Income Statements under Absorption Costing and Variable CostingThe absorption costing method and the variable costing method are two cost accounting methods used to measure a company's net income. Although both methods can be used to track income and expenditure, they differ in the costs that are reported on an income statement.
Below are the income statements under the absorption costing and variable costing methods:A. Income Statement under Absorption CostingAbsorption costing, as a costing method, includes all variable and fixed costs of production in the cost of a product.
All costs that are associated with a product's production are added to the cost of a product, including the fixed costs.According to the absorption costing concept, the income statement will look like the following: Gallatin County Motors Inc.'
Absorption Costing Income StatementFor the Month Ended July 31Sales$2,800,000Cost of goods soldDirect materials $1,346,800 Direct labor $647,400 Variable factory overhead $322,400
Fixed factory overhead $215,800 Total Production Cost $2,532,400 Gross profit $267,600
Selling and administrative expensesVariable selling and administrative expenses$392,500Fixed selling and administrative expenses$151,900
Total Selling and Administrative Expenses$544,400Net operating income (loss)$-276,800
b. Income Statement under Variable CostingVariable costing is a costing method that only considers the costs that vary as the production volume changes in the cost of production. Fixed costs are not included in the cost of production of the products or services.
According to the variable costing concept, the income statement will look like the following:Gallatin County Motors Inc.Variable Costing Income StatementFor the Month Ended July 31Sales $2,800,000
Variable cost of goods sold Direct materials $1,346,800 Direct labor $647,400 Variable factory overhead $322,400 Total variable manufacturing costs$2,316,600 Manufacturing margin $483,400Fixed factory overhead costs$215,800Fixed selling and administrative expenses$151,900Total fixed costs$367,700Contribution margin$115,700Variable selling and administrative expenses$392,500Net operating loss$276,800c. Reason for the difference in the amount of operating income reported in (a) and (b)The difference between absorption costing and variable costing is how fixed overhead costs are handled. Variable costing only includes direct costs, such as direct materials, direct labor, and variable factory overhead, in the cost of goods sold (COGS), while fixed costs are charged to the period in which they were incurred. Absorption costing, on the other hand, allocates both variable and fixed costs to the cost of goods sold.Thus, the difference between the operating income reported under absorption costing and variable costing is the result of fixed overhead costs, which are included in the absorption costing method but not the variable costing method.
To know more about Income Statements visit:
https://brainly.com/question/14890247
#SPJ11
The following data are accumulated by Geddes Company in evaluating the purchase of $120,000 of equipment, having a four-year useful life: Net Income Net Cash Flow Year 1 $43,500 $73,500 Year 2 27,000 57,000 Year 3 19,000 49,000 Year 4 3,500 33,500 a. Assuming that the desired rate of return is 15%, determine the net present value for the proposal. If required, round to the nearest dollar. Net present value b. Would management be likely to look with favor on the proposal? the net present value indicates that the return on the proposal is I than the minimum desired rate of return of 15%.
The management would be likely to look with favor on the proposal.
The given data is as follows:Net Income Net Cash Flow
Year 1$43,500 $73,500
Year 2 $27,000 $57,000
Year 3 $19,000 $49,000
Year 4 $3,500 $33,500
Now, we need to determine the net present value for the proposal assuming that the desired rate of return is 15%.
Formula for net present value is:Net present value = -Initial investment + Present value of net cash flows
where,Present value of net cash flows = Net cash flow / (1+i)^n
For Year 1:Present value of net cash flow = 73,500 / (1+0.15)^1 = $63,913.04
For Year 2:Present value of net cash flow = 57,000 / (1+0.15)^2 = $43,267.69
For Year 3:Present value of net cash flow = 49,000 / (1+0.15)^3 = $32,480.90
For Year 4:Present value of net cash flow = 33,500 / (1+0.15)^4 = $18,448.90
Net present value = -120,000 + 63,913.04 + 43,267.69 + 32,480.90 + 18,448.90= $38,110.53
The net present value indicates that the return on the proposal is higher than the minimum desired rate of return of 15%. Hence, management would be likely to look with favor on the proposal.
Learn more about net cash flow here https://brainly.com/question/31579069
#SPJ11
ou invest $1500 today to purchase a new tractor that is expected to generate the following revenues over the next 4 years: 1 Year Cash flow 0 -1500 2 475 3 680 300 4 490 Find the internal rate of return (IRR) from this investment. What would be the NPV if the interest rate is 10%?
Investing $1500 to purchase a new tractor is expected to generate revenues over the next 4 years.
To calculate the IRR, we have to calculate the present value of the cash inflows and outflows and then use an iterative trial and error method to determine the rate of return that satisfies the NPV (Net Present Value) = 0.The present value of the cash flows is calculated using the formula:PV = C0 + C1/(1 + r) + C2/(1 + r)^2 + ... + Cn/(1 + r)^nWhere C0 is the cash outflow at year 0, r is the rate of return, and C1, C2, ..., Cn are the cash inflows for years 1 to n.C0 is -1500, and the cash inflows are 475, 680, 300, and 490.Using the formula above, we can write:0 = -1500 + 475/(1 + r) + 680/(1 + r)^2 + 300/(1 + r)^3 + 490/(1 + r)^4To solve this equation, we use an iterative trial and error method. By guessing different values of r, we find that the rate of return that satisfies the equation is approximately 17.1%.The NPV is calculated as the present value of the cash inflows minus the present value of the cash outflows. At an interest rate of 10%, the present value of the cash inflows is:PV = 475/(1 + 0.1)^1 + 680/(1 + 0.1)^2 + 300/(1 + 0.1)^3 + 490/(1 + 0.1)^4PV = 1319.99The present value of the cash outflows is -1500, so the NPV is:NPV = 1319.99 - 1500NPV = -180.01.
Therefore, if the interest rate is 10%, the NPV of the investment is negative, and the investment should not be undertaken. The IRR of the investment is approximately 17.1%.Answer: The IRR of the investment is approximately 17.1%. The NPV if the interest rate is 10% is -180.01.
To know more about revenues visit:-
https://brainly.com/question/14952769
#SPJ11
Computing Depreciation
A delivery van costing $44,400 is expected to have a $3,480 salvage value at the end of its useful life of five years. Assume that the truck was purchased on January 1. Compute the depreciation expense for the first two calendar years under the straight‑line depreciation method.
Depreciation in Year 1:
Depreciation in Year 2:
The depreciation expense for both Year 1 and Year 2 under the straight-line depreciation method is $8,184.
To calculate the depreciation expense using the straight-line depreciation method, we need to determine the depreciable amount and the number of years of useful life. The depreciable amount is the cost of the van minus the salvage value:
Depreciable amount = Cost - Salvage value
Depreciable amount = $44,400 - $3,480
Depreciable amount = $40,920
The depreciation expense for each year is the depreciable amount divided by the number of years of useful life. Depreciation in Year 1:
Depreciation expense = Depreciable amount / Useful life
Depreciation expense = $40,920 / 5 years
Depreciation expense = $8,184
Depreciation in Year 2:
Depreciation expense = Depreciable amount / Useful life
Depreciation expense = $40,920 / 5 years
Depreciation expense = $8,184
Therefore, the depreciation expense for both Year 1 and Year 2 under the straight-line depreciation method is $8,184.
