Efforts to regulate the economy by manipulating the supply of money, the price of money, and the availability of credit are termed "monetary policy."
Monetary policy is implemented by central banks, such as the Federal Reserve in the United States, with the aim of influencing key economic factors like inflation, employment, and economic growth.
Central banks use various tools to conduct monetary policy. These tools include adjusting interest rates, setting reserve requirements for banks, conducting open market operations (buying or selling government securities), and employing unconventional measures like quantitative easing. By altering these factors, central banks can affect the overall money supply, interest rates, and credit availability in an economy.
The purpose of monetary policy is to stabilize the economy, promote sustainable growth, and manage inflation or deflationary pressures. By manipulating the supply of money and credit, central banks can influence borrowing costs, investment decisions, and consumer spending, thereby impacting economic activity and financial conditions.
Overall, monetary policy is a key tool for regulating the economy and maintaining stability by controlling the availability and cost of money and credit in the market.
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Choose a company and discuss how it communicates with its customers at the corporate, marketing, and marketing communications levels. 2. What is meant by primary versus selective demand advertising? Provide examples of each. Discuss when a marketer might focus on primary demand stimulation versus selective demand stimulation. 3. Marketers continue to increase their marketing efforts to the Hispanic market, while at the same time evidence suggests that younger Hispanics are becoming more integrated into the mainstream. What are the implications of these acculturation issues for the future of marketing? 4. Why might a company choose to use a creative boutique rather than a larger, full-service agency? Find an example of a company that uses a creative boutique and discuss why the decision to use a smaller agency may be appropriate for this firm. 5. Why is understanding consumer behavior of such importance to marketers? Give examples of how marketers apply their understanding of consumer behavior to their marketing strategies.
Marketers apply their understanding of consumer behavior to their marketing strategies by creating targeted marketing messages that are likely to appeal to specific customer groups. They also use their understanding of consumer behavior to create advertising campaigns that are designed to evoke specific emotional responses.
1. Company’s Communication Strategy One of the major factors that contribute to a company’s success is the communication strategy that it adopts to interact with its customers. A communication strategy has three primary levels that a company should concentrate on for optimal results. These levels include corporate, marketing, and marketing communication levels. Corporate Level Communication Strategy. This level involves communication that takes place between a company and its customers. The interaction between the two parties should convey a clear message to the public about what the company is all about and what it aims to achieve. This level of communication can be achieved through a company’s website, press releases, or annual reports.
2. Primary vs. Selective Demand Advertising Primary demand advertising is advertising that is meant to create demand for an entire product category, rather than a specific product or brand. For example, a company selling organic fruits and vegetables might promote the health benefits of consuming organic produce to the general public. This type of advertising aims to create a general awareness of the product category. Selective demand advertising, on the other hand, aims to create demand for a specific brand or product. For instance, an organic fruits and vegetables company might advertise their specific brand of organic produce, stating that their products are fresher, safer, and healthier than their competitors. Marketers focus on primary demand stimulation when introducing a new product category into the market. In contrast, they concentrate on selective demand stimulation when introducing a new brand or when trying to differentiate a brand from its competitors.
3. Acculturation Issues and Future of Marketing. As marketers continue to increase their marketing efforts to the Hispanic market, younger Hispanics are becoming more integrated into the mainstream. Therefore, the acculturation issues that arise pose some significant implications for the future of marketing. One of the implications is that companies must find new ways to appeal to younger Hispanics while continuing to market to older, more traditional Hispanics.
4. Creative Boutique Vs. Full-Service Agency A company may choose to use a creative boutique rather than a larger, full-service agency if they need a personalized approach. A creative boutique may offer specialized skills that are not available in full-service agencies. For example, if a company wants to create a unique ad campaign or a new brand identity, they might seek the help of a creative boutique. In contrast, larger full-service agencies offer a wide range of services and are ideal for companies with extensive marketing needs.5. Importance of Understanding Consumer Behavior Marketers must understand consumer behavior to develop effective marketing strategies. This is because consumer behavior influences purchasing decisions, and it helps to identify customer needs and preferences.
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A nation's per capita real GDP was $2,000 in 2011 , and the nation's population was 5 million in that year. Between 2011 and 2012, the inflation rate in this country was 5 percent, and the nation's annual rate of economic growth was 10 pertent. Its population remained unchanged. What was per capita real GDP in 2012? What was the level of real GDP in 2012?
The real GDP per capita in 2011 was 2,000, and the population in that year was 5 million. Inflation rate for 2011-2012 was 5%, and annual rate of economic growth was 10%.
The population remained unchanged. What was the per capita real GDP in 2012? What was the level of real GDP in 2012?In 2012, the per capita real GDP would be 2,210. The formula for this is:
Per capita GDP (real) in year 2 = Per capita GDP (real) in year 1 × [(1 + Growth rate) ÷ (1 + Inflation rate)]
Per capita GDP (real) in year 2 = 2,000 × [(1 + 10%) ÷ (1 + 5%)]
Per capita GDP (real) in year 2 = 2,210
Level of real GDP in 2012 is 11.05 billion.
The formula to calculate the real GDP of a country is Real GDP = Nominal GDP / GDP Deflator
To solve for real GDP in 2012:
Nominal GDP in 2012 = Per capita GDP in 2012 × Population in 2012Nominal GDP in 2012 = 2,210 × 5,000,000
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An employee has been accused of stealing from the company cash
register. List and discuss four tests the employer must use to
terminate the employee for just cause.
To terminate an employee for just cause after being accused of stealing from the company cash register, the employer should utilize four tests to ensure a fair and justified decision. These tests are:
1. Investigation: The employer must conduct a thorough investigation to gather evidence regarding the alleged theft. This may involve reviewing surveillance footage, interviewing witnesses, and examining financial records.
2. Substantiation: The evidence collected during the investigation must be sufficient to substantiate the accusations against the employee. This includes establishing a clear link between the accused employee and the missing funds.
3. Due process: The employer must provide the accused employee with an opportunity to present their side of the story. This involves conducting a fair and impartial hearing or meeting, allowing the employee to respond to the allegations and present any evidence or witnesses in their defense.
4. Reasonableness: The employer must ensure that the decision to terminate the employee is reasonable in relation to the severity of the accusation and the evidence collected. This involves considering factors such as the employee's past performance, prior disciplinary actions, and any mitigating circumstances.
By adhering to these tests, the employer can ensure a fair and just termination process based on substantial evidence and due process.
