In the direct write-off method, bad debt expense is recorded when specific customer accounts are determined to be uncollectible. Option D is the correct answer.
Option A is not correct because estimates are not used in the direct write-off method. Option B is not correct because the allowance account is not used in the direct write-off method. Option C is not correct because the primary users of the direct write-off method are small businesses. The direct write-off method is a simple method of accounting for bad debts that is used by small businesses.
Under this method, bad debt expense is recorded when specific customer accounts are determined to be uncollectible. The specific accounts are written off and the balance in the accounts receivable account is reduced accordingly. This method is not considered to be in compliance with Generally Accepted Accounting Principles (GAAP) because it does not match revenues with expenses. Therefore option D is correct.
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which of the following would not be held in a money market fund: select one: a. high credit quality, very low duration debt b. agency securities c. corporate bonds d. commercial paper
Money market funds typically invest in short-term, low-risk securities, such as high credit quality, very low duration debt (such as Treasury bills), agency securities, and commercial paper.
The correct answer is (c) corporate bonds. Corporate bonds, on the other hand, are longer-term debt instruments that are generally considered to be riskier than the other types of investments held in money market funds. While corporate bonds can provide higher yields, they are not typically held in money market funds due to their longer maturities and higher risk profile.
Money market funds are designed to invest in short-term, low-risk securities that are highly liquid and provide investors with a way to earn a return on their cash holdings while maintaining easy access to their money. Typically, money market funds invest in securities that have a maturity of less than one year, and they focus on maintaining a stable net asset value of $1 per share.
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on july 8, angstrom, incorporated sold 100 printers to office rental company at $600 each and offered a 2% discount for payment within 10 days. on july 15, office rental company paid the full amount in cash. what should angstrom record on july 15? transaction account title debit credit a. cash 60,000 a. accounts receivable 60,000 b. cash 58,800 b. accounts receivable 58,800 c. cash 58,800 c. sales discounts 1,200 c. accounts receivable 60,000 d. cash 60,000 d. sales discounts 1,200 d. sales revenue 58,800 multiple choice option a option b option c option d
Angstrom, Incorporated sold 100 printers to Office Rental Company at $600 each, which gives a total of $60,000.
Option C is the correct answer. Angstrom also offered a 2% discount for payment within 10 days, which is $1,200 (2% of $60,000). Therefore, the total payment amount after the discount is $58,800 ($60,000 - $1,200). On July 15th, when Office Rental Company paid the full amount in cash, Angstrom should record $58,800 as cash received, reduce accounts receivable by the same amount ($60,000), and record the sales discount of $1,200 as a reduction in sales revenue.
This transaction would be recorded as follows: Cash $58,800, Accounts Receivable $60,000, and Sales Discounts $1,200.
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which of the following should organizational structure and internal processes foster to help promote innovation? multiple select question. collaboration cross-functional communication interest in the market agility
To help promote innovation, organizational structure and internal processes should foster collaboration, cross-functional communication, and agility.
Collaboration,
Innovation often involves multiple perspectives and ideas from different areas of the organization.
Collaboration helps bring these perspectives together, facilitating the exchange of ideas and leading to more innovative solutions.
Cross-functional communication,
Effective communication between different departments and functions within the organization.
Helps ensure that everyone is working towards a common goal.
And allows for the sharing of ideas and feedback, leading to more innovative solutions.
Agility,
An organization that is agile is able to respond quickly to changes in the market or industry.
And can adapt to new circumstances, leading to innovation.
Therefore, to promote innovation organizational structure and internal processes should foster collaboration, cross-functional communication, and agility.
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an investor receives a return from an investment due to: group of answer choices asset allocation among different asset classes. capital gains on the sale of an investment. diversification among or within asset classes. rebalancing by buying more equities. recurring deposits.
An investor receives a return from an investment due to options (a) Asset allocation among different asset classes, (b) Capital gains on the sale of an investment (c) Diversification among or within asset classes and (e) Recurring deposits.
