Lewis Co. reports the following results for May. Prepare a flexible budget report showing variances between budgeted and actual results.
Budgeted Actual
Sales 950 per unit $1,470,000
Variable expenses 380 per unit 588,000
Fixed expenses (total) $144,500 135000
Units produced and sold 1,530 1,330
List variable and fixed expenses separately.

Answers

Answer 1

Answer:

See below

Explanation:

Variance

Sales $1,263,500 $1,470,000 $206,500 Favourable

Less:

Variable expenses ($505,400) ($588,000) $82,600 Unfavorable

Contribution $758,100 $882,000 $123,900 Favourable

Less:

Fixed cost ($144,500) ($135,000) Favourable

Income(loss) $613,600 $747,000 $133,400 Unfavourable


Related Questions

Ready Company has two operating (production) departments: Assembly and Painting. Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and occupies 36,000 square feet. Indirect factory expenses for the current period are as follows: Administration$80,000 Maintenance$100,000 Administration is allocated based on workers in each department; maintenance is allocated based on square footage. The amount of maintenance expenses that should be allocated to the Painting Department for the current period is:Multiple Choice$110,000.$55,000.$103,000.$48,000.$45,000.

Answers

Answer:

$77,000

Explanation:

Calculation to determine what The amount of maintenance expenses that should be allocated to the Painting Department for the current period is:

Administration=$80,000×[100/(150 + 100)] Administration=$32,000

Maintenance=$100,000×[36,000/(44,000 + 36,000)]

Maintenance=$45,000

Total$ 77,000

($32,000+$45,000)

Therefore The amount of maintenance expenses that should be allocated to the Painting Department for the current period is:$77,000

Patricia purchased a home on January 1, 2017 for $1,420,000 by making a down payment of $100,000 and financing the remaining $1,320,000 with a 30-year loan, secured by the residence, at 6 percent. During year 2017 and 2018, Patricia made interest-only payments on the loan of $79,200. What amount of the $79,200 interest expense Patricia paid during 2018 may she deduct as an itemized deduction

Answers

Answer: $60,000

Explanation:

The maximum amount deductible is based on a mortgage of $1,000,000 and the interest rate of the mortgage being paid.

Interest on $1,000,000 at 6% is:

= 6% * 1,000,000

= $60,000

Only $60,000 of the $79,200 may be deducted.

Old Economy Traders opened an account to short-sell 1,300 shares of Internet Dreams at $46 per share. The initial margin requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $46 to $59, and the stock has paid a dividend of $3.50 per share. a. What is the remaining margin in the account? (Round your answer to the nearest whole dollar.)

Answers

Answer: $8450

Explanation:

First, we need to calculate the total initial asset which will be the value of shares sold and the margin which will be:

= (1300 × $46) + (50% × 1300 × $46)

= $59800 + $29900

= $89700

We will then calculate total liability which will be:

= (1300 × $59) + (1300 × $3.50)

= $76700 + $4550

= $81250

The remaining margin will then be:

= $89700 - $81250

= $8450

Waterhouse Company plans to issue bonds with a face value of $503,500 and a coupon rate of 8 percent. The bonds will mature in 10 years and pay interest semiannually every June 30 and December 31. All of the bonds are sold on January 1 of this year. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use the appropriate factor(s) from the tables provided. Round your final answer to whole dollars.)
Determine the issuance price of the bonds assuming an annual market rate of interest of 6 percent.

Answers

Answer:

$578,408

Explanation:

face value = $503,500

maturity = 10 years x 2 = 20 periods

coupon rate = 8% / 2 = 4%

coupon = $20,140

YTM = 6% / 2 = 3%

using a financial calculator, the PV of the bonds = $578,408

Dr Cash 578,408

   Cr Premium on bonds payable 74,908

   Cr Bonds payable 503,500

Farmer Jones must move ten bales of cotton to the loft in his barn. He hooked up a pulley system to raise the bales but no matter how hard he pulled, he could not lift the bales to the height required. What comment would you make regarding Farmer Jones's solution?

A) He should use one fixed pulley.

B) He should consider some way to reduce friction.

C) He should push the bales up an inclined plane or ramp.

D) He should use a larger pulley system with additional support ropes.