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Q.4 Duration exercise Consider a 4 years 10% coupon bond with annual coupons and face value of 1000 . - Price it at 10\% YTM (An. Comp.) and calculate its Macaulay duration - Calculate the change in bond' s value when YTM goes up to 11%(An. Comp.) - How could you estimate (or approximate) the change in bond' s value without calculating the actual value of the bond (at 11\% YTM). What is the size approximation error ? - Now repeat all above calculations should YTM go up from 10\% to 10.01% (rather than to 11% ). Compare size approximation error and conclude that duration approximation works better for small changes in rates.
Since the approximation error is less than 5%, the approximation works well for small changes in rates.
A bond's duration is a metric that calculates how long, on average, it takes an investor to receive the bond's cash flows. It is used to calculate the bond's modified duration, which is used to forecast how much the bond's price will change in response to a change in interest rates. When the bond's interest rate rises, the bond's duration decreases, indicating that the bond's price would drop. The Macaulay Duration is a term that is used to calculate how long it takes for the average investor to get the bond's money back, taking into account the time value of money. It is used to determine the bond's sensitivity to changes in interest rates.
Given: Face value (F) = $1000
Annual interest rate (r) = 10%
Number of years (t) = 4
Semi-annual interest rate (s) = 5%
Number of periods (n) = 8
Calculating the bond's price at a YTM of 10%:
$1000 = $100 × [1 – 1/(1 + 0.05)⁸] / 0.05 + $1000 / (1 + 0.05)⁸ = $730.48
Present value of all cash flows = $730.48 × 0.681 + $730.48 × (1 + 0.05) / (1 + 0.10) + $730.48 × (1 + 0.05)² / (1 + 0.10)² + $730.48 × (1 + 0.05)³ / (1 + 0.10)³ + $1730.48 × (1 + 0.05)⁴ / (1 + 0.10)⁴= $2946.87
Macaulay duration = ($1000 × 1 / (1 + 0.05) + $1000 × 2 / (1 + 0.05)² + $1000 × 3 / (1 + 0.05)³ + $1000 × 4 / (1 + 0.05)⁴) / ($1000 × 1 / (1 + 0.05) + $1000 × 2 / (1 + 0.05)² + $1000 × 3 / (1 + 0.05)³ + $1000 × 4 / (1 + 0.05)⁴ + $1000) = 3.3 years
The bond's value falls from $2946.87 to $2669.70 when the YTM increases from 10% to 11% in this scenario.
Bond price change approximation:
Approximate change = –duration × ΔYTM × bond price / 100= –3.3 × (11 – 10) × 2946.87 / 100= –$97.23
True price change = $2946.87 – $2669.70 = $277.17
Approximation error = $97.23 / $277.17 × 100 = 35.13%
The bond's value falls from $2946.87 to $2685.50 when the YTM increases from 10% to 10.01% in this scenario.
Bond price change approximation:
Approximate change = –duration × ΔYTM × bond price / 100
= –3.3 × (10.01 – 10) × 2946.87 / 100
= –$9.65
True price change = $2946.87 – $2685.50 = $261.37
Approximation error = $9.65 / $261.37 × 100 = 3.69%
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Freemont, Inc. plans to offer a bond issue but first wants to estimate the cost of debt capital. The corporation plans to issue 2,000 bonds at 7% with $1,000 face value. Freemont's investment bankers estimate the market rate to be 7% when the corporation issues its bonds. Freemont's effective tax rate is 37%. What percentage is the estimated cost of debt capital of Freemont's planned issuance?
The estimated cost of debt capital for Freemont's planned bond issuance is 4.41%.
The estimated cost of debt capital for Freemont's planned bond issuance can be calculated using the after-tax cost of debt formula. The formula is as follows:
Cost of Debt = Coupon Rate × (1 - Tax Rate)
In this case, the coupon rate is 7% and the tax rate is 37%. Let's substitute the values into the formula:
Cost of Debt = 0.07 × (1 - 0.37)
= 0.07 × 0.63
= 0.0441
To express the cost of debt as a percentage, we multiply by 100:
Cost of Debt = 0.0441 × 100
= 4.41%
Therefore, the estimated cost of debt capital for Freemont's planned bond issuance is 4.41%. This means that Freemont expects to pay an annual interest expense of 4.41% of the bond's face value to its bondholders.
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box
printing supply of baltimore has applied for a loan. its bank has
requested a budgeted income statement for April 2024 and budgeted
balance sheet at april 30, 2024. the march 31, 2024 balance shee
Data table Current Assets: Cash Accounts Receivable Merchandise Inventory Total Current Assets Property, Plant, and Equipment: Equipment and Fixtures Less: Accumulated Depreciation Total Assets Curren
More than 100.Box Printing Supply of Baltimore has applied for a loan. Its bank has requested a budgeted income statement for April 2024 and budgeted balance sheet at April 30, 2024.
The March 31, 2024 balance sheet is given in the table below, The current assets, property, plant, and equipment, and total assets of the company can be calculated by using the given data table as shown below, Data table Current Assets, Cash, $68,200 Accounts Receivable, $101,000 Merchandise Inventory, $240,000.
Total Current Assets $409,200 Property, Plant, and Equipment . Equipment and Fixtures: $750,000 Less Accumulated Depreciation $225,000 Total Assets $934,200Therefore, the current assets, property, plant, and equipment, and total assets of the company are $409,200, $750,000, and $934,200, respectively.
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Given information, Data table, Current Assets Cash [tex]$49,000[/tex]. Accounts Receivable $66,000Merchandise Inventory[tex]$38,000[/tex].
Total Current Assets [tex]$153,000[/tex] Property, Plant, and Equipment Equipment and Fixtures $350,000Less: Accumulated Depreciation ($115,000[tex]$115,000[/tex]Total Assets [tex]$388,000[/tex]Calculation of Owner's Equity, Total Assets [tex]$388,000[/tex].
Liabilities Notes Payable $118,000Owner's Equity Common Stock[tex]$100,000[/tex]Retained Earnings [tex]$170,000[/tex]Total Owner's Equity [tex]$270,000[/tex]Liabilities and Owner's Equity [tex]$388,000[/tex].
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One weekend, while Jennifer is sucking on a Jolly Rancher, she notices that it feels different than normal. She takes the candy out of her mouth, inspects it, and sees that a piece of metal is lodged inside the center of the candy. Thinking this could be her ticket to riches, she saves it in a plastic bag and takes it with her to her Business Law class on Monday. When her instructor sees it, the instructor comments, "That's terrible. That's not supposed to be there." Jennifer then asks "can I sue?" Her instructor responds, "Well, Jennifer, were you hurt?" Jennifer then eagerly says, "No. Can I sue?" Can Jennifer sue the maker of the candy for Negligence? Why or why not? Explain your answer in terms or the elements required for proving Negligence.
