is 30 percent. Then, calculate the CCA deduction for each year by multiplying the CCA rate by the initial cost of the computers.
Year 1: CCA deduction = 0.3 x $200,000 = $60,000
Year 2: CCA deduction = 0.3 x ($200,000 - Year 1 CCA deduction) = $42,000
Year 3: CCA deduction = 0.3 x ($200,000 - Year 1 CCA deduction - Year 2 CCA deduction) = $29,400
Year 4: CCA deduction = 0.3 x ($200,000 - Year 1 CCA deduction - Year 2 CCA deduction - Year 3 CCA deduction) = $20,580
If the IT Department sells the computers for $50,000 after four years, there will be a capital loss. The amount of the loss is the initial cost of the computers minus the cumulative CCA deductions: $200,000 - ($60,000 + $42,000 + $29,400 + $20,580) = $48,020.
If the IT Department sells the computers for $100,000 after four years, there will be neither a terminal loss nor a capital gain. The selling price is higher than the remaining undepreciated balance, so no additional deductions or gains are incurred.
If the IT Department sells the computers for $250,000 after four years, there will be a capital gain. The gain is the selling price minus the remaining undepreciated balance: $250,000 - ($200,000 - $60,000 - $42,000 - $29,400 - $20,580) = $99,020. Since capital gains are taxed at 50% of the gain, the taxable amount would be $99,020 x 0.5 = $49,510.
To know more about cost visit:
https://brainly.com/question/14566816
#SPJ11
The law of demand states that quantity demanded increases in a given time period if:_____.a. the price of the good falls. b. incomes increase. c. preferences change. d. expectations improve.
The law of demand states that quantity demanded increases in a given time period if: the price of the good falls. The correct option is (a)
The law of demand is an economic principle that states that, all other factors being equal, there is an inverse relationship between the price of a good or service and the quantity demanded by consumers.
The law of demand states that, all other factors remaining constant, quantity demanded of a good or service will increase as its price decreases. This relationship between price and quantity demanded forms the fundamental principle of the law of demand.
Thus, the ideal selection is option (a).
Learn more about law of demand here:
https://brainly.com/question/30403107
#SPJ4
Bayou Corporation produced the following draft statement of financial position at December 31, 2020. Bayou Corporation Statement of Financial Position December 31, 2020 The following additional information is available: 1. The current assets section includes the following: cash $160,500; accounts receivable $181,900, less $10,700 allowance for doubtful accounts; inventory $192,600; and warranty payable $5,350. The cash balance is composed of $203,300, less a bank overdraft of $42,800 (at a separate financial institution). Inventory is stated at the lower of FIFO cost and net realizable value. 2. The investments section includes the following: note receivable from a related company, due in 2026, $42,800; FV-NI investments in shares $85,600 (fair value $85,600 ); FV-OCI investments in shares $133,750 (fair value $165,850 ); bond sinking fund $267,500; and patents $123,050, net of accumulated amortization. 3. Property, Plant, and Equipment include buildings $1,112,800, less accumulated depreciation $385,200; equipment $481,500, less accumulated depreciation $192,600; land $535,000; and land held for future use \$288,900 4. Intangible Assets include goodwill valued at $283,550. 5. Current liabilities include the following: accounts payable $149,800; short term notes payable, $85,600, long-term notes payable, $128,400; and income tax payable $42,800. 6. Long-term liabilities as stated in the statement of financial position above are composed solely of 7% bonds payable issued at a discount, due in 2028 7. Shareholders' equity has 70,000 preferred shares (200,000 authorized), which were issued for $481,500, and 107,000 common shares (unlimited number authorized), which were issued at an average price of $10 per share. In addition, the corporation has accumulated other comprehensive income of $32,100. 8. Find the value of retained earnings to balance the statement of finanrial position. Required: Prepare a classified statement of financial position in good form. Adjust the amounts in each SFP classification based on the additional information. Provide a three-line title for your Statement of Financial Position. Show all contra account balances where possible as well as net carrying value. Use proper disclosure techniques as appropriate. Show all calculations. Be sure to list current assets in order of liquidity.
The value of Bayou Corporation retained earnings is $1,157,000.
