Answer:
True
Explanation:
A seller is a person who agrees to exchange his goods or services with another party for money or other goods. A seller transfers ownership of the products to a buyer in exchange for money or other valuables. It is a person who sells, a salesperson, or a vendor of goods and services.
A seller requires a buyer to complete a sales transaction.
Strategic PlanningImagine that IBM has decided to diversify into the telecommunications business to provide online cloud-computing data services and broadband access for businesses and individuals. What method would you recommend that IBM pursue to enter this industry? Why?
Answer:
IBM could either diversify by the strategy of market penetration, which consists in increasing the market share in a particular sector (in this case, cloud computing) through more marketing efforts.
Or it could integrate horizontally, acquiring a possible competitor that is more advanced in the cloud-computing business. Or even a start-up with good prospects, because with the amount of capital that IBM has, it could more easily expand the start-up operation as a new internal business division.
Prepare an income statement (LO1-3)
Below are the account balances for Cowboy Law Firm at the end of December.
Accounts Balances
Cash $ 5,400
Salaries expense 2,200
Accounts payable 3,400
Retained earnings 3,900
Utilities expense 1,200
Supplies 13,800
Service revenue 9,300
Common stock 6,000
Required:
Use only the appropriate accounts to prepare an income statement.
COWBOY LAW FIRM
Income Statement
For the Period Ended December 31
Expenses:
Total expenses
Answer:
$5,900
Explanation:
Preparation of an Income statement
REVENUE :
Service revenue $9,300
Less EXPENSES:
Salaries expense $2,200
Utilities expense $1,200
Total Expenses($3,400)
($2,200+$1,200)
Net income $5,900
($9,300-$3,400)
Therefore the Net income amount for the income statement will be $5,900
QUESTION 14
Which of the following is not true when describing an Exchange?
Each part has something that might be of value to the other party
Three or more parties must be involved
Each party is capable of communication and delivery
Each party believes it is appropriate or desirable to deal with the other party
Each party is free to accept or reject the exchange offer
Answer:
this is my answer hopes it helps you
Explanation:
Each party believes it is appropriate or desirable to deal with the other party
estimated cost: a. managers use to make decisions about the future b. find a right price c. is not useful for
Answer:
managers use to make decisions about the future
Explanation:
Estimated cost is the cost that is projected to be incurred by a business when undertaking a project, program, or operation.
It comprises of the list of expenses that will be spent on an activity in the future.
Therefore it is used by managers to decide on the best activity to undertake in the future.
Usually the activity that has the lowest cost is balanced against the required quality.
A tax system in which the tax rate on everyone's first $10,000 of income is 10 percent, the tax rate on everyone's second $10,000 of income is 15 percent, and the tax rate on all income over $20,000 is 25 percent is a(n):
Answer:
The appropriate response is "Progressive tax".
Explanation:
Progressive taxation appears to mean that the tax rate is higher for increased organizations as well as lower for low-income communities. Whenever the taxable income leads to higher, the above tax rate tends to increase. The approximately equal tax rate would be taxation that is set regardless including its up or down in tax liability.So that above is the correct answer.
Green House operates a commercial plant nursery where it propagates plants for garden centers throughout the region.
Green House has $5,100,000 in assets. Its yearly fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.90.
Green House's volume is currently 500,000 units. Competitors offer the same plants, at the same quality, to garden centers for $4.25 each. Garden centers then mark them up to sell to the public for $9 to $12, depending on the type of plant.Read the requirements
Requirement 1.
Green House's owners want to earn an 11% return on investment on the company's assets. What is
Green House's target full product cost?
Revenue at current market price ?
Less:Desired profit ?
Target full product cost ?
Requirement 2. Given Green House's current costs, will its owners be able to achieve their target profit? Begin by calculating Green House's current full product cost.
Current variable costs ?
Plus:Current fixed costs ?
Current full product cost ?
