Answer:
Year 1 PV = 91,743.12
Year 2 PV =126,251.99
Year 3 PV = 154,436.70
Explanation:
The present value of future sum is the amount that ought to be invested today at interest rate compounded annually to equal the sum at the end of a particular period.
The present value of a future sum is given as follows:
PV = FV × PV (1+r)^(-n)
PV - present value
FV - Future value
r- interest rate
n- number of years
Year 1 PV = 100,000× 1.09^(-1) =91,743.12
Year 2 PV = 150,000× 1.09^(-2) =126,251.99
Year 3 PV = 200,000× 1.09^(-3) = 154,436.70
What is the importance of the Define Phase in terms of its placement in the DMAIC method?
a. It provides the data collection prior to data analysis
b. It clarifies the problem, the process and the customer of the process prior to data collection
c. It provides monitoring of the solution in order to sustain the gains
d. It takes the data and process analysis into account in order to develop solutions
Answer:
b. It clarifies the problem, the process and the customer of the process prior to data collection
Explanation:
DMAIC is an acronym for various phases in carrying out projects and they are Define, Measure, Analyze, Improve, Control.
The Define phase is widely known as the primary phase of DMAIC which is characterized by the project agreement, customer demands and requirements, and process operation strategy.
Hence, the importance of the Define Phase in terms of its placement in the DMAIC method is that " it clarifies the problem, the process and the customer of the process prior to data collection"
A team of analysts at Amazon is researching the viability of producing a smart watch. How might they estimate potential demand for their smart watch?
a. Consider the four-step process that many companies follow to estimate the market demand curve for their product. Place the steps in order, with the first step in the highest position and the last step in the lowest position.
survey customers
plot the demand curve
scale up the quantities demanded by the survey respondents
add up the total quantity demanded by the customers at each price point
b. Select two factors that the analysts want to keep in mind to create the most accurate demand estimates.
cost of inputs to production
information about climate change
existing competition in the market
consumer demographic information
Answer:
1. In order to estimate demand the analysts should;
Survey customersAdd up the total quantity demanded by the customers at each price pointScale up the quantities demanded by the survey respondents.Plot the demand curveWhen the analysts go into the market to research, they should start by surveying a sample of customers. They can then add up the quantity that was demanded by the customers at each price point to find out the total demand.
They should then scale up these results to see what the total market demand is. Then finally they should then use the scaled up data to construct a demand curve.
b. Two important factors
existing competition in the market - when creating demand estimates the analysts should keep in mind that they may have competition who are already selling their product. Their demand analysis should take into account factors like the people who have already bought the product and might no longer needing it or the price that the other competitors are selling at.consumer demographic information - demand also depends on demographic factors such as age and economic class. Some products are not very well used by the older generation such as smart watches so the researchers need to ensure that they have the right age groups. The watch might also cost an amount that some people cannot afford so this must be taken into account as well.The key principle of supply chain management can be best summed up as ________ between multiple firms.
Answer:
Collaboration.
Explanation:
Supply chain management can be defined as the effective and efficient management of the flow of goods and services as well as all of the production processes involved in the transformation of raw materials into finished products that meet the insatiable want and need of the consumers. Generally, the supply chain management involves all the activities associated with planning, execution and supply of finished goods and services to the consumers.
The key principle of supply chain management can be best summed up as collaboration between multiple firms. These multiple firms include a company that is saddled with the responsibility of manufacturing, a wholesaler, and a retailer who typically sells the products to the customers or consumers.
Basically, these three (3) firms or individuals are required to collaborate with each other so as to meet the needs of the customers in a timely manner or fashion and at a fair price too.
Each time a state legislature enacts a law that applies the assumption of risk doctrine to a particular sport, participants in that sport suffer. Fully explain your position and what this statement means to you?
Answer and Explanation:
The assumption of risk doctrine in law is the idea that a person who would normally compensate a victim for damages such as accident injuries would not under this doctrine since it is of the view that risk of loss in the case of injury in sports will not be compensated for by the person who caused such injury.
