Answer:
A- Stand together and present a united front.
Explanation:
It is correct to say that the team violated the principle of being together and presenting a united front, because in an effective presentation of a team, there must be cohesion and consensus among team members about the team's goals and needs, which was violated when Tina reported a different need than Jack considered the essential need to be emphasized during the presentation.
It is necessary that during the presentation the team is integrated in its objectives and proposals, so that there is greater reliability of what is being discussed and greater acceptability. It is essential for the team to reach consensus and be cohesive at the time of the presentation.
Effective team presentation is achieved by demonstrating a strong and effective team performance. The principle violated in this scenario is stand together and present a united front.
From the scenario described, we could infer that the team disagreed on which what should be the main point of focus. This highlights that the team isn't totally sharing the same view or purpose for the presentation. Hence, inferring dichotomy.Hence, the team violates the principle of "stand together and present a united front. "
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Splish Brothers Inc. uses the percentage-of-receivables basis to record bad debt expense and concludes that 3% of accounts receivable will become uncollectible. Accounts receivable are $402,700 at the end of the year, and the allowance for doubtful accounts has a credit balance of $2,897. (a) Prepare the adjusting journal entry to record bad debt expense for the year. (b) If the allowance for doubtful accounts had a debit balance of $989 instead of a credit balance of $2,897, prepare the adjusting journal entry for bad debt expense.
Answer:
A. Dr Bad Debt Expense $9,184
Cr Allowance for Doubtful accounts $9,184
B. Dr Bad Debt Expense $13,070
Cr Allowance for Doubtful accounts $13,070
Explanation:
a.Preparation of the adjusting journal entry to record bad debt expense for the year.
Dr Bad Debt Expense $9,184
[($402,700 x 3%) - $ 2,897 ]
Cr Allowance for Doubtful accounts $9,184
(To record bad debt expense)
b. Preparation of the adjusting journal entry for bad debt expense
Dr Bad Debt Expense $13,070
[($402,700 x 3%) + $ 989]
Cr Allowance for Doubtful accounts $13,070
(To record bad debt expense)
Since 1970, Super Rise, Inc., has provided maintenance services for elevators. On January 1, 2016, Super Rise obtains a contract to maintain an elevator in a 90-story building in New York City for 10 months and receives a fixed payment of $95,000.
The contract specifies that Super Rise will receive an additional $47,500 at the end of the 10 months if there is no unexpected delay, stoppage, or accident during the year.
Super Rise estimates variable consideration to be the most likely amount it will receive.
Required:
1. Assume that, because the building sees a constant flux of people throughout the day, Super Rise is allowed to access the elevators and related mechanical equipment only between 3am and 5am on any given day, which is insufficient to perform some of the more time-consuming repair work. As a result, Super Rise believes that unexpected delays are likely and that it will not earn the bonus. Prepare the journal entry Super Rise would record on January 1. (If no entry is required for a particular transaction/event, record "No journal entry required" in the first account field.)
2. Assume instead that Super Rise knows at the inception of the contract that it will be given unlimited access to the elevators and related equipment each day, with the right to schedule repair sessions any time. When given these terms and conditions, Super Rise has never had any delays or accidents in the past. Prepare the journal entry Super Rise would record on January 31 to record one month of revenue.(If no entry is required for a particular transaction/event, select "No journal entry required" in the first account field.)
Record any necessary entry on January 31 to record one month of revenue
3. Assume the same facts as requirement 1. In addition assume that, on May 31, Super Rise determines that it does not need to spend more than two hours on any given day to operate the elevator safely because the client’s elevator is relatively new. Therefore, Super Rise believes that unexpected delays are very unlikely. Prepare the journal entry Super Rise would record on May 31 to recognize May revenue and any necessary revision in its estimated bonus receivable. (If no entry is required for a particular transaction/event, select "No journal entry required" in the first account field.)
Record any necessary entry on May 31 to recognize May revenue and any necessary revision in its estimated bonus receivable.