An investor can receive returns from an investment through various means. The following options are available
a) Asset allocation among different asset classes: This refers to the distribution of investment funds across various asset classes, such as stocks, bonds, and real estate. By diversifying their portfolio across various asset classes, investors can reduce their overall risk and improve their chances of generating returns.
b) Capital gains on the sale of an investment: This refers to the profits made from selling an investment for more than its purchase price. Capital gains can occur in various types of investments, including stocks, real estate, and mutual funds.
c) Diversification among or within asset classes: Diversification is a strategy of spreading investment funds across different investments within a single asset class or across various asset classes. This reduces the risk of losses by preventing any one investment from having too much impact on the overall portfolio.
d) Rebalancing by buying more equities: Rebalancing is a strategy of adjusting an investment portfolio to maintain the desired asset allocation. If one asset class has performed better than others, it may require additional investment to maintain the original allocation.
e) Recurring deposits: This refers to the practice of regularly depositing funds into an investment account, such as a retirement account or a savings account. Recurring deposits allow investors to build their portfolios over time and benefit from compound interest.
Therefore, the correct options are (a) Asset allocation among different asset classes, (b) Capital gains on the sale of an investment (c) Diversification among or within asset classes and (e) Recurring deposits.
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in 1972, the federal government established the special supplemental nutrition program for women, infants and children (wic). recipients of aid must be women who are pregnant or breastfeeding or children under the age of 5 whose family income falls below 185% of the federal poverty line. this is an example of which of the following types of federal aid? choose 1 answer: choose 1 answer: (choice a) mandates a mandates (choice b) revenue sharing b revenue sharing (choice c) block grants c block grants (choice d) categorical grants d categorical grants
An example of types of federal aid is Categorical grants. So, the correct answer is D).
The special supplemental nutrition program for women, infants, and children (WIC) is an example of a categorical grant, which is a type of federal aid that provides funding for specific purposes, such as a program or project.
Categorical grants typically have specific guidelines and requirements that must be met in order to receive funding. In this case, the federal government established WIC to provide supplemental nutrition assistance to low-income pregnant and breastfeeding women, as well as children under age 5.
The program is funded through categorical grants to state agencies, which are responsible for administering the program and distributing benefits to eligible recipients. So, the correct option is D).
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according to the trade-off theory, what will happen if the present value of the interest tax shield on debt is at the same level compared to the present value of the costs of financial distress?
According to the trade-off theory, if the present value of the interest tax shield on debt is at the same level as the present value of the costs of financial distress, a firm will likely reach its optimal capital structure.
The trade-off theory suggests that a firm balances the benefits and costs of debt financing to determine its optimal capital structure. The interest tax shield is a benefit of using debt financing, as interest payments on debt are tax-deductible, which reduces a firm's overall tax liability. This effectively lowers the cost of debt and makes it more attractive as a financing option.
On the other hand, the costs of financial distress refer to the potential consequences of having too much debt. These costs may include bankruptcy, reduced operational flexibility, and increased agency conflicts between debt and equity holders.
In conclusion, the trade-off theory suggests that a firm's optimal capital structure is reached when the present value of the interest tax shield on debt equals the present value of the costs of financial distress. At this point, the benefits of debt financing are balanced with the potential risks, resulting in an efficient capital structure that maximizes the firm's value.
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both product development strategies and diversification strategies involve . group of answer choices developing a new product selling in a company's current market selling in new as well as existing markets selling a company's current products leaving the current market
The correct response is c. selling a company's current products. Selling a company's present products is the main objective of both market penetration and market development plans.
Penetration is the action or entering or passing through something. It provides a great understanding. A great example of this is penetration, that includes one thing moving through another. You may talk of an army storming into a citadel or a dagger piercing through clothes. When someone enters another person's vagina or anus without that person's consent, they are committing an assault by penetration. Examples of such body parts include fingers. The Broadband Penetration Rate is the proportion of a nation's or town's total population who uses the Internet.
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the following information is available for a company's cost of sales over the last five months. monthunits sold cost of salesjanuary460 $33,400february860 $40,000march1,900 $52,000april2,700 $64,000using the high-low method, the estimated variable cost of sales per unit sold is: monthunits sold cost of salesjanuary580 $27,800february720 $33,000march1,200 $45,000april2,580 $57,000using the high-low method, the estimated total fixed cost is:
The high-low method is a technique used to separate the fixed and variable components of a mixed cost. To estimate the fixed cost, we need to use the formula:
Fixed Cost = Total Cost - (Variable Cost per Unit x Total Units)
Using the information given, the highest level of units sold was in April, which was 2,700 units at a cost of $64,000. The lowest level of units sold was in January, which was 460 units at a cost of $33,400.
