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koban [17]
3 years ago
13

Tom and Mark tell Susan that they are considering expanding store hours and advertising. They wish to concentrate their efforts

on management and growth. They wish to hire several workers, but they are uncertain whether or not these workers would be designated as employees or independent contractors. Susan asks Tom and Mark to describe the nature of each position, the hours worked, and the control they exercise over each worker. Jack Walker, Grant Worthington, and Phil Costello are first-rate salespeople who have extensive experience in selling men's clothing. They would each work 40 hours per week and be paid a base salary plus commission. The salesmen would be prohibited from working elsewhere. They would be required to wear suits, and their work schedules would be set by L&S. Paid vacation and sick leave would be given as well. Jack, Grant, and Phil would have no discretion in deciding whether to attend to a customer's needs, and they would have no authority to hire assistants. Nancy Cooke is being employed as an administrative assistant. Her duties will include bookkeeping, ordering, and typing, as well as telephone reception. She will work from 10:00 a.m. to 6:00 p.m., Monday through Friday. Martha Winslow, a seamstress by trade, is being hired to perform the necessary alterations on the clothing. She would be available for appointments on Tuesdays and Thursdays from 6:00 p.m. to 8:00 p.m. and on Saturday afternoons from 2:00 p.m. to 4:00 p.m. Martha would set her own hours in addition to these, depending on the workload. Martha has set a fee schedule covering the various types of alterations performed on a per item basis. Stephanie Russo is a Web page design specialist with a degree in graphic arts. She is being trained to create a Web page for L&S. After that, she will act as a consultant for purposes of Web advertising. Lucy Johnson is being hired to clean the store after hours. She will set her own schedule, and she estimates working 1 to 2 hours per night. Stephanie is being paid on a one-time fee basis for the Web design work and then will be retained on an hourly basis as a consultant. Lucy is being paid a flat fee per night, regardless of the length of time it takes for her to clean the store. Which of these people are employees, and which are independent contractors?
Business
1 answer:
emmainna [20.7K]3 years ago
7 0

Answer:

Employees and Independent Contractors

a) The Differences are:

1. Nature of each position:  The employee is a worker who is engaged in a contract of service with an employer.  She earns a periodic salary based on a fixed time per week, e.g. 40 hours per week, Monday to Friday.  On the other hand, a contractor engages in a contract for service.  She is engaged for a fee to carry out a specified assignment or project.  The independent contractor is self-employed.  She can work for many other organizations and for any number of hours.

Hours worked:  The employee works some fixed hours per day and per week.  An independent contractor does not have any fixed hours of work.  She can choose to work more than 40 hours per week.

Control by Employer:  For the employee, the employer dictates most of the details about the work.  She can be given any work by the employer.  She enjoys sick leave and other emoluments.  She lacks discretion on which tasks to work on.  She does not have "authority to hire assistants."  The independent contractor does her work to suit her convenience, but ensures that the customer is satisfied with her work to enable contract renewal.

b) Examples of Employees and Independent Contractors from the case study:

i) Employees:

1. Jack Walker, Grant Worthington, and Phil Costello, salespeople

2. Cooke, an administrative assistant

ii) Independent Contractors:

1. Martha Winslow, a seamstress by trade

2. Stephanie Russo, Web Advertising Consultant

3. Luck Johnson, Cleaner

Explanation:

The general rule for differentiating the two types of workers is that an independent contractor directs the result of the work and not what will be done and how it will be done.  Her earnings (fees) are subject to Self-Employment Tax.  The employee does not control the result of her work and the tasks, but can control how it will be done.  Her earnings are subject to Paye Tax.

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A machine would cost $100,000, and would generate revenues of $21,000 per year. However, O&M costs would be $7,000 per year.
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Answer:

(a) What is the net present value of this potential investment?

Net present value of Investment is $(3,903)

(b) Should you invest in this machine?

We should not invest in this investment because Net present value of this investment is negative by discounting Minimum acceptable rate of return.

