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4 years ago

8

Andrew is a financial planner and charges fees of 2% for every investment made. He made investments worth $500,000. What amount

will he receive as compensation? PLEASE ANSWER SOON

1 answer:

eduard4 years ago

7 0

Fees charge = 2%
Investment worth = $500,000
Amount due = 2/100 * 500,000 = 10,000
The amount Andrew will receive as compensation is $10,000.

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Larry Ellison starts a company that manufactures high-end custom leather bags. He hires two employees. Each employee only begins

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Answer:

12.55 days

Explanation:

<em><u>Provided information </u></em>

Number of employees 2

Average production time=1.8 days

Standard deviation=2.7 days

Inter-arrival time= 1 day

Coefficient of variation= 1 day

Standard deviation of inter-arrival time= 1 day

The coefficient of variations

<u>Inter-arrival coefficient of variation </u>

$C_{vi}=\frac {\sigma}{T}$ where $\sigma$ is standard deviation of inter-arrival time, T is inter-arrival time and $C_v$ is coefficient of variation of inter-arrival time

$C_{vi}=\frac {1 day}{1 day}=1$

<u>Production time coefficient of variation </u>

$C_{vp}=\frac {2.7}{1.8}=1.5$

<u><em>Total utilization time </em></u>

$U=\frac {T}{n*T_i}$ where T is the time of production, n is number of employees, U is utilization, $T_i$ is inter-arrival time

$U=\frac {1.8}{2*1}=0.9$

Therefore, utilization time by 2 employees is 0.9

<u>Expected average waiting time </u>

$T_e=(\frac {T}{n*T_i})*0.5(C_{vi}^{2}+C_{vp}^{2})*(\frac{U^{\sqrt{2(n+1)}-1}}{1-U})$

Where $T_e$ is expected average waiting time and the other symbols as already defined

Substituting 1.5 for $C_{vp}$ , 1 for $C_{vi}$ , 0.9 for U, 2 for n, 1 for $T_i$ and 1.8 for T

$T_e=(\frac {1.8}{2*1})*0.5(1^{2}+1.5^{2})*(\frac{0.9^{\sqrt{2(2+1)}-1}}{1-0.9})$

$T_e=0.9*1.625*8.583709=12.55367 days$ and rounding off to 2 decimal places we obtain 12.55 days

Therefore, expected duration between order received and beginning of production is approximately 12.55 days

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3 years ago

Jumbuck Exploration has a current stock price of $2.00 and is expected to sell for $2.10 in one year's time, immediately after i

fiasKO [112]

The equity cost of capital for the Jumbuck Exploration is 22%

Explanation:

Equity cost refers to the return offered to the customers in place of their investment in the organisation stocks. It is calculated by the formula

Rₐ = (D₁/P₀)+g

Where Rₐ= cost of equity

D₁= dividends announced

P₀=share price (current)

g= growth rate

Now given details-

Dividend announced (D₁)- $ 0.26

Current market price (P₀) - $ 2.00

Expected price= $ 2.10

growth rate= expected price- current price

growth rate (g) =$ 0.10

Putting the values to find Rₐ

Rₐ=(0.26/2.00)+0.10

Rₐ=0.23 or 23%

Nearest answer is 22%

Hence the equity cost of the capital is 22%

4 0

4 years ago

Tanek Corp.'s sales slumped badly in 2017. For the first time in its history, it operated at a loss. The company's income statem

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Answer:

(a) Compute the break-even point in dollars for 2017. (Round final answer to 0 decimal places.)

total variable costs per unit = $1,750,000 / 500,000 = $3.50

sales price per unit = $2,500,000 / 500,000 = $5

contribution margin per unit = $5 - $3.50 = $1.50

total fixed costs = $850,000

break even point in units = $850,000 / $1.50 = 566,667 units

break even point in $ = 566,667 units x $5 = $2,833,335

(b) Compute the contribution margin under each of the alternative courses of action.

alternative 1) $6 - $3.50 = $2.50

alternative 2) $5 - $3.75 = $1.25

(c) Compute the break-even point in dollars under each of the alternative courses of action. (Round selling price per unit to 2 decimal places and other calculations to 0 decimal places.)

alternative 1:

break even point in units = $850,000 / $2.50 = 340,000 units

break even point in $ = 340,000 units x $6 = $2,040,000

alternative 2:

break even point in units = $760,000 / $1.25 = 608,000 units

break even point in $ = 608,000 units x $5 = $3,040,000

Which course of action do you recommend?

If I had to choose between alternative 1 or 2, I would choose alternative 1.

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3 years ago

Merrill Corp. has the following information available about a potential capital investment: Initial investment $ 1,700,000 Annua

Jobisdone [24]

Answer:

1./

INITIAL INVESTMENT

= $1600000

ANNUAL NET CASH FLOW

= NET INCOME + DEPERICATION

= $250000 + [($1600000 - $350000) / 8]

= $250000 + $156250

= $406250

SALVAGE VALUE

= $350000

NPV

= -$1600000 + $406250 * PVIFA 10%, 8 PERIODS + $350000 * PVIF 10% *PERIOD

= -$1600000 + $406250 * 5.3349 + $350000 * 0.4665

= -$1600000 + 2167303.13 + $163275

= $730578.13

2./

AS THE NPV IS GREATER THAN 0 OR POSITIVE THE IRR IS GREATER THAN 10%

3./

INITIAL INVESTMENT

= $1600000

ANNUAL NET CASH FLOW

= NET INCOME + DEPERICATION

= $250000 + [($1600000 - $350000) / 8]

= $250000 + $156250

= $406250

SALVAGE VALUE

= $350000

NPV

= -$1600000 + $406250 * PVIFA 20%, 8 PERIODS + $350000 * PVIF 20% *PERIOD

= -$1600000 + $406250 * 3.8372 + $350000 * 0.2326

= -$1600000 + $1558862.5 + $81410

= $40272.5

4./

AS THE NPV IS GREATER THAN 0 OR POSITIVE THE IRR IS GREATER THAN 20%

Explanation:

6 0

3 years ago

Bombs Away Video Games Corporation has forecasted the following monthly sales:

vladimir1956 [14]

Answer:

Bombs Away Video Games Corporation

Production and Inventory Schedule

Sales Units Production units Ending Units

Beginning inventory 38,000

January 22,600 15,200 30,600

February 21,200 15,200 24,600

March 7,600 15,200 1,800

April 7,600 15,200 9,400

May 6,600 15,200 18,000

June 9,600 15,200 23,600

July 11,600 15,200 27,200

August 11,600 15,200 30,800

September 13,600 15,200 32,400

October 19,600 15,200 28,000

November 23,600 15,200 19,600

December 27,200 15,200 7,600

Explanation:

a) data and Calculations:

Sales Budget ($'000) Sales Units Production units Ending Units

Beginning inventory 38,000

January $113,000 22,600 15,200 30,600

February 106,000 21,200 15,200 24,600

March 38,000 7,600 15,200 1,800

April 38,000 7,600 15,200 9,400

May 33,000 6,600 15,200 18,000

June 48,000 9,600 15,200 23,600

July 58,000 11,600 15,200 27,200

August 58,000 11,600 15,200 30,800

September 68,000 13,600 15,200 32,400

October 98,000 19,600 15,200 28,000

November 118,000 23,600 15,200 19,600

December 136,000 27,200 15,200 7,600

Total 182,400 182,400

3 0

3 years ago