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3 years ago

An airline has the following data about an airplane:

Business

1 answer:

Drupady [299]3 years ago

6 0

Answer:

Option C). This is a capital lease because it meets at least one of the four capital lease criteria.

Explanation:

In the following situations, the lease transactions are called Finance Lease.

i) The lessee will get the ownership of leased asset at the end of the lease term.

ii) The lessee has an option to buy the leased asset at the end of lease term at price, which is lower than its expected fair value at the date on which option will be excercised.

iii) The lease term covers the major part of the life of asset.

iv) At the beginning of lease term, Present value of minimum lease rental covers substantially the initial fair value of the leased asset.

In the given question, Present value of minimum lease rental amounting to $ 78 million covers substantially 94 % portion of the initial fair value of leased asset. Accordingly, last condition / last situation mentioned above to treat lease as finance lease is satisfied in the given question. In other words, out of four capital lease criteria mentioned above, fourth criteria / fourth condition (At the beginning of lease term, Present value of minimum lease rental covers substantially the initial fair value of the leased asset) is satisfied in this given question.

Present value of minimum lease rental as a percentage of initial fair value of leased asset :-

= (78 Million / 83 Million ) * 100

= 0.94 * 100

= 94 % (approx).

Lease in given question is capital lease because it meets at least one of the four capital lease criteria.

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Andrina always spends 30 % of her income on thingamabobs. Assume that her income increases by some percentage while the price of

Leni [432]

Answer

What is Income Elasticity of Demand?

Income elasticity of demand is the ratio of percentage change in quantity of a product demanded to percentage change in the income level of consumer. It is a measure of responsiveness of quantity demanded to changes in consumers income.

Income elasticity of demand indicates whether a product is a normal good or an inferior good. When the quantity demanded of a product increases with an increase in the level of income and decreases with decrease in level of income, we get a positive value for income elasticity of demand. A positive income elasticity of demand stands for a normal (or superior) good. When the quantity demanded of a product or service decreases in response to an increase and increases in response to decrease in the income level, the income elasticity of demand is negative and the product is an inferior good.

Formula

Income Elasticity of Demand Ei%\ Change in Quantity Demanded%\ Change in Consumers Income

Percentages are calculated using the mid-point formula, i.e. by dividing the change in quantity by average of initial and final quantities, and change in income by the average of initial and final values of income. Therefore:

Income Elasticity of Demand - Ei = Qf - Qi ÷ Qf + Qi ÷ 2 ÷ If - Ii / If + Ii ÷2

Income Elasticity of Demand - Ei = % Change in Quantity Demanded ÷ % change in consumer Income

Where:

Qf - is the final initial quantities demanded of the product,

Qi - is initial quantities demanded of the product,

If - is the final incomes of consumer

Ii - is the initial incomes of consumer.

∴

Question

What is her income elasticity of demand for thingamabobs?

Solution:

From the Problem, it can be deduced that -

Qf - assume it to be 60 since it is not given

Qi - assume it to be 50 thingamabobs?

If - assume it to be 40% since it is not given

Ii - 30%

Assume the % increase in Income to be

∴

Ei = 60 -50/ 60 + 50 ÷ 2 ÷ 40 - 30 / 40 + 30 ÷ 2

Ei = 10/110 /2 ÷ 10/70 ÷ 2

Ei = 10/11 X 70/10 ÷ 2

Ei = 10/55 x 14

Ei = 28/11 = 0.73%

Therefore the Income elasticity of demand for Adrina is 0.73 %

5 0

3 years ago

Coronado Inc. had beginning inventory of $12700 at cost and $20900 at retail. Net purchases were $113930 at cost and $158500 at

aalyn [17]

Answer:

Ending Inventory: 21,267.70

Explanation:

cost retail

beginning 12,700 20,900

purchases 113,930 158,500

markups 9,600

markdowns (7,400)

total 126,630 181,600

inventory to retail ratio: 126,630 / 181,600 = 0.6973

sales revenues 151,100

COGS: 151,100 x 0.6973 = 105,362.30

Ending Inventory: 126,630 - 105,362.30 = 21,267.70

3 0

3 years ago

One reason buy a home instead of rent a home is

xxTIMURxx [149]

By renting a home instead of purchasing one, you are paying someone else's mortgage every month and getting nothing in return. While you are gaining a home to live in for the short term, in the long term you will gain nothing. When you purchase a home you will have a home that you own and that you cannot be evicted from as long as you pay your mortgage.

4 0

3 years ago

What is the intersection of the assessed probability and severity of a hazard called in the RM process?

Alex_Xolod [135]

Answer:

(1) Assessment

Explanation:

The intersection of the assessed probability and severity of a hazard in the risk management process is called 'risk assessment'

Risks are usually assessed in two broad areas namely: Probability of occurrence and Impact.

Probability of occurrence has to do with the degree of likelihood that a risk will materialize while 'impact' tries to access how much damage the risk is likely to cause, in the event that it materializes.

In summary, risk management usually views risk as a function of probability and impact.

3 0

3 years ago

Mentor Corp. has provided the following information for the current year: Units produced 3,500 units Sale price $ 200 per unit D

weqwewe [10]

Answer:

Hence, the unit product cost using absorption costing is $318

Explanation:

For computing the unit product cost, the following things is need to be considered.

1. Direct material = Production units × per unit material price

= 3,500 × $70

=$245,000

2. Direct labor = Production units × per unit labor price

= 3,500 × $55

= $192,500

3. Variable manufacturing overhead = Production units × per unit variable manufacturing price

= 3,500 × 20

= 70,000

4. Fixed manufacturing overhead = $350,000

6. Variable selling and administrative cost = Production units × per unit varaible selling price

= 3,500 × 30

= $105,000

7. Fixed selling and administrative costs = $150,000

Now add these all items and divide by number of units.

So, total cost is equal to

= $245,000 + $192,500 + $70,000 + $350,000 + $105,000 + $150,000

= $1,112,500

And, units produced is = 3,500 units

So, unit product cost = Total cost ÷ units produced

= $1,112,500 ÷ 3,500

= $318

Hence, the unit product cost using absorption costing is $318

7 0

3 years ago

An airline has the following data about an​ airplane:

An airline has the following data about an airplane: