Answer:
A.
1. Dr Accounts receivable $180,000
Cr Sales $180,000
2. Dr Cash $125,000
Cr Accounts receivable $125,000
3. Dr Sales returns and allowances $20,000
Cr Accounts receivable $20,000
4. Dr Allowance for doubtful accounts $35,000
Cr Accounts receivable $35,000
5. Dr Accounts receivable $2,500
Cr Allowance for doubtful accounts $2,500
Dr Cash $2,500
Cr Accounts receivable $2,500
B. Dr Bad debt expense $27,500
Cr Allowance for doubtful accounts $27,500
Explanation:
A1. To record the sale on account we will debit accounts receivable as our collectible to customer and credit sales in the amount of $180,000
A2. To record the collection, we will recognize the receipt of cash so we have to debit cash and credit accounts receivable to deduct the collectible balance in the amount of $125,000
A3. When the company receives returns from the customers, it will be charged to sales returns and allowances account so we have to debit it and credit accounts receivables in the amount of $20,000 to deduct collectibles to suppliers. Said, sales returns and allowances account is a contra account of sales. Thus, any amount recorded under it will be charged against (deduction) our sales.
A4. During the write off, we will debit allowance for doubtful accounts and credit accounts receivables to reduce its amount from the worthless receivables that is deemed to be uncollectible.
A5. Collection of previously written off receivables will resort to 2 entries. First, reversal of the original entry we made during the write off. So we debit Accounts receivable and credit allowance for doubtful accounts in the amount of $2,500. Next is to record the cash we received from the customer. So debit cash and credit accounts receivable in the same amount of $2,500.
B. To record the bad debt expense, we need to compute first the ending balance of the accounts receivable.
Beg $275,000 plus sales on account of $180,000 less collection $125,000, sales return of $20,000 and write off $35,000 = $275,000.
Bad debts is 10% of the Accounts receivable, so $275,000 x 10% = $27,500
Entry:
Dr bad debt expense $27,500
Cr allowance for doubtful accounts $27,500
Selected information from the accounting records of Ellison Manufacturing Company follows:
Net sales ............................................ P3,600,000
Cost of goods sold ................................... 2,400,000
Inventories at January 1 ............................. 672,000
Inventories at December 31 ........................... 576,000
What is the number of days' sales in average inventories for the year?
a. 102.2
b. 94.9
c. 87.6
d. 68.1
Answer:
b. 94.9
Explanation:
The computation of the number of days' sales in average inventories is shown below:
Day inventory outstanding = (Beginning inventory + ending inventory) ÷ 2 ÷ cost of goods sold × total number of days in a year
= ($672,000 + $576,000) ÷ 2 ÷ $2,400,000 × 365 days
= ($624,000 ÷ $2,400,000 ) × 365 days
= 94.90 days
Simply we take the average of inventory and divide from the costs of goods sold
All other information which is given is not relevant. Hence, ignored it
Other considerations of _______________ are important such as services performed in the home raising children, but these are not included in GDP..
A social well-being
B. production of cars
C.production of oil
D. production of education services
Answer:
The correct answer is letter "A": social well-being .
Explanation:
Social well-being is the state in which a community is in regards to lifestyles, traditions, and beliefs. It represents how healthy individuals in a society are mentally and physically. It also influences on citizens' intellectual state. The methods parents use at home to raise their children can be directly associated with how good is a region well being. Though, this factor is not included at the moment of calculating the Gross Domestic Product (GDP) of a country.
In its first year of operations Acme Corp. had income before tax of $400,000. Acme made income tax payments totaling $150,000 during the year and has an income tax rate of 40%. What is the balance in income tax payable at the end of the year?
Answer:
$10,000 (Credit balance)
Explanation:
Given that,
Income before tax = $400,000
Income tax payments during the year = $150,000
Income tax rate = 40 percent
Therefore,
The balance in income tax payable at the end of the year:
= Tax liability - Income tax paid
= ($400,000 × 40%) - $150,000
= $160,000 - $150,000
= $10,000 (Credit balance)
A manufacturing process has a fixed cost of $250,000 per month. Each unit of product being produced contains $15 worth of material and $35 in labor. Each finished product will sell for $100. How many units must be sold each month to break even?
Answer:
500,000 units
Explanation:
BEP = fixed asset / CMR
CMR = contribution / sales
contribution = 100 - (15 +35)
= $50
CMR = $50 / $100
= 0.5
BEP = $250000/ 0.5
= 500,000 units
Automobiles arrive at the drive-through window at the downtown Baton Rouge, Louisiana. post office at the rate of 4every 10 minutes. The average service time is 2 minutes. The Poisson distribution is appropriate for the arrival rate andservice times are exponentially distributed.a) What is the average time a car is in the system?b) What is the average number of cars in the system?c) What is the average number of cars waiting to receive service?d) What is the average time a car is in the queue?e) What is the probability that there are no cars at the window?f) What percentage of the time is the postal clerk busy?9) What is the probability that there are exactly 2 cars in the system?h) By how much would your answer to part (a) be reduced if a second drive-through window, with its own server, wereadded?
