Answer:
Entrepreneurial management varies from managing established corporations.
Explanation:
Entrepreneurs must manage the affairs of a startup giving attention to all of the new paperwork filings (ig. Filing corporate charter, articles of incorporation, business license, dba, etc) in a timely manner while getting their new business off the ground. In addition to these tasks, the demands of managing everyday business still scream for attention.
The entrepreneurial demands are the concerns that affect managers of businesses. Some of them include;
Establishing the visions and goals of the business, putting a strategy in place to grow, obtaining capital and funding for the business, acquiring the right human resources to run the business, and setting up a good organizational structure.To run a business effectively, entrepreneurs have several demands of the business that they must settle. Some of these include;
The vision and goals of the business: Putting this in place helps the business to always stay on track and stick to its goals.Business strategy: To stand out from their competition, a strategy ought to be established.Funding: No business runs without money. The entrepreneur must always evaluate the important resources that should be financed to run effectively.Human resources: The right and qualified people should be employed to help in running the business.Organizational Structure: The managers, accountants, assistants, etc., must be drawn up in a good organizational structure profile. This will help people to know their seniors and subordinates and address matters accordingly.Learn more here:
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Read the following editorial and answer the question that follow.
Hyundai:Rising Sales, Falling Quality?
In 2010, Hyundai Motor Company achieved a 4.6 shares of the U.S. auto market, but it was forced to recall almost 140,000 Sonatas after an investigation by the U.S. National Highway Traffic Safety Administration. Two consumers reported that their cars,assembled in Alabama, had defective steering systems. The problem appeared to stem from a sinple assembly mistake: Bolts weren't being connected to the steering column correctly.
An editorial in The Chosun Ilbo suggests that the action should sound an alarm for Hyundai, citing Toyota's massive recall ans resulting sales problems as an example of what can happen when rapid growth overshadows a commitment to quality. Noting that Hyundai's share of the U.S. auto market was steadily increasing and that there had been another recall of 46,000 Hyundai cars with faulty front latches, the article advised Hyundai managers to focus on quality and rethink the company's rapid growth policy.
Korean automakers are hungry to become major players in the automobile industry and need new markets to expand their global share. However, parts manufacturers are having a hard time keeping up with demand, and quality control processes can falter when production increases too quickly. The article warns Korea's largest automobile manufacturer that "expansion must not come at the expense of quality"
1) The author of this editorial suggest that:
a. rapid expansion gets in the way of quality control
b. quality control is enhanced by rapid expansion
c. rapid expansion is necessary for quality control
d. quality control is necessary for rapid expansion
2) Researchers who study total quality management have criticized a number of things about the technique and the way it is implemented in corporations today. Which of the following criticisms might be responsible for the problems Hyundai encountered with its steering system? Check all that apply
1. Total quality management may focus workers so intently on one part of the process that other parts of the process are ignored or neglected.
2. Workers may be asked to make suggestions for improvement, but their suggestions may not be implemented.
3. Implementing total quality management may consume resources that would otherwise be directed toward production of goods and services.
4. Benchmarking best practices in other organizations may reduce true innovation,
Answer:
Hyundai:Rising Sales, Falling Quality?
1) The author of this editorial suggest that:
a. rapid expansion gets in the way of quality control
2. The criticisms responsible for the problems Hyundai encountered with its steering system are:
b. Workers may be asked to make suggestions for improvement, but their suggestions may not be implemented.
c. Implementing total quality management may consume resources that would otherwise be directed toward production of goods and services.
d. Benchmarking best practices in other organizations may reduce true innovation,
Explanation:
Total quality management is a management approach in which all the members of the organization actively participate in improving processes, products, services, and the organizational culture in order to achieve long-term organizational success through customer satisfaction. Benchmarking helps an organization to improve the quality of its products and services and its overall business performance.
12. You are thinking of purchasing a house. The house costs $350,000. You have $50,000 in cash that you can use as a down payment on the house, but you need to borrow the rest of the purchase price. The bank is offering a 30-year mortgage that requires annual payments and has an interest rate of 7% per year. What will your annual payment be if you sign this mortgage? (Answer: $24,176)
Answer:
The Annual Payment will be $24,176.