Explanation:

Present Values:

Revenue                    $144,146

O&M Cost                  ($48,049)

Initial Investment      <u>$(100,000)</u>

Net Present value     $(3,903)

Working :

Present Value Calculation = P x ( (1- ( 1 + r )^-10) / r

Revenue = $21,000 x ( (1- ( 1 + 0.075 )^-10) / 0.075 = 144,146

O&M Costs = $7,000 x ( (1- ( 1 + 0.075 )^-10) / 0.075 = 48,049

8 0
3 years ago
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storchak [24]

Answer:

Direct Material Equivalent Unit Weighted Average Cost Method= 240+ 400- 400= 240

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Explanation:

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                              Units ​                    Transferred- in Costs

                                            Direct Mat       Conversion Costs      WIP ​inventory

March 1                  240 ​         $33,600           0 ​                            $18,000 ​

<u>Percent complete                    ​100% ​              0% ​                         62.5%</u>

Equivalent Units                     240                     -                          150                                            

Transferred in

<u> March                 400                                                                                    </u>

Equivalent Units                          400                    400                   400

Mar 31  WIP ​inventory,  200

<u>​*Percent complete                       ​100%           ​0% ​                         80%       </u>

Equivalent Units                         400                    -                        320

Weighted Average Cost Method = Beg. Inv Equiv. Units + Units Transferred in Less Ending Inventory Equivalent Units

Direct Material Equivalent Unit Weighted Average Cost Method= 240+ 400- 400= 240

Conversion Costs Equivalent Unit Weighted Average Cost Method=

0+ 400-0= 400

Work In Process Equivalent Unit Weighted Average Cost Method=

150+ 400-320= 230

Costs added in March ​              $52,000            ​$13,200 ​        $48,600

Units Cost for Direct Materials=  $52,000 /230= $ 226.086

4 0
3 years ago
Assume that the Texas legislature is not in session and the economy has gone into recession. What must occur before legislators
Vadim26 [7]

Complete question:

Assume that the Texas legislature is not in session and the economy has gone into recession. What must occur before legislators can act to reformulate policy

A. The legislature as a body must wait for the comptroller to decertify the budget.

B. The legislature must wait for a special session to be called.

C. The legislature must wait for economic conditions to deteriorate to a point where a constitutional provision allowing deficit spending kicks in.

D. The legislature must wait until the federal government increases monies for state governments.

Answer:

The legislature must wait for a special session to be called.

Explanation:

Once the Texas legislature passes a budget and the governor has acted, after 6 months does the budget go into effect.

The Texas legislature passed a law that requires that an agency take a specific action in order to solve a problem. At formulation stage of the policy making process did the passage of this law occur

A special session (also a exceptional session) in a parliamentary term is a time when the assembly meets outside the usual legislative session. Anyone holding a special meeting would be subject to different requirements, such as by a legislative vote in a normal session, the president, or the presiding officer of the legislature.

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3 years ago
What does O + A + C = K stand for and mean in the legal "Formula" for contracts?<br> please helpppp
Drupady [299]

Answer:

O Stands for offer , A stands for acceptance , C stands for consideration , K stands for contract . An offer requirement, a contract and acceptance have it’s own thing.

Explanation:

7 0
2 years ago
Russell Preston delivers parts for several local auto parts stores. He charges clients $1.30 per mile driven. Russell has determ
Lapatulllka [165]

Answer:

A. Determine how many miles Russell needs to drive to break even?

break even formula = total fixed costs / contribution margin

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break even formula = $1,220 / $1.01 = 1,207.9 ≈ 1,208 miles

B. Assume Russell drove 2,500 miles last month. Without making any additional calculations, determine whether he earned a profit or a loss last month.

if he drove 2,500 he made a profit because it is more than the break even point.

C. Determine how many miles Russell must drive to earn $2,135.00 in profit.

($1,220 + $2,135) / $1.01 = 3,321.7 ≈ 3,322 miles

D. Prepare a contribution margin income statement assuming Russell drove 2,500 miles last month.

total revenue                         $3,250

<u>- variable costs                       ($725)</u>

contribution margin              $2,525

<u>- fixed costs                         ($1,220)</u>

net income                            $1,305

E. Use the above information to calculate Russell’s degree of operating leverage.

Degree of operating leverage = contribution margin / operating income = $2,525 / $3,250 = 0.7769 or 77.69%

8 0
3 years ago
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