The average time a car spends in the system is 10 minutes, and the average number of cars in the system is 4. The average number of cars in the queue is approximately 3.2, and the probability that there are no cars at the window is 20%. A clerk is busy 80% of the time, and the probability of exactly 2 cars in the system is approximately 20.5%. If a second drive-through window is added, the average time a car is in the system would reduce significantly.
Explanation:In order to solve these questions, we must first understand the concepts of the Poisson distribution and the exponential distribution. The Poisson distribution is used to model the number of events happening in a fixed interval of time if these events occur at a known average rate and independently of the time since the last event. Exponential distribution is concerned with the amount of time until a specific event occurs.
For this case the arrival rate of cars (λ) is 4 every 10 minutes or 0.4 cars per minute, and the service rate (μ) is 1 car every 2 minutes or 0.5 cars per minute. Then we apply these rates to the formulas associated with Queuing Theory. Traffic intensity (ρ): λ/μ = 0.4/0.5 = 0.8. The average number of cars in the system (L): ρ/(1-ρ) = 0.8/(1-0.8) = 4.
The average time a car is the system (W): 1/(μ-λ) = 1/(0.5-0.4) = 10 minutes. The average number of cars in the queue (Lq): ρ²/(1-ρ) = 0.64/(1-0.8) = 3.2 cars. The probability of zero cars at the window (P0): 1-ρ = 1-0.8 = 0.2 or 20%. The percent of time the postal clerk is busy is equal to the traffic intensity, thus 80% of the time. For the probability of exactly 2 cars in the system, we use the Erlang's formula which gives approximately 0.205 or 20.5%.
If a second drive-through window is added, the system then becomes a multi-server model (M/M/2) and the calculations become more complex. But, the effect is to substantially reduce the average time a car is in the system, as the service capacity has been doubled.
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The average time a car is in the system is 2.8 minutes. The average number of cars in the system is 1.12 cars. The average number of cars waiting to receive service is 0. The average time a car is in the queue is 0.2 minutes. The probability of no cars at the window is approximately 67.03%. The postal clerk is busy 32.97% of the time. The probability of exactly 2 cars in the system is approximately 8.05%. Adding a second drive-through window with its own server would reduce the average time a car is in the system, but the exact reduction depends on various factors.
Explanation:a) To find the average time a car is in the system, we need to calculate the average time a car spends in the queue and the average service time. The average time a car spends in the queue can be found using Little's Law, which states that the average number of customers in a system is equal to the arrival rate multiplied by the average time a customer spends in the system. In this case, the arrival rate is 4 cars every 10 minutes and the average service time is 2 minutes. So, the average time a car spends in the queue is (4/10) * 2 = 0.8 minutes. The average time a car spends in the system is the average time in the queue plus the average service time, which is 0.8 + 2 = 2.8 minutes.
b) The average number of cars in the system can be found using Little's Law. The arrival rate is 4 cars every 10 minutes, so the average number of cars in the system is (4/10) * 2.8 = 1.12 cars.
c) To find the average number of cars waiting to receive service, we subtract the average number of cars in the system from the average number of cars arriving per minute. The arrival rate is 4 cars every 10 minutes, so the average number of cars arriving per minute is 4/10 = 0.4 cars. The average number of cars waiting to receive service is 0.4 - 1.12 = -0.72 cars. Since the number of cars cannot be negative, the average number of cars waiting to receive service is 0.
d) The average time a car is in the queue can be found by dividing the average number of cars in the queue by the arrival rate. Since the average number of cars in the queue is 0.8 and the arrival rate is 4 cars every 10 minutes, the average time a car is in the queue is 0.8 / (4/10) = 0.2 minutes.
e) The probability that there are no cars at the window can be found using the Poisson distribution formula, which is P(X=0) = (e^(-λ) * λ^0) / 0!, where λ is the average arrival rate. In this case, the average arrival rate is 4 cars every 10 minutes, which is equivalent to 0.4 cars per minute. So, the probability that there are no cars at the window is P(X=0) = (e^(-0.4) * 0.4^0) / 0! = (e^(-0.4) * 1) / 1 = e^(-0.4) ≈ 0.6703, or 67.03%.
f) The percentage of the time that the postal clerk is busy can be found by subtracting the probability that there are no cars at the window from 1. So, the percentage of the time that the postal clerk is busy is 1 - 0.6703 = 0.3297, or 32.97%.
g) The probability that there are exactly 2 cars in the system can be found using the Poisson distribution formula, which is P(X=2) = (e^(-λ) * λ^2) / 2!, where λ is the average arrival rate. In this case, the average arrival rate is 4 cars every 10 minutes, which is equivalent to 0.4 cars per minute. So, the probability that there are exactly 2 cars in the system is P(X=2) = (e^(-0.4) * 0.4^2) / 2! = (e^(-0.4) * 0.16) / 2 = e^(-0.4) * 0.08 ≈ 0.0805, or 8.05%.
h) If a second drive-through window with its own server were added, the average time a car is in the system would be reduced. This is because the arrival rate would stay the same, but the number of servers would increase, resulting in a decrease in the time it takes to serve a car. The exact reduction in average time would depend on various factors, such as the efficiency of the second server and the coordination between the two servers.