Explanation:
First we need to calculate the loan amount as follow
Loan = Cost of House - Down payment = $350,000 - $50,000 = $300,000
Now use following formula to calculate the annual payment
PV of Annuity = Annuity Payment x ( 1 - ( 1 + interest rate )^-Numbers of periods ) / Interest rates
Where
PV of Annuity = Loan = $300,000
Interest rate = 7%
Numbers of periods = 30 years
Annuity Payment = Annual payment = ?
Pacing values in the formula
$300,000 = Annual Payment x ( 1 - ( 1 + 7% )^-30 ) / 7%
$300,000 = Annual Payment x 12.409
Anual Payment = $300,000 / 12.409
Anual Payment = $24,176.00
The income statement for the Bonita Pines Golf Club Inc. for the month ended July 31 shows Service Revenue $16,000, Salaries and Wages Expense $8,400, Maintenance and Repairs Expense $2,500, and Income Tax Expense $1,000. The statement of retained earnings shows an opening balance for Retained Earnings of $20,000 and Dividends $1,300.
Required:
a. Prepare closing journal entries.
b. What is the ending balance in Retained Earnings?
Answer:
a. 31-Jul
Dr Service Revenue16,000
Cr Income Summary16,000
31-Jul
Dr Income Summary11,900
Cr Salaries & Wages Expense8,400
Cr Maintenance & Repairs Expense2,500
Cr Income Tax Expense1,000
31-Jul
Dr Income Summary4,100
Cr Retained Earnings4,100
31-Jul
Dr Retained Earnings1,300
Cr Dividends1,300
b. $22,800
Explanation:
a. Preparation of closing journal entries.
31-Jul
Dr Service Revenue16,000
Cr Income Summary16,000
(Being To close revenue account)
31-Jul
Dr Income Summary11,900
(8,400+2,500+1,000)
Cr Salaries & Wages Expense8,400
Cr Maintenance & Repairs Expense2,500
Cr Income Tax Expense1,000
(Being To close expense accounts)
31-Jul
Dr Income Summary4,100
Cr Retained Earnings4,100
(16,000-11,900)
(Being To close net income to Retained earning)
31-Jul
Dr Retained Earnings1,300
Cr Dividends1,300
(Being To close dividends to Retained earning )
b. Calculation fo What is the ending balance in Retained Earnings
Retained Earnings ending balance=$20,000−$1,300+$16,000−$8,400−$2,500−$1,000
Retained Earnings ending balance=$22,800
Therefore Retained Earnings ending balance will be $22,800
The Princeville Company placed five (5) orders for Product 12B from Brookston Corporation. Brookston has the following information about Product 12B:
Activity Cost Pools Activity Rate Product 12B
Activity Machine Setups $12.00per Machine hour 40MHs
Customer Orders $10.00per Order 5 Orders
What is the overhead cost assigned to Princeville for its five (5) orders of Product 12B?
Answer:
Cost assigned to Princeville = Machine setup cost + Customer order cost.
Cost assigned to Princeville = $12.00*40MHs + $10.00*5MHs
Cost assigned to Princeville = $530
So, the overhead cost assigned to Princeville for its five (5) orders of Product 12B is $530
Match each tax form to its purpose.
Form 1098-E
Form 1098-T
Form 1099-DIV
Form 1099-INT
shows interest income
shows income from dividends
shows interest paid on a student loan
shows tuition payments
Answer:
Form 1098-E ⇒ shows interest paid on a student loan
This form is used by taxpayers to deduct student loan interests.
Form 1098-T ⇒ shows tuition payments
This form is used by taxpayers to claim education credits.
Form 1099-DIV ⇒ shows income from dividends
This form is used by taxpayers to report dividends.
Form 1099-INT ⇒ shows interest income
This form is used by taxpayers to report interest income.
Ricardo uses his personal vehicle in his sole proprietorship. He keeps no records of any kind regarding his business use of the car and doesn't really know for certain when and where he used the automobile for business. Which of the following is correct?
a. Juan should deduct a good-faith estimate of his expenses for the auto as a business expenses.
b. Juan should estimate his total vehicle expenses for the year, then deduct 50% of that amount as business expense.
c. Juan could have leased a comparable vehicle for $3,600 for 2016. Therefore, he should deduct $3,600 as a business expense.
d. Juan cannot deduct any vehicle expenses because he has no record of his expenses.
Answer: d. Juan cannot deduct any vehicle expenses because he has no record of his expenses
Explanation:
A sole proprietorship is a form of business that is owned and controlled by one person.The person enjoys the profit alone and bears the risk alone as well.
