Answer:
Assuming that the elimination of frequent-flyer programs would have enabled the airlines to earn higher profits and remain in business, then it would be a purely good idea for the airlines to eliminate their frequent-flyer programs.
The big question is, how much did the frequent-flyer programs cost the airlines? Would the cost-savings be sufficient to eliminate their bankruptcies? It is a known-fact that the airlines that create such programs always recover the program costs by charging higher fares.
Explanation:
The issue of airlines going bankruptcy does not seem to stem from customer-loyalty programs like the frequent-flyer programs. The root cause lies in operational and other costs that airline managements have not been able to control.
Answer:
a) 3 years
b) 5 years
Explanation:
The new system requires an investment of $1,200,000
The payback period is the number of year whereas the cash inflow is equal to the total investment regardless the present value of cash inflow. It means we don't apply any rate in the calculation/
a) if the even cash flows of $400,000 per year, then the payback period is 3 years ($1,200,000 = $400,000 * 3)
b) The following expected annual cash flows: $150,000, $150,000, $400,000, $400,000, and $100,000. And total cash flows in 5 years is $1,200,000 = total investment $1,200,000
The payback period in this case is 5 years.
Answer:
$2,150
Explanation:
Annual cumulative preferred stock dividend = 2,300 × $100 × 6.5% = $14,950
Cumulative preferred stock dividend carried forward to year 2 = $14,950 - $12,000 = $2,950
Cumulative preferred stock dividend payable in year 2 = $14,950 + $2,950 = $17,900
Cumulative preferred stock dividend carried forward to year 3 = $17,900 - $17,000 = $900
Cumulative preferred stock dividend payable in year 3 = $14,950 + $900 = $15,850
Dividend received by common shareholders during Year 3 = $18,000 - $15,850 = $2,150
Answer:
a. Received investment of cash by organizers and distributed to them 1,180 shares of $1 par value common stock with a market price of $15 per share.
Account Debit Credit
Cash $17,700
Common Stock $1,180
Additional Paid-In Capital $16,520
Assets increase, and stockholder's equity increase by the same amount: $17,700.
b. Purchased $8,200 of equipment, paying $1,500 in cash and owing the rest on accounts payable to the manufacturer.
Account Debit Credit
Equipment $8,200
Cash $1,500
Accounts Payable $6,700
Assets increase by a net $6,700 (Equipment - Cash), and Accounts Payable by $6,700 as well.
c. Borrowed $14,000 cash from a bank. Loaned $800 to an employee who signed a note.
Account Debit Credit
Cash $14,000
Notes Payable $14,000
Notes Receivable $800
Cash $800
Assets increase by a net $14,000 (Cash + Notes Receivable - Cash), and liabilities increase by $14,000
d. Purchased $20,343 of land; paid $9,000 in cash and signed a note for the balance.
Account Debit Credit
Land $20,343
Cash $9,000
Notes Payable $11,343
Assets increase by a net $11,343 (Land - Cash), and liabilities increase by the same amount.