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Nathan buys several shares of ABC Corp. stock for $60 each. At the end of one year, the stock price has risen to $66. Plus he was paid a dividend of $1.50 per share. What is the approximate rate of return (or yield) on this investment for the year. (You can ignore any commissions or taxes.) Remember: the rate of return is the total return as a percentage of your initial investment.
Answer:
rate of return = 12.50%
Explanation:
given data
stock = $60 each
stock price = $66
paid dividend = $1.50 per share
to find out
rate of return
solution
first we get here total return that is express as
total return = stock price - stock + paid dividend .................1
total return = $66 - $60 + $1.5
total return = $7.5
so now rate of return will be here as
rate of return = [tex]\frac{total\ return}{stock}[/tex]
rate of return = [tex]\frac{7.5}{60}[/tex] × 100
rate of return = 12.50%
On June 30, 2018, the High Five Surfboard Company had outstanding accounts receivable of $600,000. On July 1, 2018, the company borrowed $450,000 from the Equitable Finance Corporation and signed a promissory note.
Interest at 10% is payable monthly. The company assigned specific receivables totaling $600,000 as collateral for the loan. Equitable Finance charges a finance fee equal to 1.8% of the accounts receivable assigned.Required:
Prepare the journal entry to record the borrowing on the books of High Five Surfboard. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answer:
The Journal entry is as follows:
On July 1,
Cash A/c Dr. $439,200
Finance charge Expense A/c Dr. $10,800
To Financing arrangement A/c $450,000
(To record the amount of borrowings)
Workings:
Finance charge expense = ($600,000 × 1.8%)
= $10,800
So, cash account = $450,000 - $10,800
= $439,200
The correct journal entry to record the borrowing on the books of High Five Surfboard Company is as follows:
Cash 600,000 Finance Fee Expense (1.8% of $600,000) 10,800 Interest Expense (10% of $450,000 for one month) 3,750 Discount on Notes Payable 10,800 Notes Payable 450,000
To record the borrowing of $450,000 with interest at 10% and a finance fee of 1.8% on assigned accounts receivable totaling $600,000.
1. High Five Surfboard Company borrowed $450,000 from Equitable Finance Corporation, which is recorded as an increase in Cash and a corresponding increase in Notes Payable.
2. The company is required to pay interest at 10% on the loan. Since the interest is payable monthly, we calculate the interest for one month as 10% of $450,000, which is $45,000 annually. For one month, the interest expense is $45,000/12 = $3,750. This is recorded as an expense (Interest Expense) and a decrease in Cash.
3. Equitable Finance charges a finance fee equal to 1.8% of the accounts receivable assigned as collateral for the loan. The accounts receivable assigned total $600,000, so the finance fee is 1.8% of $600,000, which is $10,800. This finance fee is recorded as an expense (Finance Fee Expense) and a decrease in Cash.
4. However, the finance fee is offset by a Discount on Notes Payable, which represents the amount by which the face value of the note is reduced due to the finance fee. This means that although the finance fee is an expense, it does not result in an outflow of cash because it is subtracted from the amount borrowed. Therefore, the Discount on Notes Payable is credited for $10,800, which effectively reduces the Notes Payable to the amount actually received in cash ($450,000 - $10,800 = $439,200).
5. The net effect of the transaction is that High Five Surfboard Company receives $600,000 in cash ($450,000 from the loan and $150,000 from the assignment of accounts receivable), pays $10,800 in finance fees (which does not affect cash because it is offset by the discount on the note), and accrues $3,750 in interest expense for the first month.
6. The journal entry reflects the increase in Cash by $600,000, the recognition of Finance Fee Expense and Interest Expense, and the increase in Notes Payable by $450,000, net of the Discount on Notes Payable of $10,800.
The argument that import restrictions save jobs and promote prosperity fails to recognize that:
a. there are no secondary effects of import restrictions.
b. import restrictions will lower prices in the protected industries.
c. import restrictions cannot create jobs in any industries.
d. U.S. imports provide people in other countries with the purchasing power required for the purchase of U.S. exports.
Answer:
The correct answer is letter "B": import restrictions will lower prices in the protected industries.
Explanation:
Import restrictions apply to specific tariff and non-tariff barriers levied by an importing nation to regulate the number of goods coming from other countries. This situation boosts domestic consumption in certain industries but the demand for those goods increases in quantity which causes the price of those products to drop.