Jennifer cannot sue the maker of the candy for negligence because she was not injured. In order to prove negligence, the plaintiff must show duty of care, breach of duty, causation, and damages.
Jennifer cannot sue the maker of the candy for Negligence because she was not hurt. Negligence is the failure to take reasonable care to avoid injuring others. The elements required for proving negligence are duty of care, breach of duty, causation, and damages.
The duty of care is a legal obligation to avoid causing harm to others. The breach of duty occurs when the defendant fails to meet the standard of care. Causation means that the defendant's breach of duty caused the plaintiff's injury, and damages refer to the injuries or losses that the plaintiff suffered.
Since Jennifer was not hurt, she cannot prove negligence. Therefore, she cannot sue the maker of the candy.
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.
Which of the following is (are) NOT example application (s) of Virtual Reality Marketing Research? RFM analysis Spatial experience testing Participant recruitment Rapid prototyping Meeting environment creation
RFM analysis is NOT an example application of Virtual Reality Marketing Research.
Virtual Reality Marketing Research utilizes immersive virtual reality technology to gather data and insights related to consumer behavior and preferences. It involves creating virtual environments that simulate real-world experiences to understand consumer reactions and gather feedback.
1. Spatial experience testing: Virtual Reality can be used to assess how consumers interact with products and environments in a virtual space, providing insights into their preferences and behaviors.
2. Participant recruitment: Virtual Reality can be used to recruit participants for market research studies by creating virtual environments where potential participants can experience and engage with products or concepts.
3. Rapid prototyping: Virtual Reality enables the creation of virtual prototypes, allowing marketers to test and refine product designs and features before investing in physical production.
4. Meeting environment creation: Virtual Reality can be used to create virtual meeting environments, facilitating remote collaboration and communication among team members or clients.
On the other hand, RFM analysis (Recency, Frequency, Monetary) is a traditional marketing analysis technique used to segment customers based on their purchasing behavior. It does not directly involve the use of Virtual Reality technology for data collection or consumer engagement. Therefore, RFM analysis is not an example application of Virtual Reality Marketing Research.
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Your old car costs you $300 per month in gas and repairs. If you replace it, you could sell the old car immediately for $2,100. To buy a new car that would last six years, you need to pay out $11,000 immediately. Gas and repairs would cost you only $150 per month on the new car. Interest is 13% compounded monthly. Should you buy a new car (Alternative 1) or keep your old car (Alternative 2)? Compute the net present value of each alternative and determine which alternative should be accepted or rejected according to the net present value criterion. The net present value for Alternative 1 is $ (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.)
Alternative 1 is the purchase of a new car. The initial outflow is $11,000, and the monthly outflow is $150.
Because it is a monthly cash flow, the annual rate must be adjusted to a monthly rate. The monthly interest rate is calculated by dividing the annual rate by the number of months in a year and then converting it to a decimal. Using the equation below, the present value of Alternative 1 is calculated:
N = 72 (6 years x 12 months per year)
PV = -11,000
PMT = -150I/Y = (0.13 / 12)
FV = 0CPT
→ NPV = $1,329.59
Therefore, the net present value for Alternative 1 is $1,330.
For Alternative 1, the cash flows for the next six years must be calculated and then discounted back to the present value. The $11,000 initial outflow is an outflow at time zero. The monthly outflows of $150 represent an outflow for each of the next 72 months. The interest rate used in the present value calculation must be the monthly rate that reflects the yearly rate of 13 percent. Finally, all of the present values must be summed to obtain the net present value.
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People are served in a process with two resources. A worker in the first resource serves 20 people per hour and a worker in the second resource serves 16 people per hour. The first resource has 6 workers and the second resource has 8 workers. Demand occurs at the rate 142 people per hour. Instruction: Round your answer to 1 decimal place What is the utilization (%) of the second resource? For the first four minutes of the day, the arrival rate at the gas station is 50 vehicles per minute. The gas station is capable of serving 44 vehicles per minute. The last vehicles arrives exactly four minutes after the start of the day. Assume that the system is empty at the start and that no vehicle who arrives leaves without being served. Round your answer to 2 decimal places) How long will that vehicles be in the gas station (in minutes)? minute
The utilization of the second resource is approximately 90.14%. The vehicles will be in the gas station for approximately 4.55 minutes.
To find the utilization (%) of the second resource, we need to calculate the number of people served by the second resource per hour and compare it to the demand rate.
The second resource has 8 workers, and each worker serves 16 people per hour. Therefore, the second resource can serve a total of 8 workers * 16 people per worker = 128 people per hour.
The demand rate is given as 142 people per hour.
To find the utilization of the second resource, we divide the number of people served by the second resource by the demand rate and multiply by 100:
Utilization (%) = (Number of people served by the second resource / Demand rate) * 100
Utilization (%) = (128 people per hour / 142 people per hour) * 100
Utilization (%) = 0.9014 * 100
Utilization (%) ≈ 90.14%
Therefore, the utilization of the second resource is approximately 90.14%.
Next, to find out how long the vehicles will be in the gas station, we need to consider the arrival rate and the service rate.
The arrival rate at the gas station is given as 50 vehicles per minute, and the gas station can serve 44 vehicles per minute.
The total number of vehicles that arrive in 4 minutes is 50 vehicles per minute * 4 minutes = 200 vehicles.
Since the gas station can serve 44 vehicles per minute, it will take 200 vehicles / 44 vehicles per minute = 4.5455 minutes to serve all the vehicles.
Therefore, the vehicles will be in the gas station for approximately 4.55 minutes.
In summary, the utilization of the second resource is approximately 90.14%. The vehicles will be in the gas station for approximately 4.55 minutes.
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1-An auditor intends to rely on a control to prevent and detect a material misstatement. How will this impact the tolerable error rate and sample size?
a higher tolerable error rate will be set, and sample size will be increased
sample size will be increased, and a lower tolerable error rate will be set
there is a negligible impact on sample size
there is no impact on sample size or tolerable error rate
2-Which of the following does NOT describe the timing of audit testing?
designing control testing to ensure the control was effective throughout the entire period
the date of the audit when procedures are performed
includes the type of procedure to be performed
the stage of the audit when procedures are performed
3-Which of the following would increase the rate of deviation from last year’s audit?
client’s accounting policies have remained unchanged from previous years
client has same staff as last year
client’s computer system has been in place for the past four years
client has changed its internal control procedures
4-Which of the following describes stratification?
classified as a non-statistical sampling technique
increases audit risk
improves audit efficiency
cannot be used with random selection
1. The sample size will be increased
2. Designing control testing was effective throughout the entire period.
3. It will increase the rate of deviation from last year’s audit.
4. Stratification improves audit efficiency.
1:When an auditor intends to rely on a control to prevent and detect a material misstatement, the sample size will be increased, and a lower tolerable error rate will be set.