From the question, this would make people who participate in the sports which has assumption of risk doctrine suffer because there would be no compensation to any victims of injury by the person who caused the injury
Yolo Windows, a manufacturer of windows for commercial buildings, reports the following account information for last year (all costs are in thousands of dollars):
Information on January 1 (Beginning):
Direct materials inventory $ 36
Work-in-process inventory 48
Finished goods inventory 656
Information for the year:
Administrative costs $ 1,440
Direct labor 4,240
Direct materials purchases 3,280
Factory and machine depreciation 4,640
Factory supervision 840
Factory utilities 360
Indirect factory labor 1,120
Indirect materials and supplies 280
Marketing costs 600
Property taxes on factory 112
Sales revenue 18,160
Information on December 31 (Ending):
Direct materials inventory $ 32
Work-in-process inventory 56
Finished goods inventory 588
Required:
Prepare an income statement with a supporting cost of goods sold statement. (Enter your answers in thousands of dollars (i.e., 234,000 should be entered as 234).)
Answer:
Income Statement
Sales Revenue $ 18,160
Less Cost of Goods Sold ($14,936)
Gross Profit $3,224
Less Expenses :
Administrative costs $ 1,440
Marketing costs $ 600 ($2,040)
Net Income / (Loss) $ 1,184
Explanation:
Cost of Goods Sold Statement
Beginning Finished goods inventory $ 656
Add Cost of Goods Manufactured $ 14,868
Less Ending Finished goods inventory ($ 588)
Cost of Goods Sold $14,936
Cost of Goods Manufactured
Direct Materials ($ 36 + $ 3,280 - $ 32) $3,284
Direct labor $ 4,240
Factory and machine depreciation $ 4,640
Factory supervision $ 840
Factory utilities $ 360
Indirect factory labor $ 1,120
Indirect materials and supplies $ 280
Property taxes on factory $ 112
Add Beginning Work-in-process inventory $ 48
Less Ending Work-in-process inventory ($ 56)
Cost of Goods Manufactured $14,868
The distinguishing feature of economic capital (as opposed to financial capital, like money) is that it is:__________. a. expensive. b. profitable. c. productive.
Answer:
C. Productive
Explanation:
The distinguishing feature of economic capital (as opposed to financial capital, like money) is that it is productive. Thus, option 'C' is the correct option.
What is economic capital?Economic capital is the sum of money employed by a company to safeguard itself against risk, its effects, and any losses brought on by unanticipated risk. It is a gauge of a company's solvency. Economic capital is thought of as a way for a company to protect itself against risks related to its operations, legislative changes, economic factors, and market volatility.
Economic capital determines a firm's operational and market risks. In many cases, the anticipated risk is transformed into capital, which provides a clear picture of a firm's solvency. Capital in finance is frequently described in monetary terms. Financial capital is made up of two parts: debt and equity. The debt-to-equity ratio indicates a company's financial health.
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Pros and cons of working in the food service industry???
Answer: Yes and No
Explanation: Pros: You can own your own. Get to be the boss. Get a lot of money. Get to have fun.
Cons: You can have the lowest paycheck. Worst job for it.
ustine was interested in learning how to play the piano. She has been playing some basic songs, but still gets a lot of help from her teacher. What stage of ability development is Justine at? a. Novice b. Apprentice c. Master d. Mentor
Answer is Apprentice.
Explanation: The definition of an apprentice is someone who provides help to a skilled worker in order to learn the trade himself. Justine is being trained by a skilled pianist. Thus, brings us to the conclusion that Justine is in the state of an apprentice.
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Randy Inc. produces and sells tablets. The company incurred the following costs for the May:
Advertising cost for monthly television ads $ 6,600
Attachable keyboard 20,600
Insurance for delivery truck 660
Factory supervisor's salary 3,750
Marketing manager's salary 3,450
Assembly worker wages 28,000
Miscellaneous soldering material used to seal case 1,250
Hourly wages for factory security guard 2,400
CEO's salary 7,800
Speakers 5,400
Required:
Determine each of the following:
1. Direct Material
2. Direct Labor
3. Manufacturing Overhead
4. Total Manufacturing Cost
5. Total Period Cost
6. Total Variable Cost
7. Total Fixed Cost
Answer:
Please calculations below
Explanation:
1. Direct material is a material cost that can be traced to production unit ; which consist of the below.
Speakers + Attachable keyboard
5,400 + 20,600
= $26,000
2. Direct labor is a cost identified with wages paid to labourers who manufactures products. It is made up of the below.
Assembly worker wages $28,000
3. Manufacturing overhead refers to costs that are not direct in nature but are incurred for the production of goods and services.
Hourly wages for factory security guard + Factory supervisory salary
= 2,400 + 3,750
= $6,150
4. Total manufacturing cost refers to all costs incurred during production f goods and services.
Hourly wages for factory security guard + Attachable keyboards + assembly worker wages + speakers + factory supervisor salary
= 2,400 + 20,600 + 28,000 + 5,400 + 6,150
= $62,550
5 Total period cost are costs not traced or identified with the whole production flow.
Advertising cost for monthly television add + insurance for delivery truck + factory supervisor salary + marketing manager's salary + CEO's salary
= 6,600 + 660 + 3,750 + 3,450 + 7,800
= $22,260
6.Total variable cost refers to costs that vary with the level of output.
It consist of the items below.
Attachable keyboards + assembly worker wages + miscellaneous soldering material used to seal case + hourly wages for factory security guard + speakers
= 20,600 + 28,000 + 1,250 + 2,400 + 5,400
= $57,650
7.Total fixed cost refers to costs that do vary with output level. It is made up of the items below.
Advertising cost + insurance for delivery cost + factory supervisor salary + marketing manager's salary + CEO salary
= 6,600 + 660 + 3,750 + 3,450 + 7,800
=$22,260
For most high-income countries of the world, GDP _________________ over time.
Answer:
For most high-income countries of the world, GDP HAS INCREASED GRADUALLY over time.
Explanation:
Both GDP and GDP per capita has increased for almost all high income countries. Actually the only country in the world that was once rich and had a very high GDP and GDP per capita that turned into a developing country (AKA poor country) is Argentina. It is a unique case in all the world, since Argentina had the highest GDP per capita for 2 years (1895 and 1896) and continued to have a relatively high GDP per capita more than 60 years. Then political turmoil and corruption resulting in it falling from number one spot to number 73.
Match the expense revenues with expenses recognition approaches with the most appropriate accounting event.
Cause-and-effect relationship
Cost of goods sold
Specific time period
Monthly salary payments to an office employee
Without regard to related revenue in the period incurred Advertising expenditures
Answer:
Cause-and-effect relationship - Cost of goods sold
With the Cause and effect relationship, costs are linked to the revenue that they were incurred for to create. Cost of goods would therefore be linked to revenue.
Specific time period - Monthly salary payments to an office employee
Costs are to be recognized in the same period of time they were incurred. The monthly salary is to be paid monthly because it is incurred monthly.
Without regard to related revenue in the period incurred - Advertising expenditures
The advertising costs will be incurred when spent and not when the benefits are accrued.
A college student determines that he will have only $200 per month available for his housing for the coming semester. He is determined to continue in the university, so he has decided to list all feasible alternatives for housing.Required:List five feasible alternatives.
Answer:
Following are the description of the given points:
Explanation:
He needs to seek temporary accommodation, even so, he must not be too much further away from family, or else the costs of the trip would recompense its cheap housing. He needs to purchase a few of his blogs, which might not be used in the long term, like clothing, teaching materials not being used, etc. He can also start taking a bank loan. He may ask the college authorities to waive his college fees to some degree or provide free lodging because he's such a college. They can always take loans through school friends but I feel it's the most convenient option, so once you have extra cash, you could refund it.Market segments are homogeneous in two ways: prospective buyers have common needs and theya. use traditional forms of media on a regular basis.b. are in the same income bracket.c. are likely to be open to brand-switching.d. can be convinced to share common wants.e. will respond similarly to marketing action.
Answer:
Will Respond Similarly to marketing action
Explanation:
Market segmentation is the process by which customers are grouped based on shared characteristics, so that products can effectively be tailored to meet their needs.
Market segments therefore tend to have common needs and will respond in a similar way to market action.
Market segmentation is used by businesses to identify groups that will behave in a predictable manner to promotional efforts of the company.
This ensures accurate forecast of projected sales by the company.
Arbitrage is the purchase of assets or commodities on one market for immediate resale on another in order to profit form a price discrepancy.
A. True
B. False
Answer:
A. True
Explanation:
Arbitrage is a term that describes an activity or operation of making transactions of any of securities, currency, or commodities in various markets. The main purpose is to derive benefits or gets profits from the varying prices of those commodities and assets when resold.
Hence, it is TRUE that Arbitrage is the purchase of assets or commodities on one market for immediate resale on another in order to profit form a price discrepancy.
Isabella works on a team of one attorney, three
paralegals, and two secretaries. They defend product liability cases brought against their employer, a
medical-device manufacturer.
Answer: Corporation
Explanation:
Paralegals are what you would call legal assistants. Even though they are not called to the bar, they posses legal knowledge that helps them give support to lawyers, corporations, and even Governmental agencies.