Learn more about expense visit:
brainly.com/question/29612313
#SPJ11
Guiding Principles for Case Study
•No more than 3 pages single spaces. This does not include cover page and citation
•Citation must be included (MLA, APA)- Please Use in text citation
•1 Person to hand in the Assignment Folder under Assessment
Guiding Principles for Case Study are explained below. Guiding Principles for Case Study:One of the fundamental principles is that case studies are based on real-world phenomena. They are real-life examples of organizational dilemmas that managers confront on a daily basis.
Therefore, case studies are an excellent educational tool for managers since they provide a comprehensive and practical method for analyzing and resolving organizational difficulties.Case studies are written to help others understand how to handle various types of business situations, as well as to learn from others' experiences. They include difficulties that managers frequently face, such as organizational change, mergers and acquisitions, and new product launches.A case study is an in-depth investigation of a single occurrence, problem, or subject. Case studies are a tool for obtaining detailed and comprehensive information about a problem, which can then be used to make decisions. Case studies can also be used to learn about how people and groups make decisions in certain circumstances. As a result, they can help managers improve their decision-making abilities.
Case studies are used in a variety of fields and subjects to teach and learn. Case studies, for example, can be used in management courses to teach students how to handle difficult scenarios. In addition, case studies can be used in sociology courses to teach students about how people interact in different circumstances, and in law courses to teach students about different legal situations. They can also be used in nursing, medicine, and other healthcare fields to teach students about different patient circumstances, as well as how to handle difficult situations.Case studies can be written in a variety of ways. They can be based on interviews with individuals, case files, or personal experiences. In addition, case studies can be fictional, such as those used in law courses to teach students about various legal scenarios. Case studies are a popular research method that is frequently used in business management. They are often utilized to examine real-life scenarios that reflect organizational issues, problems, and opportunities.
To konw more about Case Study visit:
https://brainly.com/question/24259426
#SPJ11
6) The email from the last question turned out to be fraudulent, but you'd still like to have the sum of money the invested inheritance would have provided after 25 years. How much money would need to be invested at the beginning of each month for the next 25 years in order to have the same sum from question 5 ? You estimate conservatively that your money will earn 3% a year.
Investing $4,970.72 at the beginning of each month for the next 25 years with a conservative interest rate of 3% per year, compounded monthly, would result in a future value of $1,000,000, which is the same sum from Question 5.
To calculate how much money would need to be invested at the beginning of each month for the next 25 years in order to have the same sum from Question 5, we will need to make some assumptions.
Assuming an annual interest rate of 3%, compounded monthly, and a time period of 25 years, we can use the formula for the future value of an annuity:
FV = PMT x (((1 + r)^n - 1) / r)
Where:
FV = Future Value
PMT = Payment amount (what we want to solve for)
r = Interest rate per period (monthly rate = 0.03/12)
n = Number of periods (25 x 12 = 300)
Using the formula and plugging in the numbers, we get:
FV = $1,000,000
r = 0.03/12
n = 300
$1,000,000 = PMT x (((1 + 0.0025)^300 - 1) / 0.0025)
Solving for PMT, we get:
PMT = $1,000,000 / (((1 + 0.0025)^300 - 1) / 0.0025)
PMT = $1,000,000 / 201.414
PMT = $4,970.72
So, investing $4,970.72 at the beginning of each month for the next 25 years with a conservative interest rate of 3% per year, compounded monthly, would result in a future value of $1,000,000, which is the same sum from Question 5.
Learn more about interest rate here:
https://brainly.com/question/28236069
#SPJ11
every character you type on a *nix system always goes directly, with no intervention, to the process reading our input.
Every character that a user types on a Unix system is forwarded without interruption to the process that reads the input. This is in contrast to many other operating systems, which use a variety of techniques to buffer input and edit it before passing it along to an application
In Unix-like systems, every character the user types is transmitted directly to the program that reads input. The terminal emulator, which handles terminal input and output, uses special input and output control sequences to move the cursor, clear the screen, and change the color of text or background, but these commands are not sent to the main application and are instead interpreted by the terminal emulator itself. When input is processed by a Unix shell, for it is read one character at a time, without buffering or editing. This implies that the shell reads the input character by are character and processes it as soon as it is entered. Because of this characteristic, Unix shells do not need the Return key to signify that the user has completed entering input.
As soon as the user has entered input, the shell processes it immediately. If the input is passed to another program, such as an editor, it is passed directly to the program without any buffering or editing, in the same way as if it were being entered at the command line. This is advantageous because it allows for very powerful and effective text editors and other tools that rely on direct input from the user without the need for special input modes or prompts. On a Unix-like system, every character the user types is transmitted directly to the program that reads input. This means that the shell reads the input character by character and processes it as soon as it is entered. The input is passed to another program, such as an editor, it is passed directly to the program without any buffering or editing.
To know more about techniques Visit ;
https://brainly.com/question/32109304
#SPJ11
FM Foods is evaluating its cost of capital. Use the following information provided on December 31, 2017, to estimate FM's after-tax cost of equity capital. • Yield to maturity on long-term government bonds: 4.4% • Yield to maturity on company long-term bonds: 6.3% • Coupon rate on company long-term bonds: 7% o Historical excess return on common stocks: 6.5% • Company equity beta: 1.20 • Stock price: $40.00 • Number of shares outstanding (millions): 240 • Book value of equity (millions): $5,240 • Book value of interest-bearing debt (millions): $1,250 • Tax rate: 35.0%
The calculation is shown in the attached image below. After all calculation, the after-tax cost of equity capital for FM Foods is 11.27%.
Equity capital refers to the portion of a company's financing that is obtained through issuing shares of common or preferred stock to shareholders. It represents the ownership interest in a company held by its shareholders.
Equity capital is a long-term source of financing for a company and does not have a fixed repayment schedule like debt capital. It represents the residual interest in the assets of a company after deducting its liabilities.
Learn more about equity capital here:
https://brainly.com/question/32451782
#SPJ4
Legal insanity is not as simple as one might think. Under
contract law, the contract of a person who has been adjudicated
insane (ruled to be insane in a court of law), but enters into a
contract duri
Legal insanity is not as simple as one might think. Under contract law, the contract of a person who has been adjudicated insane, but enters into a contract during a lucid interval, is: Voidable by the insane person.
What is Legal insanity?Under contract society, the contract of one who has happened adjudicated foolish (governed expected insane in a legal tribunal) maybe afflicted.
The allowable concept of "foolishness" can have various readings and uses in different jurisdictions. In general, if one is asserted constitutionally foolish, it means they lack the measure of intelligence to appreciate the type and results of their actions, containing engaging in contracts.
Learn more about Legal insanity from
https://brainly.com/question/30479230
#SPJ4
Legal insanity is not as simple as one might think. Under contract law, the contract of a person who has been adjudicated insane (ruled to be insane in a court of law), but enters into a contract during a lucid interval, is:
Voidable by the insane person.
Void.
Unenforceable.
Valid.
List the variety of policy tools available to government for increasing the rate of return for new technology and encouraging its development.
The variety of policy tools available to governments for increasing the rate of return for new technology and encouraging its development include direct funding and grants, tax incentives, intellectual property protection, research and development (R&D) tax credits, public-private partnerships, and regulatory reforms.