Answer:
1) Jan 1
Dr Cash $95,000
Cr To Deferred Revenue $95,000
2) Jan 31
Dr Deferred Revenue $9,500
Dr Bonus Receivable $4,750
Cr To Service Revenue $14,250
3) May 31
Dr Deferred Revenue $9,500
Dr Bonus Receivable $23,750
Cr To Service Revenue $33,250
Explanation:
1) Preparation of the journal entry that Super Rise would record on January 1.
Jan 1
Dr Cash $95,000
Cr To Deferred Revenue $95,000
2) Preparation of the journal entry that Super Rise would record on Jan 31
Jan 31
Dr Deferred Revenue $9,500
($95,000/10month)
Dr Bonus Receivable $4,750
($47,500/10months)
Cr To Service Revenue $14,250
($9,500+$4,750)
3) Preparation of the journal entry that Super Rise would record on May 31
May 31
Dr Deferred Revenue $9,500
($95,000/10month)
Dr Bonus Receivable $23,750
($4,750*5 ) from jan to may
Cr To Service Revenue $33,250
($9,500+$23,750)
As 2017, Buttle Corp. has $10 par, 2% preferred stock, 6,500 shares outstanding, and $1 par common stock with 32,000 shares outstanding. The preferred stock is cumulative and preferred stockholders last received a dividend in 2014. If the company wants to distribute $4 per share to the common stockholders in 2017, what is the total amount of dividends that the company must pay at the end of the current year
Answer:
$131,900
Explanation:
Th computation of the total amount of dividend is shown below:
dividend per year for preferred stock is
= (10 × 6500) × 2%
= $1300
Now the total dividend for preferred stock is
= ($1300 × 3)
= $3900
And, the Total common dividend is
= (4 × 32,000)
= $128,000
So, the total dividend to be paid is
= $3,900 + $128,000
= $131,900
Discuss the economic conditions and economic institutions that affect personal finance.
Answer:
Economics and Personal Finance. Instruction in economics and personal finance prepares students to function effectively as consumers, savers, investors, entrepreneurs, and active citizens. Students learn how economies and markets operate and how the United States' economy is interconnected with the global economy.
what is the meaning of derecognition?
Answer:
withdrawal of official recognition from an organization or country.
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Department A had no Work-in-Process at the beginning of the period, 4,400 units were completed during the period, 540 units were 50% completed at the end of the period, and the following manufacturing costs were debited to the departmental Work-in-Process account during the period: Direct materials (1,540 at $10) $ 15,400 Direct labor 32,173 Factory overhead 25,735 Assuming that all direct materials are added at the beginning of production and Department A uses weighted-average process costing, what is the total cost of the departmental Work-in-Process Inventory at the end of the period
Answer:
the ending inventory is $8,748
Explanation:
The computation of the total cost of the departmental Work-in-Process Inventory at the end of the period is shown below:
Materials is $10 per unit
And, the conversion cost is
= ($32,173 + $25,735) ÷ (4,400 units + 540 units ÷ 2)
= $57,908 ÷ 4,670
= $12.4
Now the ending inventory is
= 540 units × $10 per unit + 270 units × $12.4
= $8,748
Hence, the ending inventory is $8,748
Laurel Enterprises expects earnings next year of $ per share and has a retention rate, which it plans to keep constant. Its equity cost of capital is , which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be?
Answer: $49.26
Explanation:
Using the Gordon Growth model, the price of stock should be:
= Next divided / (Cost of equity - growth rate)
Next dividend = Earnings per share * (1 - Retention rate)
= 4.44 * ( 1 - 40%)
= $2.66
Price of stock:
= 2.66 / (9% - 3.6%)
= $49.26
Suppose the United States decides to reduce export subsidies on U.S. agricultural products, but it does not decrease taxes or increase any other government spending.
Initially, a reduction in export subsidies decreases net exports at any given real exchange rate, causing the demand for dollars in the foreign exchange market to decrease. This leads to a decrease in the real exchange rate, which, in turn, decreases imports to negate any decrease in exports, leaving the equilibrium quantity of net exports and the trade deficit unchanged at this point.