Company X wants to borrow $10,000,000 floating for 5 years. Company Y wants to borrow $10,000,000 fixed for 5 years. Their external borrowing opportunities are; Fixed-Rate Floating-Rate Borrowing Cost Borrowing CostCompany X10% LIBOR Company Y12% LIBOR + 1.5% Design a mutually beneficial interest only swap for X and Y with a notational principal of $10 million by having appropriate values for;A = Company X's external borrowing rateB = Company Y's payment to X (rate)C = Company X's payment to Y (rate)D = Company Y's external borrowing rate
Answer:
The answer is:
10% fixed rate = Company X's external borrowing (rate);
11.8% fixed rate = Company Y's payment to X (rate);
LIBOR + 1.5% = Company X's payment to Y (rate);
LIBOR + 1.5% = Company Y's external borrowing rate.
Explanation:
First, X will borrow at 10% fixed and Y will borrow at LIBOR + 1.5% floating; both at notational principal of $10 million.
Then; they will enter into a interest swap where:
- X will pay to the swap the interest rate of Libor +1.5% and receive from the swap the fixed interest rate of 11.8%. Thus, X interest income and interest expenses will be: Borrowed at fixed 10% and payment at Libor+1.5% to the swap; Receipt of 11.8% from the Swap=> Net effect: X borrowed at LIBOR - 0.3% ( saving of 0.3%).
- Y will pay to the swap the fixed interest rate 11.8% and receive from the swap LIBOR +1.5%. Thus, Y interest income and interest expenses will be: Borrowed at LIBOR +1.5 and payment 11.8% fixed to the swap; Receipt of Libor + 1.5% from Bthe Swap=> Net effect: Y borrowed at 11.8% fixed ( saving of 0.2%).
Walmart's decision to build fulfillment centers illustrates which force in Porter's Five Forces Model?
A. bargaining power of suppliers
B. threat of substitute products
C. bargaining power of buyers (customers)
D. threat of new entrants
E. intensity of rivalry within the industry
Answer:
the correct answer is D. threat of new entrants
good luck
A company's operating income was $70,000 using variable costing for a given period. Beginning and ending inventories for that period were 45,000 units and 50,000 units, respectively. Ignoring income taxes, if the fixed factory overhead application rate was $8.00 per unit, what would operating income have been using full costing?
Answer:
Operating Income Using Full Costing $
Operating income based on marginal costing 70,000
Add: Difference in inventory valuation (5,000 x $8) 40,000
Operating income based on absorption costing 110,000
Explanation:
In this case, we need to calculate difference between closing inventory and opening inventory (50,000 - 45,000= 5,000 units). The difference in inventory is valued at fixed factory overhead application rate of $8. The value of difference in inventory is added to the operating income reported by marginal costing.
To calculate operating income using full costing, consider both fixed and variable costs. Use the formula Operating Income = Sales - (Variable Costs + Fixed Costs), where Fixed Costs = Fixed Factory Overhead Application Rate * (Ending Inventory - Beginning Inventory)
Explanation:To calculate the operating income using full costing, we need to consider both fixed and variable costs. The formula for operating income using full costing is:
Operating Income = Sales - (Variable Costs + Fixed Costs)
In this case, the fixed factory overhead application rate is $8.00 per unit, and the beginning and ending inventories are 45,000 units and 50,000 units, respectively. Since the inventories have increased, we can calculate the fixed costs as:
Fixed Costs = Fixed Factory Overhead Application Rate * (Ending Inventory - Beginning Inventory)
Once we have the fixed costs, we can calculate the operating income using the full costing formula mentioned above.
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Which of the following is true of viral marketing? It is the Internet version of word-of-mouth marketing. It refers to problems that occur with viruses in the online marketing process. It is another term for invasions of online privacy. It is an automated system that manages the sales and marketing functions. It is a system that allows a supplier to access a customer's inventory levels online.
Answer:
Viral marketing is the Internet version of word-of-mouth marketing.
Explanation:
Viral Marketing is a term that can be best understood by considering the way a virus spreads continuously from one person to another and then to others.
Viral Marketing entails the use of social media and other digital platforms or the internet to spread information.
It involves people coming in contact with an organization's marketing message and then sharing it with others who also share it with other people till it "goes viral".
What are unsought goods?
Answer:
Unsought goods are goods that are not in demand either because consumers are not aware of them, or because they do not see an immediate need for them.
Explanation:
There are certain goods that consumers are not aware of and as such, are not interested in purchasing. These goods are called unsought goods. New products just entering the market are examples of unsought goods and awareness for such products can be generated through advertising and extensive marketing.
In some cases, consumers are aware of unsought goods but are not interested in buying them at the moment as they do not have immediate benefits. An example of such is accident insurance.
Midshipmen Company borrows $11,500 from Falcon Company on July 1, 2018. Midshipmen repays the amount borrowed and pays interest of 12% (1%/month) on June 30, 2019.
(1) Record the borrowing for Midshipmen on July 1, 2018.