Since we are given the information that he keeps no records of any kind regarding his business use of the car and doesn't really know for certain when and where he used the automobile for business, this means that Juan cannot deduct any vehicle expenses because he has no record of his expenses.
We should note that for a deduction to be made, the details of how the vehicle is used for business purposes would be required. Since he doesn't have it, he can't deduct any vehicle expenses.
Berkshire Inc. uses a periodic inventory system. At the end of 2017, it missed counting some inventory items, resulting in an inventory understatement by $610,000. Assume that Berkshire has a 30% income tax rate and that this was the only error it made. If undetected, what is the effect of this error on Berkshire's December 31,2017 balance sheet
Answer:
Since the inventory was understated, that means that the cost of goods sold was overstated. Since the COGS was higher, gross profits and operating income were lower. This results in lower than income taxes, and lower net income.
Lower net income results in understated retained earnings (by $427,000), also taxes payable, a liability, will also be understated by $183,000. On the other side of the balance sheet, assets ill be understated by $610,000.
Explanation:
Washburn Company produces earbuds. During the year, manufacturing overhead costs are estimated to be $216,000. Estimated machine usage is 2,700 hours. The company assigns overhead based on machine hours. Job No. 551 used 90 machine hours.
Required:
a. Compute the predetermined overhead rate.
b. Determine the amount of overhead to allocate to Job No. 551.
c. Prepare the entry to assign overhead to Job No. 551 on January 15.
Answer:
1. Predetermined Overhead Rate = Manufacturing overhead costs / Machine Hours
Predetermined Overhead Rate = $216,000/2,700 hours
Predetermined Overhead Rate = $80 per machine hour
2. Allocated overheads =Predetermined Overhead Rate * Machine hours used by Job 551
Allocated overheads = $80 * 90 machine hour
Allocated overheads = $7,200
3. Date Description Debit Credit
15/01 Work In Progress Inventory $7,200
Manufacturing overhead $7,200
(To record allocation of overheads towards Job 551)
All connecting rooms adjoin, but not all adjoining rooms connect.
Answer:
What do you mean? is that the question?
An income statement reports the revenues earned minus expenses incurred by a business over a period of time.
True or false ?
Answer:
True
Explanation:
This is an income statement. Ex: Rent expenses, salaries expense, total revenues, etc.
In the Control Process, it is important to use the proper comparison method when comparing task results with its objectives and standards. Out of the following alternatives methods, which method is not an acceptable method?
Historical comparison
Relative comparison method
Engineering comparison
Personal comparison
Answer: Personal comparison
Explanation:
When it comes to the Control Process, entities are allowed to use several comparison methods when comparing task results with objectives.
These include:
the Historical method where current performance is compared to past performancethe Relative comparison method where the organization's performance is compared against a benchmark of other organizations in the industry.Engineering comparison where schedules are used to ensure that activities finish on time.Personal comparison is not an acceptable method.
Which one is a disadvantage of the process structure? *
More competition among departments
More flexibility in responding changes
Add and delete divisions
More focus on customers
Answer: Add and delete divisions
Explanation:
The process structure in organizations is when the organization is divided into different departments such that they're all related to each other for organizational goals to be achieved.
The divisions can include sales, research, manufacturing etc. It brings about more competition among the departments, focuses on customers and brings about flexibility.
Therefore, the disadvantage will be "Add and delete divisions".
Investment A has an expected return of 14% with a standard deviation of 4%, while investment B has an expected return of 20% with a standard deviation of 9%. Therefore:__________
a. A rational investor will pick investment B because the return adjusted for risk (20% - 9%) is higher than the return adjusted for risk for investment A ($14% - 4%).
b. A risk averse investor will definitely select investment A because the standard deviation is lower.
c. it is irrational for a risk-averse investor to select investment B because its standard deviation is more than twice as big as investment A's, but the return is not twice as big.
d. rational investors could pick either A or B, depending on their level of risk aversion.
Answer:
d. rational investors could pick either A or B, depending on their level of risk aversion
Explanation:
In making investment decisions investors use various analysis to make an informed decision on which assets will suit their needs.
Two of such analysis are returns standard deviation.
Returns shows the percentage of original investment that is expected to come back as profit.
Standard deviation is the tendency of investment performance to deviate from a mean value.
The higher the standard deviation the more the risk of getting low returns or getting higher profit. This is well suited to risk takers.