Using these two data points, we can calculate the variable cost per unit as follows:
Variable Cost per Unit = (Cost at High Level - Cost at Low Level) / (Units at High Level - Units at Low Level)
Variable Cost per Unit = ($64,000 - $33,400) / (2,700 - 460)
Variable Cost per Unit = $30.20
Using the information from the second part of the question, we can substitute the values into the formula above to calculate the fixed cost:
Fixed Cost = Total Cost - (Variable Cost per Unit x Total Units)
Fixed Cost = $57,000 - ($30.20 x 2,580)
Fixed Cost = $57,000 - $77,796
Fixed Cost = -$20,796
The negative result indicates that the estimated fixed cost is not a valid estimate, as it implies that the company would have a negative fixed cost.
This could be due to outliers in the data or other factors affecting the accuracy of the estimates. Further analysis and review of the data would be necessary to obtain a more accurate estimate of the fixed cost.
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what organization spurred the news industry to become more impartial and objective? the associated press united press international the hutchins commission the hearst foundation
The organization that spurred the news industry to become more impartial and objective was the Hutchins Commission. Here option C is the correct answer.
In the mid-20th century, concerns arose regarding the role of the media in shaping public opinion and the potential for biased reporting. To address these concerns, the Commission on Freedom of the Press was formed in 1942, led by Robert M. Hutchins, then-president of the University of Chicago.
The commission spent several years studying the news industry and published its findings in the landmark report, "A Free and Responsible Press," in 1947.
The report called for a new standard of objectivity and professionalism in journalism, emphasizing the importance of accuracy, fairness, and balanced reporting. It also highlighted the need for a clear distinction between news and opinion, and for news outlets to serve the public interest.
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Complete question:
What organization spurred the news industry to become more impartial and objective?
A - the associated press
B - united press international
C - the Hutchins commission
D - the Hearst Foundation
express authority consists of the agent's: a.ability to mingle the agent's funds with those of the principal. b.ability to hold power of attorney for the principal. c.written or oral instructions from principal to agent. d.inability to conduct business for the principal.
Express authority consists of the agent's ability to hold power of attorney for the principal. (option b).
Express authority refers to the explicit or specific instructions given by a principal to an agent, authorizing the agent to act on the principal's behalf.
Express authority can also include the power of attorney, which is a legal document that grants an agent the authority to act on behalf of the principal.
It is worth noting that express authority does not give the agent the right to mingle their funds with those of the principal. The agent is expected to keep their finances separate from those of the principal to avoid any potential conflicts of interest.
In conclusion, express authority is a crucial legal concept that governs the relationship between a principal and an agent. It provides clear guidelines for the agent's actions and enables the principal to delegate specific tasks or decisions to the agent.
Hence the correct option is (a).
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for a couple to benefit from the $500,000 capital gains tax advantage, the home must have been their principal residence for a minimum of: group of answer choices one out of the last two years. six of the last 12 months. two of the last five years. none of the answers are correct
two out of the last five years. The correct option is: In order to qualify for the $500,000 capital gains tax advantage, for a couple (or $250,000 for an individual), the home must have been their principal residence for at least two out of the last five years before the sale of the home.
This means that the couple must have lived in the home as their main residence for at least 24 months out of the last 60 months (5 years) leading up to the sale of the home. This is known as the "two out of five years" rule for capital gains tax exemption on the sale of a home. It is important to note that there are certain exceptions and additional requirements that may apply, so it is always best to consult with a tax professional for specific tax advice. So, the correct answer is "two of the last five years." None of the other options listed are correct.
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a $1,000 par value bond is currently selling for $1,030. this bond has a coupon rate of 7% and coupon is paid semiannually on jan 1st and july 1st each year. today is november 1st and you just bought this bond. how much will you billed for buying one bond?
When a bond is purchased between coupon payment dates, the buyer has to pay the seller the accrued interest for the period from the last coupon payment date to the settlement date.
In this case, the last coupon payment date was July 1st and the settlement date is November 1st, which means there are four months between the two dates.