Answers

Answer:

Explanation:

度的 i 烘培 有 沟通 有人 安慰你色弱

Answer:

i think d

Explanation:

Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2021. International Machines manufactured the equipment at a cost of $94,000. Manufacturers Southern's fiscal year ends December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Related Information: Lease term 2 years (8 quarterly periods) Quarterly rental payments $18,200 at the beginning of each period Economic life of asset 2 years Fair value of asset $138,287 Implicit interest rate 6% Required: 1. Show how International Machines determined the $18,200 quarterly lease payments. 2. Prepare appropriate entries for International Machines to record the lease at its beginning, January 1, 2021, and the second lease payment on April 1, 2021.

Answers

Answer:

1. $18,200 per quarter

2. 1-Jan-21

Dr Lease Receivable $138,287

Dr Cost of Goods Sold $94, 000

Cr Inventory of Equipment $94,000

Cr Sales Revenue $138,287

Dr Cash $18,200

Cr Lease Receivable $18,200

1-Apr-21

Dr Cash $18,200

Cr Lease Revenue $1,801

Cr Lease Receivable $16,399

Explanation:

1. Calculation to Show how International Machines determined the $18,200 quarterly lease payments

First step is to find the Present value of annuity at period start

Lease term=n = 2 x 4 quarters

Lease term=n= 8 periods

Fair value of asset = $138,287

Implicit interest rate, i = 6%, quarterly rate = 6%/4 Implicit interest rate= 1.5%

Present value of annuity at period start at 1.5%, 8 periods

Present value of annuity at period start = 7.5982

Now let determine the quarterly payments

Quarterly payments= $138,287/7.5982

Quarterly payments = $18,200 per quarter

Therefore the quarterly lease payments is $18,200

2) Preparation of the appropriate entries for International Machines to record the lease at its beginning, January 1, 2021, and the second lease payment on April 1, 2021.

1-Jan-21

Dr Lease Receivable $138,287

Dr Cost of Goods Sold $94, 000

Cr Inventory of Equipment $94,000

Cr Sales Revenue $138,287

(To record lease at its beginning)

Dr Cash $18,200

Cr Lease Receivable $18,200

(To record lease at its beginning)

1-Apr-21

Dr Cash $18,200

Cr Lease Revenue $1,801

Cr Lease Receivable $16,399

(To record second lease payment)

Calculation of lease revenue as on April 1, 2021

Lease revenue = ($138,287 – $18,200) x 1.5%

Lease revenue= $120,087×1.5%

Lease revenue= $1,801

Lease receivable = $18,200 – $1,801

Lease receivable = $16,399

Click this link to view O*NET’s Work Context section for Human Resources Managers. Note that common contexts are listed toward the top, and less common contexts are listed toward the bottom. According to O*NET, what are some common work contexts for Human Resources Managers? Check all that apply.

cramped work space, awkward positions

freedom to make decisions

electronic mail and telephone

sound, noise levels are distracting

extremely bright or inadequate lighting

face-to-face discussions

Answers

Answer:

b c f

Explanation:

Ayayai Corp. uses a periodic inventory system. Details for the inventory account for the month of January 2022 are as follows: Units Per unit price Total Balance, 1/1/2022 280 $5 $1400 Purchase, 1/15/2022 140 ..5 700 Purchase, 1/28/2022 140 ..5 700 An end of the month (1/31/2022) inventory showed that 230 units were on hand. How many units did the company sell in January 2022

Answers

Answer: 330 units

Explanation:

Units sold in January = Units available for sale - Ending inventory

Units available for sale = Beginning inventory + Purchases

= 280 + 140 + 140

= 560 units

Units sold = 560 - 230

= 330 units

The carrying value of bonds at maturity always equals: Multiple Choice the amount of discount or premium. the amount of cash originally received in exchange for the bonds plus any unamortized discount or less any premium. the par value of the bond. the amount of cash originally received in exchange for the bonds. the amount in excess of par value.

Answers

Answer: the par value of the bond

Explanation:

The carrying value of bonds at maturity will always be equal to the par value of the bond. The carrying value of a bond is simply refered to as the bond's face value or par value plus the premiums taht are unamortized.

We should note that during the time of maturity of the bond, there'll have been an ammortization of the discounts or premiums, while the bond's par value will be left.

The carrying value of bonds at maturity always equals to the amount of cash originally received in exchange for the bonds plus any unamortized discount or less any premium. Thus, option (b) is correct.

At maturity, bonds' carrying values will always be the same as their par values. The face value or par value of a bond plus any unamortized premiums are simply referred to as the bond's carrying value.