The lower the standard deviation the less variance from a mean value, so risk averse investors will prefer this.
In the given scenario risk averse investors will prefer Investment A with expected return of 14% with a standard deviation of 4%. Because of the low standard deviation.
Risk takers will prefer investment B with expected return of 20% with a standard deviation of 9%. Because of the higher standard deviation.
Sanborn Company has 10 employees, who earn a total of $2,100 in salaries each working day. They are paid on Monday for the five-day workweek ending on the previous Friday. Assume that year ended December 31, is a Wednesday and all employees will be paid salaries for five full days on the following Monday. The adjusting entry needed on December 31 is:
Answer:
Journal entry to record accrued wages on December 31, 202x
Dr Wages expense 1,260
Cr wages payable 1,260
Journal entry to record wages expense on Friday, January 2
Dr Wages expense 840
Cr wages payable 840
Journal entry to record payment of wages on Monday, January 5
Dr Wages payable 2,100
Cr Cash 2,100
Marketing activities enable consumers to become aware of products or services, and they hopefully provide the information necessary for each buyer to identify the one brand or model that will be most appropriate for them to purchase. Such marketing activities include promotion, advertising, and public relations, as well as supply chain activities to ensure products are available at retail outlets convenient to customers. Which of the following reasons to study marketing captures the various marketing activities described?
a. Marketing plays an important role in society.
b. Marketing can be used in everyday life.
c. Marketing offers outstanding career opportunities.
d. Marketing is important to business.
Answer:
d. Marketing is important to business.
Explanation:
The reason that captures all of the activities is that Marketing is important to business. It may actually be the most important aspect of an entire business because without it a company would not have a customer base to sell their products and services to, which would ultimately cause them to fail. Marketing makes potential customers aware of the product/service and persuades them into trying it out, which can lead to new loyal customers.
For each of the following events, identify which of the determinants of demand or supply are affected.
a. Engineers develop new automated machinery for the production of electric cars.
b. People increase their concern for the environment.
c. An economic boom raises people's wealth.
d. A strike by aluminum workers raises the price of aluminum.
e. The price of gas-powered cars fans.
Answer:
Identifying the determinants of demand and supply affected by the following events:
a. Engineers develop new automated machinery for the production of electric cars.
Technology
b. People increase their concern for the environment.
Environmental concerns and government regulations
c. An economic boom raises people's wealth.
Income distribution
d. A strike by aluminum workers raises the price of aluminum.
Price of resource
e. The price of gas-powered cars fans.
Price
Explanation:
We can identify the following determinants of supply: resource prices, technology, taxes and subsidies, prices of other related goods, price expectations, and the number of sellers in the market. Similarly, demand determinants include price, income, prices of complementary goods and substitutes, consumers' taste and expectations, etc.
(a) Technological advancements: Determinant of supply (b) Consumer preferences: Determinant of demand (c) Consumer income: Determinant of demand (d) Input prices: Determinant of supply (e) Price of related goods: Determinant of demand.
Supply refers to the amount of a good or service that manufacturers are willing and able to offer for sale in a market at a particular price during a specific time period.
As a price of a good rises, the producers than have a greater motivation to supply more of it because it becomes more profitable for them. In contrast, if the price falls, the motivation to supply may fall.
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Assume Ireland and Mali can both produce grain and dates, and that the only limited resource is the farming labor force, meaning that land, water, and all other resources are plentiful in both countries. Each farmer in Ireland can produce 10t of grain or 5t of dates in a season. Each farmer in Mali can also produce 10t of grain or 25t of dates.
Required:
a. Which country has the absolute advantage in producing dates?
b. Which country has the absolute advantage in producing grain?
c. Which country has the competitive advantage in producing dates?
d. Which country has the comparative advantage in producing grain?
Answer:
a. Which country has the absolute advantage in producing dates?
Mali
b. Which country has the absolute advantage in producing grain?
None
c. Which country has the competitive advantage in producing dates?
Mali
d. Which country has the comparative advantage in producing grain?