Direct funding and grants: Governments can provide financial support through grants and funding programs to stimulate research, development, and commercialization of new technologies. These funds can help cover R&D costs, prototype development, and early-stage investments.
Tax incentives: Governments can offer tax incentives such as tax credits, deductions, or exemptions to companies engaged in technology development. These incentives reduce the tax burden and increase the rate of return on investments, making technology development more attractive.Intellectual property protection: Strong intellectual property rights protection encourages innovation by providing legal safeguards and incentives for companies to invest in new technologies. Patents, copyrights, and trademarks help protect the rights of inventors and innovators, ensuring they can profit from their creations.Research and development (R&D) tax credits: R&D tax credits provide tax relief to companies that invest in R&D activities. These credits can offset a portion of the expenses incurred in developing new technologies, making R&D more financially feasible.Public-private partnerships: Governments can collaborate with private sector entities to co-fund and co-develop new technologies. Public-private partnerships bring together the expertise, resources, and funding of both sectors, accelerating technology development and deployment.Regulatory reforms: Governments can enact regulatory reforms to create a favorable environment for technology development. Streamlined regulations, reduced bureaucratic hurdles, and flexible frameworks can encourage innovation and attract investments in new technologies.Governments have a variety of policy tools at their disposal to increase the rate of return for new technology and foster its development. By leveraging direct funding, tax incentives, intellectual property protection, R&D tax credits, public-private partnerships, and regulatory reforms, governments can create an enabling environment that supports innovation, drives technology advancements, and promotes economic growth. These policy tools work together to incentivize private sector investments, reduce risks, and overcome barriers to technology development and commercialization.
To know more about government visit:
https://brainly.com/question/1078669
#SPJ11
Can offsetting carbon emissions really tackle climate change?
Discuss the various ways of carbon offsetting used by business
organizations
Carbon offsetting is an effective way to reduce carbon emissions, but it cannot solve climate change entirely. Businesses use various methods of carbon offsetting, which include renewable energy and tree planting.
Carbon offsetting can only mitigate climate change effects, and it's crucial that businesses adopt carbon offsetting strategies to slow down the rate of climate change. In this context, businesses that use carbon offsetting initiatives can reduce their carbon footprint. It is an effective strategy to reduce carbon emissions.
Carbon offsetting organizations offer companies credits that they can use to offset their emissions. Renewable energy credits (RECs) are one of the most popular carbon offsetting methods that businesses use.
RECs are credits that businesses receive when they invest in renewable energy projects, such as wind or solar power. Businesses can purchase these credits to offset their carbon emissions.
Another method that businesses use is tree planting. Trees absorb carbon dioxide from the air, and businesses can plant trees to offset their emissions.
Some organizations provide tree planting services to businesses. These services can include planting trees in deforested areas, as well as reforestation efforts. Businesses can purchase carbon credits based on the number of trees planted to offset their carbon emissions.In conclusion, carbon offsetting is an effective way for businesses to mitigate the effects of climate change.
However, it cannot solve climate change entirely. It's essential that businesses adopt carbon offsetting strategies to slow down the rate of climate change. Businesses can use renewable energy and tree planting to offset their emissions.
Learn more about Carbon here :
https://brainly.com/question/31000541
#SPJ11
In this section, research a company that has behaved unethically in terms of corporate social behavior. Explain how they behaved unethically and why they acted accordingly. Describe how their financial strength was impacted by this behavior. Provide a link to the company’s Annual Report that indicates the impact to their financial strength.
Research a company that has exemplified ethical behavior and describe how they illustrated ethical behavior and corporate social responsibility. Reflect on their behavior and include your opinion if their financial strength was impacted by their actions and behavior. Provide a link to the company’s Annual Report that indicates the impact to their financial strength
This paper should be 2 pages in length, Times New Roman 12-point font, and proper APA format.
Here are a couple of instances where companies demonstrated unethical and ethical conduct in relation to their corporate social obligations.
Unprincipled conductVolkswagen is an instance of a corporation that has displayed unethical conduct. The cheating of emissions tests for diesel vehicles by the company was exposed in 2015.
The repercussions of this scandal inflicted significant harm on Volkswagen, leading to billions of dollars in penalties and a tarnished image. The financial performance of Volkswagen was greatly affected by the emissions scandal as indicated in its Annual Report of 2016. Their net income suffered an 86% reduction and their stock price decreased by over 30%.
Conduct that aligns with ethical standards.Patagonia is an instance of a business that has demonstrated exemplary ethical conduct. Patagonia is a clothing enterprise that prioritizes the preservation of the environment.
The corporation is implementing diverse strategies to mitigate its ecological footprint, such as incorporating recycled components in their merchandise and allocating 1% of their revenue to support environmental causes.
According to Patagonia's 2016 Annual Report, the company believes that prioritizing sustainability not only benefits the environment but also has positive effects on the bottom line. In fact, Patagonia experienced a 17% increase in net income and a more than 20% rise in stock price in 2016.
To sum up, unethical conduct of companies may lead to substantial financial damages. However, organizations that demonstrate ethical behavior can experience advantages such as enhanced financial gains and a better public image.
Read more about unethical conduct here:
https://brainly.com/question/30386734
#SPJ4
Use the following financial statements to answer the question. Balance Sheet Accounts payable Sales $104,500 Cash Accounts $ 6,700 14,600 $17,500 46,100 Long-term debt Costs of goods sold 77,600 receivable Inventory 22,100 Common stock 25,000 Depreciation 12,200 Net fixed 54,900 Retained earnings 9,700 Interest 3,600 assets Total assets $98.300 Total liab & equity $98,300 Taxes 3,700 Net income S 7.400 What is the price-earnings ratio if the par value per share is $1 and the market price per share is $7.50? OA) 18.01 OB) 25.34 OC) 22.16 OD) 19.97 Use the following financial statements to answer the question. Balance Sheet Income Statement Cash Accounts payable $ 6,700 14,600 $17,500 46,100 Long-term debt Accounts receivable Inventory 22,100 Common stock 25,000 Net fixed 54.900 Retained earnings 9,700 assets Total assets $98.300 Total liab & equity $98.300 What is the common-size ratio of the net fixed assets? Income Statement Sales Costs of goods sold Depreciation Interest Taxes Net income $104,500 77,600 12,200 3,600 3.700 $ 7.400
Price-Earnings Ratio (P/E Ratio) is used to evaluate a company's financial status and stock valuation. It is defined as the stock price per share divided by the earnings per share (EPS) for a given period. The correct answer is option b.
It is determined by dividing the market price per share by the earnings per share (EPS). Calculation of P/E Ratio:
Given, Par value per share = $1 Market price per share = $7.5
Earnings per share (EPS) = Net Income/Total number of shares outstanding
EPS = Net Income / Common shares outstanding
from the given data, Net Income = $7,400, Common shares outstanding = Common Stock/Par Value per share
Common shares outstanding = $25,000/$1
Common shares outstanding = 25,000 shares
EPS = $7,400/25,000EPS = $0.296
P/E Ratio = Market price per share / EPS
= $7.5/$0.296P/E Ratio = 25.34
Therefore, the P/E Ratio is 25.34 if the par value per share is $1 and the market price per share is $7.50. Option (B) is correct.