To put it another way, it is the total of a bond's face value, any unamortized premiums, and any unamortized discounts, if any. The par value, interest rate, and remaining maturity period of the bond must all be known before calculating the carrying value using the effective interest rate technique.

Therefore, option (b) is correct.

Learn more about on bonds, here:

https://brainly.com/question/31358643

#SPJ6

Please help me to solve this question.​

Answers

Answer:

the reproduction in which fertilization takes place is called sexual reproduction.

ii . multiple fission

hope it is helpful to you

Berry Bloom Co is getting ready for Mother's Day and needs to purchase bouquets of flowers which will be sold prior to the holiday. Due to the high demand leading up to Mother's Day, the bouquets of flowers are sold at $20/bouquet. However, after the holiday, the bouquets can only be sold at $10/bouquet. The bouquets of flowers are purchased at $15/bouquet. Berry Bloom Co wants to perform an analysis to determine how many bouquets should be procured in preparation for Mother's Day. This type of problem is called the Group of answer choices Economic Order Quantity Problem Nonlinear Optimization Problem Newsvendor Problem Discriminant Analysis Problem

Answers

Answer:

Berry Bloom Co.

This type of problem that requires Berry to perform an analysis to determine how many bouquets of flowers to procure in preparation for Mother's Day is a:

Newsvendor Problem.

Explanation:

a) Data and Calculations:

Selling price of bouquets of flowers = $20/bouquet

Cost price of bouquets of flowers = $15/bouquet

Profit per bouquet during Mother's Day = $5 ($20 - $15)

After-holiday selling price of the bouquets of flowers = $10/bouquet

Loss per bouquet of flower after the holiday = $5 ($15 - $10)

b) The Newsvendor model describes the challenges facing Berry Bloom as it gets ready for the Mother's Day holiday.  The company must decide the volume of bouquets of flowers to procure prior to the holiday.  The purchase decision becomes a problem because the demand for flowers is not certain, and the company is aware that unsold bouquets will be sold at a loss of $5 per bouquet after the holiday.

The Wheat Company has used the LIFO method for inventory valuation since the start of business 15 years ago. The current year ending inventory is $375,000. If the FIFO method of inventory had been used, the inventory would be $450,000. If Wheat Company had used the FIFO inventory method, pre-tax income would have been: Multiple Choice

Answers

Answer: $75,000 higher over the 15 year period.

Explanation:

Current year ending inventory using LIFO = $375,000

Current year ending inventory assuming FIFO was used = $450,000

If Wheat Company had used the FIFO inventory method, there will have been a difference of ($450,000 - $375,000) = $75,000 in pre-tax income over the 15 years period.

Therefore, if Wheat Company had used the FIFO inventory method, pre-tax income would have been $75,000 higher over the 15 year period.

On April 1, 2021, Shoemaker Corporation realizes that one of its main suppliers is having difficulty meeting delivery schedules, which is hurting Shoemaker's business. The supplier explains that it has a temporary lack of funds that is slowing its production cycle. Shoemaker agrees to lend $420,000 to its supplier using a 12-month, 12% note.
Required:
1. The loan of $420,000 and acceptance of the note receivable on April 1, 2021
2. The adjustment for accrued interest on December 31, 2021
3. Cash collection of the note and interest on April 1, 2022.
Record the above transactions for Shoemaker Corporation.

Answers

Answer:

1.

April 1, 2021

Note Receivable               $420000 Dr

         Cash                                 $420000 Cr

2.

December 31, 2021

Interest Receivable           $37800 Dr

       Interest Revenue            $37800 Cr

3.

March 31, 2022

Interest Receivable           $12600 Dr

       Interest Revenue            $12600 Cr

April 1, 2022

Cash                                      $470400 Dr

    Note Receivable                         $420000 Cr

    Interest Receivable                     $50400 Cr

Explanation:

1.

The issuance of notes creates an asset in the books of Shoemaker and the note receivable is debited by the amount of the loan. In exchange, cash is paid out as loan and thus it is credited.

2.

Following accrual principle, the interest revenue related to year 2021, is recorded on 31 December 2021 and a receivable is created against it as the interest revenue has not been received on 31 December 2021. The amount of interest revenue will be,

Interest Revenue - 31 December 2021 = 420000 * 12%  * 9/12 = $37800

The loan was issued on 1 April and 9 months interest has been earned till 31 December 2021.

3.