Requirement 3. Assume Green House has identified ways to cut its variable costs to $1.75 per unit. What is its new target fixed cost? Will this decrease in variable costs allow the company to achieve its target profit?Begin by calculating Green House's new target fixed cost.
Target full product cost ?
Less:Variable costs ?
Target fixed cost ?
Requirement 4.
Green House started an aggressive advertising campaign strategy to differentiate its plants from those grown by other nurseries.
Green House does not expect volume to be affected, but it hopes to gain more control over pricing. If Green House has to spend $145,000 this year to advertise and its variable costs continue to be $1.75 per unit, what will its cost-plus price be?
Begin by calculating the cost-plus price per unit. (Round your answer to the nearest cent.)
Current variable costs ?
Plus:Fixed costs ?
Full product cost ?
Plus:Desired profit ?
Target revenue ?
Divided by:Number of units ?
Cost-plus price per unit ?
Answer:
1. Revenue at current market price $2,125,000 (500,000 units * $4.25)
Less: Desired profit $561,000 ($51,000,000 * 11%)
Target full product cost $1,564,000
2. Current variable costs $950,000 (500,000 units * $1.90)
Add: Current fixed costs $650,000
Current full product cost $1,600,000
Answer: No, the owner will not be able to meet its desired profits because the above product cost is still more than target cost of $ 1,564,000
3. Target full product cost $1,564,000
Less: Variable costs $875,000 (1.75*500,000 units)
Target fixed cost $689,000
Answer: Yes, now the company will be able to meet its target profit because the target Fixed cost calculated above is MORE than actual Fixed Cost of $ 650,000
4. Current variable costs $875,000
Add: Fixed costs $795,000
($650,000 + $145,000)
Full product cost $1,670,000
Add: Desired profit $561,000
($51,000,000 x 11%)
Target revenue $2,231,000
Cost-plus price per unit = Target revenue / Number of units
Cost-plus price per unit = $2,231,000 / 500,000 units
Cost-plus price per unit = $4.46
The price of cups increased from $3.75 to $4.05 and the quantity demanded of plates decreased from 4,950 to 4,450. Calculate the cross-price elasticity of demand for plates. Round your answer to the nearest hundredth.
Answer:Cross elasticity of demand = -1.25
Explanation:
Cross elasticity of demand= Per entage change in quantity of commodity A (plates)/ Percentage change in price of commodity B(cups)
Percentage change in quantity demanded for plates = (New quantity - old quantity/ old quantity ) x 100
={ (4450-4950)/4950] ×100
=-500/4950
= - 0.10×100= - 10%
Percentage change in price of cups =(New price - old price/ old price) x 100 [(4.05-3.75)/3.75]×100
=0.3/ 3.75
= 0.08×100= 8%
Cross price elasticity of demand = - 10%/8%
= - 1.25
Here, the cross elasticity of demand for these goods of cups and plates is negative(-1.25) showing that they are complementary goods since as the price for cups increases, the demand for plates decreased.
Assuming that the price elasticity of demand for slinkys (slinkys are a metal spring-like children's toy) is 2, an increase in the price of slinkys of 15% would result in (for slinkys) ___________a. an increase in the quantity supplied of 30%b. a decrease in demand of 30%c. a decrease in the quantity demanded of 7.5%d. a decrease in the quantity demanded of 30%
Answer: d. a decrease in the quantity demanded of 30%
Explanation:
Price elasticity of a good is used to measure the magnitude of change in the quantity demanded of the good as a result of a change in price.
Price elasticity = Change in Quantity demanded / Change in Price
2 = Change in quantity demanded / 15%
Change in Quantity demanded = 2 * 15% = 30%
The elasticity is listed as positive but is supposed to be negative even though this can cause confusion. Normal goods are assumed to have a negative elasticity so unless stated otherwise, assume elasticity is negative.
This is why the change is a decrease in quantity demanded.
Read the information about 2 competing credit cards.