As shown from the definition, paralegals can work for various types of employers including lawyers, corporations, Government agencies and sometimes even courts if they freelance. In this scenario, Isabella works for a medical-device manufacturer and so Isabella's employer is a Corporation.
Suppose the exchange rate for the swiss franc is quoted as SF 1.10 in the spot market and SF 1.13 in the 90-day forward market. Does the financial market expect the franc to strengthen or weaken relative to the dollar?
Answer:
The franc is expected to depreciate relative to the dollar, because it will take more francs to buy one dollar in the future than it does today.
Explanation:
Here it is mentioned that
Swiss Franc is quoted SF 1.10 in the spot market
SF 1.13 in 90 days forward market
Based on the above information
Here the franc approximate that it would be depreciation with respect to the dollar as it considered more francs to purchased in near future as compared with today
Therefore the same is to be considered
Paw Locker has the highest Return on Assets in its comparison group. Which of the following could be a secret to its success?
(select all that apply)
(Hint: look carefully at the definition of ROA to find only the items that will affect the ratio)
Company
Return on Equity
Return on Assets
Financial Leverage
Return on Sales
Asset Turnover
Dog Nation
0.177
0.060
3.740
0.026
2.338
Dog Shoe Warehouse
0.178
0.119
1.501
0.065
1.828
Hound Smart
0.177
0.112
1.762
0.03
2.930
Paw Locker
0.177
0.126
1.430
0.065
1.927
Pooch Mart
0.177
0.111
1.639
0.057
1.938
a. Able to charge a higher price than Pooch Mart
b. Holds lower inventory levels than Dog Shoe Warehouse
c. Uses more equity financing than Dog Nation
d. Pays less interest expense than Pooch Mart
e. Uses less debt financing than Hound Smart
Answer:
Paw Locker
The secret to its success include:
c. Uses more equity financing than Dog Nation
d. Pays less interest expense than Pooch Mart
e. Uses less debt financing than Hound Smart
Explanation:
a) Data and Calculations:
Company Dog Shoe Hound Paw Pooch
Warehouse Smart Locker Mart
Return on Equity 0.177 0.178 0.177 0.177 0.177
Return on Assets 0.060 0.119 0.112 0.126 0.111
Financial Leverage 3.740 1.501 1.762 1.430 1.639
Return on Sales 0.026 0.065 0.03 0.065 0.057
Asset Turnover 2.338 1.828 2.93 1.927 1.938
b) Paw Locker's Return on assets (ROA) indicates how profitable it is relative to its total assets. Its ROA gives a manager, investor, or analyst an idea as to how efficient the Paw Locker's management is at using the company's assets to generate earnings. As a percentage, Paw Locker's Return on assets is 12.6% and is better than the other companies' ROAs.
The ratio analysis is the analytical tool that helps in measuring the difference or the relation between two different variables of two same or different financial statements. It helps in taking business and investment decisions by the managers and helps investors for better comparison.
The secret to the success of Paw Locker may include:
c. Uses more equity financing than Dog Nation
d. Pays less interest expense than Pooch Mart
e. Uses less debt financing than Hound Smart
The ROA measures the capability of the business to earn profits from the total assets held. The ROA of the company or the business helps the managers, investors, or analysts to get an idea about the efficiency of the assets of the company.
In the given case the ROA of Law Lockers is 12.6%. When it is compared to other companies the ROA of Paw Lockers is higher. This shows that the company is efficiently using its assets to generate revenues.
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Tootsie Roll Industries is engaged in the manufacture and sale of candy. Major products include Tootsie Roll. Tootsie Roll Pops, Tootsie Pop Drops, Tootsie Flavor Rolls, Charms, and Blow-Pop lollipops. The following items were listed on Tootsie Roll s recent income statement and balance sheet. Mark each item from the balance sheet as an asset (A), liability (L), or shareholders equity (SE) item and mark each item from the income statement as a revenue (R) or expense (E) item.
