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Step2247 [10]
3 years ago
15

Pronghorn Company purchased equipment for $251,930 on October 1, 2017. It is estimated that the equipment will have a useful lif

e of 8 years and a salvage value of $14,160. Estimated production is 40,300 units and estimated working hours are 20,100. During 2017, Pronghorn uses the equipment for 530 hours and the equipment produces 1,100 units. Compute depreciation expense under each of the following methods. Pronghorn is on a calendar-year basis ending December 31. (Round rate per hour and rate per unit to 2 decimal places, e.g. 5.35 and final answers to 0 decimal places, e.g. 45,892.)
Business
1 answer:
GenaCL600 [577]3 years ago
8 0

Answer:

Pronghorn Company

Depreciation Expense under Production Hours & Production Units:

c) Production Unit:

Depreciation Rate =Depreciable amount/Production hours

= $5.90 per unit

for 1,100 units, Depreciation expense = 1,100 x  $5,90 = $6,490

b) Production hours:

Depreciation Rate = Depreciable amount/Production hours

= $237,770/20,100 = $11.83 per hour

For 530 hours, depreciation expense = 530 x $11.83 = $6,270

Explanation:

1. Data:

Pronghorn Company:

October 1, 2017

Purchase of Equipment for $251,930

Salvage value                            14,160

Depreciable amount           $237,770

2. Depreciation Expenses based on production hours and hours are some of the methods to depreciate an equipment used for production.  Using these methods, the depreciation rate is determined and then multiplied by usage (hours or units) to obtain the depreciation expense for the period.  The methods are simple and logical for depreciating production equipment.

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Investment can be increased both by reducing taxes on private saving and by reducing the government budget deficit.
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Answer:

1. Increasing

2. A. The elasticity of private saving with respect to the after-tax real interest rate

B. The response of private saving to changes in the government budget deficit

C. The elasticity of investment with respect to the interest rate

Explanation:

1. It is difficult to implement both of these policies at the same time because reducing taxes on private spending has the effect of <u><em>Increasing</em></u> the government budget deficit.

A Government budget deficit is acquired when the government spends more than it earns. The Government earns money from taxes and if it spends more than it receives in taxes, that will lead to a deficit. If taxes on Private spending are reduced, this will lead to less tax revenue for the government thereby increasing the Deficit.

2. All of the listed options are useful in determining which policy would be a more effective way to raise investment.

The elasticity of private saving with respect to the after-tax real interest rate refers to how much private saving changes in reaction to a change in the tax rates. This can enable one decide how much investment will be expected if the Government reduces or increases taxes.

The response of private saving to changes in the government budget deficit is also a useful factor to look at because private savings reduce when government deficits reduce.

Also how much does investment change by due to interest rates. This will be important to note in terms of Private Investment to see if it will be beneficial to use it over reducing the government budget deficit given a certain interest rate.

7 0
3 years ago
Using the liquidity-preference model, the Federal Reserve can react to the threat of exceedingly high inflation via monetary pol
stich3 [128]

Answer:

left as well as the contractionary monetary policy, then bring about the

increase of interest rate as well as reducing equilibrium quantity of money.

Explanation:

Liquidity Preference model can be regarded as a model gives suggestions about investor and interest rate, the model entails that high interest rate as well as premium on securities associated with long-term maturities with higher risk should be demanded by investors, reason behind this suggestions is that most investors will always go for cash as well as available highly liquid holdings, all things been equal. It should be noted that Using the liquidity-preference model, the Federal Reserve can react to the threat of exceedingly high inflation via monetary policy by shifting the supply of money to the left as well as the contractionary monetary policy, then bring about the increase of interest rate as well as reducing equilibrium quantity of money.

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3 years ago
Three workers each take home two packs of Post-It notes at a cost of $.67 per pack.
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Answer:

$ 4.02

Explanation:

Take two packs ×3 and it = 6 then take 6 × 67 and you get $4.02

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3 years ago
Boeing has often cut its prices drastically to try to maintain its 60 percent of sales of commercial aircraft as it competes wit
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A market share objective is the reason they encountered losses. Market share often pursues by companies when industry sales are relatively flat or declining. Although increased market share is a primary goal of some firms, others see it as a means to other ends: increasing sales and profits.



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3 years ago
Consider a small landscaping company run by Mr. Viemeister. He is considering increasing his firm’s capacity. If he adds one mor
joja [24]

Answer:

A.$12,000

B.$8000

C.MRPL/PL = 3

MRPK/PK =2

D) Since each of the above calculated ratios are more than one, therefore adding additional worker or tractor will increase the total revenue for each of the dollar spent.

Explanation:

(a) The Marginal Revenue Product of Labor (MRPL) can said to be the additional revenue generated when an additional worker is employed.

$66,000 - $54,000 = $12,000

Thus, MRPL is 12,000

b) Marginal revenue product of capital is

( 62000 - 54000)= $8000

c) MRPL/PL = 12000/ 4000= 3

MRPK/PK = 8000/4000=2

Therefore Since these two ratios are not equal it means the firm is not using the least cost combination of inputs.

d) Since each of the above calculated ratios are more than one, therefore adding additional worker or tractor will increase the total revenue for each of the dollar spent.

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2 years ago
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