To calculate the accrued interest, we can use the following formula:
Accrued Interest = (Coupon Rate * Face Value * Number of Days) / (Number of Days in Coupon Period * 100)
Number of Days = 122 (from July 1st to November 1st, inclusive)
Number of Days in Coupon Period = 182 (since the coupons are paid semiannually)
Coupon Rate = 7%
Face Value = $1,000
Accrued Interest = (0.07 * $1,000 * 122) / (182 * 100) = $23.62
Therefore, if you just bought one bond on November 1st, you would be billed $1,030 + $23.62 = $1,053.62.
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a spot rate may be defined as group of answer choices the u.s. dollar value of a foreign currency. the forecasted future value of a foreign currency. the price a foreign currency can be purchased or sold today. the euro value of a foreign currency. the price today at which a foreign currency can be purchased or sold in the future.
The definition of spot rate is "the price at which a foreign currency can be purchased or sold today". The correct option is C.
The spot rate is the cost of a currency on the spot date, which is the current date when the deal is concluded. It's the most up-to-date and accurate cost of a currency available. It is the cost that traders pay for immediate currency delivery rather than for a currency to be paid at some future date. The spot rate is also known as the "spot price" or the "spot exchange rate."
A spot rate is different from a future exchange rate or a forward exchange rate, which is the projected exchange rate for a future date. A forward exchange rate is a future exchange rate that is decided at the time the transaction is made but is scheduled for a future date. Forward exchange rates are used to hedge foreign exchange risks by locking in the exchange rate for a future date.
When two parties accept a forward exchange rate, they are agreeing to exchange currencies at a predetermined exchange rate and date in the future.
Option C is the correct answer.
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the sale of boeing commercial aircraft and microsoft operating systems in many countries around the globe enables these companies to benefit from group of answer choices higher prices in their domestic markets. reducing their exposure to currency risks. economies of scale. optimizing the location for many activities in their value chain.
The sale of Boeing commercial aircraft and Microsoft operating systems in many countries around the globe enables these companies to benefit from economies of scale.
Economies of scale refer to the cost advantage that arises with increased output of a product. In simpler words, it can be explained as the benefits of producing on a larger scale.The sale of Boeing commercial aircraft and Microsoft operating systems in many countries around the globe enables these companies to benefit from economies of scale. This is because the production of these products in large quantities helps in reducing the cost per unit. This is due to the fact that the fixed costs of production such as rent, advertising, and administrative costs get distributed among the large number of units produced.As a result, both companies are able to offer their products at competitive prices in both domestic and international markets. Therefore, economies of scale are the key to their success in the global market.
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abc company purchases a bond with a face value of $100,000 for $98,253 cash. abc company purchased this bond at a.a cost of $100,000. b.a discount of $1,747. c.a premium of $1,747. d.face value.
For $98,253 in cash, ABC Company buys a bond with a face value of $100,000. This bond was bought by ABC Company for its face value.
Face value is a term used in finance to describe a security's nominal or monetary worth as stated by its issuer. The face value of stocks is the original purchase price of the shares, as shown on the certificate. or take someone or something for what they are on the surface. 1. To accept somebody or something without questioning if they are who they say they are. You shouldn't accept these threats at their value. The true worth of a digit in a number is known as face value. We multiply a number's digit value by its numerical value to obtain its place value. As 5 is in the tens place in the number 452, for instance, its place value is (5 10) = 50.
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t. the common stock currently sells for $100 a share and there are 5,000,000 shares outstanding. the firm's marginal tax rate is 40 percent. what is the wacc?
When the common stock currently sells for $100 a share and there are 5,000,000 shares outstanding with the firm's marginal tax rate is 40 percent, the WACC here is 9.7%.
The cost of each element of the company's capital structure must be determined, and each element must then be given a weight based on how much of the total capital structure it makes up in order to calculate the Weighted Average Cost of Capital (WACC).
The WACC can be determined using the following formula, assuming that the company's capital structure only consists of common stock:
WACC = Cost of Equity x Weight of Equity
The cost of equity should be applied since the company's capital structure only consists of common stock. With the help of the Capital Asset Pricing Model (CAPM), we can calculate the cost of equity:
Cost of Equity= Risk-Free Rate + Beta x (Market Risk Premium)
Assume that the stock's beta is 1.2, the risk-free rate is 2.5 percent, and the market risk premium is 6 percent. These figures allow us to determine the cost of equity at:
Cost of Equity = 2.5% + 1.2 x 6% = 9.7%
Next, we need to determine the weight of equity in the company's capital structure. Since the company has only common stock, the weight of equity is 100%.