(1) Bank loans
(2) Selling, marketing, and administrative expenses
(3) Accounts payable
(4) Dividends payable
(5) Retained earnings
(6) Cash and cash equivalents
(7) Accounts receivable
(8) Provision for income taxes
(9) Product cost of goods sold
(10) Machinery and equipment
(11) Net product sales
(12) Inventories
(13) Trademarks
(14) Buildings
(15) Land
(16) Income taxes payable
(17) Rental and royalty costs
(18) Investments (in other companies)
Answer and Explanation:
The categorization is shown below:
1, liability (L) credit balance
2. expense (E) debit balance
3. liability (L) credit balance
4. liability (L) credit balance
5. shareholders equity (SE) item credit balance
6. asset (A) debit balance
7. asset (A) debit balance
8. liability (L) credit balance
9 expense (E) debit balance
10 asset (A) debit balance
11 revenue (R) credit balance
12 asset (A) debit balance
13 asset (A) debit balance
14 asset (A) debit balance
15 asset (A) debit balance
16 liability (L) credit balance
17 expense (E) debit balance
18. asset (A) debit balance
In order to be strategic when participating in the recruiting process, HR professionals must:______.
Answer:
understand the labor market
Explanation:
To understand the labor market is to have vast knowledge in the following areas of labor market amongst others:
1. the availability of competent employees in the area of specialization that needs to be filled.
2. the average salary for each role
3. the average working hours
4. commonly preferred skills and certifications required.
Hence, In order to be strategic when participating in the recruiting process, HR professionals must: "understand the labor market"
Angelina is hired to work for Pupco Inc. for two years. Which of the following is true?A. Angelina has the right to quit after six months.
B. Pupco has the right to fire Angelina after six months.
C. Pupco has the power to fire Angelina after six months.
D. Two of these. E. None of these.
Answer:
B. Pupco has the right to fire Angelina after six months.
Explanation:
Angelina as the employee, can decide when to quit freely and Pupco as the employer cannot force her to keep working. Depending on specific clauses, Angelina might have to give a 1 or 2 weeks notice that she is quitting, but ultimately she can quit whenever she wants. The same does not apply to the employer, which cannot fire Angelina immediately or if she does, Pupco will have to pay her normal wages as if she had worked during a minimum amount of time. Laws generally protect the least powerful party and in a labor relationship, the employee is the least powerful party.
Deon is VP of marketing with a major beverage company and is reviewing the contracts of several film, media, and television personalities who work with the company. Recently, two of them were involved in controversial activities concerning their political beliefs and have been quite vocal regarding several social justice issues. Deon is considering canceling their contracts because it is difficult to establish that their personal views are not the views of his company. Which exchange criteria most directly relates to Deon's cancellation of these sponsorships
Question Completion:
Options:
a. There must be at least two parties.
b. Each party is free to accept or reject the exchange offer.
c. Each party believes it is appropriate or desirable to deal with the other party.
d. Each party has something that might be of value to the other party.
Answer:
c. Each party believes it is appropriate or desirable to deal with the other party.
Explanation:
Criteria C is the criteria that will most directly relate to Deon's cancellation of the sponsorships. Business deals and relationships cannot be established or allowed to subsist when it becomes inappropriate or undesirable to deal with the other party because of controversial activities. This is more so when the activities involve political and social justice beliefs and differences. Ordinarily, business partners should not allow such personal prejudices to becloud their relationships. The best approach, therefore, is for business partners to keep their political and social justice beliefs personal and not make them public issues.
To realize his passion,Alex recently opened Original Tunes,Inc. ,a small state of the art recording studio in Nashville,TN.He probably could have set-up shop in several major cities,but Nashville offered him the two most important factors that he learned in business school would enhance the creation of wealth: labor and political freedom.
a. True
b. False
Answer:
a. True
Explanation:
Indeed, we could rightly say the statement is true by remembering the four key factors of production (business):
capital (wealth)laborresourcesentrepreneur.Labor is part of the list of important factors and political freedom allows the entrepreneur to sucessfully manage business activities.
Develop an estimate for each of the following situations:_________. a. The cost of a 500-mile automobile trip, if gasoline is $3 per gallon, vehicle wear and tear is $0.50 per mile and our vehicle gets 20 miles per gallon.b. The total number of hours in the average human life, if the average life is 75 years.
Answer:
A.$325
B.657000 hours
Explanation:
We can calculate the cost of a 500-mile automobile trip by adding the cost of gasoline burnt and the cost of wear and tear during the trip. Total number of hours of 75 years old can be calculated by multiplying the number of hours in a day with the total number of days in a year.
