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sergey [27]
2 years ago
6

The Woods Co. and the Speith Co. have both announced IPOs at $63 per share. One of these is undervalued by $11, and the other is

overvalued by $4, but you have no way of knowing which is which. You plan to buy 1,000 shares of each issue. If an issue is underpriced, it will be rationed, and only half your order will be filled. a. If you could get 1,000 shares in Woods and 1,000 shares in Speith, what would your profit be? (Do not round intermediate calculations.) b. What profit do you actually expect? (Do not round intermediate calculations.)
Business
1 answer:
dimaraw [331]2 years ago
8 0

Answer:

Profit is equal to $7000

Expected profit is equal to $1500

Explanation:

Number of shares = 1000

Undervalued amount = $11

Overvalued amount = $4

Profit received by both the stocks is equal to

Profit = shares ×undervalued amount - shares × overvalued amount

=1000\times 11-1000\times 4

=$7000

Expected profit is equal to

=\frac{1000}{2}\times 11-1000\times 4

= $1500

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Early in 2017, Sheryl Crow Equipment Company sold 500 Rollomatics during 2017 at $6,000 each. During 2017, Crow spent $20,000 se
sertanlavr [38]

Answer:

Explanation:

                                         Debit $                                   Credit$

a. Cash                3000000  

    Sales revennue (500*6000)                                 3000000

Warranty expenses   55000  

   Estimated warranty liability                                    55000

Estimated warranty liability  20000  

     Cash account                                                    20000

b. Cash account   3000000  

   Sales revenue (500*6000- 56000)                                2944000

   Unearned warranty revenue                                  56000

Warranty expenses   20000  

      Cash account                                                 20000

Unearned warranty revenue  20364  

    Warranty revenue (56000*20000/55000)                      20364

3 0
3 years ago
Pacific Company sells only one product for $ 12 per​ unit, variable production costs are $ 3 per​ unit, and selling and administ
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Answer: The operating income is​ $<u>76 comma 500</u> when 11 comma 000 units are sold.

Explanation:

Selling price = $12 / unit

Variable cost of production = $3 / unit

Selling and Admin cost = $1.5 / unit

Fixed cost for 11 comma 000 units are $ 6 comma 000.

For 11 comma 000 units,

Sales  = 12 x 11000 = $132000

cost of production = 3 x 11000 = $33000

Selling and Admin cost = 1.5 x 11000 =$16500

Fixed cost = $6000

Operating Income = Sales - Cost of Production - Selling and Admin cost - Fixed cost

Operating income = 132000 - 33000 - 16500 - 6000 = $76,500

The operating income is​ $<u>76 comma 500</u> when 11 comma 000 units are sold.

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3 years ago
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Answer:

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4. What are the main political and economic risks that ABB must deal with given that it has a strong focus on entering emerging
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The main political and economic risks which ABB <em>must deal with</em> given that it has a strong focus on <em>entering emerging economies </em>is:

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According to the given question, we are asked to state the  main political and economic risks which ABB <em>must deal with</em> given that it has a strong focus on <em>entering emerging economies.</em>

As a result of this, we can see that when a company or an organisation wants to do business in a new and emerging economy in a county, the major political and economic risks which they have to consider is the stability of the national government so that their business would not be suddenly affected by government policies or wars.

Read more about national government here:

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