1. However, the reduction in expenditure on export subsidies ___________ the fiscal deficit, thereby ___________ public saving.
2. Indicate the effect this has on the U.S. market for loanable funds. (Supply and demand shift?)
3. Given the change in the real interest rate, show the effect this has on net capital outflow.
4. This causes the supply of dollars in the foreign exchange market to ______________, the real exchange rate to ______________, and the equilibrium level of net exports to _____________.
Answer:
1. Decrease, increase
2. Supply curve shifts to the right
3. NCO will rise
4. Real exchange rate falls and net exports rises
Explanation:
Fiscal deficit occurs when government spending's exceed government revenue. When the government lowers its export subsidies while keeping other spending's and taxes unchanged, it leads to a fall in the fiscal deficit.
1. However, the reduction in expenditure on export subsidies decreases the fiscal deficit, thereby increases public savings.
2. As public savings increase it leads to an increase in funds available to be loaned out. So the supply curve for loanable funds will shift to the right from S1 to S2. This will lead to a fall in the interest rate.
3. As we know that net capital outflow is inversely related to the interest rate. A fall in the interest rate above will lead to a rise in net capital outflow.
4. When net capital outflow increases, people move funds out of the country. Thus, supply of dollars will increase. While demand for dollars has remained unchanged, it leads to a fall in the real exchange rate. As exchange rate falls, the equilibrium level of net exports will rise.
1. Decrease, increase; 2. Supply curve shifts to the right; 3. NCO will rise;
and last 4. The real exchange rate falls and net exports rises
What is the Supply Curve?
A fiscal deficit happens when government spending surpasses government revenue.
When the government diminishes its export subsidies while maintaining different spending and taxes unchanged, it leads to a decline in the fiscal deficit.
1. However, the reduction in expense on export sponsorships decreases the fiscal deficit, thereby increasing general savings.
2. As public savings increase it rules to an increase in funds known to be loaned out. So the supply curve for loanable funds will shift to the right from S1 to S2. This will direct to a fall in the interest rate.
3. As we comprehend that net capital outflow is inversely correlated to the interest rate. A fall in the interest rate overhead will lead to a rise in the net capital outflow.
4. When net capital outflow increases, individuals transfer funds out of the country. Therefore, the supply of dollars will increase. While demand for dollars has stayed unchanged, it directs to a fall in the real exchange rate. As the conversation rate falls, the equilibrium grade of net exports will rise.
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which of the following users of accounting information are interested in the quality of a company assets?
a government agencies
b loan creditors
c employees
d public
Answer:
D
Explanation:
Well public is all about quality
The benefit of establishing a company over other forms of ownership
Answer:
limited liability
tax advantages
establishing credibility
unlimited life
raising capital
Topic: How Banks Create Money
Skill: Definition
33) Suppose the required reserve ratio is 20%, A $40 million cash deposit will, at most, allow an
expansion of the money supply to
Answer:
$200 million
Explanation:
Increase in the total value of checkable deposit is determined by the money multiplier
Money multiplier = amount deposited /required reserve requirement
Required reserve requirement is the percentage of deposits required of banks to keep as reserves by the central bank
$40 million / 0.2 = $200 million
Core Corporation reported current earnings and profits of $250,000. Core distributed a building with an adjusted basis of $170,000 and a fair market value of $230,000 to its sole shareholder. The building had a mortgage of $90,000, which the shareholder will assume. What is the amount of the dividend received by the shareholder?
A. $80,000.
B. $140,000.
C. $230,000.
D. $250,000.
Answer:
B. $140,000
Explanation:
The total cost of acquiring an asset, including the installation, commission, transportation and other relevant fees is known as adjusted basis. The fair market value is the value an asset would yield when sold. It is an amount that would be received in return when an asset is sold.