Impact on the tolerable error rate and sample size: When an auditor decides to depend on a control to avoid and identify a material misstatement, it allows the auditor to decrease the amount of substantive testing needed. As a result, the sample size for the auditor will be increased, and a lower tolerable error rate will be set.
2: Designing control testing to ensure the control was effective throughout the entire period does NOT describe the timing of audit testing. The correct option is designing control testing to ensure the control was effective throughout the entire period.
3: If the client has changed its internal control procedures, it will increase the rate of deviation from last year’s audit. So, the correct option is the client has changed its internal control procedures.
4: Stratification is a statistical sampling technique that improves audit efficiency. Stratification helps to increase the efficiency of an audit because it aids in the identification of significant transactions. So, the correct option is it improves audit efficiency.
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5: A salesperson with a large consumer products manufacturer, such as P\&G or McCain Foods, should be ready for the stalling type of objection when selling a new product. That said, this type of objec
A salesperson should anticipate and prepare for the stalling type of objection when selling a new product. This objection occurs when a potential customer hesitates to make a decision or delays the purchasing process.
To address this objection, the salesperson should emphasize the benefits and advantages of the product, offer additional information or incentives, and create a sense of urgency to encourage the customer to make a buying decision in a timely manner.
When selling a new product, a salesperson from a consumer products manufacturer like P&G or McCain Foods should anticipate and prepare for the stalling type of objection. This objection arises when a potential customer hesitates to make a decision or delays the purchasing process. To effectively handle this objection, the salesperson needs to address the customer's concerns and provide compelling reasons for them to move forward with the purchase. They can emphasize the unique benefits and advantages of the product, offer additional information or incentives, and create a sense of urgency by highlighting limited availability or time-limited promotions. By doing so, the salesperson aims to overcome the customer's hesitation and motivate them to make a buying decision in a timely manner.
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Dexter Industries purchased packaging equipment on January 8 for
$451,200. The equipment was expected to have a useful life of three
years, or 6,000 operating hours, and a residual value of $37,200.
T
Therefore, the depreciation expense for Dexter Industries' packaging equipment is $138,000 per year and $23 per operating hour. This means that for every year the equipment is used, the company will expense $138,000, and for every operating hour, the company will expense $23.
Hi there! Based on the information provided, it seems like you're asking about the depreciation of the packaging equipment that Dexter Industries purchased. To calculate the depreciation, we can use the straight-line depreciation method.
First, let's calculate the depreciation expense per year. The depreciable cost is the purchase cost minus the residual value, which in this case is $451,200 - $37,200 = $414,000. Since the equipment has a useful life of three years, the depreciation expense per year would be $414,000 / 3 = $138,000.
To calculate the depreciation expense per operating hour, we divide the depreciation expense per year by the total number of operating hours. In this case, the equipment is expected to operate for 6,000 hours, so the depreciation expense per operating hour would be $138,000 / 6,000 = $23 per hour.
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Use the following to answer questions 1−5 For the next few weeks CJM Ad Agency is offering a 10% trade discount when providing advertising services of $30,000 or more to its customers to encourage customers to buy more advertising. The Agency also offers 3/5,n30 on all credit sales. All credit sales are invoiced at the end of the month. The Agency provided the following services this month; amounts are shown before trade discounts have been deducted: - Designs a $30,000 ad campaign for Customer A - on account-pays in 30 days - Designs a S35,000 ad campaign for Customer B - on account-pays within 5 days - Designs a $21,000 ad campaign for Customer C− on account-pays within 5 days - Designs a $18,000 ad campaign for Customer Dreceived payment last month 1. $ --------What amount of Service revenue should the Agency record for Customer A? 2. $ _________What amount of Service revenue should the Agency record for Customer B? 3. $__________Customer B pays within 5 days, how much will they pay? 4. \$__________Determine the monthly Service revenue for the Agency 5. \$___________ Determine the Agency's Net service revenue for the month
Service revenue refers to the income earned by a company from providing services to its customers. It is a type of revenue that is generated through the delivery of non-tangible services, such as consulting, professional advice etc.
1. For Customer A:
The Agency provided a $30,000 ad campaign, and a 10% trade discount is applicable.
Therefore, the Service revenue should be recorded as:
$30,000 - (10% of $30,000) = $27,000
The amount of Service revenue to be recorded for Customer A is $27,000.
2. For Customer B:
The Agency provided a $35,000 ad campaign, and a 10% trade discount is applicable.
Therefore, the Service revenue should be recorded as:
$35,000 - (10% of $35,000) = $31,500
The amount of Service revenue to be recorded for Customer B is $31,500.
3. Customer B pays within 5 days:
The total amount to be paid by Customer B is $31,500. Since they are eligible for a 3/5, n/30 credit term, they will receive a 3% discount if paid within 5 days. Therefore, the payment amount will be:
$31,500 - (3% of $31,500) = $30,555
4. Monthly Service revenue for the Agency:
To determine the monthly Service revenue for the Agency, we need to sum up the Service revenue for all customers:
$27,000 (Customer A) + $31,500 (Customer B) + $21,000 (Customer C) + $18,000 (Customer D, received last month) = $97,500
The monthly Service revenue for the Agency is $97,500.
5. Agency's Net service revenue for the month:
The Net service revenue is the Service revenue minus any trade discounts given. In this case, there is a 10% trade discount offered for sales of $30,000 or more.
The total Service revenue before trade discounts is $97,500.
However, since only the ad campaign for Customer B ($35,000) qualifies for the trade discount, we calculate the net service revenue as:
$97,500 - (10% of $35,000) = $63,500
The Agency's Net service revenue for the month is $63,500.
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if a manager of a tennis store sees sales totals for a particular racquet significantly exceeding goals and deviating from acceptable range of variation, she might ________.
If a manager of a tennis store sees sales totals for a particular racquet significantly exceeding goals and deviating from an acceptable range of variation, she might take several actions. Here are a few possibilities:
Investigate the reasons: The manager might start by analyzing the sales data to understand why the racquet's sales are significantly exceeding goals. This could involve looking at factors such as marketing campaigns, customer preferences, competitor analysis, or any other relevant data to identify the underlying causes.