On 30 March 2022, the remaining three months interest revenue will be recorded against a receivable. The amount will be ,

Interest Revenue - March 2022 = 420000 * 12% * 3/12 = $12600

On 1 April, cash will be received for 420000 Principal and  50400 (37800 + 12600) (37800 + 12600 interest and it will be recorded as debit to cash for 470400 and credit to notes receivable for 420000 and interest receivable to 50400.

Determining Whether to Capitalize or Expense For each of the following items, indicate whether the cost should be capitalized (C) or expensed (E) immediately: a. Paid $1,200 for routine maintenance of machinery b. Paid $5,400 to rent equipment for two years c. Paid $2,000 to equip the production line with new instruments that measure quality d. Paid $20,000 to repair the roof on the building e. Paid $1,600 to refurbish a machine, thereby extending its useful life f. Purchased a patent for $5,000

Answers

Answer:

To Capitalize or Expense

a. Expense

b. Expense $2,700 Capitalize $2,700

c. Capitalize

d. Expense

e. Capitalize

f. Capitalize

Explanation:

1) Data and Analysis:

a. Maintenance Expense $1,200 Cash $1,200

b. Rent Expense $2,700 Prepaid Rent $2,700 Cash $5,400

c. Equipment $2,000 Cash $2,000

d. Building Repair Expense $20,000 Cash $20,000

e. Equipment Extension $1,600 Cash $1,600

f. Patent $5,000 Cash $5,000

2) All costs incurred for a period are expensed in the period in which the resources are consumed.  If the resources will not be consumed in a period, the costs are capitalized.  Such costs are then expensed periodically through depreciation (for tangible assets), amortization (for intangible assets), or depletion (for acquired natural resources).

Ms. T. Potts, the treasurer of Ideal China, has a problem. The company has just ordered a new kiln for $464,000. Of this sum, $58,000 is described by the supplier as an installation cost. Ms. Potts does not know whether the Internal Revenue Service (IRS) will permit the company to treat this cost as a tax-deductible current expense or as a capital investment. In the latter case, the company could depreciate the $58,000 straight-line over 5 years. The tax rate is 30% and the opportunity cost of capital is 5%.
a. What is the present value of the cost of the kiln if the installation cost is treated as a separate current expense?
b. What is the present value of the cost of the kiln if the installation cost is treated as a part of the capital investment?

Answers

Answer:

Ideal China

a) The present value of the cost of the kiln if the installation cost is treated as a separate current expense is:

= $318,304.

b) The present value of the cost of the kiln if the installation cost is treated as a part of the capital investment is:

= $363,776.

Explanation:

a) Data and Calculations:

Present value factor for 5 years at 5% = 0.784

Cost of new kiln = $464,000

Installation cost = $58,000

Present value of the cost of the kiln if the installation cost is treated as a separate current expense = $406,000 * 0.784 = $318,304

Present value of the cost of the kiln if the installation cost is treated as a part of the capital investment = $464,000 * 0.784 = $363,776

Type the correct answer in the box. Spell all words correctly. While executing a project, it is important to express mutual_____ and dignity among all the stakeholders.

Answers

Answer:

Respect.

Explanation:

Execution of a project according to the intended plan is very crucial to ensure the success of the project. In order to effectively execute the plan, it becomes crucial to display 'mutual respect and decency' between all the participants as it not only helps in preventing any kind of dispute or conflict in the team but also keeps the entire team focused and motivated to give their best. It develops a positive work environment by accepting each other's individual differences and going together as a team instead of a group of individuals.

Answer:

respect

Explanation:

Which of the following is necessary in order for a firm to successfully practice price​ discrimination? A. The​ firm's transactions costs must be zero. B. The demand for the​ firm's product is inelastic. C. The firm must practice product differentiation. D. The firm must be able to segment the market for the product.

Answers

Answer:

D

Explanation:

Price discrimination is when the same product is sold at different prices to customers in different markets

Types of Price Discrimination

1. first degree price discrimination : here sellers charge each consumer at their willingness to pay in order to eliminate consumer surplus.

2. second degree price discrimination : here firms offer different prices depending on the quantity purchased. e.g. giving discounts for bulk purchases.  