Ireland
Explanation:
Opportunity cost of producing dates:
Ireland = 10 / 5 = 2 tons of grains
Mali = 10 / 25 = 0.4 tons of grains
Opportunity cost of producing grains:
Ireland = 5 / 10 = 0.5 tons of dates
Mali = 25 / 10 = 2.5 tons of dates
Barton Corporation, which adds materials at the beginning of production, uses a weighted-average process-costing system. Consider the data that follow. Number of Units Cost of Materials Beginning work in process 40,000 $ 80,600 Started in June 60,000 124,400 Production completed 75,000 Ending work in process 25,000 The company's cost per equivalent unit for materials is:
A new surgical facility called Cut & Sew is opening in neighborhoods throughout the United States. They are job shops that handle a variety of outpatient surgical procedures. Their process is set up so that one doctor cuts and the other sews. They have five patients to sequence for tomorrow. Since the weather forecast is for a cool and sunny day, they would also like to play golf tomorrow. They want to sequence their patients with the objective of minimizing the time from the beginning of the first job until the finish of that job. The patients and estimated times are as follows:
Patient Cut Time (hours) Sew Time (hours)
A 2.3 2.8
B 2.5 3
C 2 1.5
D 0.6 1
E 3.6 2.6
Sequence the patients using Johnson's Method, state the schedule for each operation, and determine the minimum makespan.
Answer:
Sequence: D| A| B| E| C|
Makespan = 14.1 hours.
Explanation:
Solution: We are asked to use Johnson's Method to sequence the patients and to determine the minimum makespan.
In Johnson's Method of sequencing, there are some conditions which must be met in order to solve this questions which are as follows:
1. Constant time for jobs, no variation.
2. No job priorities.
3. Jobs will go through from machine 1 to machine 2.
Keeping all those conditions in mind, let's start sequencing by Johnson's method.
Sequence:
D| A| B| E| C|
Hence, this is the sequence to reduce the total time efficiently to perform all the jobs.
Rules to do sequencing:
First of check the number of jobs, here in our case, we have 5 jobs. So create a line of 5 boxes.
Secondly, you have check the data, check for the job and the machine which gives minimum time. If machine 1 (which is Patient cut) gives minimum job time, then write it on the left most box and proceed towards right if other minimum times are also from machine 1. Otherwise, if machine 2 gives minimum job time for a particular job then write in the right most box and so on. Here you can see, Job C and Machine 2 gives the minimum job time, that is why I have put it on the right most box. Now, after including C, you cannot repeat job C. Moreover, you can see, Job D machine 1 gives minimum time, that is why wrote it in the left most box.
Hope, you have understood the method.
Let's Calculate the Makespan for this.
Makespan: It is basically the total elapsed time from the start of job 1 to the end of job 5.
I have attached a table showing the starting and ending of each job and hence calculating the makespan. Please refer to the attachment.
Makespan = 14.1 hours.
As an indicator of an impending recession, inventories will most likely:___________.
A. decrease as a result of a decrease in consumption
B. decrease as a result of an increase in aggregate supply
C. increase as a result of a decrease in aggregate supply
D. increase as a result of a decrease in consumption
E. remain constant as a result of economic uncertainty
Answer:
D. increase as a result of a decrease in consumption
Explanation:
Economics can be classified into two (2) categories, namely;
I. Macroeconomics can be defined as the study of behaviors, performance and factors that affect the entire economy. Hence, it focuses on aggregate phenomena such as price level, economic growth, Gross Domestic Product (GDP), inflation, recession, unemployment and national income levels with respect to the central bank, demand or supply shocks, government policies, aggregate spending and savings.
2. Microeconomics can be defined as the study of the effect of price and quantity levels through interactions between individual buyers and sellers in various markets. It is focused on analyzing or evaluating the decisions of consumers (buyers) and those of firms (sellers) such as methods of production, pricing; and the manner in which government policies affect those decisions.
Hence, as an indicator of an impending recession, inventories will most likely increase as a result of a decrease in consumption and general decline or fall in economic activities in the society.
Answer:d
Explanation:
What is one of the Agile Release Train sync meetings?
a. Iteration Review
b. Solution DemoIteration
c. Retrospective
d. Scrum of Scrum
Answer:
D. Scrum of scrums
Explanation:
When groups are divided into Agile teams of 5persons to 10 persons, . Every daily scrum that is within each of these sub-team is usually ended by making one member in the sub team as ambassador. The ambassador would then participate in a daily meeting with other appointed ambassadors from other sub-teams. This Is what is known as the Scrum of Scrums.
Assume that an economy produces only two goods, pizza and wings, and that it is producing on its production possibilities frontier (PPF). If the economy can only produce two goods, in which ways would allow the economy to produce even more pizza?