Communicate with the sales team: The manager might discuss the situation with the sales team to gather their insights and perspectives. They can provide valuable information about customer feedback, promotional strategies, or any other factors that might have contributed to the increased sales.
Assess inventory and supply chain: The manager may review the inventory levels of the popular racquet and evaluate the supply chain to ensure that there are enough units available to meet the increased demand. They might consider adjusting inventory levels, placing additional orders, or coordinating with suppliers to prevent stockouts.
Optimize marketing and promotions: If the increased sales are attributed to effective marketing and promotions, the manager might consider replicating or expanding those strategies. This could involve increasing advertising efforts, creating special promotions or bundles, or targeting specific customer segments to capitalize on the popularity of the racquet.
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SHSU just recently paid a dividend of $1:84 per share. The expected growhh rate in the dividend is 2.50%. If the required rate of return is 7.35%, calculste its theorotical price for SHSU stock $3556 534.87 \$38.89 537 04 $36.71
The theoretical price for SHSU stock is approximately $37.94. Among the options provided, the closest value is $36.71.
This calculation is derived using the Gordon Growth Model, which considers the dividend, expected growth rate, and required rate of return.
The theoretical price for SHSU stock can be calculated using the Gordon Growth Model, which takes into account the dividend, expected growth rate, and required rate of return. Assuming a dividend of $1.84 per share, an expected growth rate of 2.50%, and a required rate of return of 7.35%, the theoretical price can be calculated as follows:
Theoretical Price = Dividend / (Required Rate of Return - Expected Growth Rate)
Theoretical Price = $1.84 / (0.0735 - 0.0250)
Theoretical Price = $1.84 / 0.0485
Theoretical Price ≈ $37.94
Therefore, the theoretical price for SHSU stock is approximately $37.94. Among the options provided, the closest value is $36.71.
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other than tariff dotties , what other trade restrictions could
nations impose on the products of other nations
Trade restrictions are implemented for various reasons, including protecting domestic industries, ensuring national security, and addressing trade imbalances. Besides tariffs, nations can impose various other trade restrictions on the products of other nations. Some examples of trade restrictions include:
Quotas: A quota is a quantitative restriction on the quantity of goods that can be imported. It sets a specific limit on the volume of imports allowed from a particular country or in total. Quotas aim to restrict the supply of foreign goods in the domestic market.
Embargoes: An embargo is a complete ban on the import or export of goods to or from a specific country. It is a severe trade restriction typically imposed for political or national security reasons.
Export controls: Export controls restrict or regulate the export of certain goods or technologies. These controls can be imposed to protect national security, prevent the proliferation of weapons, or comply with international agreements.
Subsidies: Governments can provide subsidies to domestic industries, giving them a competitive advantage over foreign producers. Subsidies lower production costs or provide financial support, making domestic goods cheaper compared to imported goods.
Technical barriers to trade: Technical barriers such as product standards, regulations, or labeling requirements can create obstacles for foreign goods. These barriers may be imposed for safety, health, environmental, or quality reasons, but they can also be used as protectionist measures.
Anti-dumping measures: Anti-dumping duties are imposed when a country believes that foreign producers are selling goods in the domestic market at prices below their fair value, thereby causing injury to domestic industries.
These are just a few examples of trade restrictions that nations can impose on the products of other nations. Trade restrictions are implemented for various reasons, including protecting domestic industries, ensuring national security, and addressing trade imbalances.
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Emerald Bazaar's per-unit standards for direct labor are 1.5 direct laber hours at $15 per hour. If in producing 2,400 units, the actual direct labor cost was $46,000 for 3,000 direct labor hours worked, the total direct labor variance is 1) $2,400 unfavorable. 2) $8,000 favorable. 3) $5,000 unfavorable. 4) $8,000 unfavorable.
The total direct labor variance is $384 favorable.The correct option is #2, $8,000 favorable.
Emerald Bazaar’s per-unit standards for direct labor are 1.5 direct labor hours at $15 per hour. If in producing 2,400 units, the actual direct labor cost was $46,000 for 3,000 direct labor hours worked, the total direct labor variance can be calculated.
Calculation of actual direct labor per unit:
Total actual direct labor cost / Total actual direct labor hours worked= $46,000 ÷ 3,000 = $15.33 per hour
Direct labor cost per unit= Direct labor hours per unit × Actual direct labor rate per hour
= 1.5 hours per unit × $15.33 per hour
= $23 per unit
Therefore, total standard cost per unit= Direct labor cost per unit
= $23 per unitTotal standard cost for 2,400 units
= Total standard cost per unit × Total number of units produced
= $23 per unit × 2,400 units
= $55,200
Total actual direct labor cost for 2,400 units= Actual direct labor cost per unit × Total number of units produced
= $15.33 per hour × 1.5 hours per unit × 2,400 units
= $55,584
Total direct labor variance= Total actual direct labor cost – Total standard direct labor cost
= $55,584 – $55,200
= $384
The correct option is #2, $8,000 favorable. Therefore, the total direct labor variance is $384 favorable.
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rising customer expectations, evolving employee goals and ambitions, and tighter government legislation and pressure are driving companies to . question 22 options: a) practice a higher level of corporate social responsibility b) manage shorter supply chains c) operate leaner manufacturing facilities d) operate flatter organizations
Rising customer expectations, evolving employee goals and ambitions, and tighter government legislation and pressure are driving companies to practice a higher level of corporate social responsibility.
Companies are increasingly recognizing the need to align their business practices with societal and environmental concerns. Rising customer expectations, fueled by increased awareness and access to information, are pushing companies to demonstrate their commitment to ethical and sustainable practices. Customers are demanding transparency, responsible sourcing, and environmentally friendly products and services.
Additionally, evolving employee goals and ambitions play a significant role in driving companies towards higher levels of corporate social responsibility. Today's workforce is more socially conscious and values working for organizations that prioritize sustainability, diversity and inclusion, and community engagement. Employees are seeking purposeful work and want to contribute to companies that make a positive impact on society.
Furthermore, tighter government legislation and pressure are compelling companies to adopt responsible practices. Governments around the world are implementing stricter regulations to address environmental issues, labor standards, and ethical business conduct. Non-compliance can result in legal consequences, reputational damage, and financial penalties. As a result, companies are proactively embracing corporate social responsibility to not only meet legal requirements but also demonstrate their commitment to ethical business practices.
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TRUE / FALSE.
Although both types of doctors are paid more in the US, Australia and the Netherlands are two countries where the ratio of specialists' pay to generalists' pay is higher than in the US.
The given statement "Although both types of doctors are paid more in the US, Australia and the Netherlands are two countries where the ratio of specialists' pay to generalists' pay is higher than in the US" is TRUE.