DATA
Gasoline per gallon = $3
Vehicle wear and tear = $0.50/mile
Miles per gallon = 20 miles
Hours in a day = 24hours
Days in a year = 365
Number of years = 75
Requirement A
Cost of a 500 mile automobile trip = Cost of gasoline + Cost of vehicle wear ]
Cost of a 500 mile automobile trip = $75 + $250 = $325
Working
Cost of gasoline = (500 miles / 20 miles) * $3 per gallon = $75 Cost of vehicle wear and tear = 500 miles * $0.50 per mile = $250
Requirement A
Total number of hours in 75 years of human life = Life in years x Number of days in a year x Number of hours in a day
Total number of hours in 75 years of human life = 75 years * 365 days * 24 hours = 657000 hours
Suppose you take a short position of 1 million USD in the USD- MXN at 22.4015. What is the flow of MXN in your accounts
Answer:
22,401,500 MXN exit from account
Explanation:
Given:
MXN at 22.4015
Amount = $1,000,000
MXN at short position
Find:
Flow of MXN
Computation:
MXN at short position so, flow is exit
MXN exit = 1,000,000 × 22.4015 )
22,401,500 MXN exit from account
In terms of the production possibilities curve, inefficiency is represented by:_________.
Answer:
The inefficiency is represented by any point that lies inside the curve.
Explanation:
In the case of the production possibility curve, the inefficiency is represented by any point that lies inside the curve. While the point on the curve shows the efficient combination or use and the point beyond or outside the curve exhibits that combination that cannot be achieved. Moreover, the point inside the PPF curve shows that the government or economy is not suing its resources efficiently and the efficient use of an economy can reach the optimal combination of production.
Business ethics week 8 assignment 4
Should leadership be the manager's job or should leadership be a shared process?
Answer:
leadership be a shared process
Explanation:
Leadership may be defined as when a person leads to a particular group or a community. Leader always motivate to people for the purpose so that they can achieve the goal in a particular period of time. On the other hand an organization have always leader so that high authority gives responsibility to a leader for achieving the goal with the help of directing their employees.
Therefore leadership should be a shared process as leader need to corporate their employees.
Valuing assets at their liquidation values rather than their cost is consistent with the:_______A. Historical cost principle B. Periodicity assumption C. Expense recognition principle D. None of the above
Answer:
D. None of the above
Explanation:
The historical cost principle refers to that principle in which the asset should be recorded at the purchased price
The periodicity assumption refers to a period in which the period is divided i.e. weeks, monthly, quarterly, semi annually, yearly, etc
And, the expense recognition principle refers to that principle in which the expenses should be recognized in that year in which they are incurred along with it, the revenues are also recognized in which they are earned
Hence, the correct option is D. none of the above
A savings account earns 8% interest. If $1,000 is invested, how many years is it until each of the following amounts is on deposit?a. $1,360b. $2,720c. $4,316d. $6,848
Answer:
a. 4 years
b. 19 years
c. 19 years
d. 25 years
Explanation:
The number of years, n is calculated for each future value as follows :
a. $1,360
Pv = - $1,000
Pmt = $ 0
P/y = 1
r = 8 %
Fv = $1,360
n = ?
Using a Financial Calculator, the number of years, n is 3.9953 or 4 years
b. $2,720
Pv = - $1,000
Pmt = $ 0
P/y = 1
r = 8 %
Fv = $2,720
n = ?
Using a Financial Calculator, the number of years, n is 13.00 or 13 years
c. $4,316
Pv = - $1,000
Pmt = $ 0
P/y = 1
r = 8 %
Fv = $4,316
n = ?
Using a Financial Calculator, the number of years, n is 19.00 or 19 years
d. $6,848
Pv = - $1,000
Pmt = $ 0
P/y = 1
r = 8 %
Fv = $6,848
n = ?
Using a Financial Calculator, the number of years, n is 24.9991 or 25 years
Co. was organized to sell a single product that carries a 45-day warranty against defects. Engineering estimates indicate that % of the units sold will prove defective and require an average repair cost of per unit. During 's first month of operations, total sales were units; by the end of the month, defective units had been repaired. The liability for product warranties at month-end should be
Answer:
$660 (credit balance)
Explanation:
the question is missing the numbers, so I looked for a similar one:
4% of units will be defectiveaverage repair cost of $201,100 units sold during the first month11 defective units were repairedThe journal entry to record warranty liability:
Dr Warranty expense 880
Cr Warranty liability 880
the journal entry to record actual money spent repairing defective units:
Dr Warranty liability 220
Cr Cash 220
the balance of the warranty liability account at the end of the month = $880 - $220 = $660