The demand for a good increase when the price of a substitute in consumption decreases and also decreases when the price of a complement in consumption increases.
What is demand and supply?Supply and demand is an economic theory that describes how prices are set in a market in microeconomics. In a competitive market, it is hypothesized that all else being equal, the unit price for a specific good or other traded good, such as labor or liquid financial assets, will fluctuate until it settles at a point where the quantity demanded (at the current price) will equal the quantity supplied (at the current price), resulting in an economic equilibrium for price and quantity transacted. It is the theoretical cornerstone of contemporary economics.Therefore, the demand for a good increases when the price of a substitute in consumption decreases and also decreases when the price of a complement in consumption increases.
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What is the definition of average variable cost? Multiple choice question. Total variable cost divided by output (Q) Total variable cost divided by total fixed cost (TFC) Total variable cost divided by change in output (Q) Total variable cost divided by marginal cost (MC)
The definition of average variable cost is total variable cost divided by output (Q).
What is an average variable cost?This refers to a firm's variable costs such as labor, electricity divided by the quantity of output produced.
Hence, it is also defined as total variable cost divided by output (Q).
Therefore, the Option A is correct.
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A company emphasizes ________ in its strategic planning where it develops four alternative futures based on two key variables: the cost of energy and the extent of growth opportunities in emerging markets.
A company emphasizes scenario analysis in its strategic planning where it develops four alternative futures based on two key variables: the cost of energy and the extent of growth opportunities in emerging markets.
The technique of evaluating a portfolio's expected value following a specific change in the values of key elements is known as scenario analysis. This method, which frequently makes use of computer simulations, can be used to test both likely scenarios and unlikely worst-case events.
The terms scenario planning, scenario thinking, scenario analysis, scenario prediction, and the scenario approach all refer to a flexible long-term planning technique used by some businesses. It is largely an adaptation and generalization of traditional military intelligence techniques.
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Freezing narco-barons' assets at international banks falls under which diplomatic, informational, military and economic (DIME) activity?
Freezing narco-barons' assets at international banks fall under economic activity.
Asset freezing is a type of temporary or preliminary injunction that forbids a party to a lawsuit from managing or disposing of its assets in an effort to thwart a future ruling. Other common law jurisdictions largely acknowledge it, and such orders may be designed to have a global impact.
Assets must be frozen, seized, and confiscated in order to preserve physical evidence of a crime or to stop the suspect from disposing of or enjoying the proceeds of a crime.
An asset freeze bans a person or organization from dealing with any money or resources that belong to the person who is the target of the freeze. The delivery of money or other non-monetary assets like property or vehicles is also prohibited for the people.
Until the assets are unfrozen, they are kept by the banks that owned the assets at the time they were frozen. The American government does not seize ownership.
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What is the name of the document that companies use to report quarterly financial results?.
Form 10-Q is the answer.
Quarterly earnings reports are typically supported by Company Form 10-Q, a legal document that must be submitted to the Securities and Exchange Commission on a quarterly basis.
A quarterly report or quarterly report is a type of report that is produced every three months. This simply means that the company releases four quarterly reports a year.
Form 10-Q contains unaudited financial statements and provides an ongoing review of the company's financial position for the year. Reports are submitted every first three fiscal quarters of our fiscal year.
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_____ tell people symbolically what the organization wants them to do and how it expects them to do it. Group of answer choices
Option 4 is the answer. Rituals tell people symbolically what the organization wants them to do and how it expects them to do it.
What does rituals mean?This is the term that is used to refer to the habitual happenings that are expected in an organization.
The word is used to express the system that has been used over time in the working place till it became a habit.
Complete question_____ tell people symbolically what the organization wants them to do and how it expects them to do it.
Heroes
Myths
Norms
Rituals
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Howard Cooper of Owens Corning Fiberglass talks to David Weekley, a homebuilder, to find out how much fiberglass insulation he intends to use in building homes during the next year. Howard then multiplies that number by the total number of builders in the territory. He is using a ____ approach to measure sales potential.