Answer:
- growth in labour force
- improved pizza making technology
Explanation:
A production possibility frontier is a curve that shows the combinations of 2 products that can be manufactured given the available resources.
That means given the resources available there is no way a different combination of products can be manufactured.
In the given scenario there has to be an increase in resources for more pizzas to be produced.
There are two options that will allow more pizza to be produced:
- if there is growth in labour force, the production of both wings and pizzas will increase.
- of there is improved pizza making technology, the amount of pizzas produced will increase
The opportunity to defer investing in a project until a later date may have value primarily because: __________
a. the option to abandon may disappear.
b. investment costs tend to increase over time.
c. market conditions may improve.
d. the cost of capital may increase.
e. project cash flows may be lower in the future.
Answer:
c. market conditions may improve.
Explanation:
Investing in the right time and at the right place is very important. It can help to make money or profit or to loose money.
When a company permanently rejects the opportunity to invest in a project to day may not be a good or a wise decision mainly because the company is foregoing all the possible future options. And so the opportunity to postpone an investment by a company in a project until another time in the future has value as in the future the market condition may improve. And it will be better to invest at that time in the project.
Choose a company you know well. Identify primary competitors of the company. Discuss how the company differentiates its product/service. Discuss primary channels of marketing. Explain how a company should adapt prices and marketing channels to meet varying circumstances and opportunities?
Answer:
Coca Cola is the beverage company which produces many types of flavored carbonated drinks for its customers.
Explanation:
Coca Cola has many competitors and one of the biggest competitors is Pepsi cola. Coca Cola differentiates its products by frequently changing its packaging. It introduces new packaging with national hero's , country flags and other similar initiatives to attract its customers.
The primary channels of marketing for Coca Cola are Social media, Faacebook and advertisements on television. The company focuses on selling the product with additional attracting features. Sometimes company also introduces discount or complimentary products to boost its sales.
The company should keep value for money and do not go for cheap pricing as it will increase sales for the company but on the other hand the value of the product will decline in customers eye. The company can introduce new products which are some sort of snacks which compliments the beverage.
In his job, Damon often identifies causes of problems with telecommunication equipment. Which is most likely his employer?
A) a government-run company
B) a local cable company
C) a publishing company
D) a production company
—this question is from edge 2020/2021–
Answer:
B) a local cable company
Explanation:
A local cable company provides communication services using underground cables. Service offed by a cable company includes televisions, internet connectivity, and telephone services. Such a company needs communication equipment to facilitate signal and message transmission.
Damien repairs communication equipment. He probably works for a local cable company.
Suppose that your demand schedule for pizza is as follows:
Price Quantity of Pizzas Demanded Quantity of Pizzas Demanded
(Dollars) (Income = $20,000) (Income = $24,000)
8 40 50
10 32 45
12 24 30
14 16 20
16 8 12
Using the midpoint method, your price elasticity of demand as the price of pizzas increases from $14 to $16 is 0.27/0.20/5.00/3.75 if your income is $20,000 and 5.00/0.27/0.20/3.75 if your income is $24,000.
If the price of a pizza is $10, your income elasticity of demand is 1.22/0.07/0.10/1.86 as your income increases from $20,000 to $24,000. However, if the price of a pizza is $14, your income elasticity is 1.86/0.07/0.10/1.22.
Answer:
1. 5.00
2. 3.75
3. 1.86
4. 1.22
Explanation:
The calculations are all in the attachment.
1. As the price elasticity goes from $14 to $16, the price of pizza becomes $5 at an income of $20,000
2. With income = $24000, if the price should move from $14 to $16, the price elasticity of demand is 3.75
3. With the price of pizza at $10, the income elasticity of demand as income rises from 20000 to 24000 = 1.86
4. If we have price if pizza as 24 dollars, with income rising from $20000 to $24000, then the income elasticity of demand = 1.22
Please check the attachment for the calculations
The income elasticity of demand as your income increases from $20,000 to $24,000, with a price of $10, is 0.07 if the price of a pizza is $10. However, if the price of a pizza is $14, the income elasticity is 0.10. The correct option is C.
Income elasticity of demand is a measure that indicates how sensitive the quantity demanded of a good or service is to changes in income. It measures the percentage change in the quantity demanded divided by the percentage change in income.
If the income elasticity of demand is positive, it indicates that the good is a normal good, meaning that as income increases, the quantity demanded of the good also increases.