Weight of Equity = 100%
Finally, we can calculate the WACC as:
WACC = Cost of Equity x Weight of Equity = 9.7% x 100% = 9.7%
Therefore, the WACC for the company is 9.7%.
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in title vii cases, what type of damages involve the pay that an employee lost due to the discriminatory act? multiple choice question.
The type of damages that involve the pay that an employee lost due to a discriminatory act in Title VII cases is known as back pay.
Back pay is the sort of damages in Title VII lawsuits that involve the compensation that an employee lost due to a discriminatory act. Back pay is a form of remuneration that attempts to compensate an employee for earnings and perks lost as a result of an employer's biassed behaviour.
This can include any pay or wages, bonuses, or perks that the employee would have gotten if the prejudice had not occurred. Back pay is an essential recourse for compensating workers for the damage caused by prejudice while also discouraging companies from participating in discriminating practises.
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a contract that gives the holder the right to sell a security at a preset price only immediately before contract expiration is a(n):
A contract that gives the holder the right to sell a security at a preset price only immediately before contract expiration is a European put option.
An option contract that restricts execution to the expiration date is known as a European option. An investor would be unable to use the choice early and either take possession of or sell the shares if the price of the underlying security, such as a stock, had changed.
Instead, just the option maturity date will see a call or put action. The underlying security may be sold by the holder at expiration of a European put option. When a put option expires, the stock price must be trading significantly below the strike price in order for the premium paid by the investor to be recouped.
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when walmart threatens to punish or punishes the other channel member for not undertaking certain tasks, such as if it were to delay payment for a late delivery, this is an example of
This is an example of a coercive power play in a supply chain relationship. Walmart, as a powerful retailer, uses its leverage to force its suppliers to comply with its demands.
By threatening or punishing the other channel member for not fulfilling certain obligations, Walmart is using its position of power to control the actions of its suppliers. This type of behavior can lead to an unbalanced and unsustainable relationship in the long run, as suppliers may feel exploited or coerced into making decisions that are not in their best interest.
It is important for companies to practice fair and ethical behavior in their supply chain relationships to ensure a mutually beneficial and sustainable partnership.
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1. what is the main issue being decided by the court? 2. did the parties engage in a bargained-for exchange or a gift with strings attached? 3. is the contract described in this case a unilateral contract? 4. are gratuitous gifts enforceable under u.s. contract law? 5. if a boss told an employee that she would receive a bonus for her long service to the company, would this constitute a contract? why or why not?
In Hamer v. Sidway, the Court's primary concern was determining whether the waiver of a legal right in exchange for future benefits promised by a third party could qualify as legal compensation for a contract.
In this instance, the parties participated in a negotiated trade as opposed to a gift with conditions. If the cousin agreed to abstain from alcohol, tobacco, and gaming until he turned 21, the uncle would give him $5,000. The uncle admitted that he would give his nephew the money when he was "capable of taking care of it" after the nephew kept his word.
The deal in question is indeed unilateral. In a solo contract, only one party commits, and the other party fulfills the commitment by performing an act. In this instance, the uncle agreed to give his nephew $5,000 if the nephew stayed away from particular pursuits until he turned 21.
No, because they lack thought, gratuitous presents are typically not enforceable under American contract law. A valid contract must include a consideration, which is the term for a trade of something of worth between the parties.
Whether a boss' statement that an employee would receive a bonus for her lengthy service to the business would amount to a contract would rely on the details of the situation. There must be an offer, an acceptance, and a thought for a contract to be made. A contract might have been created if the boss's remark was meant to be an offer, the employee took it by continuing to work for the business, and there was a payment in the form of the employee's continued service.