A buildup approach is used by Howard to find out how much fiberglass insulation to use in building homes
What is a buildup approach?This refers to the method of calculating an market's revenue potential by recognizing the number of probable purchasers in the market and ther purchaser's requirements as well.
Hence, this same approach is used by Howard to find out how much fiberglass insulation to use in building homes.
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A homebuyer took out a $350,000 30-year fixed rate loan at 4.5% interest with a monthly payment of $1,773.40. After making two monthly payments the principal balance of the loan will have been reduced by a total of: Select one: a. $923.53. b. $460.90. c. $957.38. d. $892.12.
The principal balance of the loan will have been reduced by a total of: a. $923.53.
Principal balance of loanFirst step
First month's payment:
Annualized interest=$350,000 ×.045
Annualized interest = $15,750
First month's interest=$15,750/12
First month's interest= $1,312.50
First month's principal reduction=$1,773.40- $1,312.50
First month's principal reduction= $460.90
Remaining balance=$350,000 -$460.90
Remaining balance= $349,539.10
Second step
Second month's payment:
Annualized interest=$349,539.10 × .045
Annualized interest = $15,729.30
Second month's interest=$15,729.30/ 12
Second month's interest= $1,310.77
Second months principal reduction= $1,773.40 -$1,310.77
Second months principal reduction = $462.63
Third step
Total principal reduction after 2 payments=$460.90 + $462.63
Total principal reduction after 2 payments = $923.63
Therefore the correct option is A.
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______________________ argues that the productivity of workers will increase if they are paid more, and so employers will often find it worthwhile to pay their employees somewhat more than market conditions might dictate. Group of answer choices
Efficiency wage theory argues that the productivity of workers will increase if they are paid more, and so employers will often find it worthwhile to pay their employees somewhat more than market conditions might dictate.
Employers who offer efficiency salaries above the minimum wage do so to keep skilled people on staff, boost output, or maintain loyalty. The efficiency wage theory explains why businesses are hesitant to reduce pay even in the face of heightened competition or during recessions.
Workers may experience unemployment because they are paid more than the equilibrium pay, which draws in more workers. Therefore, in contrast to theories that place a strong emphasis on government intervention, such as minimum wages, efficiency wages offer a market failure explanation of unemployment.
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A company issues 7%, 7-year bonds with a par value of $170,000 on January 1 at a price of $179,602, when the market rate of interest was 6%. The bonds pay interest semiannually. The amount of each semiannual interest payment is:
The amount of each semiannual interest payment is $5,950
Compute the amount payable semiannually as interest?
The amount of each semiannual interest payment means the amount the company, the bond issuer would pay as cash interest to bondholders every six months, which is a function of the bond coupon rate of 7%, the par value as shown below:
semiannual interest payment=coupon rate*par value*6/12
coupon rate=7%(7% bond means coupon rate is 7%)
par value=face value=$170,000
6/12 implies that the coupon payment is semiannual. not for a full year
semiannual interest payment=7%*$170,000*6/12
semiannual interest payment=$5,950
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When a phased-in change in rates is scheduled to occur in the future years in which a temporary difference is expected to reverse, the ___. Multiple Choice currently enacted tax rate is multiplied by the temporary amounts reversing in each of those years and the total is the deferred tax liability or asset. differences between the currently enacted rate and the future tax rates are multiplied by the temporary amounts reversing in each of those years and the difference is the deferred tax liability or asset. specific tax rates of each future year are multiplied by the temporary amounts reversing in each of those years and the total is the deferred tax liability or asset. specific tax rates of each future year are multiplied by the temporary amounts reversing in each of those years to determine the change in the deferred tax liability or asset.
When a phased-in change in rates is scheduled to occur in the future years in which a temporary difference is expected to reverse, "the specific tax rates of each future year are multiplied by the temporary amounts reversing in each of those years and the total is the deferred tax liability/ asset".
What is total deferred tax liability/asset?On a company's balance sheet, a deferred tax asset is something that lowers future taxable revenue/credit. When a company overpays its taxes, a line item asset of this nature may be discovered. This money will eventually be returned to the business in the form of tax relief.
The examples of deferred tax assets are-
Net operating loss: During that time, the company suffered a financial loss.Tax over-payment: During the prior period, you overpaid taxes.Business Expenses: These are recorded under one accounting system but not another.Revenue: When revenue is received during one accounting period but recognised in a different one.Unpaid debt: It is first reported as revenue before being written off as uncollectible. The unpaid receivable eventually becomes a deferred tax asset when it is recognised.To more about difference between a tax credit and a tax deduction, here
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Considering the bid-rent model, when we see rents increase with proximity to the central business district, development will tend to
Considering the bid-rent model, when rents rise in proximity to the central business area, construction will prefer to build upward on sites inside the central business district to accommodate numerous tenants.
The bid rent theory is a geographical economic theory that describes how real estate prices and demand vary as one moves out from the central business area (CBD). It is stated that diverse land users would fight for land in the city center.
This theory focuses on how land values influence land use patterns. These are also affected by transportation costs and accessibility.
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Haitao has an espresso maker that stopped working properly within the warranty period. He plans to write a claim letter to the company. Because he feels his request to have his espresso maker repaired at no cost is justified and will be granted, he should use ________.
Haitao has an espresso maker that stopped working properly within the warranty period. He plans to write a claim letter to the company. Because he feels his request to have his espresso maker repaired at no cost is justified and will be granted, he should use the direct strategy.
What is direct strategy?The main idea and supporting evidence are placed at the top of the paper when using the direct approach. When your audience will be accepting of or receptive to your message, this strategy is used. The direct approach typically requires you to begin the official report with a summary of your primary findings, conclusions, and recommendations. For business reporting, this "up-front" arrangement is by far the most well-liked and practical. It saves time and makes it simpler to understand the remainder of the report. The direct method also results in a stronger report.
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Haitao has to use the direct strategy.
The major concept (such as a recommendation, conclusion, or request) appears at the "head" of the text when you employ the direct method, followed by the supporting details. This is a logical justification. When your audience will be accepting of or receptive to your message, this strategy is employed.
Direct strategy refers to being straightforward with your message, whereas indirect strategy is less direct yet still conveys the same idea. Direct strategy refers to being straightforward with your message, whereas indirect strategy is less direct but still gets the point across.
Hence, haitao should use the direct strategy to complete his request of his espresso maker being repaired.
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Dane Company has a break-even point of 120,000 units. If the firm's sole product sells for $40 and fixed costs total $480,000, the variable cost per unit must be:
Based on the breakeven point and the selling price of the product, the variable cost per unit is $36
What is the variable cost per unit?First, find the contribution margin:
Breakeven = Fixed costs / Contribution margin
120,000 = 480,000 / Contribution margin
Contribution margin = $4
The variable costs are:
= Selling price - contribution
= 40 - 4
= $36
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Restrictive practices are characterized as... Group of answer choices Practices that prevent firms from entering certain markets. Practices that restrict the number of consumers who may purchase a product Practices the reduce competition without outright agreements to raise price or reduce quantity Practices that promote competition by restricting monopolies
The Correct Answer is - Option (3) Practices that reduce competition without outright agreements to raise price or reduce quantity.
What are Restrictive Practices?Antitrust law includes rules against restrictive practices—practices that do not involve outright agreements to raise price or to reduce the quantity produced, but that might have the effect of reducing competition Antitrust cases involving restrictive practices are often controversial, because they delve into specific contracts or agreements between firms that are allowed in some cases but not in others.For example, if a product manufacturer is selling to a group of dealers who then sell to the general public it is illegal for the manufacturer to demand a minimum resale price maintenance agreement, which would require the dealers to sell for at least a certain minimum price. . A minimum price contract is illegal because it would restrict competition among dealers. However, the manufacturer is legally allowed to “suggest” minimum prices and to stop selling to dealers who regularly undercut the suggested price.Key Concepts and SummaryAntitrust laws prevent businesses from openly collaborating to create cartels that would lower output and increase prices. Companies occasionally try to circumvent these constraints in other ways, and as a result, several antitrust actions involve anticompetitive tactics such tie-in sales, bundling, and predatory pricing.
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Correct Question - Restrictive practices are characterized as :
1) Practices that prevent firms from entering certain markets.
2) Practices that restrict the number of consumers who may purchase a product
3) Practices that reduce competition without outright agreements to raise price or reduce quantity
4) Practices that promote competition by restricting monopolies.
An example of ________ would be when a manager expects employees to perform badly, they probably will, and when the manager expects them to perform well, they probably will.
An example of a self-fulfilling prophecy would be when a manager expects employees to perform badly, they probably will, and when the manager expects them to perform well, they probably will.
The self-fulfilling prophecy is a psychological phenomenon in which someone "predicts" or expects something, and that "prediction" or expectation is realized solely because he or she believes or expects to do so. And the resulting behavior of the person is adjusted to meet the belief
.
Self-fulfilling prophecy, also known as the interpersonal expectation effect, refers to a phenomenon in which one person or group expects the behavior of another person or group helps to actually achieve the prophecy or expected behavior.
An example of a self-fulfilling prophecy is the placebo effect. This is when a person experiences positive results because he expects an inert "similar" substance or treatment to work, despite the lack of known medical effects.
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On January 1, 2008 an asset was acquired for $30,000. Its useful life was expected to be 10 years and the salvage value is expected to be $0. After four years of use, the company realized the asset would be useful for only three more years. (In other words, the total useful life of the asset will be seven years instead of the original 10 years.) The company uses the straight-line method of depreciation. The Depreciation Expense in each of the years 2012, 2013, and 2014 will be $___
Each of the years 2012, 2013, and 2014 will incur a $6,000 depreciation expense.
figured out as follows:
Amount to Be Depreciated = Cost of $30,000 less Estimated Salvage Value of $0.
For the years 2012, 2013, 2014, and 2015, $30,000 divided by ten years equals $3,000 every year.
The Book Value is $18,000 after 4 years ($30,000 minus $12,000).
Depreciation of the $18,000 book value will be required over the remaining 3 years= $6,000 annually.
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12.15. How can a forward contract on a stock with a particular delivery price and delivery date be created from options
An investor can buy/sell a call option and a put option with the same strike price and expiration date in order to simulate a standard forward contract.
A synthetic forward contract creates an offsetting forward position by combining call and put options with the same strike price and expiration date.
A forward contract is a customizable derivative contract between two parties to purchase or sell an asset on a future date at a defined price. Forward contracts may be customized to include a particular commodity, quantity, and delivery date.
Assume the delivery cost is k and the delivery date is t. When both options have strike price k and exercise date t, a forward contract is formed by purchasing a European call and selling a European put. Under all conditions, this portfolio produces a payout of st -k, where st is the stock price at time t. Assume FO is the forward price. If k=FO, the new forward contract has no value. When the strike price is F0, the price of a call matches the price of a put.
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Stuart signs a contract that allows him to rent a snowplow from Homer's Plow Company. The contract stipulates that he has to pay $50 per week. Winter ends sooner than expected, so Stuart wants to return the plow ahead of the due date in order to avoid paying unnecessary rent. Homer's Plow Company agrees to let Stuart return the plow as long as he signs a contract that requires him to rent the plow again next year. This is an example of a(n) ________. Group of answer choices release rescission novation waiver arbitration
This is an example of release. Group of answer choices release rescission novation waiver arbitration.
A waiver happens when a party purposefully renounces their ability to enforce a contract. A release is created when one party declares the other side is not required to fulfill its obligations.Damages are amounts given as compensation for costs directly suffered as a result of a contract breach, such as costs incurred from another source.The fundamental components necessary for the agreement to be a valid offer and acceptance, adequate consideration, capacity, and legality are: mutual assent, expressed through a contract-compliant offer.What are the laws of contract?