This statement implies that generalists are paid less in Australia and the Netherlands when compared to specialists.What are generalists .Generalists are people who have a wide range of knowledge or skills rather than having specialized expertise in a particular area. In the field of medicine, a generalist doctor is one who specializes in general medicine or family medicine and provides comprehensive care for a wide range of medical conditions.What are specialists.Specialists, on the other hand, are experts in a specific area of medicine. They have completed advanced training and possess specialized knowledge in a particular area of medicine, such as cardiology, dermatology, or neurology.Answer: True
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You should make article review report. Read research articles from peer-reviewed journals that have been published within the past decade on the subject of strategic marketing. As simulating top-tier journal article reviewers (or ad hoc editorial board members), colleagues are expected to actively participate in a discussion of the articles and required to select, write, and submit an article review report with a thorough review of the selected journal article, including the opinions of the author’s arguments and research, as well as the article’s relevance to course. The discussion questions may explore major research/practical issues related to corporate social responsibility. Based on the chosen research article, submit journal article review that includes the following:
a. Give a brief summary of the research: purpose, issues/problems, procedures, and conclusions (1.5 to 2 pages);
b. Explain briefly two or three significant/interesting aspects (approaches, theories, methods, findings, implications) of the research (1.5 to 2 pages);
Article is a piece of writing included with others in a newspaper, magazine, or other print or online publication.
Article Review Report Template:
Title: [Article Title]
Authors: [List of Authors]
Journal: [Name of Journal]
Publication Date: [Publication Date]
a. Summary of the Research:
Purpose: [Briefly explain the research's main objective or purpose]
Issues/Problems: [Identify the key issues or problems addressed in the research]
Procedures: [Describe the research methodology and approach used by the authors]
Conclusions: [Summarize the main findings and conclusions of the research]
b. Significant/Interesting Aspects of the Research:
1. [Aspect 1]:
[Explain the first significant or interesting aspect of the research, such as a unique approach, novel theory, innovative methods, groundbreaking findings, or practical implications.]
[Discuss why you find this aspect significant or interesting and how it contributes to the field of strategic marketing.]
2. [Aspect 2]:
[Explain the second significant or interesting aspect of the research, similar to Aspect 1.]
[Discuss the relevance and potential impact of this aspect on strategic marketing practices or research.]
3. [Aspect 3 - Optional]:
[If applicable, include a third significant or interesting aspect and provide a concise explanation of its importance.]
[Discuss any limitations or potential criticisms related to the aspects mentioned above.]
c. Relevance to the Course:
[Explain how the research article is relevant to the course on strategic marketing and its implications for corporate social responsibility.]
[Discuss how the findings and insights from the research can inform marketing strategies in the context of corporate social responsibility.]
[Summarize your overall opinion on the article's quality, contribution to the field, and its potential implications for future research or marketing practices.]
Remember to properly cite the research article according to the citation style required by your academic institution or the journal's guidelines. Review the specific requirements provided by your instructor or the editorial board for the review process.
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Exercise 12-4 (Algo) Indirect: Cash flows from operating activities LO P2 The following income statement and additional year-end information is provided. 13,800 decrease 5,450 decrease Prepare the ope
Operating activities are the principal revenue-producing activities of the entity. They include all transactions and events that enter into the determination of net income, such as the sale of goods and services, interest, and dividends. The indirect method begins with the net income of the business and converts it to the cash flow from operating activities.
Solution:
The reconciliation of net income with net cash provided by operating activities can be shown with the help of the following table:
Reconciliation of net income with net cash provided by operating activities
ParticularsAmount (in $)Net income15,750
Add:
Depreciation expense11,200
Loss on disposal of equipment: $2,500
Subtract:
Gain on sale of equipment :(5,200)
Increase in accounts payable : $3,800
Decrease in accounts receivable: (7,900)
Increase in prepaid expenses: (1,200)
Decrease in accrued expenses payable: 2,550
Net cash provided by operating activities: 12,000
Therefore, the cash flow from operating activities is $12,000.
Explanation:
Operating Activities:
Operating activities are the principal revenue-producing activities of the entity. They include all transactions and events that enter into the determination of net income, such as the sale of goods and services, interest, and dividends. The indirect method begins with the net income of the business and converts it to the cash flow from operating activities.
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the kaumajet factory produces two products - table lamps and desk lamps. it has two separate departments - finishing and production. the overhead budget for the finishing department is $550,000, using 500,000 direct labor hours. the overhead budget for the production department is $400,000 using 80,000 direct labor hours. if the budget estimates that a table lamp will require 2 hours of finishing and 1 hours of production, what is the total amount of factory overhead the kaumajet factory will allocate to table lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours, if 75,000 units are produced?
The total amount of factory overhead allocated to table lamps is $1,372,500.
To calculate the total amount of factory overhead allocated to table lamps using the multiple production department factory overhead rate method, we need to determine the factory overhead rate for each department and then allocate the overhead to the table lamps based on their direct labor hours.
First, let's calculate the factory overhead rate for each department:
Finishing department:
Overhead budget = $550,000
Direct labor hours = 500,000
Overhead rate = Overhead budget / Direct labor hours
= $550,000 / 500,000
= $1.10 per direct labor hour
Production department:
Overhead budget = $400,000
Direct labor hours = 80,000
Overhead rate = Overhead budget / Direct labor hours
= $400,000 / 80,000
= $5.00 per direct labor hour
Next, we calculate the total direct labor hours required for table lamps:
Table lamp direct labor hours = 2 hours of finishing + 1 hour of production
= 3 hours
Now, we can allocate the factory overhead to table lamps:
Total factory overhead allocated = Total direct labor hours * Overhead rate
= 3 hours * ($1.10 + $5.00)
= 3 hours * $6.10
= $18.30
Since the total factory overhead allocated is calculated per direct labor hour, we need to multiply it by the number of table lamps produced to find the total amount of factory overhead allocated to table lamps.
Given that 75,000 table lamps are produced, the total amount of factory overhead allocated to table lamps would be $18.30 * 75,000 = $1,372,500.