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Complete question:
Hamer VS sidway
1. What is the main issue being decided by the Court?
2. Did the parties engage in a bargained-for exchange or a gift with strings attached?
3. Is the contract described in this case a unilateral contract?
4. Are gratuitous gifts enforceable under U.S. Contract Law?
5. If a boss told an employee that she would receive a bonus for her long service to the company, would this constitute a contract? Why or why not?
data used in budgeting: fixed element per month variable element per client-visit revenue $ 0 $ 37.20 personnel expenses $ 31,300 $ 12.20 medical supplies 2,100 7.60 occupancy expenses 9,400 3.70 administrative expenses 7,700 0.20 total expenses $ 50,500 $ 23.70 actual results for november: revenue $ 156,078 personnel expenses $ 82,376 medical supplies $ 34,788 occupancy expenses $ 24,405 administrative expenses $ 8,291 the spending variance for medical supplies in november would be closest to:
If the actual amount spent on medical supplies in November was less than the budgeted amount, then the spending variance would be favorable (a positive number), indicating that less money was spent than expected.
To calculate the spending variance for medical supplies in November, we need to compare the actual amount spent on medical supplies with the budgeted amount for medical supplies.
Budgeted amount for medical supplies = Fixed element per month + (Variable element per client-visit x Actual number of client-visits)
Fixed element per month for medical supplies = $2,100
Variable element per client-visit for medical supplies = $7.60
The actual number of client-visits in November, so we cannot calculate the budgeted amount for medical supplies precisely. However, we know that the budgeted amount is a combination of a fixed element and a variable element based on the number of client-visits.
The actual amount spent on medical supplies in November was $34,788.
Therefore, the spending variance for medical supplies in November would be:
Spending Variance = Actual Amount Spent - Budgeted Amount
= $34,788 - Budgeted Amount
if the actual amount spent on medical supplies in November was less than the budgeted amount, then the spending variance would be favorable (a positive number), indicating that less money was spent than expected. Conversely, if the actual amount spent on medical supplies was more than the budgeted amount, then the spending variance would be unfavorable (a negative number), indicating that more money was spent than expected.
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which of the following statements is true? i. buyers bear the majority of the tax burden if the tax is originally imposed on buyers. ii. buyers bear the majority of the tax burden if the tax is originally imposed on sellers. iii. buyers and sellers will always bear equal amounts of the tax burden. iv. buyers and sellers will jointly bear the tax. i only iii only iv only ii only
The true statement among the given options is "ii. buyers bear the majority of the tax burden if the tax is originally imposed on sellers."
When a tax is imposed on a product or service, it affects both the buyers and the sellers. However, the distribution of the tax burden between the buyers and sellers depends on who the tax is originally imposed on.
If the tax is originally imposed on the sellers, then the sellers have to pay more tax, which in turn increases the price of the product or service for the buyers. As a result, the buyers bear the majority of the tax burden in this case.
On the other hand, if the tax is originally imposed on the buyers, then the buyers have to pay more tax directly. Therefore, the buyers will bear the majority of the tax burden in this case. The correct option is ii only.
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the estimated amount of overhead that should be allocated to individual product lines is: under an abc system the materials handling costs allocated to one unit of wm is:
The estimated amount of overhead that should be allocated to individual product lines is determined using Activity-Based Costing (ABC) method.
Under an abc system the materials handling costs allocated to one unit of wm depend on the specific cost driver.
ABC is a costing technique that assigns overhead costs to products and services based on the activities that are required to produce them. Under ABC, overhead costs are allocated to products or services based on their use of different activities in the production process.
The amount of overhead allocated to individual product lines will depend on the nature and extent of the activities required to produce those products.
For example, if a product line requires extensive use of machine setup activities, then a larger portion of the overhead costs associated with machine setup will be allocated to that product line.
On the other hand, the materials handling costs allocated to one unit of WM (assuming "WM" refers to a specific product) would depend on the specific cost driver used to allocate these costs under the ABC system. The cost driver could be the number of times a unit of WM is moved or the distance it is moved within the production process, for example.
In summary, the amount of overhead allocated to individual product lines and the materials handling costs allocated to a specific unit of WM would both depend on the cost drivers used in the ABC system, and the nature and extent of the activities required to produce those products.
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if the return on the risk-free security is 3% and the return on digital computer incorporated is expected to be 18% (with beta of 1.5), what must be the return on the market, according to capm? multiple choice question.
Using CAPM, the return on the market must be 13%. Therefore, the correct option is B.
