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puteri [66]
3 years ago
7

TeleGlobal is an American firm producing TV sets. TeleGlobal imports TV set components from Taiwan and assemb them domestically.

Suppose that in the United States, a TV set sells for $500 and that 80% of the TV set's value comes from the value of the imported components. The United States imposes a 30% tariff on TV sets and a 10% tariff on the TV set's components. Assume that costs of producing components are the same in the United States a Taiwan. Based on the information provided, the effective rate of protection that TeleGlobal receives from the tariff is:__________.
a. -17.5%
b. 70.0%
c. 110.0%
d. 24.4%
e. 47.5%
Business
1 answer:
vichka [17]3 years ago
3 0

Answer:

The right choice is Option c (110.0%).

Explanation:

⇒ Effective \ rate \ of \ protection = tariff \ rate \ on \ imported \ finished \ good + price \ of \ Component\times  \frac{(tariff \ on \ imported \ good- tariff \ on \ imported \ component)}{(Price \ of \ finished \ good - Price \ of \ components)}

On estimating the values, we get

⇒                                   = 30 \ percent + (80 \ percent\times 500)\times \frac{(30 \ percent - 10 \ percent)}{500-80 \ percent\times 500}

⇒                                   = 110 \ percent

Note: percent = %

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Ace Company purchased a machine valued at $328,000 on August 1. The equipment has an estimated useful life of six years or 2.5 m
nlexa [21]

Answer:

A. $53,167

Explanation:

The computation of the depreciation expense under the straight-line method is shown below:

= (Original cost - residual value) ÷ (useful life)

= ($328,000 - $9,000) ÷ (6 years)

= ($319,000) ÷ (6 years)  

= $53,167

In this method, the depreciation is same for all the remaining useful life.

The estimated useful life in units is used in units of production method. Hence, it is ignored here.

6 0
3 years ago
Lupo Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The
earnstyle [38]

Answer:

Total cost= $2,040

Explanation:

Giving the following information:

Total machine-hours 30,000

Total fixed manufacturing overhead cost $ 252,000

Variable manufacturing overhead per machine-hour $ 2.10

Job T687:

Total machine-hours 30

Direct materials $675

Direct labor cost $1,050

First, we need to calculate the estimated overhead rate:

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

Estimated manufacturing overhead rate= (252,000/30,000) +2.1= $10.5 per machine-hour

Now, we can calculate the total cost of Job T687:

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3 0
3 years ago
Respond to the following comments:
MakcuM [25]

Answer:

Comment for statement A -  The firm must still compare the IRR with the opportunity cost of capital when using the IRR rule. Therefore, even with the IRR method, the   appropriate discount rate must still be specified.

Comment for statement B - There should be a higher discount rate on risky cash flows than the rate used to discount less risky cash flows.

Making use of the payback rule is equivalent to using the NPV rule with a zero discount rate for cash flows before the payback period and an infinite discount rate for cash flows thereafter.

Explanation:

a)

“I like the IRR rule. I can use it to rank projects without having to specify a discount rate”

The firm must still compare the IRR with the opportunity cost of capital when using the IRR rule. Therefore, even with the IRR method, the   appropriate discount rate must still be specified.

b.

“I like the payback rule. As long as the minimum payback period is short, the rule makes sure that the company takes no borderline projects. That reduces risk”

There should be a higher discount rate on risky cash flows than the rate used to discount less risky cash flows.

Making use of the payback rule is equivalent to using the NPV rule with a zero discount rate for cash flows before the payback period and an infinite discount rate for cash flows thereafter.

5 0
3 years ago
In a Chapter 11 bankruptcy, a class of creditors is considered to have accepted the bankruptcy plan when: Group of answer choice
anygoal [31]

Answer:

In a Chapter 11 bankruptcy, a class of creditors is considered to have accepted the bankruptcy plan when:

one-half of the class in number and two-thirds of the class in dollar amount agree.

Explanation:

In a Chapter 7 bankruptcy, the business assets are liquidated to pay the creditors.  In a Chapter 11 bankruptcy, the business assets are not liquidated.  Instead, the business is refinanced as the assets and debts are reorganized, making it possible for the continued existence of the business.  This is the reason the agreement of the creditors are usually paramount in the decision to undergo a Chapter 11 bankruptcy, unlike a Chapter 7 bankruptcy.

7 0
2 years ago
Assume that Jing Company earned $29,400 cash revenue and incurred $18,500 in cash expenses in Year 3. The company uses the strai
ElenaW [278]

Answer:

Explanation:

In every single company, the main aim of installing an office equipment is to make profit. After the office equipment made a revenue of $29400, Jing Company incurred expenses of $18500. The value of the equipment was $29400- $18500= $10900. It was sold for $10400 meaning that the net income of the equipment was $10400-$10900= -$500. Therefore, it will incur a net loss of $500.

8 0
3 years ago
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