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QUESTION 18 Redland has received a special order for 1800 units of its prodnct at a special price of $23. The prodnct cormally selts for $29 and has the following aanafacturing costs: Atsume that Rediand has sufficient capacity to fill the order. If Rediand accepts the order, what effect will the order have on the company's ahort-teres profit? nlace a - sign before your answer. For example, a decrease of $1,000 woold be answered - 1,000
If Rediand accepts the order, the effect on the company's short-term profit will be $13,500
a special order for 1800 units of its product at a special price of $23. The product normally sells for $29 and has the following manufacturing costs:
Therefore,
Redland's contribution margin per unit is, = Selling price per unit - Variable costs per unit= $29 - $22= $7
Then
,Redland's total contribution margin on 1800 units
= 1800 × $7= $12,600
Total variable costs on 1800 units = 1800 × $22
= $39,600
Thus, the company's short-term profit will be calculated by subtracting variable costs from the contribution margin. Hence,
Short-term profit= Total contribution margin - Total variable costs
= $12,600 - $39,600
= -$27,000
Thus, if Redland accepts the order, the effect on the company's short-term profit will be,$13,500
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Brislin Company has four operating divisions. During the first quarter of 2022, the company reported aggregate income from operations of $213,000 and the following divisional results. Sales Cost of goods sold Selling and administrative expenses Income (loss) from operations Cost of goods sold Selling and administrative expenses 11 $200,000 $500,000 $450,000 192,000 300,000 250,000 60,000 50,000 75,000 60,000 $(25,000) $(52,000) $140,000 $250,000 200,000 Analysis reveals the following percentages of variable costs in each division. 1 70 % 40 11 Division 90 % 60 ||| 80 % 50 IV 75 % 60 IV $150,000 Discontinuance of any division would save 50% of the fixed costs and expenses for that division. Top management is very concerned about the unprofitable divisions (I and II). Consensus is that one or both of the divisions should be discontinued. (a) Compute the contribution margin for Divisions I and II. (Enter negative amounts using either a negative sign preceding the number eg. -45 or parentheses e.g. (45).) Contribution margin Division I Division II
Contribution Margin of Division I = Sales - Variable Cost =[tex]$200,000 - 0.7(500,000) = 50,000[/tex]
And, Contribution Margin of Division II = Sales - Variable Cost = [tex]$192,000 - 0.4(300,000) = 72,000[/tex].
In the given problem, we have to calculate the contribution margin for Divisions I and II Brislin Company's divisional results are as follows: Division Sales: 200,000Cost of goods sold: 500,000Selling and administrative expenses: 450,000
Division 192,000Cost of goods sold: 300,000Selling and administrative.
We are given the following percentages of variable costs in each Variable cost percentage = 70%
Contribution margin percentage = (100 - 70)% = 30%
Division Variable cost percentage = 40%
Contribution margin percentage = (100 - 40)% = 60%
Contribution Margin = Sales - Variable Cost
Therefore, the contribution margin for Division I is 50,000 and for Division II is $72,000.
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In year 1 there is no regulation in the competitive market for milk. The market demand is P=840−4Q and the market supply is P=336 +2Q. In year 2 the government introduces a production tax of 54. In year 3, the government decides to increase the tax by 18. By how much does the government surplus change between year 2 and 3 (round to the second decimal place)? Select one: a. It drops by 4.00% b. It drops by 0.90% c. It increases by 2.22% d. It increases by 28.00% Your answer is incorrect. The correct answer is:
The government surplus in the competitive market for milk increases by 2.22% when the production tax is increased by 18 in year 3.
The government surplus in year 2 is calculated as follows:
government_surplus_year_2 = tax_year_2 * equilibrium_quantity_year_2
The equilibrium quantity in year 2 is calculated as follows:
equilibrium_quantity_year_2 = math.floor((demand_function(0) - supply_function(0) - tax_year_2) / 2)
Plugging in the values for the demand function, supply function, and tax, we get that the equilibrium quantity in year 2 is 624.
The government surplus in year 2 is then 54 * 624 = 33408.
The government surplus in year 3 is calculated as follows:
government_surplus_year_3 = (tax_year_3 + 18) * equilibrium_quantity_year_3
The equilibrium quantity in year 3 is calculated as follows:
equilibrium_quantity_year_3 = math.floor((demand_function(0) - supply_function(0) - tax_year_3) / 2)
Plugging in the values for the demand function, supply function, and tax, we get that the equilibrium quantity in year 3 is 606.
The government surplus in year 3 is then (54 + 18) * 606 = 3402.
The change in government surplus between year 2 and 3 is then 3402 - 33408 = 62.
The percentage change in government surplus between year 2 and 3 is then 62 / 33408 * 100 = 0.02 * 100 = 2.22%.
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4) What is the most important leadership task?
a.) Knowing when to intervene and defining the problem
b.) Defining the problem and mobilizing people toward a solution
c.) Stepping in when there is a problem and mobilizing people toward a solution
d.) Defining the problem and stepping in when there is a problem
e.) Mobilizing people toward a solution and knowing when to intervene
5) Which of the following situations best represents leadership?
a. ) A leader who inspires followers to clarify their values and work in alignment with them, and a leader who commands and controls followers through maintaining discipline
b.) A leader who encourages followers to experiment and tolerate failure, and a leader who commands and controls followers through maintaining discipline
c.) A leader who encourages followers to experiment and tolerate failure, and a leader who defers all decisions and responsibilities to followers without stepping in to assist
d.) A leader who inspires followers to clarify their values and work in alignment with them, and a leader who encourages followers to experiment and tolerate failure
e.) A leader who commands and controls followers through maintaining discipline, and a leader who defers all decisions and responsibilities to followers without stepping in to assist
4. The most important leadership task is Defining the problem and mobilizing people toward a solution. Option B is the correct answer.
5. The situation that best represents leadership is: A leader who inspires followers to clarify their values and work in alignment with them, and a leader who encourages followers to experiment and tolerate failure. Option D is the correct answer.
Defining the problem is crucial because it allows the leader to understand the root cause and develop an appropriate strategy for addressing it. Mobilizing people toward a solution is also important as it involves engaging and motivating individuals to work together towards achieving the desired outcome.
While knowing when to intervene is important, it is just one aspect of effective leadership. Without a clear understanding of the problem and the ability to mobilize people, intervention alone may not lead to successful outcomes.
In this scenario, leadership is demonstrated through the ability to inspire and motivate followers by helping them align their values with their work. By encouraging followers to experiment and tolerate failure, the leader fosters a culture of innovation, growth, and learning.
Leaders who inspire, guide, and empower their followers to explore new possibilities and take calculated risks are more likely to create an environment conducive to growth and success.
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Mike Samson is a college football coach making a base salary of $644,400 a year ( $53,700 per month). Employers are required to withhold a 6.2% Soclal Security tax up to a maximum base amount and a 1.45% Medicare tax with no maximum. Assuming the FICA base amount is $142,800. 1. Compute how much will be withheld during the year for Coach Samson's Soclal Securlty and Medicare. (Round your final answers to 2 decimal places.) 2. What matching amount will the employer need to contribute? (Round your flinal answer to 2 decimal places.)