Bayou Corporation
Statement of Financial Position
As of December 31, 2020
Assets
Current Assets:
Cash and cash equivalents $160,500
Accounts receivable 171,200 ($181,900 - $10,700)
Inventory 192,600
Warranty payable (5,350)
Total Current Assets 519,950
Investments:
Note receivable from a related company 42,800
FV-NI investments in shares 85,600
FV-OCI investments in shares 133,750
Bond sinking fund 267,500
Patents 123,050
Total Investments 652,700
Property, Plant, and Equipment:
Buildings 727,600 ($1,112,800 - $385,200)
Equipment 288,900 ($481,500 - $192,600)
Land 535,000
Land held for future use 288,900
Total Property, Plant, and Equipment 1,840,400
Intangible Assets:
Goodwill 283,550
Total Intangible Assets 283,550
Total Assets 3,296,600
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable 149,800
Short-term notes payable 85,600
Income tax payable 42,800
Total Current Liabilities 278,200
Long-term Liabilities:
Bonds payable 128,400
Total Long-term Liabilities 128,400
Shareholders' Equity:
Preferred shares 481,500
Common shares 1,070,000 (107,000 shares x $10 per share)
Retained earnings 277,800 (calculated below)
Accumulated other comprehensive income 32,100
Total Shareholders' Equity 1,861,400
Total Liabilities and Shareholders' Equity 3,296,600
To find the value of retained earnings, we can use the balance sheet equation:
Total Assets = Total Liabilities + Shareholders' Equity
Rearranging the equation:
Retained earnings = Total Assets - Total Liabilities - Shareholders' Equity
= $3,296,600 - $278,200 - $1,861,400
= $1,157,000
Therefore, the value of retained earnings is $1,157,000.
To know more about retained earnings click here:
https://brainly.com/question/33671432
#SPJ4
A $1000-face-value 10 -year bond has a 3% coupon rate, its current price is $980. If future interest rate (YTM) stays the same, calculate price after one year and after two year
According to the problem the price of the bond after one year would be approximately $980.46. the price of the bond after two years would be approximately $961.47.
To calculate the price of the bond after one year and after two years, we need to consider the bond's coupon payments and the future interest rate (yield to maturity, YTM).
Given:
Face value (FV) = $1000
Coupon rate = 3% (0.03)
Current price = $980
First, let's calculate the annual coupon payment:
Coupon payment = FV * Coupon rate = $1000 * 0.03 = $30
Next, let's calculate the yield to maturity (YTM) rate, assuming it stays the same:
YTM = Coupon payment / Current price = $30 / $980 = 0.0306 (or 3.06%)
To calculate the price after one year, we use the formula for bond pricing:
Price after one year = (Coupon payment / YTM) * (1 - (1 / (1 + YTM)^n)) + (Face value / (1 + YTM)^n)
Where:
n = number of years = 1
Substituting the values into the formula:
Price after one year = ($30 / 0.0306) * (1 - (1 / (1 + 0.0306)^1)) + ($1000 / (1 + 0.0306)^1)
= $980.46
To calculate the price after two years, we repeat the same calculation but with n = 2:
Price after two years = ($30 / 0.0306) * (1 - (1 / (1 + 0.0306)^2)) + ($1000 / (1 + 0.0306)^2)
= $961.47
To learn more about Current price
https://brainly.com/question/27993050
#SPJ11
Transcribed image text:
A plant is capable of processing 2,400 tons of material per year (100\% capacity). If the material cost is $0.35 per pound, what is the expected total annual material cost if the plant is operated at 85% capacity? Recall that 1 ton =2,000 pounds. Select the closest answer. $1,275,000 per year $2,400,000 per year $1,680,000 per year $1,428,000 per year
The expected total annual material cost if the plant is operated at 85% capacity is $1,428,000 per year.
Given that a plant is capable of processing 2,400 tons of material per year at 100% capacity.
Let the expected total annual material cost if the plant is operated at 85% capacity be y.
Since the plant is operating at 85% capacity, the amount of material processed in a year would be; 2400 * (85/100) = 2040 tons of material
We know that 1 ton = 2000 pounds
Therefore, the amount of material in pounds processed per year at 85% capacity = 2040 * 2000 = 4,080,000 pounds
If the cost of material per pound is $0.35, then the expected total annual material cost if the plant is operated at 85% capacity would be; y = $0.35 * 4,080,000 = $1,428,000
Therefore, the expected total annual material cost if the plant is operated at 85% capacity is $1,428,000 per year.