The area of law that deals with creating and upholding contracts is known as contract law. An agreement that can be upheld by a court is referred to be a contract. The body of legislation known as contract law regulates the formation of contracts, their performance, and the creation of just reparations in the event of a breach.Learn more about laws of contract
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How many years will it take for an investment to increase by 3 times at an interest rate of 9% g
Answer:
The Rule of 72 is a quick, useful formula that is popularly used to estimate the number of years required to double the invested money at a given annual rate of return. Alternatively, it can compute the annual rate of compounded return from an investment given how many years it will take to double the investment.
While calculators and spreadsheet programs like Microsoft Excel have functions to accurately calculate the precise time required to double the invested money, the Rule of 72 comes in handy for mental calculations to quickly gauge an approximate value. For this reason, the Rule of 72 is often taught to beginning investors as it is easy to comprehend and calculate. The Security and Exchange Commission also cites the Rule of 72 in grade-level financial literacy resources.
1
KEY TAKEAWAYS
The Rule of 72 is a simplified formula that calculates how long it'll take for an investment to double in value, based on its rate of return.
The Rule of 72 applies to compounded interest rates and is reasonably accurate for interest rates that fall in the range of 6% and 10%.
The Rule of 72 can be applied to anything that increases exponentially, such as GDP or inflation; it can also indicate the long-term effect of annual fees on an investment's growth.
This estimation tool can also be used to estimate the rate of return needed for an investment to double given an investment period.
For different situations, it's often better to use the Rule of 69, Rule of 70, or Rule of 73.
Rule of 72
The Formula for the Rule of 72
The Rule of 72 can be leveraged in two different ways to determine an expected doubling period or required rate of return.
Years To Double: 72 / Expected Rate of Return
To calculate the time period an investment will double, divide the integer 72 by the expected rate of return. The formula relies on a single average rate over the life of the investment. The findings hold true for fractional results, as all decimals represent an additional portion of a year.
Expected Rate of Return: 72 / Years To Double
To calculate the expected rate of interest, divide the integer 72 by the number of years required to double your investment. The number of years does not need to be a whole number; the formula can handle fractions or portions of a year. In addition, the resulting expected rate of return assumes compounding interest at that rate over the entire holding period of an investment.
The Rule of 72 applies to cases of compound interest, not simple interest. Simple interest is determined by multiplying the daily interest rate by the principal amount and by the number of days that elapse between payments. Compound interest is calculated on both the initial principal and the accumulated interest of previous periods of a deposit.
How to Use the Rule of 72
The Rule of 72 could apply to anything that grows at a compounded rate, such as population, macroeconomic numbers, charges, or loans. If the gross domestic product (GDP) grows at 4% annually, the economy will be expected to double in 72 / 4% = 18 years.
With regards to the fee that eats
Why is it critical for an organization to understand that eventually a product will go into the decline stage
It is critical for an organization to understand that eventually a product will go into the decline stage prepare to find replacement products.
What is the decline stage of the product?Decline stage is the last stage of the product life cycle which comes after the after introductory stage, growth stage and maturity stage.
It is the stage when the sales drop and start to decline as original need for the product have diminished.
Decline is also the reason due to the innovation of the new product.
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Yater's Inc. is a food and beverage company based in the United States. The company decides to market and sell its products in all European countries under the same brand name. In this scenario, Yater's Inc. has decided to use a(n) _______. a. co-branding strategy b. one-brand-name strategy c. individual branding strategy d. transactional marketing strategy
In this scenario, Yater's Inc. has decided to use (B) one-brand-name strategy.
What is a co-branding strategy?Co-branding is a marketing tactic in which various brand identities are applied to a product or service as a result of a strategic partnership. Co-branding (or "cobranding"), often known as a brand partnership, refers to a variety of branding alliances that typically involve the brands of at least two businesses.What is a one-brand-name strategy?When employing a single-brand approach, a business targets only one particular market segment with each of its brands. Each brand has its own distinct "personality," is handled separately, and is distinctly differentiated from the rest of the company's brands.What is a transactional marketing strategy?A business technique known as "point of sale" transactions is called transactional marketing. Instead of focusing on forging a relationship with the customer, individual sales are being optimized for efficiency and volume.Therefore, in this scenario, Yater's Inc. has decided to use (B) one-brand-name strategy.