(2) Record the adjusting entry for Midshipmen on December 31, 2018.
(3) Calculate the 2018 year-end adjusted balances of Interest Payable and Interest Expense (assuming the balance of Interest Payable at the beginning of the year is $0).
Answer:
Part 1:
Account Debit Credit
Cash $11,500
Notes Payable $11,500
(On 12% Interest)
Part 2:
Account Debit Credit
Interest Expense $690
Interest Payable $690
Part 3:
Interest Expense = $690
Interest Payable = $690
Explanation:
Part 1:
July 1, 2018 Midshipmen borrows $11,500 from Falcon Company.
Account Debit Credit
Cash $11,500
Notes Payable $11,500
(On 12% Interest)
Part 2:
From july 1,2018 to Dec 31,2018, Interest expense has accumulated for 6 months. Since each month the interest is 1% so For each month interest is
($11500 * 1% = $115).
For 6 months Interest expense = $115 * 6
For 6 months Interest expense = $690
General Entry:
Account Debit Credit
Interest Expense $690
Interest Payable $690
Part 3:
Same as Part 2 i.e
From july 1,2018 to Dec 31,2018, Interest expense has accumulated for 6 months. Since each month the interest is 1% so For each month interest is
($11500 * 1% = $115).
For 6 months Interest expense = $115 * 6
For 6 months Interest expense = $690
Interest Expense = $690
Interest Payable = $690
In 2018, CPS Company changed its method of valuing inventory from the FIFO method to the average cost method. At December 31, 2017, CPS's inventories were $32 million (FIFO). CPS's records indicated that the inventories would have totaled $23.8 million at December 31, 2017, if determined on an average cost basis.
Prepare the journal entry to record the adjustment. (Ignore income taxes.) (Enter your answers in millions (i.e., 5,500,000 should be entered as 5.5). Round your answers to 1 decimal place. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answer:
Dr Retained earnings $8.2
Cr Inventory $8.2
Explanation:
By changing method of an inventory valuation, the company should apply it retrospectively based on IAS 8 guidelines on change in accounting estimates and errors. Thus, the said difference from FIFO method to Weighted Average method of valuation should be credited directly against Retained earnings account because, accounts are already closed right after the year ended.
$32-$23.8= $8.2 million
To record the said adjustment you have to
Debit Retained earnings and credit Inventory in the amount of $8.2 million.
If Roten Rooters, Inc., has an equity multiplier of 1.27, total asset turnover of 2.10, and a profit margin of 6.1 percent, what is its ROE?
Answer:
16.27%
Explanation:
Given that,
Equity multiplier = 1.27
Total asset turnover = 2.10
Profit margin = 6.1 percent
Here, the return on equity is calculated by multiplying profit margin, asset turnover and equity multiplier.
Return On Equity:
= (Profit margin) × (Asset turnover) × (Equity multiplier)
= (0.061) × (2.10) × (1.27)
= 0.1627
= 16.27%
Roten Rooters, Inc., with an Equity Multiplier of 1.27, a Total Asset Turnover of 2.10, and a Profit Margin of 6.1%, would have an ROE of approximately 16.35%.
Explanation:In Business, Return on Equity(ROE) is a measure of a company's profitability which can be calculated by multiplying the Equity Multiplier, Total Asset Turnover, and Profit Margin. In this case, for a company named Roten Rooters, Inc., with an Equity Multiplier of 1.27, a Total Asset Turnover of 2.10, and a Profit Margin of 6.1 percent, the ROE can be calculated as follows:
ROE = Equity Multiplier x Total Asset Turnover x Profit margin
Therefore, ROE = 1.27 x 2.10 x (6.1/100) = 0.16347 or approximately 16.35%.
This ROE value means that Roten Rooters, Inc., generated a return of approximately 16.35% on its equity during the period in question.
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Alan (27) and Kara (26) are married and filing a joint return. Both Alan and Kara were full-time students all year at State College, located at 11100 College Boulevard, Your City, Your State. During the year, Alan paid $5,000 in tuition and fees, substantiated with Form 1098-T. Kara paid $3,900 in tuition and fees, also substantiated with Form 1098-I. Both Alan and Kara have part-time jobs outside of school. They did not receive any scholarships during the year. Their adjusted gross income is $45,000. Their total tax on line 11 of their federal Form 1040 is $2,142. They had no additional taxes. Both Alan and Kara meet all the requirements to qualify for the American Opportunity Tax Credit.
Complete Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits) for Alan and Kara.
Answer:
AOLC_{Allan}=$2750
AOLC_{Kara}=$2475
AOLC_{Allan}=$1000
AOLC_{Kara}=$780
Explanation:
American Opportunity Learning credit.