Therefore, the shareholders would receive dividend at the fair market value adjusted for the mortgage balance
= $230,000 - $90,000
= $140,000
Reddy Corporation has collected the following data for the month of June: Actual total factory overhead incurred $61,150 Budgeted fixed factory overhead costs $40,700 Activity level, in direct labor hours 14,800 Actual direct labor hours 17,800 Standard hours for output this period 16,800 Total factory overhead rate $4.30 What is the variable overhead efficiency variance
Answer:
Variable overhead efficiency variance = $8,600 favorable
Explanation:
Variable overhead efficiency variance is the difference between the actual time taken to achieve a given production output less the standard hours for same multiplied by the standard variable overhead rate
Variable overhead efficiency variance is determined as follows:
Hours
standard hours for actual output 16,800
Actual hours 14,800
Efficiency variance 2,000 favorable
× standard variable OH rate × $4.30
Variable overhead efficiency variance ($) $8,600 favorable
As the new profit center manager, you switch carriers to a more expensive, but quicker, more responsive transportation carrier. You justify this because when using a(n) ____________ perspective, your overall inventory and warehouse savings more than offset the increase in transportation costs. Group of answer choices lane operations economic order quantity total cost ABC
Answer:
You justify this because when using a(n) _____ABC_____ perspective, your overall inventory and warehouse savings more than offset the increase in transportation costs.
Explanation:
The ABC perspective allocates overhead costs based on the cost drivers and the level of activity consumed by each cost driver. This is the best cost allocation basis. ABC is justified by the fact that activities consume resources or cause costs to be incurred. As a profit center manager, your focus should be on minimizing the activities that drive up costs instead of just focusing on mere cost reduction without paying attention to the cost drivers.
1. How does payroll withholding help a company's employees? (1-2 sentences. 2.0 points)
Answer:
Payroll withholding spreads out the cost of taxes throughout the year, so employees don't have to pay the entire amount they owe all at once on April 15. This helps make sure that people pay their taxes.
Cornerstone Exercise 9-41 Ratio Analysis Red Corporation had $1,750,000 in total liabilities and $3,000,000 in total assets as of December 31, 2020. Of Red's total liabilities, $600,000 is long-term. Required: Calculate Red's debt to assets ratio and its long-term debt to equity ratio. Round your answers to four decimal places, if required. Debt to Total Assets fill in the blank 1 Long-Term Debt to Total Equity fill in the blank 2
Answer:
A. Debt to Total Assets ratio 0.5833 times
B. Long Term Debt to Total Equity Ratio 0.48 times
Explanation:
A. Calculation for Red's debt to assets ratio using this formula
Debt to Total Assets ratio = Total Liabilities/
Total Assets
Let plug in the formula
Debt to Total Assets ratio=$1,750,000/$3,000,000
Debt to Total Assets ratio=0.5833 times
Therefore the Debt to Total Assets ratio will be 0.5833 times
B. Calculation to determine its long-term debt to equity ratio
First step is to calculate the Shareholders’ Equity using this formula
Shareholders’ Equity = Total Assets – Total outside liabilities
Let plug in the formula
Shareholders’ Equity = $3,000,000-$1,750,000 Shareholders’ Equity =$1,250,000
Now let calculate the Long Term Debt to Total Equity Ratio using this formula
Long Term Debt to Total Equity Ratio = Long Term Debt/ Total Shareholder’s equity
Let plug in the formula Long Term Debt to Total Equity Ratio=$600,000/$1,250,000
Long Term Debt to Total Equity Ratio= 0.48 times
Therefore Long Term Debt to Total Equity Ratio will be 0.48 times
The market price of Northern Mills stock has been relatively volatile and you think this volatility will continue for a couple more months. Thus, you decide to purchase a two-month European call option on this stock with a strike price of $30 and an option price of $1.60. You also purchase a two-month European put option on the stock with a strike price of $30 and an option price of $.20. Contracts are on 100 shares. What will be your net profit or loss on these option positions if the stock price is $36 on the day the options expire
Answer:
$420
Explanation:
Calculation to determine What will be your net profit or loss
First step is to calculate Net Profit from call option Using this formula
Net Profit from call option = (Gain from Exercising Call Option - Option Premium paid) * Size of the Contract
Let plug in the formula
Net Profit from call option= (($36 - $30) - $1.60) × 100 Shares
Net Profit from call option= $440
Second step is to calculate Net Loss from put option
Using this formula
Net Loss from put option = (Option Premium paid) * Size of the Contract
Let plug in the formula
Net Loss from put option = $0.20 × 100 Share
Net Loss from put option = $20
Now let calculate the net profit using this formula
Net profit= Net Profit from Call Option - Net loss from Put Option
Let plug in the formula
Net profit= $440 - $20
Net profit= $420
Therefore What will be your net profit is $420
The financial staff of Cairn Communications has identified the following information for the first year of the roll-out of its new proposed service: Projected sales $24 million Operating costs (not including depreciation) $9 million Depreciation $5 million Interest expense $4 million The company faces a 25% tax rate. What is the project's operating cash flow for the first year (t = 1)? Enter your answer in dollars. For example, an answer of $1.2 million should be entered as $1,200,000. Round your answer to the nearest dollar.
