Answer = The producer price index
Answer: a. The common-size balance sheet allow for comparison of firms with different levels of total assets by introducing a common denominator.
Explanation: The common-size balance sheets are those balance sheets in which the structure of each part of the assets, liabilities and equity major categories are detailed, each one with their absolute value (the amount) and their relative value (percentage of the total).
For example, assets are 5 million dollars, capital 3 million and liabilities 2 million. Cash is 1 million. So in the common-size balance sheet you will see Cash (or liquidity) for 1 million dollars and 20%.
This way you can compare two or more firms with different ammount of assets (one with 8 million with one of just 1 million, for example) as indicating which is the percentage of liquidity for each one, or their percetage of liabilities, etc. The relative value, which is made in the common-size balance sheets makes this comparisson possible.
Answer: See explanation
Explanation:
The journal entry to record the purchase of raw materials is analysed below:
November:
Dr Raw materials $86000
Cr Cash or account payable $86000
It should be noted that as the raw material is increasing, the raw material account will be debited while as the cash or account payable I decreasing, it is credited.
Answer:
annual demand = 380 * 12 = 4,560
order cost = $8.50
annual holding cost = $0.45 * 25% = $0.1125
EOQ = √[(2 * 4,560 * $8.50) / $0.1125] = 830.10 ≈ 830 units
time between placement of orders = 830 units / 4,560 units = 0.182 years = 2.18 months
reorder point = 4,560 units * 2/12 (lead time) = 760 units
A new order should be placed when the inventory level is 760 units
Answer:
6.12%
Explanation:
the market value of the bond when you purchased it was:
PV of face value = $1,000 / 1.04⁵ = $821.93
PV of coupon payments = $60 x 4.4518 (PV annuity factor, 4%, 5 periods) = $267.11
initial investment = $1,089.04
after 1 year, you receive $60 +
PV of face value = $1,000 / 1.034⁴ = $874.82
PV of coupon payments = $60 x 3.6818 (PV annuity factor, 3.4%, 4 periods) = $220.91
market price = $1,095.73
total holding return = ($1,095.73 + $60 - $1,089.04) / $1,089.04 = 6.12%