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A mortgage clause that states that the mortgage is due and payable upon certain conditions, such as non-payment is: Select one: a. Prepayment. b. Subordination. c. Defeasance. d. Acceleration.
A mortgage clause that states that the mortgage is due and payable upon certain conditions, such as the non-payment is the option(d) i.e, the Acceleration clause.
What is a mortgage clause?A provision in an insurance policy (such as a fire insurance policy) that allows the designated mortgage to receive payment for property damage or loss.
There are different types of clauses:
Acceleration clauseDue-On-Sale clausePrepayment Penalty clauseSubordination clause Release clauseIf the borrower breaches the conditions of the agreement, an acceleration clause in a mortgage or trust deed states that the entire obligation is payable immediately. Additionally, it will specify the circumstances under which a lender may request full loan payback. For instance, home loans frequently feature an acceleration provision that kicks in after a certain number of missed payments.
Most of the time, it is harmful to accelerate a loan. Typically, it denotes that the borrower has fallen behind on payments or broken the terms of the agreement, and the lender is requiring prompt repayment of the whole loan balance to avoid foreclosure.
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Brewer Inc. has 5,000 shares of 8%, $50 par value, cumulative preferred stock and 100,000 shares of $1 par value common stock outstanding at December 31, 2019, and December 31, 2018. The board of directors declared and paid a $15,000 dividend in 2018. In 2019, $60,000 of dividends are declared and paid. What are the dividends received by the preferred stockholders in 2019
Dividends received by the preferred stockholders in 2019 are $25,000.
What are shares?Shares signify ownership in a corporation. An individual becomes a shareholder in your business when they purchase shares. Shareholders decide who manages a corporation and participate in important decisions like whether a company should be sold.What are preferred stocks?A component of share capital known as preferred stock is often regarded as a hybrid instrument since it might have any combination of characteristics that common stock does not, including characteristics of both an equity and a debt instrument.Solution -Annual dividend paid to stakeholder = 5000\times $50\times 8% = $20,000
Dividend declared and paid in 2013 = $15,000
Preferred dividend = $20,000 -$15,000
= $5,000
No dividend will be paid to common stockholders in 2014 until all 2013 dividends and 2014 annual dividends have been paid in full, therefore there will be $60,000 in dividends declared and paid in 2014. \
Preferred stockholders will receive $5000 for the 2013 dividend and $20,000 for the 2014 dividends.
The total dividends that preferred stockholders earned in 2014 were $5,000 + $20,000 = $25,000.
Therefore, dividends received by the preferred stockholders in 2019 are $25,000.
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Why would the WACC based on market values tend to be higher than the one based on book values if the stock price exceeded its book value
The WACC based on market values tend to be higher than the one based on book values if the stock price exceeded its book value because “ The price of the stock in the market increases means higher WACC using market values.”
Since the market price of the stock is increased means the share of equity in the market is high which leads to higher WACC using market values.
WACC refers to Weighted average cost of capital.
WACC represents firm’s average cost of capital which includes equity shares, preference shares, bonds and other forms of debts.
WACC is considered to represent firm’s opportunity cost which is used to evaluate investment opportunities.
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The direct write-off method is not allowed under GAAP because it violates the ______. Multiple choice question. aging principle sales method cost principle expense recognition (matching) principle revenue recognition principle
The direct write-off method is not allowed under GAAP because it violates the principle expense recognition (matching) principle.
A direct write-off is an accounting method by which uncollectible accounts received are written off as bad debts.
GAAP stands for General Accepted Accounting Principles.It is a collection of conventionally and generally accepted accounting rules and standards for financial reportage. The direct write-off method is also referred to as the direct charge-off method. Upon receiving an invoice that has been deemed uncollectible, bad debts have to be cleared off. The direct write-off method violates the principle expense recognition (matching) principle. The matching principle states that expenses need to be matched with the revenue for a given period of association.Therefore, the direct write-off method is not allowed under GAAP because it violates the principle expense recognition (matching) principle.