Answer: $1,428,000 per year
To know more about cost visit:
https://brainly.com/question/14566816
#SPJ11
Kangaroo company had a transaction that caused a $5,000 increase in both assets and total liabilities. this transaction could have been a(n):_________
Kangaroo Company had a transaction that caused a $5,000 increase in both assets and total liabilities. This transaction could have been a purchase of office equipment for $12,000, paying $7,000 cash and issuing a note payable for the balance. Thus, option A is the correct option.
The transaction that could have caused a $5,000 increase in both assets and total liabilities for Kangaroo Company is the purchase of office equipment for $12,000. Out of the total purchase amount, $7,000 was paid in cash, resulting in an increase in assets.
The remaining balance of $5,000 was financed through the issuance of a note payable, which increased the company's total liabilities. This transaction demonstrates how the purchase of assets and the associated financing can impact both the asset and liability side of a company's balance sheet.
Learn more about notes payable here:
https://brainly.com/question/32012740
#SPJ4
Probably the full options are:
A. Purchase of office equipment for $12,000, paying $7,000 cash and issuing a note payable for the balance.
B. Investment of $5,000 cash in the business by the stockholders.
C. Purchase of office equipment for $5,000 cash.
D. Repayment of a $5,000 bank loan.
the following transactions occurred during March 2024 for the Right Corporation. The company operates a wholesale warehouse. 1. Issued 30,000 shares of no-par common stock in exchange for $300,000 in cash. 2. Purchased equipment at a cost of $40,000. Cash of $10,000 was paid and a note payable to the seller was signed for the balance owed. 3. Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system. 4. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000. 5. Paid $5,000 in rent on the warehouse bullding for the month of March. 6. Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2024. 7. Paid $70,000 on account for the inventory purchased in transaction 3. 8. Collected $55.000 from customers on account. 9. Recorded depreciation expense of $1,000 for the month on the equipment. Required: Analyze each transaction and show the effect of each on the expanded accounting equation for a corporation. Note: Amounts to be deducted should be indicated by a minus sign. Enter the net change on the accounting equation.
The net change in the expanded accounting equation is $460,000.
Expanded accounting equation:
The expanded accounting equation is a comprehensive equation that reflects the relationship between assets, liabilities, owner's equity, revenue, and expense.
Here, we are going to analyze each transaction and show the effect of each on the expanded accounting equation for a corporation.
Transaction 1:
Issued 30,000 shares of no-par common stock in exchange for $300,000 in cash.
Effects on the expanded accounting equation:
Cash $300,000
Common Stock $300,000
Transaction 2:
Purchased equipment at a cost of $40,000. Cash of $10,000 was paid, and a note payable to the seller was signed for the balance owed.
Effects on the expanded accounting equation:
Equipment $40,000
Notes Payable $30,000
Cash $10,000
Transaction 3:
Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system.
Effects on the expanded accounting equation:
Inventory $90,000
Accounts Payable $90,000
Transaction 4:
Credit sales for the month totaled $120,000. The cost of goods sold was $70,000.
Effects on the expanded accounting equation:
Accounts Receivable $120,000
Sales $120,000
Cost of Goods Sold $70,000
Inventory $70,000
Transaction 5:
Paid $5,000 in rent on the warehouse building for the month of March.
Effects on the expanded accounting equation:
Cash $5,000
Rent Expense $5,000
Transaction 6:
Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2024.
Effects on the expanded accounting equation:
Cash $6,000
Prepaid Insurance $6,000
Transaction 7:
Paid $70,000 on account for the inventory purchased in transaction 3.
Effects on the expanded accounting equation:
Accounts Payable $70,000
Cash $70,000
Transaction 8:
Collected $55,000 from customers on account.
Effects on the expanded accounting equation:
Cash $55,000
Accounts Receivable $55,000
Transaction 9:
Recorded depreciation expense of $1,000 for the month on the equipment.
Effects on the expanded accounting equation:
Depreciation Expense $1,000
Accumulated Depreciation $1,000
The net change in each item of the expanded accounting equation can be calculated by summing up the individual effects on the expanded accounting equation. The net change for each account is as follows:
Assets:
Equipment $40,000
Inventory $90,000
Accounts Receivable $120,000
Cash $11,000
Prepaid Insurance $6,000
Accumulated Depreciation $1,000
Total Assets = $242,000
Liabilities:
Accounts Payable $20,000
Notes Payable $30,000
Total Liabilities = $50,000
Owner's Equity:
Common Stock $300,000
Total Owner's Equity = $300,000
Revenue:
Sales $120,000
Total Revenue = $120,000
Expense:
Rent Expense $5,000
Depreciation Expense $1,000
Cost of Goods Sold $70,000
Total Expense = $76,000
The net change in each item of the expanded accounting equation can be calculated as follows:
Total Assets = $242,000
Total Liabilities = $50,000
Total Owner's Equity = $300,000
Total Revenue = $120,000
Total Expense = $76,000.
