Question 25(Multiple Choice Worth 4 points)

ivann1987 [24]

Answer:

i want to see the answer to this question

3 0

3 years ago

After a major earthquake, the San Francisco Opera Company is offering zero coupon bonds to fund the needed structural repairs to

tekilochka [14]

Answer:

Buster Norton and the Bonds of San Francisco Opera Company

If Mr. Norton purchases three of these bonds today, in 10 years from today at maturity, he will receive:

= $6,000.

Explanation:

a) Data and Calculations:

Face value of each zero coupon bond purchased = $2,000

Number of bonds purchased by Norton = 3

Value of bond investments at maturity = $6,000 ($2,000 * 3)

Maturity period of the San Francisco Opera Company bonds = 10 years

Annual Yield to Maturity of similar bonds in the market = 12%

From an online financial calculator:

Present value of bonds = $1,932 (with each as $644 ($1,932/3))

N (# of periods) 10

I/Y (Interest per year) 12

PMT (Periodic Payment) 0

FV (Future Value) -6000

Results

PV = $1,931.84

Total Interest $4,068.16

3 0

3 years ago

After making a sale, a seller may have customers that return goods. The seller uses the perpetual inventory system. This require

anyanavicka [17]

Answer:

D. All of the statements are correct.

Explanation:

The Seller requires to

Reduce its sales by the estimated return value and cost of goods sold by the estimated cost value of the units expected to return in the future.

Use historical data of sales and returns and calculate the value of expected return items.

After the estimation of values record the adjusting transaction for the estimated return liability and the inventory to be returna as well.

7 0

3 years ago

State Road Fabricators Inc. is considering eliminating Model A02777 because of losses over the past quarter. The past three mont

ICE Princess25 [194]

Answer:

Option (C) is correct.

Explanation:

Manufacturing costs:

= Direct Materials + Direct Labor + Variable overhead

= $160,000 + $80,000 + (150,000 × 75%)

= $160,000 + $80,000 + $112,500

= $352,500

Operating income:

= Sales (1,100 units) - Manufacturing costs

= $370,000 - $352,500

= $17,500

Therefore, if Model A02777 is dropped from the product line, operating income will decrease by $17,500.

6 0

3 years ago

G dixon company produced 6,000 units of product that required 1.5 standard hours per unit. the standard fixed overhead cost per

sweet [91]

Given:
Actual Production 6,000 units @ 1.5 standard hours per unit.
Budgeted hours: 10,000
Fixed overhead cost per unit is $0.50 per hour.

6000 units * 1.5 std. hrs/unit = 9,000 hours

Actual hours: 9,000 hours * $0.50 per hour = $4,500
Budgeted hours: 10,000 hours * $0.50 per hour = $5,000

Fixed Factory Overhead Volume Variance = $5,000 - $4,500 = $500 UNFAVORABLE.

It is unfavorable because the production is inefficient. It is more favorable if the produced units are higher than 6,000 units and the actual hours of production are more than the budgeted hours of production.

3 0

3 years ago