Answer: $12,500,000
Explanation:
Sales = $24,000,000
Less: Operating cost = $9,000,000
Less,l: Depreciation = $5,000,000
Earning before interest and tax = $10,000,000
Less: Tax at 25% EBIT = $2,500,000
Net income before interest = $7,500,000
Add: Depreciation = $5,000,000
Operating cashflow = $12,500,000
Exercise 9-19 (Algorithmic) (LO. 3) Brenda, a self-employed taxpayer, travels from Chicago to Barcelona (Spain) on business. She is gone 10 days (including 2 days of travel) during which time she spends 5 days conducting business and 3 days sightseeing. Her expenses are $1,930 (airfare), $245 per day (meals), and $420 per night (lodging). Because Brenda stayed with relatives while sightseeing, she only paid for 5 nights of lodging. Compute Brenda's deductions for the following:
Answer:
a. $1,351
b. $857.5
c. $2,100
Explanation:
Computation for Brenda's deductions
a. Airfare= (70% × $1,930)
Airfare=$1,351
b. Meals= [(245/2)*7]
Meals=857.5
c. Lodging= [420*5]
Lodging=$2,100
Therefore Brenda's deductions are:
a. $1,351
b. $857.5
c. $2,100
You are the manager of a firm that manufactures front and rear windshields for the automobile industry. Due to economies of scale in the industry, entry by new firms is not profitable. Toyota has asked your company and your only rival to simultaneously submit a price quote for supplying 100,000 front and rear windshields for its newest version of the Highlander. If both you and your rival submit a low price, each firm supplies 50,000 front and rear windshields and earns a zero profit. If one firm quotes a low price and the other a high price, the low-price firm supplies 100,000 front and rear windshields and earns a profit of $11 million and the high-price firm supplies no windshields and loses $2 million. If both firms quote a high price, each firm supplies 50,000 front and rear windshields and earns a $6 million profit. Determine your optimal pricing strategy if you and your rival believe that the new Highlander is a "special edition" that will be sold only for one year. Would your answer differ if you and your rival were required to resubmit price quotes year after year and if, in any given year, there was a 60 percent chance that Toyota would discontinue the Highlander? Explain.
Answer:
a. The optimal pricing strategy will be one-shot Nash equilibrium in which “You” charge low price, “Your Rival” charge low price and then the payoff is ($0, $0)
b. Yes, the anwer will differ becuase it is not possible to sustain the collusive outcome as a Nash equilibrium because [tex]\pi ^{Cheat}[/tex] > [tex]\pi ^{Cooperate}[/tex].
Explanation:
a. Determine your optimal pricing strategy if you and your rival believe that the new Highlander is a "special edition" that will be sold only for one year.
Note: See the attached excel file for the Representation of one shot normal for of the game played between "You" and "Your Rival" together with the payoffs.