So, the net change is: $536,000 - $76,000 = $460,000. Hence, $460,000 is the net change in the expanded accounting equation.
To learn more about equation, refer below:
https://brainly.com/question/29538993
#SPJ11
Sallie Schnudel trades currencies for Keystone Funds in Jakarta. She focuses nearly all of her time and attention on the U.S. dollar/Singapore dollar ($/S$) cross-rate. The current spot rate is $0.6000/S$. After considerable study, she has concluded that the Singapore dollar will appreciate versus the U.S. dollar in the coming 90 days, probably to about $0.7000/S$. She has the following options on the Singapore dollar to choose from:
Option
Strike Price
Premium
Put on Sing $
$0.6500/S$
$0.00003/S$
Call on Sing $
$0.6500/S$
$0.00046/S$
Should Sallie buy a put on Singapore dollars?
Yes
No
Using your response regarding Sallie purchasing a put or a call, what is Sallie's gross profit (including premium) if the spot rate at the end of 90 days is indeed $0.7000/S$?
Using your response regarding Sallie purchasing a put or a call, what is Sallie's net profit (including premium) if the spot rate at the end of 90 days is indeed $0.7000/S$? [to 5-decimal places]
if the spot rate at the end of 90 days is $0.7000/S$, Sallie's gross profit would be $0.00003/S, but her net profit would be -$0.00003/S.
Sallie Schnudel should buy a put option on Singapore dollars because she believes the Singapore dollar will appreciate.
If the spot rate at the end of 90 days is indeed $0.7000/S$, let's analyze Sallie's gross and net profit based on her purchase of the put option.
Gross Profit:
The strike price of the put option is $0.6500/S$, and the premium paid is $0.00003/S$. Since the spot rate at the end of 90 days is higher than the strike price, the put option expires worthless, and Sallie's gross profit is equal to the premium paid: $0.00003/S.
Net Profit:
Since the put option expired worthless, Sallie's net profit is negative, equal to the premium paid: -$0.00003/S.
Therefore, if the spot rate at the end of 90 days is $0.7000/S$, Sallie's gross profit would be $0.00003/S, but her net profit would be -$0.00003/S.
Leatn more about profit here:
https://brainly.com/question/1078746
#SPJ11
There are three basic categories of taxation: progressive, proportional, and regressive. For each type, 1) briefly explain what the term means, 2) give an advantage or disadvantage, and 3) give a specific example of a real world tax based on that type.
You must use complete sentences when writing your response
Progressive taxation: Tax rate increases as income increases.
Proportional taxation: Tax rate remains constant regardless of income.
Regressive taxation: Tax rate decreases as income increases.
Progressive taxation: It aims to distribute the tax burden more heavily on higher-income individuals. The advantage is that it promotes income equality, but the disadvantage is that it may discourage work and investment by high-income earners. An example is the income tax system in many countries, where higher income brackets face higher tax rates.
Proportional taxation: Also known as a flat tax, it imposes the same tax rate on all income levels. The advantage is simplicity and fairness, but the disadvantage is that it can be regressive in its impact on lower-income individuals. An example is the flat income tax rate in countries like Russia and Estonia.
Regressive taxation: It imposes a higher tax burden on lower-income individuals compared to higher-income individuals. The advantage is simplicity, but the disadvantage is that it can exacerbate income inequality. An example is sales tax, where lower-income individuals spend a larger proportion of their income on taxable goods.
Progressive taxation can help promote income equality, proportional taxation offers simplicity, and regressive taxation can be straightforward but potentially unfair. Real-world tax systems often combine elements of these categories to strike a balance between equity and efficiency.
To Know More about Tax rate , Visit:
https://brainly.com/question/29029776
#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: $40 million - Excess cash: $120 million - Shares outstanding: 50 million - Expected FCF in 2014: $43 million - Expected FCF in 2015: $56 million - Future FCF growth rate beyond 2015: 5\% - Weighted-average cost of capital: 9.4% A) The enterprise value in 2013 is: $____ million. (Round to the nearest integer)
B) The equity value is: $____ million. (Round to the nearest integer)
C) The value of IDX per share is: $____ million. (Round to the nearest integer)
(A). The enterprise value in 2013 is approximately $1,350 million.