Credit card 1 would be the better option if the borrow:
A. Had major expenses in the first year.
B. Spent a lot of money in the second year.
C. Used the card regularly in the long term.
D. Carried a large balance in the long term.
Answer: A. Had major expenses in the first year.
Explanation: It just makes sense and it’s also correct
In constructing a common-size income statement, depreciation will be______. A. omitted since it is a noncash expense. B. expressed as a percentage of sales. C. added back to convert net income to cash flows. D. expressed as a percentage of total assets. E. expressed as a percentage of gross fixed assets.
Answer:
B. expressed as a percentage of sales.
Explanation:
The common size income statement is the income statement where n each line the item on the income statement should be expressed as a percentage of sales
In the given options, the option B is correct as it shows that the depreciation would be expressed in sales percentage
Therefore all other options are wrong
The portfolio with the lowest standard deviation for any risk premium is called the_______. A.efficient frontier portfolio B.CAL portfolio C.global minimum variance portfolio D.optimal risky portfolio
Answer:
The right approach is Option C (global minimum variance portfolio).
Explanation:
A completely-invested portfolio with either a low uncertainty factor seems to be the GMV portfolio. This same GMV portfolio corresponds to or is situated mostly on the left end including its FI-efficient frontier. Although aside from either the full-investment requirement, no restrictions are enforced, the GMV portfolio deals for analytical portrayal.The latter options offered are not relevant to something like the scenario presented. So that is indeed the correct solution.
In an appearance on Shark Tank, the owner of a wedding runner company wanted to pursue a strategy of _____ and make her runners affordable to the public. The sharks suggested she should pursue a strategy of ______, focusing on quality and uniqueness.a. differentiation; cost leadershipb. unrelated diversification; related diversificationc. cost leadership; differentiationd. focused retrenchment; growthe. related diversification; unrelated diversification
Answer:
c. cost leadership; differentiation
Explanation:
Remember, we are told that the owner wants to make her runners affordable to the public, and we agree that affordability is only possible when there is cost leadership. Cost leadership strategy simply implies that the company's products/services are positioned to be the cheapest in comparison with other competitors.
To specifically focus on quality and uniqueness, the sharks were asking the owner to pursue the differentiation strategy. Differentiation strategy requires having features that set your product or service apart from others such as quality and uniqueness.
Which situation best illustrates an effect of the law of demand?
A. A car company increases sales when incomes rise in a city.
B. More children go to a theme park after a competing park shuts
down.
C. Customers stop going to a restaurant after it raises its prices.
D. A shop orders more computers when their selling price increases.
The correct answer is C
Answer: C. Customers stop going to a restaurant after it raises its prices
Explanation: (apx)
The person granting another person to act on their behalf using a power of attorney is called a _______________. A) Potentate B) Premier C) Principal D) Agent E) None of the above Mark for follow up
Answer:
Principal
Explanation:
Paradise Corporation Budgeted on an annual basis for it fiscal year. The following beginning and ending inventory levels (in units) are planned for next year. Beginning Inventory Raw materials 55,000 Finished goods 95,000 Ending inventory raw material 65,000 Finished goods 65,000. Three pounds of raw material are needed to produce each unit of finished product. If Paradise Corporation plans to sell 555,000 units during next year, the number of units it would have to manufacture during the year would be:________. a. 500,000 units b. 555,000 units c. 585,000 units d. 525,000 units.
Answer:
d. 525,000 units.
Explanation:
The computation of the number of units manufactured during the year is shown below:
= Number of units sold + ending finished goods inventory - beginning finished goods inventory
= 555,000 units + 65,000 units - 95,000 units
= 525,000 units
hence, the correct option is d. 525,000 units
We simply applied the above formula so that the correct value could come
And, the same is to be considered
Some recent financial statements for Smolira Golf Corp. follow:
SMOLIRA GOLF CORP.