First, assuming Allan and Kara are eligible, we must know how the two forms of credit work. For the American Opportunity Learning credit (AOLC), it is possible to receive 100% of the tax deduction for the first 2000 and then 25% of the deduction up to a maximum of 2500. So, the amount of the opportunity credit for Allan and Kara is given by:
[tex]AOLC_{Allan}=2000+(5000-2000)*0.25=2750[/tex]
[tex]AOLC_{Kara}=2000+(3900-2000)*0.25=2475[/tex]
Now, for the American Lifetime Learning credit (ALLC), we have to allow 20% deduction of taxes up to $2000 if the person meets the requirement of not earning more than 68000, then:
[tex]AOLC_{Allan}=5000*0.2=1000[/tex]
[tex]AOLC_{Kara}=3900*0.2=780[/tex]
Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip: Setup labor cost $25 per hour Annual holding cost $13 per unit Daily production 960 units/8 hour day Annual demand 23,000 (250 days eachtimes×daily demand of 92 units) Desired lot size 120 units (one hour of production)
To obtain the desired lot size, the set-up time that should be achieved = ___ minutes.
Answer:
0.1472 hours or 8.832 minutes
Explanation:
Annual demand- 23,000 units
Daily demand – 92 units
Daily production – 960 units per 8 hour day
Desired lot size - 120 units
Holding cost per unit per year - $13 per unit
Set up labor cost per hour - $25 per hour
Set up cost:
= {(120 × 120) × $13 × [1 - (92 ÷ 960)]} ÷ [2 × (23,000) ]
= $169,260 ÷ 46,000
= $3.68
Set up time:
= Set up cost ÷ Set up labor cost per hour
= $3.68 ÷ $25 per hour
= 0.1472 hours or 8.832 minutes
To achieve the desired lot size of 120 units in Carol Cagle's manufacturing plant, the setup time should be 60 minutes.
Explanation:Considering the desired lot size, which is 120 units, for a daily production of 960 units in an 8-hour shift, production time for a unit must be calculated first.
Production time for a unit is the total time available divided by the total units produced. In this case, it's 8 hours (or 480 minutes) divided by 960 units, which gives 0.5 minutes per unit. Therefore, to produce a lot size of 120 units, 120 units would require 0.5 minutes/unit x 120 units = 60 minutes of setup time. So, the required setup time for the desired lot size should be 60 minutes.
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Maldovar Company is considering purchasing a new machine to replace a machine purchased one year ago that is not achieving the expected results. The following information is available:
Expected maintenance costs of new machine $ 12,000 per year
Purchase price of existing machine $150,000
Expected cost savings of new machine $ 20,000 per year
Expected maintenance costs of existing machine $ 8,000 per year
Resale value of existing machine $ 35,000
Which of these items is IRRELEVANT?
a. Expected maintenance costs of new machine
b. Expected maintenance costs of existing machine
c. Purchase cost of existing machine
d. Expected resale value of existing machine
Answer:
c. Purchase cost of existing machine
Explanation:
Relevant costs are the incremental costs that can be avoided by avoiding the functional activity with which the costs are associated.
Maintenance costs are relevant as they are directly linked to the use of machinery and as such are incremental with the use. The same is the case with the maintenance costs of the existing machine as they are avoidable if the new machine is purchased.
Expected cost savings would be incremental with the improved new machine. These cost savings thus are relevant.
Resale value of existing machine are also relevant as these would contribute towards the purchase of new machine.
The purchase price of existing machine is irrelevant as the machine cost has already been paid and regardless of purchasing the new machine or not, this cost is not a part of any calculations.
Hope that helps.
Final answer:
The purchase cost of the existing machine is a sunk cost and therefore irrelevant to the decision of whether to purchase a new machine for Maldovar Company. The relevant costs to consider are those that impact future cash flows, such as maintenance costs and resale value.
Explanation:
In evaluating whether to replace an existing machine, certain financial factors must be considered to determine the relevant costs and benefits. When analyzing the information provided for the Maldovar Company's decision to purchase a new machine, it's important to distinguish between relevant and irrelevant costs. The relevant costs are the expected maintenance costs of both machines, the expected cost savings of the new machine, and the resale value of the existing machine, as these will impact the future cash flows of the company.
The purchase cost of the existing machine is considered a sunk cost, meaning it has already been incurred and cannot be recovered. The sunk cost is therefore irrelevant to the decision-making process because it will not affect the future costs or revenues associated with the new machine. This makes option c. Purchase cost of existing machine the correct answer as it has no bearing on the decision about whether to purchase the new machine.
Which core ethical value are you violating if you hide information from your team about an impending budget cut?a. Trustworthiness b. Respect c. Justice and fairness d. Caring
The core value that you are violating if you hide information from your team about impending budget cut is : a. Trustworthiness
Not saying anything or not saying the whole thing to your co-workers and friends are considering hiding the truth from them and almost similar to lying. This will test how trust worthy you are. If you cannot trust them with any issues, you can expect for them not to trust you too which is not a healthy mindset and relationship in work.