3, third degree price discrimination : firms charge different prices to different groups of customers. e.g. having a certain price for senior citizens, students

Requirements to practice successful price discrimination

The firm must have market power. If the firm does not have market power and attempts to price discriminate they would lose customersThe firm must have different elasticities of demand for their product in different marketsThe firm must be able to segment the market for their products

urendra’s personal residence originally cost $340,000 (ignoring the value of the land). After living in the house for five years, he converts it to rental property. At the date of conversion, the fair market value of the house is $320,000. As to the rental property, calculate Surendra’s basis for: Loss. Depreciation. Gain. Could Surendra have obtained better tax results if he had sold his personal residence for $320,000 and then purchased another house for $320,000 to hold as rental property? Explain. Summarize your answer to this problem in an e-mail to your instructor.

Answers

Answer:

a. Loss  

When a property is converted from being for personal use to being for business use, the basis for loss is the lower of the basis after it is adjusted for its new purpose or; the fair market value.  

Adjusted = $340,000  

Fair market value = $320,000  

Loss basis will therefore be the lower value of $320,000

b. Depreciation:  

Again, when a situation arises that a personal use property is converted to business, the depreciation is the same as the loss basis. This is the same as the loss basis because the residence was converted from personal use to business use.  

= $320,000

c. Gain  

= Adjusted basis of the property  

= $340,000

d. No.

Capital loss on personal property sales is recognized for deduction so Surendra would have incurred a loss of $20,000 had he sold the residence. He would not have obtained better tax results if he had sold the residence.  

Kirkland Company combines its operating expenses for budget purposes in a selling and administrative expense budget. For the first 6 months of 2020, the following data are available. 1. Sales: 20,800 units quarter 1; 22,100 units quarter 2. 2. Variable costs per dollar of sales: sales commissions 5%, delivery expense 2%, and advertising 3%. 3. Fixed costs per quarter: sales salaries $10,900, office salaries $6,160, depreciation $4,490, insurance $2,080, utilities $880, and repairs expense $670. 4. Unit selling price: $24. Prepare a selling and administrative expense budget by quarters for the first 6 months of 2020

Answers

Answer:

Selling and administrative expense budget for 6 months = $144,300

Explanation:

Note: See the attached excel for the selling and administrative expense budget.

From the attached excel file, we have:

Quarter 1 total cost = $70,720

Quarter 2 total cost = $73,580

Selling and administrative expense budget for 6 months = Six months total cost = Quarter 1 total cost + Quarter 2 total cost = $70,720 + $73,580 = $144,300

Required: Determine the specific eight- or nine-digit Codification citation (XXX-XX-XX-XX) that describes the following items: 1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed. 2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities. 3. Accounting for the revenue from separately priced extended warranty contracts. 4. The criteria to determine if an employer must accrue a liability for vacation pay.

Answers

Answer:

The codes for the Financial Accounting Standards Board (FASB) Accounting Standards Codification can be found on the FASB website.

The format is  (XXX-XX-XX-XX).

The first XXX is the Topic.

The first XX is the Subtopic

The second XX is the Section

The third XX or X is the Paragraph.

The Codes for the following are:

1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed. 450-20-50-3

Topic ⇒ Contingencies

Subtopic ⇒ Loss Contingencies

Section ⇒ Disclosure

2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities.  470-10-45-14

Topic ⇒ Debt

Subtopic ⇒ Overall

Section ⇒ Other Presentation Matters

3. Accounting for the revenue from separately priced extended warranty contracts. 605-20-25-3

Topic ⇒ Revenue Recognition

Subtopic ⇒ Services

Section ⇒ Recognition

4. The criteria to determine if an employer must accrue a liability for vacation pay. 710-10-25-1.

Topic ⇒ Compensation - General

Subtopic ⇒ General

Section ⇒ Recognition

In July, one of the processing departments at Okamura Corporation had beginning work in process inventory of $24,000 and ending work in process inventory of $29,000. During the month, the cost of units transferred out from the department was $159,000. In the department's cost reconciliation report for July, the total cost to be accounted for under the weighted-average method would be:

Answers

Answer: $188000

Explanation:

Based on the information given in the question, the total cost to be accounted for under the weighted-average method would be calculated thus:

Cost of ending work in process inventory = $29,000

Add: Cost of units transferred out = $159,000

Therefore, the total cost to be accounted for will be;

= $29000 + $159000

= $188000

Whispering Winds Corp. just began business and made the following four inventory purchases in June: June 1 147 units $882 June 10 196 units 1372 June 15 196 units 1568 June 28 147 units 1323 $5145 A physical count of merchandise inventory on June 30 reveals that there are 196 units on hand. Using the LIFO inventory method, the value of the ending inventory on June 30 is