According to CAPM (Capital Asset Pricing Model), the expected return of an asset depends on the risk-free rate, the expected market risk premium, and the beta of the asset. Using CAPM, the expected return on Digital Computer Incorporated can be calculated using the formula:
Expected return = Risk-free rate + Beta * (Market return - Risk-free rate)
Given the risk-free rate is 3%, the expected return on Digital Computer Incorporated is 18%, and its beta is 1.5, we can solve for the market return:
18% = 3% + 1.5 * (Market return - 3%)
To find the market return, follow these steps:1. Subtract the risk-free rate from the expected return: 18% - 3% = 15%
2. Divide this result by the beta: 15% / 1.5 = 10%
3. Add the risk-free rate back to the result: 10% + 3% = 13%
Hence, the return on the market, according to CAPM, is Option B: 13%.
Note: The question is incomplete. The complete question probably is: If the return on the risk-free security is 3% and the return on Digital Computer Incorporated is expected to be 18% (with beta of 1.5), what must be the return on the market, according to CAPM? A) 11.75%` B) 13.00% C) 15.00% D) 10.00%.
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Which expense contributes to a business's cost?
2.
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Wages, salary, maintenance, rent, and depreciation are all examples of expenses. To calculate profits, revenue is subtracted from expenses. To lessen the tax burden and increase profits, businesses are permitted to deduct some expenses from taxes.
What are a business's costs of expenses?An expense is a business's operational cost incurred to produce income. Operational income is the company's profit after running costs like salaries, depreciation, and cost of goods sold have been subtracted.
These consist of payroll taxes, insurance deductibles, commissions, bonuses, and other perks including paid time off, health insurance, and retirement savings schemes. When beginning and registering a business, the majority of states in the U.S. will demand some kind of business license.
You can more easily keep track of your business costs if you keep your personal and business accounts separate. Maintaining a healthy cash flow and being eligible for tax deductions that could lower your taxable income require keeping track of business expenses.
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How the fed affects the monetary base the reserve requirement is the amount of funds that banks must hold in reserves against specific deposit accounts. the dollar amount of a bank's reserve requirement is based on the amount of a bank's net total transaction accounts. since 1982, the first few million dollars of net transaction accounts have constituted an exemption amount, an amount exempt from the reserve requirement, with the exemption amount starting off at $2 million in 1982 and reaching $13.2 million in 2014. the amount of net transaction accounts is subject to a 3% required reserve ratio. this low- reserve tranche is adjusted each year. in 1980, it was $89.0 million and it reached $25 million in 2014. net transaction account amounts over the low-reserve tranche level are subject to a 10% required reserve ratio. and the suppose that the level of exemption amount increased. then, ceteris paribus, the amount of required reserves will decrease monetary base will decrease and the suppose now that the low-reserve tranche increased. then, ceteris paribus, the amount of required reserves will decrease monetary base will decrease
An increase in the level of exemption amount will decrease the amount of required reserves and the monetary base, while an increase in the low-reserve tranche will increase the amount of required reserves and the monetary base.
The suppose that the level of exemption amount increases. Then, ceteris paribus, the amount of required reserves will decrease and the monetary base will decrease. This is because banks will have to hold less money in reserve and they will have more money available to lend out or invest in the economy.
Conversely, if the low-reserve tranche increases, then the amount of required reserves will increase and the monetary base will increase. This is because banks will have to hold more money in reserve, reducing the amount of money available to lend out or invest in the economy.
This change in the monetary base affects the supply of money in the economy, which in turn affects economic activity.
Complete Question:
How the fed affects the monetary base
The reserve requirement is the amount of funds that banks must hold in reserves against specific deposit accounts. the dollar amount of a bank's reserve requirement is based on the amount of a bank's net total transaction accounts. since 1982, the first few million dollars of net transaction accounts have constituted an exemption amount, an amount exempt from the reserve requirement, with the exemption amount starting off at $2 million in 1982 and reaching $13.2 million in 2014. the amount of net transaction accounts is subject to a 3% required reserve ratio. this low- reserve tranche is adjusted each year. in 1980, it was $89.0 million and it reached $25 million in 2014. net transaction account amounts over the low-reserve tranche level are subject to a 10% required reserve ratio.