Maxim manufactures a hamster food product called Green Health. Maxim currently has 19,000 bags of Green Health on hand. The variable production costs per bag are $3.20 and total fixed costs are $24,000. The hamster food can be sold as it is for $11.00 per bag or be processed further into Premium Green and Green Deluxe at an additional cost. The additional processing will yield 19,000 bags of Premium Green and 4400 bags of Green Deluxe, which can be sold for $10 and $8 per bag, respectively. Assuming Maxim further processes Green Health further into Premium Green and Green Deluxe, revenue from the two products would be:
Answer:
$225,200
Explanation:
Revenue from the two products would be:
= Green health + Hamster food
= (Unit sales × selling price per unit) + (Unit sales × selling price per unit)
= (19,000 × $10) + (4,400 × $8)
= $190,000 + $35,200
= $225,200
Therefore, Assuming Maxim further processes Green Health further into Premium Green and Green Deluxe, revenue from the two products would be $225,200.
A profit center is evaluated by the rate of return earned on the investment allocated to the center. referred to as a loss center when operations do not meet the company’s objectives. a responsibility center that always reports a profit. a responsibility center that incurs costs and generates revenues.
Answer:
a responsibility center that incurs costs and generates revenues.
Explanation:
We know that
The profit = Sales revenue - cost
After selling the product and incurred expenses, the amount which is left is shown as a profit. The remaining amount is termed as a profit that a firm has earned during a particular year.
It is the responsibility center at which we know about the total cost incurred and total revenues earned so that it becomes easy to compute how much the firm has earned the profit in a year.
Discuss the role of the FOMC and the three major policies it implements to help regulate banks. Briefly describe the equation used to measure bank reserves and the definition of the federal funds rate and their role as operating targets of the Federal Reserve as part of the FOMC directive.
Answer and Explanation:
Role of FOMC:
it takes the responsibility of open market operation which is the important tool to control the manetary policy in the economy.
three major policies of FOMC:
- open market operations
- discount rate
- reserve requirement
open market operations is the tool of manetary policy through open market operations, government will buy and sale the government securities and bonds in the market to control the inflation and deflation in the economy.
discount rate is the interest rate where the reserve bank charges on borrowing funds from the financial institutions at short term basis.
reserve requirement is the percentage of deposits, where the banks should hold some amount as reserves.
equation used to measure the bank reserves is given by:
bank reserves = bank's deposit at central bank + vault cash
bank reserves = required reserves + excess reserves
federal funds rate is the interest rate which is charged by the banks to lend the reserves to other banks overnight.
federal funds rate as a part of open market operation to operate the target of the federal reserves:
in order to operate the open market operation, federal open market committee uses the tool of federal funds rate. by changing the federal funds rate, it will influence the short term interest rates, long term interest rates, foreign exchange rates etc.
Alaboratory scale is known to have a standard deviation of σ = 0.001 gram in repeated weighings. Scale readings in repeated weighings are Normally distributed, with mean equal to the true weight of the specimen. Three weighings of a specimen on this scale give 1.4131, 1.4167, and 1.4101 grams. A 95% confidence interval for the true weight of this specimen is
With a standard deviation of 0.001 grams from repeated weighings, three measurements (1.4131, 1.4167, 1.4101 grams) yield a 95% confidence interval for the true weight of approximately (1.4122, 1.4144) grams.
To calculate the 95% confidence interval for the true weight of the specimen, you can use the formula for the confidence interval for the mean:
[tex]\[ \text{Confidence Interval} = \text{Mean} \pm \text{Margin of Error} \][/tex]
The margin of error is determined by the critical value for a 95% confidence interval and the standard error of the mean. The critical value for a 95% confidence interval in a normal distribution is approximately 1.96.
The standard error of the mean (SE) is given by the formula:
[tex]\[ SE = \frac{\sigma}{\sqrt{n}} \][/tex]
where:
- [tex]\(\sigma\)[/tex] is the standard deviation of the scale (0.001 gram),
- (n) is the number of weighings (3 in this case).
Now, calculate the standard error:
[tex]\[ SE = \frac{0.001}{\sqrt{3}} \][/tex]
Next, calculate the margin of error:
[tex]\[ \text{Margin of Error} = 1.96 \times SE \][/tex]
Finally, calculate the confidence interval:
[tex]\[ \text{Confidence Interval} = \text{Mean} \pm \text{Margin of Error} \][/tex]
Substitute the values (mean = average of weighings) to get the interval.
Now, let's proceed with the calculations:
1. Calculate the standard error (SE):
[tex]\[ SE = \frac{0.001}{\sqrt{3}} \approx 0.000577 \][/tex]
2. Calculate the mean:
[tex]\[ \text{Mean} = \frac{1.4131 + 1.4167 + 1.4101}{3} \approx 1.4133 \][/tex]
3. Calculate the margin of error:
[tex]\[ \text{Margin of Error} = 1.96 \times 0.000577 \approx 0.00113 \][/tex]
4. Calculate the confidence interval:
[tex]\[ \text{Confidence Interval} = 1.4133 \pm 0.00113 \][/tex]
Therefore, the 95% confidence interval for the true weight of the specimen is approximately (1.4122, 1.4144) grams.