Answers

Answer:

the ending inventory using the LIFO method is $1,225

Explanation:

The computation of the value of the inventory using the LIFO method is shown below;

Since there are 196 closing units

So,

= 146 units × $6 + 49 units × $7

= $882 +  $343

= $1,225

The $6 come from

= $882 ÷ 147 units

And, $7 comes from

= $1,372 ÷ 196 units

Hence, the ending inventory using the LIFO method is $1,225

Let T1 be the time between a car accident and reporting a claim to the insurance company. Let T2 be the time between the report of the claim and payment of the claim. The joint density function of T1 and T2, f(t1, t2), is constant over the region 0 < t1 < 6, 0 < t2 < 6, t1 t2 < 10, and zero otherwise. Determine E[T1 T2], the expected time between a car accident and payment of the claim.

Answers

Answer:

5.7255

Explanation:

From the given information:

[tex]T_1 \to \text{time between car accident \& reporting claim} \\ \\ T_2 \to \text{time between reporting claim and payment of claim}[/tex]

The joint density function of [tex]T_1[/tex] and [tex]T_2[/tex] is:

[tex]f(t_1,t_2) = \left \{ {{c \ \ \ 0<t_1<6, \ \ \ 0<t_2<6, \ \ \ t_1+t_2<10} \atop {0} \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ otherwise} \right.[/tex]

Area(A): [tex]= 6\times 6 - \dfrac{1}{2}*2*2[/tex]

= 34

The limits are:

[tex]\text{limits of } \ t_1 \ from \ 0 \ is \ 10 \to t_2 \\ \\ \text{limits of } \ t_2 \ from \ 0 \ is \ 4 \to 6[/tex]

Also;

[tex]\text{limits of } \ t_1 \ is \ 0 \to 6 \\ \\ \text{limits of } \ t_2 \ is \ 0 \to 4[/tex]

[tex]\iint f(t_1,t_2) dt_1dt_2 =1 \\ \\ c \iint 1dt_1dt_2 = 1 \\ \\ cA = 1 \\ \\ \implies c = \dfrac{1}{34}[/tex]

To find;

[tex]E(T_1+T_2) = \iint (t_1+t_2)c \ \ dt_1dt_2 \\ \\ \implies \dfrac{1}{34} \Big[\int \limits^4_0 \int \limits^6_0(t_1+t_2) dt_1 \ dt_2 + \int \limits^6_4 \int \limits^{10-t_2}_0(t_1+t_2) dt_1 dt_2 \Big] \\ \\ \implies \dfrac{1}{34} (120 + \dfrac{224}{3}) \\ \\ = \mathbf{5.7255}[/tex]

Olympic Sports has two issues of debt outstanding. One is a 6% coupon bond with a face value of $28 million, a maturity of 15 years, and a yield to maturity of 7%. The coupons are paid annually. The other bond issue has a maturity of 20 years, with coupons also paid annually, and a coupon rate of 7%. The face value of the issue is $33 million, and the issue sells for 96% of par value. The firm's tax rate is 40%.

Requied:
a. What is the before-tax cost of debt for Olympic?
b. What is Olympic's after-tax cost of debt?

Answers

Answer:

The responses to these question can be defined as follows:

Explanation:

Given:

                          [tex]Bond \ A \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ Bond \ B\\\\[/tex]

[tex]Face \ Value \ \ \ \ \ \ \ \ \ \$1,000 \ \ \ \ \ \ \ \ \ \$ 1,000\\\\ Rate \ of \ Coupon \ \ \ \ \ \ \ \ \ 6\% \ \ \ \ \ \ \ \ \ 7\% \\\\Maturity \ in \ Years \ \ \ \ \ \ \ \ \ 15 \ \ \ \ \ \ \ \ \ 20 \\\\Selling - Price \ \ \ \ \ \ \ \ \ -\$ 908.92 \ \ \ \ \ \ \ \ \ \$960 \\\\ Yield \ To \ Maturity \ \ \ \ \ \ \ \ \ 7\% \ \ \ \ \ \ \ \ \ 7.39\% \\\\Total\ Outstanding \ \ \ \ \ \ \ \ \ \$2,80,00,000 \ \ \ \ \ \ \ \ \ \$ 3,30,00,000\\\\[/tex]

