The following is not true of job-order costing it is used in firms that produce homogeneous products.
What is Job Order Costing?
Job order costing is a costing method which is used to determine the cost of manufacturing each product. This costing method is usually adopted when the manufacturer produces a variety of products which are different from one another and needs to calculate the cost for doing an individual job. Job costing includes the direct labor, direct materials, and manufacturing overhead for that particular job.
This costing method is usually adopted when the manufacturer produces a variety of products which are different from one another and needs to calculate the cost for doing an individual job. Job costing includes the direct labor, direct materials, and manufacturing overhead for that particular job.
Therefore, we can conclude that all the options A,C, and D . are all characteristics of a job order costing system. It means that option B, it is used in firms that produce homogeneous products, is not a characteristic of a job order costing system.
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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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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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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
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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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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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.
Pepper Company provided the incomplete financial statements shown below as well as the following additional information: 1. All sales during the year were on account. 2. There was no change in the number of shares of common stock outstanding during the year. 3. The interest expense on the income statement relates to the bonds payable; the amount of bonds outstanding did not change during the year. 4. Selected balances at the beginning of the current year were:
Accounts receivable $ 270,000
Inventory $ 360,000
Total assets $ 1,800,000
e. Selected financial ratios computed from the statements below for the current year are:
Earnings per share $ 2.30 Debt-to-equity ratio 0.875 Accounts receivable turnover 14.0 Current ratio 2.75 Return on total assets 18.0 %
Times interest earned ratio 6.75 Acid-test ratio 1.25 Inventory turnover 6.5 Required:
Compute the missing amounts on the company's financial statements.
The missing amounts on the company's financial statements include the current asset of $880000, quick asset is $400000 and an inventory of $480000.
How to calculate the asset?Based on the information given, it should be noted that the current assets will be:
= Current liability × Current ratio
= $320000 × 2.75
= $880000
The quick assets will be:
= $320000 × 1.25
= $400000
The inventory will be:
= $880000 - $400000
= $480000
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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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Mary has just been asked to analyze an investment to determine if it is acceptable. Unfortunately, she is not being given sufficient time to analyze the project using various methods. She must select one method of analysis and provide an answer based solely on that method. Which method do you suggest she use in this situation
Mary should choose the Net Present Value method.
What is Net Present Value method?The Net Present Value Method (NPV) takes into account the time value of money, i.e. recognizes that cash-flows that are received sooner are worth more than cash-flows that are received in later years, and this method does this by discounting the expected cash-flows using the projects cost of capital. It therefore takes into consideration the cost of capital and the risk inherent in making projections about the future unlike the Payback method
The NPV method also tells us in dollars terms, if the investment is profitable or not, and by how much. Therefore, using this method, it is very easy to rank different projects in terms of profitability and to choose between competing investments .
The results are also not distorted in situations where the investments being analyses have more that one cash out-flow during the investment period as would happen with the Internal rate of return which can give multiple solutions. This also makes the NPV superior to the Profitability index where different investments can have the same index but are vastly different in terms of absolute dollar profitability.
Therefore, we can conclude that the correct option is C.
Your question is incomplete, but most probably your full question was:
Mary has just been asked to analyze an investment to determine if it is acceptable. Unfortunately, she is not being given sufficient time to analyze the project using various methods. She must select one method of analysis and provide an answer based solely on that method. Which method do you suggest she use in this situation?
A. Internal rate of return
B. Payback Liquidity method
C. Net present value
D. Profitability index
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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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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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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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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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Calculate the following financial ratios. TIP: If you don't remember how to calculate financial ratios, review the Calculating Financial Ratio pages from Lesson 2 of this unit.
The financial ratio on a financial statement or items gives an insight on the firm financial position.
What is a financial ratio?This refers to the ratio that is used to calculate a company's financial status or production against other firms.
Most decision-users makes use of these financial tool to analyse and gain information about the finance of a company's history or the entire business sector.
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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 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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What type of plan should be in place in the event an employee or leader needs to be replaced?.
An emergency succession plan should be in place in the event an employee or leader needs to be replaced.
An emergency succession plan is installed in place when a key leader wishes to be replaced unexpectedly. a long-term succession plan, however, allows the enterprise to account for expected adjustments in management.
Alternative planning is the method of identifying brief-term and lengthy-term emergency backups to fill crucial positions or to take the area of important people. quick-time period replacement making plans makes a specialty of finding backups at the same time as an important character is out for a brief time, which includes on an excursion or out unwell.
The reason for succession making plans is to ensure a business enterprise usually has the right leaders in location have to an alternate take place fast. by using failing to create an orderly plan for succession, your corporation won't get a 2nd risk if it doesn't adapt right now after a key participant leaves the corporation or passes away.
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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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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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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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_____ 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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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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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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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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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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______________________ 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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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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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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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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