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3 years ago

Most contracts are discharged by fulfilling conditions precedent

Business

1 answer:

Kryger [21]3 years ago

3 0

Answer:

False

Explanation:

A condition precedent is something that must occur before something else happens. For example if you want to buy a house, before the selling contract can be performed, an inspector must check the house to see if everything is OK with it.

After the condition precedent occurs, then both parties can perform their respective duties and fulfill the contract.

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During January, 7,000 direct labor hours were worked at a standard cost of $20 per hour. If the direct labor rate variance for J

igor_vitrenko [27]

Answer:

$17.50

Explanation:

Given that,

Direct labor hours = 7,000

Standard cost = $20 per hour

Direct Labor Rate Variance = $17,500 Favorable

(Standard Rate - Actual Rate) × Actual Hours = $17,500 Favorable

(20 - Actual Rate) × 7,000 = $17,500 Favorable

140,000 - 7,000 Actual Rate = $17,500 Favorable

Therefore,

7,000 Actual rate = (140,000 - $17,500)

Actual rate = 122,500 ÷ 7,000

= $17.50

8 0

3 years ago

Santana Rey, owner of Business Solutions, realizes that she needs to begin accounting for bad debts expense. Assume that Busines

Anastasy [175]

Answer:

The Journal entries are as follows:

(a)

Bad Debt Expense A/c Dr. $440

To Allowance for Doubtful Accounts $440

(To record the bad debts)

Workings:

Bad Debt Expense = 1% of Total revenue

= 0.01 × $44,000

= $440

(b)

Bad Debt Expense A/c Dr. $439.34

To Allowance for Doubtful Accounts $439.34

(To record the bad debts)

Workings:

Bad Debt Expense = 2% of accounts receivable

= 0.02 × $21,967

= $439.34

4 0

4 years ago

You are in a line at the bank drive-through and 9 cars are in front of you. You estimate that the clerk is taking about four min

omeli [17]

What i would do is multiply the 9 cars by 4 because I need to take the 4 minutes and apply it to all the cars in front of me. 9 x 4 = 36. I calculate that I would wait 36 mins for it to be my turn.

5 0

3 years ago

A bank has written a call option on one stock and a put option on another stock. For the first option the stock price is 50, the

iris [78.8K]

Answer:

10-Day 99% VaR = 3.61

Explanation:

Data Given:

For First Option:

Stock Price = 50

Strike Price = 51

Volatility = 28% per annum

Time to maturity = 9 months

For Second Option:

Stock Price = 20

Strike Price = 19

Volatility = 25% per annum

Time to maturity = 12 months or 1 year

Risk Free Rate = 6% per annum

Correlation = 0.4

Find 10-day 99% VaR.

Solution:

First of all we need to refer the DerivaGem Model to dig out the change in price equation for both the options.

So, according to DerivaGem Model, We have following data:

For First Option:

Value = -5.413

Delta Value = -0.589

For Second Option:

Value = -1.014

Delta = -0.284

Change in Price = (Delta value of First Option x Stock Price)Y1 + (Delta value of the second option x Stock Price)Y2

Change in Price = (-0.589 x 50)Y1 + (-0.284 x 20)Y2

So, We will get the Change in Price Linear Equation for both the options.

Change in Price = -29.45Y1 -5.68Y2

Now, we have to calculate the Daily Volatility Percentage.

Formula:

Daily Volatility Percentage = Volatility/ Square root of number of days active in annum

Number of Days Active = 252

Volatility for First Option = 28%

Volatility for Second Option = 25%

Daily Volatility Percentage for First Option = 28%/ $\sqrt{252}$

Daily Volatility Percentage for First Option = 0.0176

Similarly,

Daily Volatility Percentage for Second Option = 25%/ $\sqrt{252}$

Daily Volatility Percentage for Second Option = 0.0157

Now, utilizing the above calculated data, we can find the one-day variance of change in price.

1-Day Variance = $(29.45^{2} *0.0176^{2}) + (5.68^{2} * 0.0157^{2}) - (2 * 29.45 * 0.0176 * 5.68 * 0.0157 * 0.4)$

Solving the above equation:

We get:

1-Day Variance = 0.2396

Now, we have to find the standard deviation of 1-Day Variance:

SD of 1-Day Variance = $\sqrt{0.2396}$

SD of 1-Day Variance = 0.4895

So,

Now, in order to find the value of one day 99% VaR from the table, we have all the prerequisites.

So,

Value of One day 99% VaR from table = 2.33

But we need 10-Day 99% VaR.

So, number of days = 10

Hence,

10-Day 99% VaR = $0.4895 * 2.33 * \sqrt{10}$

10-Day 99% VaR = 3.61

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3 years ago

A company is considering producing some new gameboy electronic games. based on past records, management believes that there is a

german

Market research predicted these

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3 years ago