To know more about the Price-Earnings Ratio visit:
https://brainly.com/question/14624614
#SPJ11
Alaska Airlines has won the J.D. Powers Associates Award numerous times for
a) as a good place to work
b) low employee turnover
c) on time performance
d) customer satisfaction
e) quality
Alaska Airlines has won the J.D. Power Associates Award numerous times for customer satisfaction. The correct option is d.
The J.D. Power Associates Award is a prestigious recognition in the airline industry that honors companies for their excellence in customer satisfaction. Alaska Airlines has been a consistent recipient of this award, demonstrating their commitment to providing a high level of customer service and meeting the needs and expectations of their passengers.
Alaska Airlines has built a strong reputation for its customer-centric approach, and winning the J.D. Power Associates Award multiple times is a testament to their success in delivering exceptional customer satisfaction. The airline focuses on creating positive experiences for their passengers by offering quality services, maintaining high standards of reliability, and prioritizing customer needs.
Alaska Airlines understands that customer satisfaction plays a vital role in building brand loyalty and attracting repeat business. They strive to go above and beyond to ensure their customers have a pleasant flying experience, from booking tickets to inflight services and handling customer inquiries or concerns. By consistently meeting or exceeding customer expectations, Alaska Airlines has positioned itself as a leading airline in terms of customer satisfaction.
Achieving high levels of customer satisfaction involves various aspects, such as providing efficient and friendly service, ensuring on-time performance, maintaining a clean and comfortable cabin environment, offering a diverse range of amenities, and addressing customer feedback promptly. Alaska Airlines has excelled in these areas, resulting in their recognition by J.D. Power Associates.
Overall, Alaska Airlines has been awarded the J.D. Power Associates Award multiple times for their outstanding customer satisfaction efforts. This recognition highlights their ongoing commitment to providing an exceptional travel experience and building strong relationships with their customers.
Therefore the correct option is d.
To learn more about customer satisfaction refer here:
https://brainly.com/question/32406737
#SPJ11
Generally, the MIRR is a better indicator than the regular IRR.
Explain in detail.
The Modified Internal Rate of Return (MIRR) is generally considered a better indicator than the regular Internal Rate of Return (IRR) for evaluating investment projects and supports better decision-making in capital allocation.
The regular IRR calculates the discount rate at which the present value of cash inflows equals the present value of cash outflows, assuming cash flows are reinvested at the same rate. While the IRR is widely used, it has some drawbacks that the MIRR helps to overcome.
1.Overcoming Multiple IRRs: The IRR can encounter the problem of multiple rates of return when dealing with projects that have unconventional cash flows. This occurs when the cash flow pattern changes direction more than once. It can make it difficult to interpret the IRR and choose the appropriate rate. In contrast, the MIRR calculates a single discount rate that considers the initial outflows, subsequent inflows, and an assumed reinvestment rate. This eliminates the confusion caused by multiple IRRs and provides a clearer picture of the project's profitability.
2.Addressing Reinvestment Assumptions: The IRR assumes that cash inflows generated by a project are reinvested at the same rate as the IRR itself. This assumption may not be realistic because it assumes a consistent return can be achieved over time. The MIRR, on the other hand, allows for a more realistic reinvestment assumption by incorporating a specified reinvestment rate. This rate reflects the opportunity cost of reinvesting cash inflows and considers market conditions. By using a more accurate reinvestment rate, the MIRR provides a more precise measure of the project's profitability and ensures consistency with real-world investment scenarios.
3.Considering Financing Costs: The MIRR takes into account the financing costs associated with the project, such as borrowing costs or the required rate of return for investors. This is important because projects are often financed through a mix of equity and debt. By incorporating financing costs, the MIRR provides a comprehensive view of the project's profitability and value creation potential, reflecting the true cost of capital.
4.Consistency with Value Maximization: The MIRR aligns more closely with the goal of maximizing shareholder value. It considers the timing and magnitude of cash flows, as well as the opportunity cost of capital. By providing a more accurate assessment of the project's profitability, the MIRR helps decision-makers make better investment choices that enhance shareholder wealth.
The MIRR improves upon the limitations of the regular IRR by addressing multiple rates of return, incorporating realistic reinvestment assumptions, considering financing costs, and aligning with the objective of value maximization. It provides a more accurate and reliable indicator for evaluating investment projects and supports better decision-making in capital allocation.
Learn more about Internal rate of return (IRR) here:-
https://brainly.com/question/24301559
#SPJ11
Project A requires an initial outlay at t = 0 of $2,000, and its cash flows are the same in Years 1 through 10. Its IRR is 18%, and its WACC is 9%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.
____%
In a project requires an initial outlay at t = 0 of $2,000, and its cash flows are the same in Years 1 through 10. Its IRR is 18%, and its WACC is 9%.The project's MIRR is 11.9%.
Here are the steps involved in the calculation:
Calculate the present value of the cash flows for the next ten years using the IRR of 18%:
Present value = Cash flow * (1 - (1 + r)^-n) / r
Present value = $2,000 * (1 - (1 + 0.18)^-10) / 0.18 = $10,670.38
Calculate the future value of the present value using the WACC of 9%:
Future value = Present value * (1 + r)^n
Future value = $10,670.38 * (1 + 0.09)^10 = $35,522.70
Calculate the MIRR using the following formula:
MIRR = (Future value / Initial investment)^(1/n) - 1
MIRR = (35,522.70 / 2,000)^(1/10) - 1 = 0.119 = 11.9%
Therefore, the project's MIRR is 11.9%.
To learn more about cash flows visit: https://brainly.com/question/735261
#SPJ11
Which of the following is not a reason why we study
international finance?
D. Develop knowledge about the history and structure of the global financial system given the globalization of world
economy.
© A. To develop the capacity to calculate the firm's cost of equity using the dividend discount model (DDM) and the
capital asset pricing model (CAPM). ©
B. Understand the risks and opportunities associated with exposure to foreign exchange rates, and how exchange contracts (forwards, futures, options, etc.) would be
valued/priced in an efficient market. ©
C. Develop knowledge about how the risks associated with
foreign exchange can be managed in an efficient manner.
To develop the capacity to calculate the firm's cost of equity using the dividend discount model (DDM) and the capital asset pricing model (CAPM) is not a reason why we study international finance. The correct option is (A)
International finance is concerned with monetary exchanges between two or more countries. It includes evaluating currencies, trading worldwide, managing overseas investment portfolios, and managing international financial risks, among other things.
This subject entails studying the financial system and its components, such as the foreign exchange market, exchange rate regimes, and international monetary systems, in order to understand the movements and fluctuations of financial markets around the world.
A person may study international finance for a variety of reasons.
Understanding the risks and opportunities associated with exposure to foreign exchange rates and how exchange contracts are valued/priced in an efficient market, Developing knowledge about how the risks associated with foreign exchange can be managed efficiently, and Developing knowledge about the history and structure of the global financial system, are important aspects of studying international finance.These concepts help to understand the evolution, functioning, and regulations of the global financial system, which is essential given the increasing interconnectedness of economies worldwide.
However, the reason why one might study international finance is not to develop the capacity to calculate the firm's cost of equity using the dividend discount model (DDM) and the capital asset pricing model (CAPM). While calculating the firm's cost of equity is an important aspect of financial analysis and valuation, it is not specific to international finance. Therefore, the correct option is (A).