From the attached excel file, the dominant strategy is for “You” and “Your Rival” to charge “Low Price” each. If the dominant strategy is played by “You” and “Your Rival”, the optimal pricing strategy will be one-shot Nash equilibrium in which “You” charge low price, “Your Rival” charge low price and then the payoff is ($0, $0).
b. Would your answer differ if you and your rival were required to resubmit price quotes year after year and if, in any given year, there was a 60 percent chance that Toyota would discontinue the Highlander? Explain.
When we have a year-after-year competition between “You” and “Your Rival” but with a 60 percent chance that Toyota would discontinue the Highlander, the payoffs of the firm that continue to comply with the collusive strategy of charging “High Price” by each firm under the normal trigger strategy whereby “You” and “Your Rival” agree to charge high price as long as there is no past deviation by any of the firm, otherwise charge a low price is as follows:
[tex]\pi ^{Cooperate}[/tex] = $6 + $6(100% - 60%) + $6(100% - 60%)^2 + 6(100% - 60%)^2 …….
[tex]\pi ^{Cooperate}[/tex] = $6 / 6% = $10
Therefore, what the firm that cheats earn today is $11 million and it earns $0 forever. The implication of this is that [tex]\pi ^{Cheat}[/tex] = $11
Therefore, the anwer will differ becuase it is not possible to sustain the collusive outcome as a Nash equilibrium because [tex]\pi ^{Cheat}[/tex] > [tex]\pi ^{Cooperate}[/tex].
The Technology department at Watkins Transit has a budgeted annual cost of $65,000. The department has a capacity to handle 250 work stations per year. Currently, purchasing, shipping, and administrative departments have 20, 45, and 135 work stations, respectively. If practical capacity is used to allocate costs, how much cost is allocated to shipping
Answer: $14,625
Explanation:
Based on the information given, if practical capacity is used to allocate cost, the cost that is allocated to shipping will be:
= Budgeted annual cost/200 × Number of shipping work stations
= 65000/200 × 45
= $14,625
Cost Allocation is the process of allocating an item of cost to an item of cost, which is directly followed. The cost that is allocated to shipping will be $14,625.
What is called costs allocation?
Cost Allocation is the process of identifying, accumulating, and allocating costs to expense items such as departments, products, systems, and many others.
Based on the information given, if practical capacity is used to allocate cost, the cost that is allocated to shipping will be:
[tex]\rm\, Cost \;that \;is \; allocated \; to \;shipping = \rm\, \frac{ \;Budgeted \; Annual \;Cost}{200} \times \;Number \;of \; shipping \;work \;stations\\\\= \dfrac{65000}{200} \times 45\\\\= \$14,625[/tex]
Hence, the cost that is allocated to shipping is $14,625.
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As a CEO, you are concerned that your firm and the industry in your country are being devastated by foreign imports. Trade lawyers suggest that you file an antidumping case against leading foreign rivals and assure you a win. Would you file an antidumping case or not
Answer:
The company can file antidumping case against the leading foreign rivals. The probability of winning the case is only high when there is cash deposits near to zero in the country and balance of payment is negative.
Explanation:
There can be a law suit files against the foreign rivals but the company will have to bear lawyers fee for this. There is a threat to employment of labor in the home country as most of the goods are imported so factories in the home country will be moved towards shut down because consumers will be buying imported goods which are offered at low price.
Taylorism emphasises the formal structure, hierarchy of management, the technical requirements and the assumption of rational behaviour Question Attachment: Answer O True O False
Taylorism underlines the conventional construction, order of the executives, the specialized prerequisites and the supposition of judicial way of behaving is a genuine assertion.
judicial way , Arrangement of logical administration upheld by Fred W. Taylor. In Taylorism view, the assignment of processing plant the executives was to decide the most effective way for the laborer to finish the work, to give the appropriate apparatuses and preparing, and to give motivations to great execution.
He separated each occupation into its singular movements, examined these to figure out which were fundamental, and planned the specialists with a stopwatch.