2014 and 2015 Balance Sheets
Assets Liabilities and Owners' Equity
2014 2015 2014 2015
Current assets Current liabilities
Cash $ 24,056 $ 24,200 Accounts payable $ 23,284 $ 27,200
Accounts receivable 12,548 15,300 Notes payable 12,000 10,900
Inventory 25,592 27,200 Other 11,671 15,900
Total $62,196 $ 66,700 Total $ 46,955 $ 54,000
Long-term debt $ 90,000 $103,000
Owners' equity
Common stock and
paid-in surplus $42,000 $42,000
Accumulated retained
earnings 208,936 233,000
Fixed assets
Net plant and
equipment $325,695 $365,300 Total $250,936 $275,000
Total assets $387,891 $432,000 Total liabilities and
owners' equity $387,891 $432,000
SMOLIRA GOLF CORP.
2015 Income Statement
Sales $336,329
Cost of goods sold 231,000
Depreciation 21,600
Earnings before interest and taxes $ 83,729
Interest paid 14,400
Taxable income $ 69,329
Taxes (35%) 24,265
Net income $45,064
Dividends $21,000
Retained earnings 24,064
1. The company's profit margin is __________ percent.
2. The total asset turnover is __________ times.
3. The equity multiplier is __________ times.
4. Using the Du Pont Identity, the company's ROE is __________ percent.
Answer:
1. The company's profit margin is 13.4% percent.
profit margin = net income / net sales = $45,064 / $336,329 = 13.4%
2. The total asset turnover is 0.82 times.
asset turnover ratio = net sales / average assets = $336,329 / [($387,891 + $432,000)/2] = $336,329 / $409,945.50 = 0.82
3. The equity multiplier is 1.7 times.
equity multiplier = average total assets / average total equity = $409,945.50 / [($205,936 + $275,000)/2] = $409,945.50 / $240,468 = 1.70
4. Using the Du Pont Identity, the company's ROE is 18.68% percent.
ROE = profit margin x asset turnover x equity multiplier (or financial leverage) = 0.134 x 0.82 x 1.7 = 0.1868 = 18.68%
Why would a large publically traded corporation likely prefer issuing bonds as a way to raise new money as opposed to issuing more shares?
A. the rate of return the corporation promised will be more difficult to deliver
B. more shares will dilute the existing value of the stock, causing its market price to fall
C. the market will view the new share issue as a sign the company is in financial difficulty
D. issuing bonds is a more secure method for corporations to raise needed money
Answer:
B. more shares will dilute the existing value of the stock, causing its market price to fall
Explanation:
A bond can be defined as a debt or fixed investment security, in which a bondholder (creditor or investor) loans an amount of money to the bond issuer (government or corporations) for a specific period of time.
Generally, the bond issuer is expected to return the principal at maturity with an agreed upon interest to the bondholder, which is payable at fixed intervals.
The reason a large publicly traded corporation would likely prefer issuing bonds as a way to raise new money as opposed to issuing more shares is because more shares will dilute the existing value of the stock, causing its market price to fall and may negatively affect by reducing the value and proportional ownership of the investor's shares in the corporation.
Last year there was no change in either the raw materials or the work in process beginning and ending inventories. However, finished goods, which had a beginning balance of $25,000, increased by $15,000. If the manufacturing costs incurred totaled $600,000 during the year, the cost of goods available for sale must have been:_______.
a. $585,000
b. $600,000
c. $610,000
d. $625,000
Answer:
d. $625,000
Explanation:
cost of goods available for sale = cost of goods manufactured during the current period + finished goods inventory at the beginning of the period
cost of goods manufactured during the current period = $600,000finished goods inventory at the beginning of the period = $25,000cost of goods available for sale = $600,000 + $25,000 = $625,000
cost of goods sold = cost of goods available for sale - ending inventory = $625,000 - $40,000 = $585,000
Use the information for the question(s) below. Rosewood Industries has EBIT of $450 million, interest expense of $175 million, and a corporate tax rate of 35% If Rosewood had no interest expense, its net income would be closest to:___________ a. $430 million b. $160 million c. $290 million d. $405 million
Answer:
$180 million
Explanation:
Net income is calculated as;
= (EBIT - Interest expense)(1 - tax)
Given that;
EBIT = $450 million
Interest expense = $175 million
Tax = 35%
Net income = (450 - 175)(1 - 0.35)
Net income = (275)(0.65)
Net income = $178.75
Net income = $180 million approximated.