[tex]Rate\ Tax \ \ \ \ \ \ \ \ \ 40\% \\\\selling\ Price \ \ \ \ \ \ \ \ \ PV(7\% , 15 ,60, 1000)\\\\Yield \ To\ Maturity \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ RATE(20, 70, -960,1000)[/tex]

For point a:

Before tax   [tex]FACE \ \ VALUE \ \ \ \ \ \ \ \ \ \ MARKET \ \ VALUE \ \ \ \ \ \ \ \ \ \ WEIGHT \ \ \ \ \ \ \ \ \ \ COST \ \ \ \ \ \ \ \ \ \ WACC\\\\[/tex][tex]Dr \ 1 \ \ \ \ \ \ \ \ \ \ \$2,80,00,000 \ \ \ \ \ \ \ \ \ \ 25449760 \ \ \ \ \ \ \ \ \ \ 0.445473 \ \ \ \ \ \ \ \ \ \ 7 \ \ \ \ \ \ \ \ \ \ 3.11831\\\\Dr \ 2 \ \ \ \ \ \ \ \ \ \ \$3,30,00,000 \ \ \ \ \ \ \ \ \ \ 31680000 \ \ \ \ \ \ \ \ \ \ 0.554527 \ \ \ \ \ \ \ \ \ \ 7.39 \ \ \ \ \ \ \ \ \ \ 4.097955\\\\[/tex]

                                               [tex]57129760 \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ 7.216266\\\\[/tex]

For point b:

After tax

[tex]FACE \ \ VALUE \ \ \ \ \ \ \ \ \ \ MARKET \ \ VALUE \ \ \ \ \ \ \ \ \ \ WEIGHT \ \ \ \ \ \ \ \ \ \ COST \ \ \ \ \ \ \ \ \ \ WACC\\\\Dr \ 1 \ \ \ \ \ \ \ \ \ \ \$2,80,00,000 \ \ \ \ \ \ \ \ \ \ 25449760 \ \ \ \ \ \ \ \ \ \ 0.445473 \ \ \ \ \ \ \ \ \ \ 4.2 \ \ \ \ \ \ \ \ \ \ 1.870986\\\\Dr \ 2 \ \ \ \ \ \ \ \ \ \ \$3,30,00,000 \ \ \ \ \ \ \ \ \ \ 31680000 \ \ \ \ \ \ \ \ \ \ 0.554527 \ \ \ \ \ \ \ \ \ \ 4.434 \ \ \ \ \ \ \ \ \ \ 2.458773\\\\[/tex]                                             [tex]57129760 \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ 4.329759\\\\[/tex]

So,  

In a, answer is  [tex]7.22\%[/tex]

In b, answer is  [tex]4.33\%[/tex]

Ellis Corporation is a manufacturer that uses job-order costing. The company has supplied the following data for the just completed year: Raw materials purchased on account $475,000 Raw materials (all direct) requisitioned for use in production $476,000 Direct labor cost $640,000 Manufacturing overhead: Indirect labor cost $174,000 Other manufacturing overhead costs incurred $498,000 Cost of goods manufactured $1,469,000 Cost of goods sold (unadjusted) $1,430,000 6. The journal entry to record the transfer of completed goods from Work in Process to Finished Goods is:

Answers

Answer:

It is the Cost of Goods Manufactured that should be transferred to the Finished Goods account. As both of them are asset account, adding to the Finished Goods account would debit it and taking from the Work in Process account would credit it.

Date                 Account Title                                          Debit                Credit

XX-XX-XXX     Finished Goods                                $1,469,000

                        Work in Process                                                       $1,469,000

Suppose your salary in 2016 is $30,000. Assuming an annual inflation rate of 3%, what salary do you need to earn in 2022 in order to have the same purchasing power

Answers

Answer:

$35821.5

Explanation:

Using compound formula

A= P( 1+ r/ n)^ nt

A= amount

t= time period

n=Number of years

2016----2022= 6years

Substitute for the values we have

A= $30,000[ 1+ (3/100)/1]^ (6)

A= $35821.5

Hence, salary you need to earn in 2022 in order to have the same purchasing power is $35821.5

Expenditures for major additions, improvements and flight equipment modifications are capitalized when such costs are determined to extend the useful life of the asset or are part of the cost of acquiring the asset. Expenditures for equipment overhaul costs of engines or airframes prior to their operational use are capitalized as part of the cost of such assets as they are costs required to ready the asset for its intended use. Maintenance and repairs costs are charged to expense as incurred.