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Sibila, Inc. sells its product for $40. The variable costs are $18 per unit. Fixed costs are $16,000. The company is considering the purchase of an automated machine that will result in a $2 reduction in unit variable costs and an increase of $5,000 in fixed costs. Which of the following is true about the break-even point in units?
a. It will remain unchanged
b. It will decrease.
c. It will increase.
d. It cannot be determined from the information provided.
Answer:
c. It will increase.
Explanation:
Break even point is the level of activity at which a firm neither makes a profit nor a loss.
Break - even units = Fixed Costs ÷ Contribution per unit
therefore,
Existing break-even point in units :
Break - even units = $16,000 ÷ ($40 - $18) = 727.27 or 728 units
New break-even point in units :
Break - even units = $21,000 ÷ ($40 - $16) = 875 units
Conclusion :
The results show that break-even point in units will increase from 728 units to 875 units as a result of the changes
The payoff matrix supplied shows outcomes of various strategies that two firms might follow in response to action on the part of the other company. This payoff matrix describes actions in developing vaccines for not-too-rare but also not-too-common diseases. Each element shows the payoffs to a set of strategies as the payoff to the domestic firm, then a comma, then the payoff to the foreign firm.
Foreign firm
Enter Not Enter
Domestic firm Enter -3,-3 183,0
Not Enter 0,183 0,0
Required:
What is the minimum subsidy the US must offer the domestic firm to ensure that it will choose to produce the vaccine?
Answer:
Subsidy per unit must be equal to 3.
Explanation:
The payoff matrix shows that the Domestic firm can earn -3 or 183 from entering into the market. While, it will get only 0 from not entering. So it will be beneficial for it to enter provided the government can bear the negative payoff it gets from entering as the foreign firm also enters.
Thus, if the government can subsidise the domestic firm's negative payoff of $3 from entering such that its payoff becomes, 0 or 186 from entering and 0 from not entering. Like this the domestic firm will be more likely to enter and produce the vaccine.
Thus, the amount of the subsidy must be $3.
The real interest rate earned is the Group of answer choices same as the nominal interest rate when inflation is moderate cost of borrowing in current consumer prices cost of borrowing in current producer prices cost of borrowing adjust for the rate of change in the price level nominal interest rate adjusted for the growth rate of the economy
Answer:
cost of borrowing adjust for the rate of change in the price level
Explanation:
The real interest rate earned is the rate where the borrowing cost would be adjusted for the change in the rate in the level of the price as the real interest rate represent the interest rate that should be adjusted to the inflation
Hence, according to the given options, second option is correct
hence, the same would be relevant
High financial leverage has the effect of: Group of answer choices Reducing both the firm's risk and its potential profits. Only increasing the firm's potential profits. Increasing both the firm's risk and its potential profits. None of these answers is correct. Only increasing the firm's risk.
Answer:
Increasing both the firm's risk and its potential profits
Explanation:
Q 10.7: Melbee Farms is considering purchasing a new combine that would help them finish their harvesting faster, thus allowing them to pick up extra revenue by doing custom combining for other farmers. The combine and headers cost $487,000. They expect to have net cash flows of $157,000 in year 1, $182,000 in year 2, $202,000 in year 3, and $213,000 in year 4. If they discount the cash flows by 7%, what is the discounted payback period for the combine
Answer:
Discounted payback period= 3 years 1 month
Explanation:
The discounted payback period is the estimated length of time in years it takes the present value of net cash inflow from a project to equate the net cash the initial cost
To work out the discounted payback period, we will compute present value of the cash inflow and then determine how long it will take for the sum to be equal to the initial cost. This is done as follows:
Year Cash flow DF Present value
0 487,000 × 1 = (487,000)
1 157,000 × 1.07^(-1) = 146,729.0
2 182,000 × 1.07^(-2) = 158965.8
3 202,000 × 1.07^(-3) = 164,892.2
4 213,000 × 1.07^(-4) =162,496.7
Total PV for 2 years = 146729 +158965+164892= 470587.0
Balance of cash flow remaining to equal = 487,000-470587 = 16413.0
Discounted payback period = 3 years + 16413.0 /162,496.7 × 12 months
= 3year , 1.2months
Discounted payback period= 3 years 1 month
If the denominator activity is less than the standard hours allowed for the actual output, one would expect that: Multiple Choice the variable overhead efficiency variance would be unfavorable. the fixed overhead volume variance would be favorable. the fixed overhead budget variance would be unfavorable. the variable overhead efficiency variance would be favorable.
