Vendor analysis has the greatest potential for savings for items which have:______

A company will make $74,000 in annual revenue each year for the next seven years from a new investment. The interest rate of 7.2

UkoKoshka [18]

Answer:

The present value is $395,354.84

Explanation:

The computation of the Present value is shown below

= Present value of all yearly cash inflows after applying discount factor

The discount factor should be computed by

= 1 ÷ (1 + rate) ^ years

where,

rate is 7.25%

Year = 0,1,2,3,4 and so on

Discount Factor:

For Year 1 = 1 ÷ 1.0725 ^ 1 = 0.9324

For Year 2 = 1 ÷ 1.0725 ^ 2 = 0.8694

For Year 3 = 1 ÷ 1.0725 ^ 3 = 0.8106

For Year 4 = 1 ÷ 1.0725 ^ 4 = 0.7558

For Year 5 = 1 ÷ 1.0725 ^ 5 = 0.7047

For Year 6 = 1 ÷ 1.0725 ^ 6 = 0.6571

For Year 7 = 1 ÷ 1.0725 ^ 7 = 0.6127

So, the calculation of a Present value of all yearly cash inflows are shown below

= (Year 1 cash inflow × Present Factor of Year 1) + (Year 2 cash inflow × Present Factor of Year 2) + (Year 3 cash inflow × Present Factor of Year 3) + (Year 4 cash inflow × Present Factor of Year 4) + (Year 5 cash inflow × Present Factor of Year 5) + (Year 6 cash inflow × Present Factor of Year 6) + (Year 7 cash inflow × Present Factor of Year 7)

= ($74,000 × 0.9324 ) + ($74,000 × 0.8694 ) + ($74,000 × 0.8106 ) + ($74,000 × 0.7558 ) + ($74,000 × 0.7047 ) + ($74,000 × 0.6571 ) + ($74,000 × 0.6127 )

= $68,997.67 + $64,333.49 + $59,984.61 + $55,929.70 + $52,148.91 + $48,623.69 + $45,336.77

= $395,354.84

We take the first four digits of the discount factor.

4 0

3 years ago

Which of the following is NOT true about licensing? a. The license fee could be based on a percentage of final sales revenue of

nordsb [41]

Answer:

The option that is not true about licencing is E) It involves slightly more risk to the licensee than licensor.

Explanation:

Licensing is a business arrangement in which one company gives another company permission to manufacture its product for a specified payment. Licensing generally involves allowing another company to use patents, trademarks, copyrights, designs, and other intellectual in exchange for a percentage of revenue or a fee.

Usually, It is the licensor that that bears more risk. For instance, unscrupulous licensees have been known to manufacture licensed products and sell them under different brand names in order to tamper with the royalty payable to the licensor.

4 0

3 years ago

At the beginning of the year, Infodeo established its predetermined overhead rate for movies produced during the year by using t

vesna_86 [32]

Answer:

Part a. Determine the predetermined overhead rate for the year 2017.

Predetermined Overhead Rate is 350% of direct labor costs

Part b. Determine whether overhead is overapplied or underapplied during the year.

Amount of Overapplication of Overheads is $10,500

Part c. Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold.

Overhead Account $10,500 (debit)

Cost of Goods Sold $10.500 (credit)

Explanation:

Part a. Determine the predetermined overhead rate for the year 2017.

Predetermined Overhead Rate = Budgeted Total Overheads / Budgeted Activity

= $1,680,000/ $480,000

= 350% of direct labor costs

Part b. Determine whether overhead is overapplied or underapplied during the year.

We do a comparison of Overheads Applied against Actual Overheads

Applied Overheads = Predetermined Overhead Rate × Actual Direct Labor Costs

= 350 % × $ 475,000

= $1,662,500

Actual Overheads = $1,652,000 (given)

Applied Overheads > Actual Overheads, therefore the Overheads are Overapplied

Amount of Overapplication is $1,662,500 - $1,652,000 = $10,500

Part c. Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold.

The Amount of Overapplied overheads reduces the cost of sales as follows;

Overhead Account $10,500 (debit)

Cost of Goods Sold $10.500 (credit)

6 0

3 years ago

Read 2 more answers

Texas Inc. has 8,000 shares of 6%, $125 par value cumulative preferred stock and 83,000 shares of $1 par value common stock outs

vesna_86 [32]

Answer:

the annual dividend on the preferred stock is $60,000

Explanation:

The computation of the annual dividend on the preferred stock is shown below:

= Number of shares × par value per share × dividend percentage

= 8,000 shares × $125 × 6%

= $60,000

Hence, the annual dividend on the preferred stock is $60,000

We simply applied the above formula and the same is relevant

8 0

3 years ago

At the beginning of the twentieth century, for the most part, the only investments available to individual investors were corpor

MrMuchimi

Answer:

A. True

Explanation:

In the starting of the twentieth century, the only stock in which an individual invest is the stocks and the bonds but today there is a lot of different type of investment choices who provides the better return. Accprding to the demand of the investor there are various options available for invest

Hence, the given statement is true

5 0

3 years ago

Vendor analysis has the greatest potential for savings for items which have:_______