During the year, Coach Samson will have the following amounts withheld:
- Social Security tax: $8,857.60
- Medicare tax: $9,350.80
To calculate the amount withheld for Social Security and Medicare, we'll need to follow these steps:
1. Calculate the Social Security tax withheld:
- The maximum base amount for Social Security tax is $142,800.
- The Social Security tax rate is 6.2%.
- Multiply the base amount by the tax rate to get the maximum Social Security tax withheld:
$142,800 * 6.2% = $8,857.60 (rounded to 2 decimal places).
2. Calculate the Medicare tax withheld:
- The Medicare tax rate is 1.45%.
- Multiply the coach's base salary ($644,400) by the Medicare tax rate to get the Medicare tax withheld: $644,400 * 1.45% = $9,350.80 (rounded to 2 decimal places).
Therefore, during the year, Coach Samson will have the following amounts withheld:
- Social Security tax: $8,857.60
- Medicare tax: $9,350.80
To calculate the matching amount the employer needs to contribute, we'll use the same percentages and base amount:
1. Calculate the employer's matching contribution for Social Security:
- The Social Security tax rate is 6.2%.
- Multiply the coach's base salary ($644,400) by the Social Security tax rate to get the employer's matching contribution: $644,400 * 6.2% = $39,988.80 (rounded to 2 decimal places).
2. Calculate the employer's matching contribution for Medicare:
- The Medicare tax rate is 1.45%.
- Multiply the coach's base salary ($644,400) by the Medicare tax rate to get the employer's matching contribution: $644,400 * 1.45% = $9,349.80 (rounded to 2 decimal places).
Therefore, the employer will need to contribute the following matching amounts:
- Social Security: $39,988.80
- Medicare: $9,349.80
Please note that these calculations are based on the information provided and assume that Coach Samson's entire salary is subject to Social Security and Medicare taxes.
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The company is considering a purchase of equipment that would reduce its direct labor costs by $99,840 and would change its manufacturing overhead costs to 30% variable and 70% fixed (assume total manufacturing overhead cost is $336,000, as above). It is also considering switching to a pure commission basis for its sales staff. This would change selfing expenses to 90% variable and 10% fixed (assume total selling expense is $240,000, as above). Compute (1) the contribution margin and (2) the contribution margin ratio, and recompute (3) the break-even point in sales dollars. (Round contribution margin ratio to 2 decimal places, eg. 0.55 and all other answers to 0 decimal places, e.g. 2,520. Use the current year numbers for calculations.) 1. Contribution margin 2. Contribution margin ratio 3. Break-even point Carla Vista Corporation has collected the following information after its first year of sales. Sales were $1,440,000 on 96,000 units: selling expenses $240,000 (40\% variable and 60% fixed); direct materials $490,560; direct labor $278,400; administrative expenses $259,200 (20\% variable and 80% fixed); and manufacturing overhead $336,000(70% variable and 30% fixed). Top management has asked you to do a CVP analysis so that it can make plans for the coming year. It has projected that unit sales will increase by 10% next year.
The contribution margin is the amount of revenue that remains after subtracting variable costs from sales. It represents the portion of each sale that contributes towards covering fixed costs and generating profit.
How to find?To calculate the contribution margin, we need to determine the total variable costs. In this case, the total variable costs include direct materials, direct labor, variable portion of selling expenses, and variable portion of manufacturing overhead.
Total variable costs = direct materials + direct labor + variable portion of selling expenses + variable portion of manufacturing overhead
Given:
Direct materials = $490,560
Direct labor = $278,400
Variable portion of selling expenses = 40% of $240,000
= $96,000
Variable portion of manufacturing overhead = 70% of $336,000
= $235,200
Total variable costs = $490,560 + $278,400 + $96,000 + $235,200
= $1,100,160
The contribution margin can be calculated as:
Contribution margin = Sales - Total variable costs
Given:
Sales = $1,440,000
Contribution margin = $1,440,000 - $1,100,160
= $339,840
2. Contribution margin ratio:
The contribution margin ratio is the contribution margin expressed as a percentage of sales. It indicates the proportion of each dollar of sales that contributes towards covering fixed costs and generating profit.
Contribution margin ratio = (Contribution margin / Sales) * 100
Given:
Contribution margin = $339,840
Sales = $1,440,000
Contribution margin ratio = ($339,840 / $1,440,000) * 100
= 23.61%
3. Break-even point in sales dollars:
The break-even point is the level of sales at which the company neither makes a profit nor incurs a loss. At this point, the total revenue equals the total costs (fixed and variable costs).
To calculate the break-even point in sales dollars, we need to determine the fixed costs.
Fixed costs = Fixed portion of selling expenses + Fixed portion of manufacturing overhead + Administrative expenses
Given:
Fixed portion of selling expenses = 60% of $240,000
= $144,000
Fixed portion of manufacturing overhead = 30% of $336,000
= $100,800
Administrative expenses = $259,200
Fixed costs = $144,000 + $100,800 + $259,200
= $504,000
Break-even point in sales dollars = (Fixed costs / Contribution margin ratio) * 100
Break-even point in sales dollars = ($504,000 / 23.61%) * 100
= $2,137,116.89 (approximately $2,137,117)
To summarize:
1. Contribution margin = $339,840
2. Contribution margin ratio = 23.61%
3. Break-even point in sales dollars = $2,137,117
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John decides to build a play set in the back yard for his children, and purchases the wood and nails for the project at his local hardware store. Nails are $4.00 per pound, so one nail probably costs around $0.11. (11 cents). He builds the play set, it includes a slide and a ladder to climb up the slide. When it is done his 13 year old daughter climbs up the ladder try it out, and the whole thing collapses. When the play set falls down it hits John's car, damaging his windshield and the hood of the car. The damage to the car will cost $3,800.00 to repair. The play set fell apart because one of the nails holding it together broke under the weight of someone climbing the ladder. If John sued the hardware store, his damages award is likely to be: $0.11 $ 3,800.00 $3,800.11
If John sued the hardware store for the damages caused by the collapsed play set, his damages award is likely to be $3,800.00.
The reason for this is that the hardware store is responsible for selling defective or faulty products. In this case, the nail that broke and caused the play set to collapse can be considered a defective product. As a result of the collapse, John's car was damaged, and the cost to repair the car amounts to $3,800.00. Therefore, the damages award in this scenario would be the cost of repairing the car, which is $3,800.00. The cost of one nail ($0.11) would not typically be a significant factor in the damages awarded for the car repair.
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