Answer:
The variable overhead efficiency variance would be favorable.
Explanation:
Variable overhead efficiency variance: Variable overhead efficiency variance aims to determine whether or not their exist savings or extra cost incurred on variable overhead as a result of workers being faster or slower that expected.
Since the variable overhead is charged using labour hours, any amount by which the actual labour hours differ from the standard allowable hours would result in a variance
A favourable variance would occurs when actual hours is less than the standard hours allowed for the actual output.
The variance in Dollars is the difference in actual hours and standard hours for actual output multiplied by the standard variable overhead rate
Black Bear Auto Company incurred $120,000 of indirect advertising costs for its operations. The following 2017 data have been collected for its three departments: New Cars Used Cars Parts and Service Direct advertising costs $30,000 $24,000 $6,000 Newspaper ad space 60% 30% 10% Sales $250,000 $200,000 $50,000 Required: Determine the costs allocated to each department using the following allocation bases: a. Direct advertising costs b. Newspaper ad space c. Sales
Answer:
a. Allocating cost using direct advertising costs
We have:
Cost allocated to New Cars = $60,000
Cost allocated to Used Cars = $48,000
Cost allocated to Parts and Service = $12,000
b. Allocating cost using Newspaper ad space
We have:
Cost allocated to New Cars = $72,000
Cost allocated to Used Cars = $36,000
Cost allocated to Parts and Service = $12,000
c. Allocating cost using Sales
We have:
Cost allocated to New Cars = $60,000
Cost allocated to Used Cars = $48,000
Cost allocated to Parts and Service = $12,000
Explanation:
Given:
New Cars Used Cars Parts and Service
Direct advertising costs $30,000 $24,000 $6,000
Newspaper ad space 60% 30% 10%
Sales $250,000 $200,000 $50,000
The costs allocated to each department can now be calculated as follows:
a. Allocating cost using direct advertising costs
The indirect advertising costs can be allocated using the following formula:
Cost allocated to a department = (Direct advertising costs of the department / Sum of direct advertising costs of the 3 departments) * Indirect advertising costs ................... (1)
Using equation (1), we have:
Cost allocated to New Cars = ($30,000 / ($30,000 + $24,000 +$6,000)) * $120,000 = $60,000
Cost allocated to Used Cars = ($24,000 / ($30,000 + $24,000 +$6,000)) * $120,000 = $48,000
Cost allocated to Parts and Service = ($6,000 / ($30,000 + $24,000 +$6,000)) * $120,000 = $12,000
b. Allocating cost using Newspaper ad space
The indirect advertising costs can be allocated using the following formula:
Cost allocated to a department = Percentage of Newspaper ad space of the department * Indirect advertising costs ................... (2)
Using equation (2), we have:
Cost allocated to New Cars = 60% * $120,000 = $72,000
Cost allocated to Used Cars = 30% * $120,000 = $36,000
Cost allocated to Parts and Service = 10% * $120,000 = $12,000
c. Allocating cost using Sales
The indirect advertising costs can be allocated using the following formula:
Cost allocated to a department = (Sales of the department / Sum of Sales of the 3 departments) * Indirect advertising costs ................... (3)
Using equation (3), we have:
Cost allocated to New Cars = ($250,000 / ($250,000 + $200,000 + $50,000)) * $120,000 = $60,000
Cost allocated to Used Cars = ($200,000 / ($250,000 + $200,000 + $50,000)) * $120,000 * $120,000 = $48,000
Cost allocated to Parts and Service = ($50,000 / ($250,000 + $200,000 + $50,000)) * $120,000 * $120,000 = $12,000