Thus, the ideal selection is option C.
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Gruman Company purchased a machine for $198,000 on January 2, 2016. It made the following estimates:
Service life 5 years or 10,000 hours
Production 180,000 units
Residual value $18,000
In 2016, Gruman uses the machine for 1,700 hours and produces 40,000 units. In 2017, Gruman uses the machine for 1,200 hours and produces 34,000 units. If required, round your final answers to the nearest dollar.
Required:
Compute the depreciation for 2016 and 2017 under each of the following methods:
a. Straight-line method
b. Sum-of-the-years'-digits method
c. Double-declining-balance method
d. Activity method based on hours worked
e. Activity method based on units of output
Answer:
$36,000 $36,000
b. $60,000 $48,000
c. $79,200, $47,520
d. $30,600, $21,600
e. $40,000 $34,000
Explanation:
A. Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
( $198,000 - $18,000 ) / 5 = $36,000
Depreciation expense each year would be $36,000
B. Sum-of-the-year digits = (remaining useful life / sum of the years ) x (Cost of asset - Salvage value)
Sum of the years = 1 +2 +3 +4 + 5 = 15
Depreciation expense in year 1 = (5/15) X ( $198,000 - $18,000 ) = $60,000
Depreciation expense in year 2 = (4/15) x ( $198,000 - $18,000 ) = $48,000
C. Depreciation expense using the double declining method = Depreciation factor x cost of the asset
Depreciation factor = 2 x (1/useful life)
2 x(1/5) = 0.4
Depreciation expense in year 1 = 0.4 x $198,000 = $79,200
Book value at the end of year 1 = $198,000 - $79,200 = $118,800
Depreciation expense in year 2 = 0.4 x $118,800 = $47,520
D. Activity method based on hours worked = (hours worked that year / total hours of the machine) x (Cost of asset - Salvage value)
Depreciation expense in year 1 = (1,700 / 10,000) x ( $198,000 - $18,000 ) = $30,600
Depreciation expense in year 1 = (1,200 / 10,000) x ( $198,000 - $18,000 ) = $21,600
E. Activity method based on units of output = (output produced that year / total output capacity of the machine) x (Cost of asset - Salvage value)
Depreciation expense in year 1 = ( 40,000 / 180,000) x ( $198,000 - $18,000 ) = $40,000
Depreciation expense in year 12= ( 34,000 / 180,000) x ( $198,000 - $18,000 ) = $34,000
What is the function of the Securities and Exchange Commission (SEC)?
O Monitors the money supply
O Purchases money securities
O Controls the amount of investments
O Regulates against fraud
When setting a short-term financial plan, it should lover the following timeframe:
A) Less than a year
B) 1-5 years
C) Over 5 years
D) Retirement
On December 20, 2017, Butanta Company (a U.S. company headquartered in Miami, Florida) sold parts to a foreign customer at a price of 75,000 ostras. Payment is received on January 10, 2018. Currency exchange rates for 1 ostra are as follows:
December 20, 2017 $1.17
December 31, 2017 1.14
January 10, 2018 1.10
Required:
a. How does the fluctuation in exchange rates affect Butanta's 2017 income statement?
b. How does the fluctuation in exchange rates affect Butanta's 2018 income statement?
Answer:
A. Decrease in asset $2,250
B. Decrease in asset $3,000
Explanation:
A. Calculation for How does the fluctuation in exchange rates affect Butanta's 2017 income statement
Transaction amount in Dollar terms as on date of transaction ($75,000*1.17) $ 87,750
Transaction amount in Dollar terms as on Year end 31/12/2017 ($75,000*1.14) $ 85,500
Decrease in asset ($ 87,750 -$ 85,500 ) $ 2,250
Since will have Decrease in asset of the amount of $2,250 in 2017 which means that their is foreign exchange loss due to DECREASES in dollar value
B. Calculation for does the fluctuation in exchange rates affect Butanta's 2018 income statement
Transaction amount in Dollar terms as on Year end 31/12/2017 (75,000*1.14) $ 85,500
Transaction amount in Dollar terms as on date of receipt of payment 10/1/2018 (75,000*1.10) $ 82,500
Decrease in asset (85,500 - 82,500) $ 3,000
Since will have Decrease in asset of the amount of $3,000 in 2018 which means that their is foreign exchange loss due to DECREASES in dollar value