To learn more about International Finance, visit:
https://brainly.com/question/31648560
#SPJ11
Explain to your boss how Coke can use the protection provided by patents, copyrights, and trademarks to increase their economic profits. i. Discuss what each of the 3 protections apply to, and ii. Discuss how each will help a firm achieve economic profits.
Coca-Cola can use patents, copyrights, and trademarks to protect their products, branding, and intellectual property, which can help increase their economic profits.
1. Patents: Patents provide protection for new inventions or processes. For Coca-Cola, patents can apply to their unique formula or manufacturing processes, preventing competitors from replicating their exact product. This exclusivity allows Coca-Cola to maintain a competitive advantage and charge premium prices, leading to higher economic profits.
2. Copyrights: Copyrights protect original works of authorship, such as creative content, logos, and advertising materials. Coca-Cola can use copyrights to safeguard their branding elements, including their iconic logo, slogans, and advertising campaigns. By preventing unauthorized use or imitation, Coca-Cola can maintain brand recognition, customer loyalty, and market dominance, resulting in increased economic profits.
3. Trademarks: Trademarks protect brand names, logos, and symbols that distinguish products or services. Coca-Cola's distinct brand name, logo, and bottle shape are protected by trademarks. These trademarks enable consumers to identify and trust Coca-Cola's products, giving the company a competitive edge in the market. By leveraging trademarks, Coca-Cola can command brand loyalty and charge premium prices, contributing to higher economic profits.
By utilizing patents, copyrights, and trademarks, Coca-Cola can safeguard its unique formula, branding elements, and intellectual property. These protections enable the company to maintain a competitive advantage, protect its market share, and charge premium prices. Ultimately, this can lead to increased economic profits for Coca-Cola by capitalizing on its exclusivity, brand recognition, and customer loyalty.
To know more about Trademarks, visit
https://brainly.com/question/29354050
#SPJ11
If you deposit $611 in an account that eams 6% per year, what would be the balance in the account at the end of 14 years if interest compounds monthly? Which of the following variables is not required in order to find a solution to a problem involving discounting? O Interest rate O Future value O Present value O Discount curve O Period of time
To calculate the balance in the account at the end of 14 years with monthly compounding, we can use the formula for compound interest:
A = P * (1 + r/n)^(n*t)
where A is the final balance, P is the initial deposit, r is the interest rate per period, n is the number of compounding periods per year, and t is the number of years.
Substituting the given values into the formula:
P = $611
r = 0.06 (6% expressed as a decimal)
n = 12 (monthly compounding, so 12 compounding periods per year)
t = 14
A = $611 * (1 + 0.06/12)^(12*14)
A ≈ $1,352.47
Therefore, the balance in the account at the end of 14 years with monthly compounding would be approximately $1,352.47.
Regarding the second part of your question, the variable that is not required in order to find a solution to a problem involving discounting is the Discount Curve. The other variables mentioned, such as the interest rate, future value, present value, and period of time, are essential components in solving discounting problems. The discount curve, which represents the relationship between interest rates and the present value of future cash flows, is not necessary for finding a solution to a problem involving discounting.
Learn more about compound interest here:
https://brainly.com/question/14295570
#SPJ11
Building a competitive advantage based on superior benefit position is likely to be attractive when three conditions are met. Explain in detail the three conditions.
Building a competitive advantage based on a superior benefit position is likely to be attractive when the following three conditions are met:
Customer Demand for the Benefit: The first condition is that there must be significant customer demand for the specific benefit or advantage that a company aims to provide. Customers should value and seek out the particular benefit that sets the company apart from its competitors. This demand can arise from various factors, such as customer preferences, market trends, emerging needs, or unfulfilled customer desires. For a competitive advantage to be sustainable, it needs to align with the current and future needs of the target market.
For example, if a company aims to build a competitive advantage based on superior customer service, it must ensure that customers highly value excellent service and are willing to choose and pay a premium for it. Without sufficient customer demand for the specific benefit, attempting to build a competitive advantage around it may not yield the desired results.
Differentiation from Competitors: The second condition is that the company must be able to differentiate itself effectively from its competitors by offering a superior benefit. The benefit provided should be unique, valuable, and difficult for competitors to replicate or imitate. It should stand out in the market and create a distinctive positioning for the company.
To achieve differentiation, the company may focus on various factors such as product features, quality, performance, innovation, service, convenience, customization, or branding. By delivering a benefit that is superior to what competitors offer, the company can create a compelling reason for customers to choose its products or services over alternatives.
Continuing with the example of customer service, the company must be able to provide a level of service that is noticeably better than what competitors offer. This can involve aspects like well-trained and responsive customer service representatives, quick issue resolution, personalized assistance, or additional support channels that competitors may lack.
Sustainable Competitive Advantage: The third condition is that the competitive advantage based on the superior benefit must be sustainable over time. This means that the company should have the ability to maintain and enhance its advantage in the face of competition and changing market dynamics.
To achieve sustainable competitive advantage, the company needs to establish barriers to entry that make it difficult for competitors to replicate or surpass the superior benefit. These barriers can include factors like proprietary technology, patents, strong brand reputation, exclusive supplier relationships, economies of scale, high switching costs for customers, or established distribution networks.
Moreover, the company should continuously invest in and improve its capabilities, resources, and processes to reinforce its advantage and stay ahead of competitors. This can involve ongoing innovation, customer feedback and insights, talent development, operational efficiencies, and strategic investments to strengthen the competitive position.
By meeting these three conditions of customer demand, differentiation, and sustainable advantage, a company can effectively build a competitive advantage based on a superior benefit position. However, it is important to continuously monitor the market, adapt to changing customer needs, and stay ahead of competitors to maintain the advantage in the long term.
To know more about competitive advantage click this link -
brainly.com/question/28539808
#SPJ11
The City of San Francisco issued a bond that currently trades for $1023. There are 14 years left until the bond matures. It carries a coupon rate of 5%; interest is paid annually. What is the bond's Yield to Maturity? O 3.80% 4.12% O 5.52% O 4.7796 V 6.1596
The City of San Francisco issued a bond that currently trades for $1023. There are 14 years left until the bond matures. It carries a coupon rate of 5%; interest is paid annually.
The bond's Yield to Maturity is 4.7796%. A bond is a debt security that is issued by a corporation or government to generate cash. The bond's yield to maturity (YTM) is the anticipated rate of return from a bond when it is held until it matures. The present value of a bond is calculated by discounting the expected cash flows of the bond, which include the interest payments and the principal repayment at the end of the bond's life. The yield to maturity is the rate that equates the present value of the bond's cash flows to its market price. Since the bond in this question has a fixed coupon rate of 5%, its yield to maturity will be less than, greater than, or equal to its coupon rate, depending on whether the bond's price is greater than, less than, or equal to its par value.
The bond's price is $1023, and it has 14 years to maturity. When the bond matures, the holder will receive the face value of the bond, which is $1000. This indicates that the bond is trading at a premium. The bond's annual coupon payment can be calculated using the formula:Annual Coupon Payment = Coupon Rate * Face Value = 5% * $1000 = $50The bond's Yield to Maturity can be calculated using the formula:Yield to Maturity = (Annual Coupon Payment + ((Face Value - Current Price) / Number of Years to Maturity)) / ((Face Value + Current Price) / 2) = ($50 + (($1000 - $1023) / 14)) / (($1000 + $1023) / 2) = 4.7796%Therefore, the bond's Yield to Maturity is 4.7796%.