(B). The equity value is approximately $1,430 million.
(C). The value of IDX per share is approximately $29 million.
Evaluate values:
(A) To calculate the enterprise value in 2013, we need to consider the debt, excess cash, and expected future cash flows of IDX Technologies.
First, we calculate the net debt by subtracting the excess cash from the debt:
Net Debt = Debt - Excess Cash
= $40 million - $120 million
= -$80 million
Next, we calculate the present value of the expected future cash flows using the discounted FCF approach. We discount each year's cash flow using the weighted-average cost of capital (WACC). The WACC is given as 9.4%.
Present Value of FCF in 2014 = FCF in 2014 / (1 + WACC)¹
= $43 million / (1 + 0.094)¹
= $39.41 million
Present Value of FCF in 2015 = FCF in 2015 / (1 + WACC)²
= $56 million / (1 + 0.094)²
= $47.52 million
Now, we calculate the terminal value, which represents the value of all future cash flows beyond 2015. We use the formula:
Terminal Value = FCF in 2015 * (1 + Future FCF Growth Rate) / (WACC - Future FCF Growth Rate)
= $56 million * (1 + 0.05) / (0.094 - 0.05)
= $56 million * 1.05 / 0.044
= $1,342.73 million
Finally, we calculate the enterprise value by summing the present value of FCFs and the terminal value, and then adding the net debt:
Enterprise Value = Present Value of FCF in 2014 + Present Value of FCF in 2015 + Terminal Value + Net Debt
= $39.41 million + $47.52 million + $1,342.73 million + (-$80 million)
= $1,349.66 million
Therefore, the enterprise value in 2013 is approximately $1,350 million.
(B). The equity value can be calculated by subtracting the net debt from the enterprise value:
Equity Value = Enterprise Value - Net Debt
= $1,349.66 million - (-$80 million)
= $1,429.66 million
Therefore, the equity value is approximately $1,430 million.
(C). To calculate the value of IDX per share, we divide the equity value by the number of shares outstanding:
Value per Share = Equity Value / Shares Outstanding
= $1,430 million / 50 million
= $28.6
Therefore, the value of IDX per share is approximately $29 million.
To learn more about future cash flows from the given link.
https://brainly.com/question/10922478
#SPJ11
On August 1, 2016 , Major Link lnc. purchased a new piece of equipment that cost S25 ,000. The estimated use-full life is five years, and estimated residual value is S2,500 . Assume Major Link purchased the equipment on August 1, 2016. lf Major Link uses the straight-line method for depreciation, what is the depreciation expense for the year ended December 31 , 2016? a. S1,875 b. S1,500 c. $2,083 d. S4,500
To calculate the depreciation expense for the year ended December 31, 2016, using the straight-line method, we need to determine the depreciable base and divide it by the useful life.
The depreciable base is the cost of the equipment minus the estimated residual value. In this case:
Depreciable Base = Cost of equipment - Estimated residual value
Depreciable Base = $25,000 - $2,500
Depreciable Base = $22,500
Next, we divide the depreciable base by the useful life to calculate the annual depreciation expense:
Depreciation Expense = Depreciable Base / Useful life
Depreciation Expense = $22,500 / 5
Depreciation Expense = $4,500
Therefore, the depreciation expense for the year ended December 31, 2016, using the straight-line method, is $4,500. The correct option is d. $4,500.
To know more about depreciation, visit
https://brainly.com/question/29894489
#SPJ11
A loan for $66,000 is made for 10 years at 5 percent interest and no monthly payments will be due (aśsuming monthly compounding) Required: a. How much will be due at the end of 10 years? b. What will be the yield to the lender if it is repaid after eight years? c. If 1 point is charged to the yield, what will be the new yleld to the lerider?
At the end of 10 years, $108,347.29 will be due. The yield to the lender, if the loan is repaid after eight years, is approximately 6.13%. If 1 point is charged to the yield, the new yield to the lender would be approximately 7.13%.
a. To calculate the amount due at the end of 10 years, we can use the formula for compound interest: A = P(1 + r/n)^(nt), where A is the future value, P is the principal amount, r is the interest rate, n is the number of compounding periods per year, and t is the number of years.