Rosewood's net income is closest to $180 million.
Where do the resources come from to continue to expand the production of watermelons
Explanation:
A production of watermelons or any agrarian resource, needs specific resources to continue expanding production, because unlike an organization that produces durable goods, a company that produces watermelons needs more than machines and equipment, it primarily needs a farm with ideal land for planting and growing watermelons.
The resources also come from government subsidies, workers, equipment, investments, etc.
A consumer is currently spending all of her available income on two goods: music CDs and DVDs.At her current consumption bundle she is spending twice as much on CDs as she is on DVDs.If the consumer has $120 of income and is consuming 10 CDs and 2 DVDs,what is the price of a CD?
A) $4
B) $8
C) $12
D) $20
Answer:
D) $20
Explanation:
Calculation for the price of a CD
Since the Total income is 120 then let the Income spent on DVDs be x and let them income spent on CDs be 2*x
First step
x + 2*x = $120
3*x = $120
x=$120/3
x = $40
Second step
Let the Price of one CD be y
Hence,
2*y = $40
y = $40 / 2
y = $20
Therefore the price of a CD will be $20
Hollister Company amended its defined benefit pension plan at the beginning of 2020 and recognized prior service cost of $1,700,000.
The company has collected the following additional information for the year 2020:
Service cost $400,000
Interest on the PBO 190,000
Amortization of prior service cost 170,000
Actual and expected return on plan assets 110,000
Plan funding was $700,000
Benefit payments to retirees totaled $390,000
The net increase to the PBO for 2020 is:_________.
a. $ 770,000.
b. $ 1,900,000.
c. $ 1,730,000.
d. $ 650,000.
Answer: b. $ 1,900,000
Explanation:
The Net Increase in PBO can be calculated by the formula;
= Prior service cost + Service cost + Interest on the PBO - Benefits paid
= 1,700,000 + 400,000 + 190,000 - 390,000
= $1,900,000
Major areas in business decision making
Answer:
it is investment decision, financing decision and dividend decision
Explanation:
The major areas in business decision making are:
1 Investment decision
2. Financial decision
3.Dividend decision
ABC Corp. received a 3-month, 8% per year, $1, 500 note receivable on December 1. The adjusting entry on December 31 will include a:___________ a) debit to interest Revenue of $10 b) credit to interest Receivable of $20 c) credit to interest Revenue of $30 d) debit to interest Receivable of $10
Answer:
Option D is the correct answer.
d) debit to interest Receivable of $10
Explanation:
Under the accrual basis or principle of accounting, we match the revenue with the expenses and record the transactions in the period to which they relate to rather than when the cash is paid or received. This means that the interest receivable that is accrued for time period relating to this year should be recorded as a revenue in the current period and as an asset under interest receivable as it will be received in the next period.
Thus, the interest on the note relating to 1 month of December will be recorded as follows,
Interest Revenue = 1500 * 0.08 * 1/12 = 10
31 Dec 2021
Interest Receivable 10 Dr
Interest Revenue 10 Cr
The market demand function for corn is Qd = 5 15 - 2P and the market supply function is Qs= 5P- 6, both quantities measured in billions of bushels per year. Suppose the government wants to raise the price to $4 per bushel. What are the aggregate surplus, consumer surplus, and producer surplus at the competitive equilibrium?
Answer:
The Producer surplus = 19.6.
consumer surplus = 12.25.
Aggregate supply = 31.85.