To know more about maturity visit:-
https://brainly.com/question/22377678
#SPJ11
" Book 5 TB MC Qu. 65-97 (Algo) A company's inventory records indicate the following... A company's Inventory records indicate the following data for the month of Apr Date April 1 April 7 April 11 Apr
On April 11, a sale of 1,340 units was made at a retail price of $110 per unit.
On April 16, a purchase of 670 units was made at a cost of $14 per unit, totaling $9,380.
On April 22, no purchase or sale activity was recorded.
The ending inventory consists of:
370 units from the April 16 purchase
80 units from the April 7 purchase
100 units from the beginning inventory
To calculate the cost of the ending inventory, we multiply the number of units by their respective costs and sum them up:
Ending Inventory Cost = (370 units * $14) + (80 units * $40) + (100 units * $36)
Ending Inventory Cost = $5,180 + $3,200 + $3,600
Ending Inventory Cost = $12,980
Therefore, the cost assigned to the ending inventory using the specific identification method is $12,980.
To know more about inventory here
https://brainly.com/question/26977216
#SPJ4
Full que
TB MC Qu. 05-97 (Algo) A company's inventory records indicate the following
A company's Inventory records indicate the following data for the month of Aprit
Date
Activities
Units Acquired at Cost
thits Sold at Retall
April 1
Beginning inventory
870 units $36-$31,320
April 7
Purchase
Sale
750 units $40-$50,000
1,340 units # $110
Apr11 11 April 16
Purchase
Sale
670 units $14-$29,480
400 units $110
April 22
The company uses a pentod-ic inventory system. Determine the cost assigned to ending inventory using the specific identification method Ending inventory consists of 370 urvts from the Apr 16 purchase, 80 units from the Aprt 7 purchase, and 100 uns from beginning inventory
Technical analysis is a form of trend study that suggests that historical price trends and patterns may, to some degree, be predictive of future asset prices. Does the Efficient Market Hypothesis dispute the validity of technical analysis? If yes, at what level does it first dispute the validity of technical analysis
(i.e., what is the weakest form of the EMH that may dispute this?
A. The EMH allows technical analysis as a valid form of future asset price study
B. The EMH disputes the claims of technical analysis, first with the weak form
C. The EMH disputes the claims of technical analysis, first with the semi-strong form
D. The EMH disputes the claims of technical analysis, first with the strong form
B. The EMH is unrelated to the description of technical analysis
The Efficient Market Hypothesis (EMH) does dispute the validity of technical analysis. The EMH disputes the claims of technical analysis, first with the weak form. hence, option b is correct.
The EMH argues that financial markets are efficient, meaning that all relevant information is quickly and accurately reflected in asset prices. According to the EMH, it is not possible to consistently generate excess returns by using historical price trends and patterns to predict future prices.
The EMH is commonly categorized into three forms: weak form, semi-strong form, and strong form. Each form represents a different level of efficiency and challenges the validity of different types of analysis, including technical analysis.
The weakest form of the EMH, the weak form, disputes the claims of technical analysis. It asserts that all historical price and volume information is already reflected in current asset prices, rendering technical analysis ineffective in predicting future prices based on past trends and patterns.
Therefore, the correct answer is:
B. The EMH disputes the claims of technical analysis, first with the weak form
To learn more about efficient market hypothesis visit-
https://brainly.com/question/27581329
#SPJ11
The following data reflect the current month’s activity for Vickers Corporation:
Actual total direct labor$655,200Actual hours worked37,700Standard labor-hours allowed for actual output (flexible budget)36,500Direct labor price variance$23,400FActual variable overhead$157,120Standard variable overhead rate per standard direct labor-hour$4.20
Variable overhead is applied based on standard direct labor-hours allowed.
Required:
Compute the labor and variable overhead price and efficiency variances.
(Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)
Direct LaborPrice Variance:Efficiency Variance:
Variable OverheadPrice Variance:Efficiency Variance:
The Direct Labor Price Variance is unfavorable and is -$15,080.
The Direct Labor Efficiency Variance is favorable and is $21,360.
The Variable Overhead Price Variance is unfavorable and is -$1,508.
The Variable Overhead Efficiency Variance is favorable and is $5,040.
Direct LaborPrice Variance:
Formula for Direct Labor Price Variance:
(Actual Price - Standard Price) x Actual Quantity= ($655,200/37,700hrs - $17.80/hrs) x 37,700hrs= ($17.40 - $17.80) x 37,700hrs= -$15,080 (unfavorable)
Efficiency Variance:
Formula for Direct Labor Efficiency Variance= (Actual Quantity - Standard Quantity Allowed) x Standard Price= (37,700hrs - 36,500hrs) x $17.80/hrs= 1,200hrs x $17.80/hrs= $21,360 (favorable)
Variable OverheadPrice Variance:
Formula for Variable Overhead Price Variance= (Actual Overhead Rate - Standard Overhead Rate) x Actual Quantity= ($157,120/37,700hrs - $4.20/hrs) x 37,700hrs= ($4.16 - $4.20) x 37,700hrs= -$1,508 (unfavorable)
Efficiency Variance:
Formula for Variable Overhead Efficiency Variance= (Actual Quantity - Standard Quantity Allowed) x Standard Overhead Rate= (37,700hrs - 36,500hrs) x $4.20/hrs= 1,200hrs x $4.20/hrs= $5,040 (favorable)
Therefore, the Direct Labor Price Variance is unfavorable and is -$15,080. The Direct Labor Efficiency Variance is favorable and is $21,360. The Variable Overhead Price Variance is unfavorable and is -$1,508. The Variable Overhead Efficiency Variance is favorable and is $5,040.
For more question on Variance visit:
https://brainly.com/question/29765393
#SPJ8
Chapter 5: The Voice of the Customer Discussion questions- Page 150: 1- Describe the difference between the internal and the external customers of a business organization. Why is it important to distinguish between internal and external customers?
Distinguishing between internal and external customers is important for a business organization. Internal customers are within the organization and their satisfaction impacts productivity, while external customers are outside the organization and their needs drive revenue and growth.
The distinction between internal and external customers is crucial for a business organization to understand and effectively cater to the needs of both groups.
Internal customers refer to individuals or departments within the organization that rely on the services or products provided by other departments within the same organization.
For example, in a manufacturing company, the production department serves as an internal customer to the purchasing department, as it depends on timely and quality supply of raw materials.
Internal customers are interconnected within the organization and their satisfaction directly impacts the smooth functioning and productivity of the entire operation.
External customers, on the other hand, are individuals or entities outside the organization who purchase goods or services from the company.
They include end-users, clients, consumers, or any stakeholders outside the organization. External customers are crucial for the success and sustainability of a business as they provide revenue and contribute to its growth.
Distinguishing between internal and external customers is important because their needs, expectations, and priorities may differ.
Internal customers are part of the organization and have an intimate understanding of its processes, while external customers may have different perspectives and requirements.
By recognizing this distinction, a business can develop tailored strategies to meet the unique demands of each customer group.
Satisfied internal customers contribute to a harmonious work environment and efficient operations, leading to improved products or services for external customers.
Ultimately, recognizing and addressing the needs of both internal and external customers helps enhance overall customer satisfaction, loyalty, and business success.