In this case, the principal amount is $66,000, the interest rate is 5% (or 0.05), the compounding is monthly (so n = 12), and the loan duration is 10 years (or t = 10). Plugging these values into the formula, we find:
A = $66,000(1 + 0.05/12)^(12*10) = $108,347.29
Therefore, $108,347.29 will be due at the end of 10 years.
b. To calculate the yield to the lender after eight years, we need to find the interest rate that would result in a future value of $66,000 after eight years. Using the same formula and rearranging it to solve for r, we get:
r = (A/P)^(1/(nt)) - 1 = ($66,000/$108,347.29)^(1/(128)) - 1 ≈ 0.0613
So, the yield to the lender, if the loan is repaid after eight years, is approximately 6.13%.
c. If 1 point is charged to the yield, it means the interest rate is increased by 1 percentage point. Therefore, the new yield to the lender would be approximately 6.13% + 1% = 7.13%.
Adding 1 point to the original yield of 6.13% results in a new yield of 7.13% for the lender. This adjustment reflects an increase in the interest rate charged, which compensates the lender for the additional risk or cost associated with the loan.
To learn more about loan, Click Here: brainly.com/question/30015539
#SPJ11
Theledger of Pina Colada Corp on March 31 of the current year includes the selected accounts below before adjusting entries have beenprepared. 7. Interest of sanowaconued on the noges purable: 4. Fu5pheconfign 10 a $1.020
The ledger of Pina Colada Corp on March 31 of the current year includes the selected accounts below before adjusting entries have been prepared.
7. Interest of Sanowaconued on the noges purable: 4. Fu5pheconfign 10 a $1.020.Below are the adjusting entries for the accounts stated in the question above:1. Interest Expense: Debit (Sanowaconued on the Notes Payable) and Credit (Interest Payable)Entries for accrued interest on notes payable are recorded with an offsetting entry to interest expense. This will take place at the end of the accounting period before the financial statements are prepared. Accrued interest is calculated based on the length of the loan and the interest rate.2. Depreciation Expense: Debit (Furniture and Fixtures) and Credit (Accumulated Depreciation-Furniture and Fixtures)Depreciation is recorded with an offsetting entry to depreciation expense. Accumulated depreciation is used to represent the reduction in the value of the asset over time. Depreciation expense is a non-cash transaction that reduces the value of the asset on the balance sheet.
To know more about Pina Colada Corp. visit:
https://brainly.com/question/18849693
#SPJ11
A corporate bond, with face value $1000, pays an annual coupon of 5% for 2 years. Assume the annual interest rate is 2%. If the price of this bond today is $1050, will you buy? Explain.
Yes, I would buy the corporate bond. Calculate the present value of the coupon payments.
PV(coupon payments) = Coupon Payment / (1 + interest rate) + Coupon Payment / (1 + interest rate)2
PV (coupon payments) = 0.05 * $1000 / (1 + 0.02) + 0.05 * $1000 / (1 + 0.02)2
Calculate the present value of the face value:
PV(face value) = Face Value / (1 + interest rate)2.
PV (face value) = $1000 / (1 + 0.02)2
Calculate the total present value.
Total PV = PV (coupon payments) + PV (face value)
To know more about corporate bonds visit :
https://brainly.com/question/29059164
#SPJ11
Since the price of the bond today is $1050, which is less than its present value, it is a good buy. This is because the price is lower than what the bond is actually worth.
To determine whether to buy the corporate bond, we need to compare the bond's yield to its coupon rate. The coupon payment can be calculated by multiplying the face value ($1000) by the annual coupon rate (5%). In this case, the annual coupon payment would be $50 (=$1000 * 5%).
Next, we calculate the present value of the bond by discounting the future cash flows (coupon payment and face value) at the annual interest rate of 2%. The present value of the two $50 coupon payments can be calculated using the formula: PV = Coupon / (1 + r) + Coupon / (1 + r)², where r is the annual interest rate. In this case, the present value of the coupon payments would be approximately $97.93.
The present value of the face value ($1000) can be calculated using the formula: PV = Face Value / (1 + r)ⁿ, where n is the number of years until maturity. In this case, the present value of the face value would be approximately $960.78.
By summing the present values of the coupon payments and face value, we find that the present value of the bond is approximately $1058.71.
In summary, based on the calculations, it would be beneficial to buy the corporate bond as its price is below its present value.
Learn more about present value from the given link:
https://brainly.com/question/28304447
#SPJ11