Explanation:
Normally, the demand equilibrium function equals to supply equilibrium function will get us the price which is $3 that is Qd = Qs. Hence, if we equate both function together like;
15 - 2P = 5P - 6.
15 +6 = 5P + 2P.
21 = 7P.
P = $3.
Thus, Qd = 15 - 2P= 15 - 2(3) = 15 - 6 = 9 units.
Qs = 5P - 6 = 5(3) - 6 = 15 - 6 = 9.
Therefore, if the price is going to be Increased by $4, we will have that;
Qd = 15 - 2P= 15 - 2(4) = 15 - 8 = 7 units.
=> The Producer surplus = 1/2 × 14 (4 - 1.2) = 19.6.
=> consumer surplus = 1/2 × 7 (7.5 - 4) = 12.25.
Aggregate supply = Producer surplus + consumer surplus = 19.6 + 12.25 = 31.85.
One effective way to manage credit card debt is to:
A. exaggerate your income when applying for a credit card.
B. spend your entire credit limit before making any payments.
C. replace high-interest credit cards with low-interest options.
D. always pay only the minimum payment required each month.
Answer:
C. replace high-interest credit cards with low-interest options.
Explanation:
A credit card provides a secure and convenient way to pay for goods and services even when they do not have money. The credit card gives the user access to instant credit every time they use it. The user does not incur any charges should they pay the amount due before its due date.
Credit card interest rate charges are among the highest in the industry. If the user is late in their payment, the interest fee and other charges accumulate real quick. Shifting to cards with lower interest is one way of managing credit card debts.
Pillar Company owns 70 percent of Salt Company's outstanding common stock. On December 31, 20x8, Salt sold equipment to Pillar at a price in excess of Salt's carrying amount but less than its original cost. On a consolidated balance sheet at December 31,20x8, the carrying amount of the equipment should be reported at:_______________ A) Pillar's original cost. B) Salt's original cost. C) Pillar's original cost less Salt's recorded gain. D) Pillar's original cost less 70 percent of Salt's recorded gain.
Answer:
C. Pillar's original cost less Salt's recorded gain
Explanation:
For physical assets, that is in the form of machineries or computer hardware or in this case, equipment, we can calculate the carrying cost to be the original cost minus accumulated depreciation.
in answer to this question, the carrying amount of the equipment should be reported at Pillar's original cost less Salt's recorded gain.
Barney, a manager, is very conventional, resistant to change, habitual, and does not accept new ideas very easily.This implies that Barney has:________.
A) low neuroticism.
B) low customary thinking.
C) high extraversion.
D) high agreeableness.
E) low openness to experience.
Answer:
A
Explanation:
The envelope method, notebook and pencil, and online software are all methods of ______.
estimating your unexpected expenses
planning for your future
tracking your spending
understanding your current expenses
Answer:
tracking your spending
Explanation:
In personal and business activities inner needs to track spending in order to know financial status and budget effectively with available funds.
Without tracking spending there is tendency that waste will occur and spending on unimportant items will occur.
The envelop method entails having money for each category of spending in different envelops. At the end of a period you can check the envelops to see how much has been spent in each category.
Notebook and pencil involves writing down expenses.
Online software such as QuickBooks can be used to track how much an individual or business has spent.
Answer:
C. tracking your spending
Explanation:
Compute the standard cost for one hat, based on the following standards for each that:_______. Standard material: 3/4 yard of fabric at $5.00 per yard Standard labor: 2 hours at $5.75 per hour Factory overhead: $3.20 per direct labor hourRound your answer to two decimal places. Total standard cost $______
Answer:
$21.65
Explanation:
Computation for the Total standard cost
Using this formula
Total standard cost = Material cost + Labor cost + Overhead cost
Let plug in the formula
Total standard cost = 3/4*5 + 2*5.75 + 3.2*2
Total standard cost= $21.65
Therefore the Total standard cost will be $21.65