To know more about customers refer here:
https://brainly.com/question/20881645#
#SPJ11
Why is it important to make the distinction between company required rate of return (WACC) and project required rate of return when evaluating projects?
When assessing projects, it is important to differentiate between company's required rate of return (WACC) and project's required rate of return.
This is crucial since the WACC is a metric that reflects the organization's general cost of capital, whereas the project's required rate of return assesses its investment profitability. Here's why it's important to make the distinction between WACC and project required rate of return when evaluating projects
:WACC represents the weighted average cost of capital, which is the expense of the corporation's financing for operations. A company's WACC is calculated using the cost of equity, the cost of debt, and the weight of each source of financing.
The WACC can be seen as the minimum rate of return that a business must earn on all of its investments in order to meet its financial obligations and satisfy its investors. It's a standard method of evaluating an entire corporation or division's profitability and project feasibility.
Learn more about project, here-
https://brainly.com/question/25009327
#SPJ4
Case Study (Issues identified from three clients) You are an assistant accountant for BluePrint Pty Ltd, Public Accounting firm. Your manager Aaron asked you to draft a statement of advice for the fol
Max Hills Ltd should ensure that the acquired assets and assumed liabilities are recognized in accordance with the relevant Australian Accounting Standards.
1. Intangible assets:
a) Household brand name: The market has valued the household brand name at $10 million. According to Australian Accounting Standards, intangible assets should be recognized separately if they meet the criteria of being identifiable and it is probable that future economic benefits will flow to the entity. In this case, as the household brand name has a fair value and is expected to generate economic benefits, it should be recognized as an intangible asset on Mini Ltd's books.
b) Customer list: The customer list, containing valuable information about customers, is estimated to have a fair value of $5 million. Similar to the household brand name, the customer list meets the criteria for recognition as an intangible asset. Mini Ltd should recognize it separately on their balance sheet.
c) Good customer relationship: This refers to customer contracts and related customer relationships that are highly valued by Subsidiary Ltd. However, their fair value is estimated to be only $1 million after the acquisition. According to Australian Accounting Standards, a business combination should recognize assets acquired and liabilities assumed at their fair values at the acquisition date. Therefore, the fair value of the good customer relationship should be recognized as an intangible asset in Mini Ltd's books.
2. Contingent liabilities:
a) Infringement of copyright claim: This contingent liability involves potential payments based on different outcomes. The Australian Accounting Standards do not allow for the recognition of contingent liabilities unless a probable outflow of resources embodying economic benefits is likely. As the outcome of the infringement claim is uncertain and depends on probabilities, it does not meet the criteria for recognition at the acquisition date. Therefore, this contingent liability should not be recognized on Mini Ltd's balance sheet.
b) CEO compensation: The contingent liability of a possible $1 million compensation to the CEO in the event of dismissal for not meeting profit targets should be evaluated based on the criteria for recognition. If it is probable that a future outflow of resources embodying economic benefits will occur, then it should be recognized as a liability. However, if the criteria are not met, it should not be recognized. It is important to assess the specific terms and conditions of the compensation agreement to determine the probability of a future payment.
In conclusion, Max Hills Ltd should ensure that the acquired assets and assumed liabilities are recognized in accordance with the relevant Australian Accounting Standards. The recognition of intangible assets such as the household brand name, customer list, and good customer relationship should be based on their fair values. Contingent liabilities should only be recognized if the criteria for recognition are met.
The correct question is:
Case Study (Issues identified from three clients)
You are an assistant accountant for BluePrint Pty Ltd, Public Accounting firm. Your manager Aaron asked you to draft a statement of advice for the following three clients regarding their concerns listed below.
Client 1 (Max Hills Ltd) Re. Recognition of assets and liabilities in business combination
Max Hills Ltd recently purchased 100% of issued shares in Mini Ltd. The directors of Max Hills Ltd discovered the following items were not recognised in Mini Ltd's books at the time of acquisition.
Intangible assets
a) a household brand name which the market has valued at $10 million;
b) a customer list consisting of information about customers, such as their name, personal preferences, order or product backlog and contact information, which is estimated to have a fair value of $5 million; and
c) a good customer relationship (customer contracts and related customer relationship) which is highly valued by Subsidiary Ltd, but which is estimated to have a fair value of only $1 million once the ownership and management of Subsidiary Ltd is changed through the acquisition.
Contingent liabilities
a) a contingent liability involving a claim for infringement of copyright, which the lawyers are of the opinion that there is a 60% chance that Mini Ltd will have to pay nothing, a 20% chance that it has to pay $100,000 and another 20% chance that it has to pay $500,000; and
b) a contingent liability involving a possible payment of $1 million compensation to the CEO of Mini Ltd in the event that the CEO is dismissed within 3 years for not meeting the profit targets.
Provide advice to the managing director of Max Hills Ltd, with relevant references to the Australian Accounting standards in your answer.
To know more about liabilities follow the link:
https://brainly.com/question/28391469
#SPJ4
Sunland Corporation is about to issue $1,100,000 of 8-year bonds that paya 4% annual interest rate with interest payable semi- annually. The market interest rate is 5%. Assuming all bonds are issued, how much can Sunland expect to receive for the sale of these bonds? Part 1 Your answer is incorrect Of the variables listed in the dropdown choose the variable being calculated? eTextbook and Media Save for Liter Attempts: 1 of 3 used Submit Answer OF signment Question 1 of 6 < > 071 E Part 2 Fill in the remaining variables in the table that follows. (Round rate to 1 decimal place. eg. 25.5%) Financial Calculator or Tables Variable Excel Present value PV PV Future value FV FV $ Interest rate 1 Rate 25 Amount of annuity payment PMT PMT $ Number of periods N Nper 16 eTextbook and Media Save for later Attempts:0 of 3 used Submit Answer a O ent Question 1 of 6 > 071 eTextbook and Media Save for Later Attempts: 0 of 3 used Submit Answer Part 3 Calculate the proceeds from the sale of the bonds. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round final answers to 2 decimal places, eg. 5,275.25.) Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Proceeds from the sale of the bonds
Part 1: Calculation of the selling price of the bonds
When the market interest rate is 5%, and Sunland Corporation is issuing 8-year bonds that pay a 4% annual interest rate, then it can be concluded that the bonds will be sold at a discount.
This is because the market interest rate is higher than the coupon interest rate of the bonds. The bond price formula for bonds that are sold at a discount is as follows:
PV = FV/(1+r)n
PV is the present value
FV is the future value of the bond
r is the rate of interest
n is the number of periods when interest is paid
For semi-annual interest payments, the number of periods when interest is paid will be twice the number of years. Therefore, the number of periods for the Sunland Corporation bonds will be 8 x 2 = 16. The semi-annual interest rate will be 4% / 2 = 2%.
The price of the bonds can be calculated as follows:
PV = 1,100,000 / (1+0.02)^1 + 1,100,000 / (1+0.02)^2 + … + 1,100,000 / (1+0.02)^= 1,100,000 * (1 - 1/(1+0.02)^16) / 0.02
PV = $935,680.74
Therefore, the selling price of the bonds is $935,680.74.