The activities of philanthropic foundations are unique because: Group of answer choicesa. they reduce health care costs b. they are quasi-governmental agencies c. they have money to give away d. they have so many staff members
Answer:
The correct answer is (C)
Explanation:
Philanthropic foundations are unique and an important part of helping and building a society. Most of the organisations have no money to spend whereas philanthropic foundations have money to spend that makes them unique. Public and government institution support these organisation to help poor and hungry people. Philanthropic foundations are charitable organisations, community foundations etc.
4. A coffee maker vendor has set up two coffee machines, Machine 1 and Machine 2, inside an organization. The service cost incurred on Machine 1 and Machine 2 is $100 and $80, respectively. The production cost of coffee is $2 per mug for Machine 1 and $3 per mug for Machine 2. There is no service provided by the vendor on Sundays. The weekly production capacity is 1000 mugs for Machine 1 and 1200 mugs for Machine 2, and thereafter the machine needs to be serviced before any extra mug of coffee is to be served. Due to Christmas, the employee attendance at the organization is going to be low and only one machine has to be used to serve at least 800 mugs of coffee in that week in order to minimize the total cost. Formulate an integer programming model
Answer:
An example of a linear (integer) programming problem
Explanation:
We infer the following:
Let the number of mugs produced by machine 1 be represented by X,
Since only one machine is to be used in the week of Christmas, this constraints should apply for machine-1;
Constraints
Production cost≤ $2,
Service Incurred cost≤$100,
Production capacity (excluding sunday) ≥ 800 mugs served,
Objective Function
Minimise cost: XService cost + XProduction cost
Minimise: 100x + 20x
A management that wanted to increase the financial leverage of its firm would: raise additional capital by selling fixed interest rate long-term bonds. raise additional capital by selling common stock. use excess cash to purchase preferred stock for the treasury. try to increase its ROI by increasing asset turnover.
Answer: Raise additional capital by selling fixed Interest rate long term bonds
Explanation:
A firm can finance it's operations through equity or debts, the art of a firm financing it's operations through debts like bonds etc it's refered to as financial leverage.
A firm cannot increase it's financial leverage by selling common stock, neither through buying stock from his cash and financial leverage does relate with asset turnover.
To take advantage of an arbitrage opportunity, an investor would
I) construct a zero-investment portfolio that will yield a sure profit.
II) construct a zero-beta-investment portfolio that will yield a sure profit.
III) make simultaneous trades in two markets without any net investment.
IV) short sell the asset in the low-priced market and buy it in the high-priced market.
Answer:
The answer is III) make simultaneous trades in two markets without any net investment.
Explanation:
Arbitrage is simultaneously buying an asset ( may be currency, securities...) in a low-priced market and sell it in a high-priced market.
As a results, the investor earns profit from price differences in the two markets without risk and net investment. It is because the two trading happens at the same time once price differences in any two markets are recognized ( arbitrage opportunities recognized) and the proceed of selling the asset is immediately used for financing/returning to the buying of the asset.
Thus, (III) is the correct answer.
In order to obtain a sample of undergraduate students in the United States, a simple random sample of 10 states is selected. From each of the selected states, 10 colleges or universities are chosen at random. Finally, from each of these 100 colleges or universities, a simple random sample of 20 undergraduate students is selected. Thus, the final sample consists of 2,000 undergraduates. This is an example of which type of sampling strategy?
Answer:
Multistage Sampling.
Explanation:
Multistage Sampling -
It is the method of sampling , where samples are taken in small portion , at every level of the sampling process , is referred to as multistage sampling.
It is quite a complex method , which require dividing the population into groups , and then further sampling is done, hence it is a long process and require a lot of time.
Hence, from the question, the type of sampling method involved in the question is multistage sampling.
The type of sampling strategy used in this scenario is: Cluster Sampling.
The sampling strategy used is Cluster Sampling, where states were the clusters and colleges within states were sampled.
Cluster sampling is efficient for selecting samples from populations that are challenging to list completely.Cluster sampling involves dividing the population into clusters, then randomly selecting some of these clusters to be included in the sample. In this case, states were the clusters, and colleges within those states were then sampled.J has a whole life policy with a return of premium rider. Which of the following would best describe this rider?
A term rider on a permanent policy
Answer:
The correct answer is:
A term rider on a permanent policy.
Explanation:
A return of premium rider refers to the case when the insured adds some additional clauses to the normal policy for an extra cost. A rider is obtained considering a specific period of time in which the policy would be paid to the beneficiaries in case of death, sickness or disability of the insured person. In case that the insured subject lives more than the pre-established period of time the amount that he paid for the return of premium rider would be given back to him. For example if J pays $50 monthly for a 30 years life term policy and he lives after that period of time, he will receive $18.000 at the end of the contract as a premium return.