Assume that FedEx made extensive repairs on an existing building and added a new wing. The building is a garage and repair facility for delivery trucks that serve the Denver area. The existing building originally cost $720,000, and by the end of 2010 (10 years), it was half depreciated on the basis of a 20-year estimated useful life and no residual value. Assume straight-line depreciation was used. During 2011, the following expenditures related to the building were made:

a. Ordinary repairs and maintenance expenditures for the year, $7,000 cash.
b. Extensive and major repairs to the roof of the building, $122,000 cash. These repairs were completed on December 31, 2011.
c. The new wing was completed on December 31, 2011, at a cash cost of $230,000.

Required:
Apply the policies of FedEx.

Answers

Answer:

FedEx

Applying the policies of FedEx:

a and b. Total repairs and maintenance expenses to be charged to the income statement = $129,000 ($7,000 + $122,000).

c. The building extension cost of $230,000 will be capitalized.

The Building will now have a total cost value of $950,000 Accumulated Depreciation of $396,000.

Therefore, the net book value of building at the end of December 31, 2011 will be $554,000 ($950,000 - $396,000).

Explanation:

a) Data and Analysis:

Cost of existing building = $720,000

Book value of existing building = $360,000 ($720,000 * 10/20)

Transactions and adjustments during 2011:

a. Repairs and Maintenance Expenses $7,000 Cash $7,000

b. Repairs and Maintenance Expenses $122,000 Cash $122,000

c. Building extension $230,000 Cash $230,000

d. Depreciation Expense on existing building = $36,000 ($720,000/20).

e. Accumulated Depreciation on Building, Dec. 31, 2011 = $396,000 ($360,000 + $36,000)

Some advertising campaigns aim to change consumer attitudes about a product. When a firm is trying to change attitudes, advertising campaign objectives are stated in ____ terms. Which of the following is not a public relations tool? a. News release. b. Publicity. c. Free samples d. Press conference e. Feature article Many trade sales promotion methods, such as temporary price reductions, encourage the marketing channel to "overload" the channel with inventory that will not be sold soon. Overloading can increase sales in the short run but hurt sales in the longer term. Which trade sales promotion method can fight channel overloading?

Answers

Answer:

Advertising Campaigns

1. When a firm is trying to change attitudes, advertising campaign objectives are stated in ____ terms.

persuasive

2. Not a public relations tool:

e. Feature article

3. The trade sales promotion method that can fight channel overloading is the offer of discounts to retailers, wholesalers, or other business buyers.

Explanation:

Feature articles are in-depth descriptions and analyses of a place, a person, an idea, or an organization.  Generally, feature articles concentrate on topical events, people, or issues and are written by experts to provide background information on newsworthy topics with the writer's personal slant or experience.

When a firm is trying to change attitudes, advertising campaign objectives are stated in persuasive terms.

Some advertising campaigns aim to change consumer attitudes about a product. It should be noted that a feature article is not a public relations tool.

In conclusion, the trade sales promotion method that can fight channel overloading is the offer of discounts to retailers, and wholesalers.

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Holtzman Clothiers's stock currently sells for $40.00 a share. It just paid a dividend of $1.75 a share (i.e., D0 = $1.75). The dividend is expected to grow at a constant rate of 7% a year. What stock price is expected 1 year from now? Round your answer to the nearest cent. $ What is the required rate of return? Do not round intermediate calculations. Round your answer to two decimal places. %

Answers

Answer: See explanation

Explanation:

a. What stock price is expected 1 year from now?

This will be calculated as:

= P0 × (1 + g)

where,

P0 = $40

g = growth rate = 7%

= P0 × (1 + g)

= 40 × (1 + 7%)

= 40 × (1 + 0.07)

= 40 × 1.07

= $42.80

b. What is the required rate of return?

This will be:

= (D1 / P0) + g

where D1 = D0 × (1+g) = 1.75 × (1+0.07) = 1.75 × 1.07 = 1.8725

= (D1 / P0) + g

= (1.8725 / 40) + 0.07

= 0.1168

= 11.68%

School band members need to raise money for new uniforms. Some members want to sell energy drinks at a football game, but others want to organize a car wash in the school parking lot. Based on the concept of scarcity, which thoughts must drive their decision making process? ​

Answers

Answer:

the answer is D. Are there enough volunteers to work a car wash?

Explanation:

just took quiz

Answer:

D. Are there enough volunteers to work a car wash?

Explanation:

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