The suppose that the level of exemption amount _______. Then, ceteris paribus, the amount of required reserves will ______ monetary base will decrease
The suppose now that the low-reserve tranche _______. Then, ceteris paribus, the amount of required reserves will decrease the monetary base will ________.
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your firm's existing bonds trade with a yield to maturity of eight percent. the state of missouri has offered to loan your firm $10,000,000 at zero percent for five years. repayment will be of the form of $2,000,000 per year for five years; the first payment is due in one year.what is the value of this offer
The present value of the loan offer is $8,130,733. Since the loan is being offered at zero percent interest, it represents a lower cost of borrowing than the eight percent yield to maturity on the existing bonds.
To determine the value of the loan offer, we need to compare it to the cost of borrowing from the market.
Assuming that the $10,000,000 loan is used to replace existing bonds, the cost of borrowing from the market is eight percent. The present value of five annual payments of $2,000,000 at an eight percent discount rate is:
PV = $2,000,000 / (1 + 8%) + $2,000,000 / (1 + 8%)^2 + ... + $2,000,000 / (1 + 8%)^5
PV = $2,000,000 x [(1 - (1 / (1 + 8%)^5)) / 8%] = $8,130,733
Therefore, the present value of the loan offer is $8,130,733. Since the loan is being offered at zero percent interest, it represents a lower cost of borrowing than the eight percent yield to maturity on the existing bonds. Therefore, the loan offer is valuable and the firm should consider accepting it.
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during the year, hamlet incorporated paid $20,000 to have bond certificates printed and engraved, paid $100,000 in legal fees, paid $10,000 to a cpa for registration information, and paid $200,000 to an underwriter as a commission. what is the amount of bond issue costs?
The amount of bond issue costs incurred by Hamlet incorporated is $330,000.
During the year, Hamlet incorporated paid $20,000 to have bond certificates printed and engraved, paid $100,000 in legal fees, paid $10,000 to a CPA for registration information, and paid $200,000 to an underwriter as a commission. The amount of bond issue costs can be calculated by adding all of the expenses that have been incurred during the bond issuance, excluding the cost of the bonds themselves.
This includes legal fees, printing and engraving of bond certificates, registration fees, and underwriting commissions.The bond issue costs of Hamlet incorporated are:$20,000 + $100,000 + $10,000 + $200,000 = $330,000 .
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which time horizon has the most fixed input and output prices? multiple choice question. long run immediate short run extended long run short run
The correct answer is "Long run" horizon has the most fixed input and output prices. In this case option C is correct
In the long run, a company can adjust all of its inputs, including labor and capital, to produce the desired level of output. As a result, all costs are variable in the long run, meaning that fixed input and output prices are less prevalent.
In contrast, in the short run, some inputs are fixed, such as the size of the production facility or the number of employees. Therefore, short-run costs include fixed costs, such as rent or salaries, which can lead to more fixed input and output prices.
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Which time horizon has the most fixed input and output prices? multiple choice question.
long-run immediate short run extended long run short runnetflix has used the long tail in the dvd-by-mail business to its advantage, crafting a business model that creates close ties with film studios. what do film studios stand to gain from taking advantage of the netflix model targeted at increasing the firm's long-tail offerings?
Film studios stand to gain increased revenue and exposure by offering their films on Netflix's long-tail offerings, as well as valuable data insights and greater control over their content and distribution.
Revenue benifits:
Film studios stand to gain several benefits from taking advantage of the Netflix model targeted at increasing the firm's long-tail offerings. These benefits include:
Increased revenue: By offering their films on Netflix, studios can reach a wider audience and generate more revenue than they would through traditional distribution channels.Increased exposure: By being included in Netflix's long-tail offerings, films that may not have received much attention in traditional distribution channels can gain exposure to a larger audience.Data insights: Netflix's extensive data analytics capabilities can provide valuable insights to film studios about consumer preferences and viewing habits, which can help inform future content production and distribution decisions.Greater control: By working closely with Netflix, film studios can retain greater control over their content and distribution, ensuring that their films are presented in the best possible way to consumers.Overall, taking advantage of the Netflix model targeted at increasing the firm's long-tail offerings can provide film studios with increased revenue, exposure, data insights, and control, making it a valuable partnership for both parties.
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