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2 years ago

An agent who arranges a transaction between a buyer and a seller of equity securities is called a:_____.

Business

1 answer:

Gre4nikov [31]2 years ago

5 0

An agent who arranges a transaction between a buyer and a seller of equity securities is called a broker.

A broker is a person or business that stands between a potential investor and a securities exchange. Individual traders and investors require the services of exchange members since securities exchanges only accept orders from people or companies who are members of that exchange.

Brokers offer that service and are paid in a variety of methods, including commissions, fees, or payments from the exchange itself. Investment advisers register with the SEC as registered investment advisors, while brokers register with the Financial Industry Regulatory Authority (FINRA) (RIAs).

Learn more about brokers here:

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Assume the following for a piece of equipment assuming straight-line depreciation: Purchase price $20,000; installation costs

Grace [21]

Answer:

a. $14,700

b. $9,600

Explanation:

Total cost of the equipment = Purchase price + installation costs = $20,000 + $2,500 = $22,500

Salvage value = $4,500

Amount to be depreciated = $22,500 - $4,500 = $18,000

Depreciation rate = 1 ÷ 4 = 0.25, or 25%

Annual depreciation = $18,000 × 25% = $4,500

Equipment book value after 2 years = $22,500 - ($4,500 × 2) = $13,500

(a) What would be the cash flow from salvage if the asset sold after 2 years for $15,500

Gross profit on equipment disposal = Sales amount - Equipment book value = $15,500 - $13,500 = $2,000

Tax = $2,000 × 40% = $800

Net profit on equipment disposal = $2,000 - $800 = $1,200

Cash flow = Equipment book value + Net profit on equipment disposal = $13,500 + $1,200 = $14,700

(b) What would be the cash flow from salvage if the asset sold after 2 years for $7,000

Loss on equipment disposal = Sales amount - Equipment book value = $7,000 - $13,500 = $6,500

Tax shield difference = $6,500 × 40% = $2,600

Cash flow = $7,000 + $2,600 = $9,600

8 0

3 years ago

Ahngram Corp. has 1,000 defective units of a product that cost $3.30 per unit in direct costs and $6.80 per unit in indirect cos

OLga [1]

Answer:

If the units are reworked, income will increase by $5,800.

Explanation:

Giving the following information:

Number of units= 1,000

Sell as-is= $4.3

Rework cost= $2.8

Selling price= $12.9

<u>Because the original cost will remain constant in both options, we will not take them into account.</u>

Sell as-is:

Effect on income= 1,000*4.3= $4,300

Rework:

Effect on income= 1,000*(12.9 - 2.8)

Effect on income= $10,100

If the units are reworked, income will increase by $5,800.

4 0

3 years ago

(Land’s End) Geoff Gullo owns a small firm that manufactures "Gullo Sunglasses." He has the opportunity to sell a particular sea

Law Incorporation [45]

Answer:

Answer is explained in the explanation section below.

Explanation:

Answer-a with option-1

the land end sale price is $100, purchase cost is $65 and salvege valu is $53

So the underage cost = Cu = 100-65 = 35 and overage cost = Co = 65-53 = 12

the critical ratio = Cu/(Cu+Co) = 35/47 = 0.7422

From the standard normal distribution function The Z value at 0.7422 = 0.66

The optimal order quantity = 200 + 0.66 x 125 = 282.5

The optimal order quantity = 282.5

Answer-b with option-1

the land end sale price is $100, purchase cost is $55 and salvage value is $0

So the underage cost = Cu = 100-55 = 45 and overage cost = Co = 55-0 = 55

the critical ratio = Cu/(Cu+Co) = 45/100 = 0.45

From the standard normal distribution function The Z value at 0.45 = -0.12

the optimal order quantity = 200 - 0.12 x 125

The optimal order quantity = 185

We have to calculate the expected profit in each case to determine which option Lands Ends should choose.

With option-1 Geoff's sells 282.5 units at $65 for total revenue of 18363 and production cost of 282.5 = 7063

Geoff credits Lands ends for each returned sunglass so we need to evaluate how many sunglasses Land Ends return.

Expected lost sales = 125 x 0.1528 = 19.1

Expected sales = 200 - 19.1 = 180.9

expected left over inventory = 282.5 - 180.9 = 101.6

Expected profit = (100-65) x 180.9 - (65-53)x 101.6 = 5112

Expected profit = 5112

Similarly with option 2 the Expected profit = 4053

So option-1 is preferred.

If the Land chooses option-1 and orders 275 units Then Geoff earn = 275 x $65 = $17875

and production cost = $25 x 275 = $6875

With order quantity 275 the z statistics = 0.6

and expected lost sales = 125 x 0.6 = 21.09

Expected left over inventory = 275-200+21.09 = 96.09

So the Geoff's buy back cost = 96.09 x 53 = $5093

and expected profit = $17875 - $5093 = $5907

expected profit = $5907

7 0

3 years ago

An investor purchases an original issue discount general obligation municipal bond (OID) on the offering and holds it to maturit

qaws [65]

Answer:

not taxed

Explanation:

original issue discount which are new issue municipal bonds do not have their interest income taxed at the federal level by the IRS. An investor that purchases the municipal bond from the secondary market however would be accreted and have his income from the bond treated as ordinary income and would be taxed. But interest from original issue discount bonds are not taxed and are also not taxed when held to maturity

3 0

3 years ago

Inventory at the end of the year is overstated. Which of the following statements correctly states the effect of the error? a. n

vlabodo [156]

Answer:

The answer is stockholders' equity is overstated

Explanation:

When inventories are overstated it reduces the cost of sales because the excess inventory in accounting records means the ending inventory will be higher and cost of sales will be lower.

When ending inventory is overstated, total assets and retained earnings will be overstated. And when retained earnings is overstated, stockholders' equity is also overstated because retained earnings is a line item under stockholders' equity.

7 0

3 years ago