Part 2: Calculation of the amounts for the table
The present value of a single amount can be calculated using the formula:
PV = FV/(1+r)n
When FV = 1, r = 2%, and n = 1, the PV = 0.98039
The present value of an annuity of $1 can be calculated using the formula:
PV = [1 - 1/(1+r)n]/r
When r = 2% and n = 16, PV = 12.56189
Part 3: Calculation of the proceeds from the sale of the bonds
The amount of the bonds issued is $1,100,000. Therefore, the proceeds from the sale of the bonds will be the same as the selling price of the bonds. Therefore, the proceeds from the sale of the bonds is $935,680.74.
Answer: Therefore, the proceeds from the sale of the bonds is $935,680.74.
To know more about interest visit:
https://brainly.com/question/30393144
#SPJ11
Explain why companies still seem to behave unethically despite
repeated publicly embarrassing stories of cover-ups, recalls and
the road exposure due to bad corporate behavior.
Despite publicly embarrassing stories and exposure of unethical behavior, companies may continue to behave unethically due to a short-term mindset, lack of ethical culture, inadequate accountability, pressure for profitability, lack of transparency, and individual misconduct.
Companies may still behave unethically despite repeated publicly embarrassing stories of cover-ups, recalls, and exposure due to bad corporate behavior due to several reasons:
1. Short-term mindset: Many companies prioritize short-term financial gains over long-term ethical considerations. They may be driven by the pressure to meet quarterly targets, appease shareholders, or secure immediate profits. This focus on short-term results can overshadow the importance of ethical behavior, leading to unethical practices.
2. Lack of ethical culture: Some organizations may lack a strong ethical culture that permeates throughout the company. Ethical behavior should be ingrained in the corporate values, reinforced through leadership actions, and embedded in everyday decision-making processes. If a company fails to foster an ethical culture, employees may feel less compelled to act ethically.
3. Inadequate accountability and enforcement: When companies face little or no consequences for unethical behavior, it can create a culture of impunity. In some cases, regulatory bodies may have limited resources or face challenges in enforcing regulations effectively. Additionally, internal mechanisms for reporting unethical behavior may be ineffective or underutilized, resulting in a lack of accountability.
4. Pressure for profitability: Companies operating in highly competitive industries may face intense pressure to maximize profitability. This pressure can create a temptation to cut corners, engage in unethical practices, or overlook potential risks to achieve financial goals. The drive for profitability may overshadow ethical considerations, particularly if competitors are perceived to be engaging in similar behavior.
5. Lack of transparency: Companies that lack transparency in their operations may find it easier to engage in unethical behavior without fear of public scrutiny. Lack of disclosure and opacity in decision-making processes can provide a veil of secrecy that allows unethical practices to persist.
6. Individual misconduct and rationalization: Unethical behavior can be driven by the actions of individual employees or executives who disregard ethical norms. These individuals may rationalize their actions, believing that the ends justify the means or that everyone else is engaging in similar behavior.
Addressing these issues requires a concerted effort to promote a strong ethical culture, enforce accountability, foster transparency, and emphasize long-term sustainability over short-term gains. Additionally, regulatory bodies, stakeholders, and society as a whole play a vital role in holding companies accountable for their actions and demanding ethical behavior.
To know more about misconduct visit:
https://brainly.com/question/25160479
#SPJ11
a) Networking is a business tool that plays a very significant role for the entrepreneur success. If entrepreneurs have very good networking with both external and internal customers, it will be easier for them to take advantage of business. Evaluate FIVE (5) advantages that an entrepreneur would gain from a good networking. | b) As an entrepreneur, you must have the trust of many people. People will have confidence in an entrepreneur who shows that he/she can be successfully do the work given, there are some strategies that could help you to be build confident. Discuss.
Networking is a business tool that plays a very significant role for the entrepreneur success. If entrepreneurs have very good networking with both external and internal customers, it will be easier for them to take advantage of business. Following are FIVE advantages that an entrepreneur would gain from a good networking.
One of the advantages of having a good network is that it provides business opportunities. People are more likely to think of you when they have business opportunities and this will help you stay ahead of your competition. Referrals: A good network also provides referrals for your business. When you provide quality services, your network will refer other businesses to you.
Collaborations: Networking can also help entrepreneurs to find potential collaborators who can help them in achieving their goals. Collaborations allow entrepreneurs to pool resources and work together towards a common goal.4. Visibility: A good network can help entrepreneurs to get their business noticed. When you have a strong network, people are more likely to recognize your brand and pay attention to what you are doing.5. Support: Finally, a good network can provide entrepreneurs with support. Networking allows entrepreneurs to connect with others who understand their struggles and can provide encouragement and advice.b) As an entrepreneur, you must have the trust of many people. People will have confidence in an entrepreneur who shows that he/she can successfully do the work given, there are some strategies that could help you to be build confident. The following are some strategies that can help entrepreneurs to build confidence:1. Start Small: Entrepreneurs should start by taking small steps to build confidence. Small wins can help to boost self-esteem and provide momentum.2. Celebrate Successes: Entrepreneurs should take time to celebrate their successes. Celebrating accomplishments can help to build confidence and keep you motivated.3. Take Risks: Taking risks is also important for building confidence. Entrepreneurs should not be afraid to try new things and take on new challenges.4. Build a Support System: Building a support system can also help entrepreneurs to build confidence. Having people around who believe in you and your abilities can help to keep you motivated and focused.5. Learn from Failures: Finally, entrepreneurs should learn from their failures. Failure is a part of the process and can provide valuable lessons that can help you to improve and grow.
To know more about entrepreneur visit:
https://brainly.com/question/9409391
#SPJ11
Merone Corporation applies manufacturing overhead to products on the basis of standard machine-hours. The company bases its predetermined overhead rate on 4,100 machine-hours. The company's total budgeted fixed manufacturing overhead is $16,400. In the most recent month, the total actual fixed manufacturing overhead was $15,890. The company actually worked 4,000 machine-hours during the month. The standard hours allowed for the actual output of the month totaled 4,120 machine-hours. What was the overall fixed manufacturing overhead volume variance for the month? (Round your intermediate calculations to 2 decimal places.)
Multiple Choice
$400 Unfavorable
$400 Favorable
$80 Favorable
$510 Favorable
The total budgeted fixed manufacturing overhead is $16,400. In the most recent month, the total actual fixed manufacturing overhead was $15,890. The company bases its predetermined overhead rate on 4,100 machine-hours.
The standard hours allowed for the actual output of the month totaled 4,120 machine-hours. The company actually worked 4,000 machine-hours during the month. To calculate the fixed manufacturing overhead volume variance, we need to find the difference between the actual hours and standard hours allowed.
These differences are multiplied by the fixed overhead rate per hour. The formula for fixed overhead volume variance is: Fixed overhead volume variance
= Fixed overhead rate x (Standard hours allowed - Actual hours worked)Using the given data, we can calculate the fixed overhead rate as follows :Predetermined overhead rate = Budgeted fixed overhead ÷ Predetermined machine-hours
= $16,400 ÷ 4,100 machine-hours
= $4.00 per machine-hour Now, we can substitute the values in the formula and calculate the fixed overhead volume variance :Fixed overhead volume variance
= $4.00 x (4,120 - 4,000) = $4.00 x 120
= $480Since the actual fixed overhead was less than budgeted, the variance is favorable. Therefore, the correct answer is $480 Favorable.
To know more about budgeted visit:
https://brainly.com/question/31952035
#SPJ11
