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WITCHER [35]
3 years ago
6

Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams from the previous problem. The initial margi

n requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $40 to $50, and the stock has paid a dividend of $2 per share. a. What is the remaining margin in the account
Business
1 answer:
GrogVix [38]3 years ago
3 0

Answer:

a.38%

b. No because the margin is above the requirement at 38%

c.-150%

Explanation:

a.

1000 shares*$40 per share = 40000

margin requirement is 50% so equity = 20000

1 year later price increase to 50

$1000 shares*$50 per share = 50000

dividend = $2*1000 = 2000

margin = 20000/52000 = 38%

b.

No because the margin is above the requirement at 38%

c.

Price of 1000 stock year 1 at 50$/share = 50000

40000 – 50000 = -10000

Rate of return = (-10000 -20000)/20000 = -150%

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Dan and Emily have decided to start a new home inspection business. They have both worked in this industry as sole proprietors,
daser333 [38]

Answer: Partnership

   

Explanation: In simple words, partnership refers to an agreement between two or more independent parties to join their forces for achieving a common business goal with the ultimate objective of earning profit.

In the given case,  Dan and Emily were sole proprietors and now they are joining their forces also the case states their new entity will not be a separate entity and both of the owners will be having unlimited debt.

Hence from the above we can conclude that this is a partnership business.

3 0
3 years ago
Which of the following is not an example of a cost and its related cost driver? Cost Cost Driver A. Rent Square feet B. Transpor
valina [46]

Option C

Direct labor hours ; Indirect labor is not an example of a cost and its related cost driver

<u>Explanation:</u>

A cost driver triggers a variation in the price of the activity. The idea is everywhere ordinarily employed to allocate aloft prices to the abundance of built assemblies. It can further be related to activity-based costing inquiry to ascertain the circumstances of expenses, which can be done to depreciate overhead prices.

In unusual accounting systems, cost drivers are practically inapplicable in determining the enrichment, Quantity of set-ups, Amount of machine-hours, Amount of labor hours, Abundance of orders bound and uttered.

7 0
3 years ago
Kubal Inc. applies overhead based on machine hours. Kubal reports the following for the year just ended: Budgeted overhead for t
Dmitry_Shevchenko [17]

Answer:

Under/over applied overhead= $21,000 overapplied

Explanation:

<u>First, we need to calculate the predetermined overhead rate:</u>

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 280,000/2,000

Predetermined manufacturing overhead rate= $140 per machine hour

<u>Now, we can allocate overhead:</u>

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 140*2,400

Allocated MOH= $336,000

<u>Finally, the under/over allocation:</u>

Under/over applied overhead= real overhead - allocated overhead

Under/over applied overhead= 305,000 - 336,000

Under/over applied overhead= $21,000 overapplied

5 0
2 years ago
The receipt of dividends and interest from abroad as a result of ownership of foreign assets by a country's residents is recorde
finlep [7]

Answer:

<em>income-generating assets under the current account of the balance of payment.</em>

Explanation:

Remember, the related term balance of payment refers to the calculation of a country's transactions at the international level for a specific period.

In other to determine the flow of money in and out of a country, the receipts from income-generating assets such as stocks (in the form of dividends) are thus recorded in the current account.

4 0
3 years ago
Unless an organization has contracted for a ____ or equivalent, office equipment such as desktop computers are not provided at b
Andrews [41]
The term that best fits the blank above is HOT SITE. A hot site is very useful once a business experiences disaster in the recovery service. This allows the business to still resume in utilizing computer operations when a disaster happens. Therefore, it would be a great advantage to have a hot site or any equivalent to this.
6 0
3 years ago
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