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What type of estimate is a cost estimation tool that involves estimating individual work items or activities and summing them to get a project total
The answer is Bottom-Up estimates.
Bottom-up estimating involves the estimation of work at the lowest possible level of detail.
The estimates so calculated are then aggregated to arrive at summary totals. The probability to meet the estimated amounts improves substantially by building detailed cost and time estimates for a work package.
In other words, bottom-up estimating approximates an overall value by approximating values for smaller items and using the sum of these values as the overall value.
This cost estimation tool is often used when detailed information is available about lower-level activities. It can be especially useful when estimating projects that are similar to ones that were completed in the past.
Hence, a Bottom-Up estimate is a cost estimation tool that involves estimating individual work items or activities and summing them to get a project total.
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what are some strategies that you can use to prepare to file taxes each year? What would be he benefits of these strategies?
Strategies which can be used to prepare for filing taxes each year are by keeping a proper record of expenses and receipts by filling them out, sorting out each piece of documentation that will be required at the time of filing tax, and one can create folders and sub-folders also.
The benefits of these strategies are:
It will help in avoiding added penalties or interests.
It will keep track of future refunds.
A portion or the entire refund can be used to pay back any owed taxes, among other things.
What is tax filing?"Tax filing" or "tax return" means filing a document with a tax authority. In that document, reports about income, expenses, and information about other financial activities are filled in.
Filing a tax return is entirely dependent on income. There are certain guidelines within which one can file a tax.
Therefore, with the usage of strategies, one can prepare tax file each year.
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On April 1, Cyclone Company purchases a trencher for $286,000. The machine is expected to last five years and have a salvage value of $43,000. Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the straight-line method.
The depreciation expense at December 31 for both the first year and second year is :
2016 - $36,450
2017 - $48,600
What is Straight line Depreciation ?With the straight line depreciation method, the value of an asset is reduced uniformly over each period until it reaches its salvage value. Straight line depreciation is the most commonly used and straightforward depreciation method for allocating the cost of a capital asset. It is calculated by simply dividing the cost of an asset, less its salvage value, by the useful life of the asset.
Using the straight-line method, the formula for annual depreciation expense is:
(cost – salvage value) / useful life = Annual depreciation expense
Where:
Cost of the asset is the purchase price of the asset.
Salvage value is the value of the asset at the end of its useful life.
Useful life of asset represents the number of periods/years in which the asset is expected to be used by the company.
So, The straight line depreciation for the machine would be calculated as follows:
Straight line depreciation expense = (Cost of asset - Salvage value)
useful life
= ($286,000 - $43,000) / 5 = $48,600
The depreciation expense each year would be $48,600 except in 2016 because it the machine was only used for 9 months
Depreciation expense in 2016 = (9 / 12) x $48,600 = $36,450
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The key in using expert opinion to help forecast demand is ________; that is, comparing estimates produced by different sources. morphing indemnification simulation triangulation modeling
The key in using expert opinion to help forecast demand is triangulation; that is, comparing estimates produced by different sources.
What is triangulation?Triangulation refers to a strategy, used by researchers to test the validity through collection of information from various sources.
In other words, triangulation is a method of finding the location of an object based on measurements made from two other locations
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Assume that the drug passed FDA approval process. Suppose that the market size is 30 mil., market share is 30%, production and advertising costs are $50 mil. What is the profit on this drug in millions (ignore the R&D costs that have already been incurred)?
Based on the revenue per customer, the market share, and the production and advertising costs, the profit on this drug is $58 million .
How much profit does the drug bring in?First find the number of customers the company will sell to:
= 30 million x 30% market share
= 9 million people
The profit is:
= (Number of customers sold to x revenue per customer) - production and advertising costs
= (9 million x 12) - 50 million
= $58 million
Relevant part of the question is:
Revenue per customer is expected to be $12. Production and advertising costs run between $20 and $70 million with $50 million the most likely amount (triangular distribution seems appropriate).
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