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timurjin [86]
3 years ago
7

Recall Little’s Law that relates the 3 most important process measures (average inventory, average flow rate, and average flow t

ime). The following statement gives two of these three measures and you must find the third. "The flow unit is accounts receivable dollars. A manufacturer bills $300 million worth of cellular equipment per year. The average amount in accounts receivable is $45 million. How much time does the accounts receivable process take, on average, in years? (i.e., the time that elapses on average from the time customer is billed to the time payment is received)?" Enter the number in years, rounded to 2 decimal points. (For example, report 16.347 years as 16.35.)
Business
1 answer:
Anna11 [10]3 years ago
7 0

Answer: 0.15 years

Explanation:

According to Little's Law, it should be noted that:

I = R × T

where,

I = amount of flow units

R = rate of processing flow units

T = time

For this question,

I = $45 million

R = $300 million

Time will be:

T = I/R

T = 45/300

T = 0.15 years

Therefore, the account receivable process will use an average of 0.15 years.

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The concept that people should pay taxes based on the benefits they receive from government services is called?.
Scilla [17]

The Benefits Received Principle is an income tax fairness theory that holds that individuals should pay taxes based on the advantages they receive from the government.

According to the benefits received rule, those who receive the most benefits from the government, either directly or indirectly, should pay the most taxes in order to be fair.

Rather than using such a rule, taxes in the United States are mostly paid using a progressive system of income tax .

The benefits received rule dissuades double-counting charitable donations as a tax regulation.

Learn more on income tax -

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5 0
1 year ago
Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $70,000 or $200,000 with equal p
xenn [34]

Answer:

A) 964,286

B) 14

C) 750,000

Explanation:

The portfolios expected return = (0.5 x $70,000) + (0.5 x $200,000) = $35,000 + $100,000 = $135,000

If the risk free investment yields 6% per year, and you require a risk premium of 8%, then the total interest rate that the portfolio yields must be 6% + 8% = 14%

you will be willing to pay: $135,000 / 14% = $964,286 for the portfolio

if the risk premium increase by 4%, then the price of the portfolio will decrease to: $135,000 / 18% = $750,000

4 0
3 years ago
A physical count of merchandise inventory on November 30 reveals that there are 82 units on hand. Assuming that the specific ide
sattari [20]

After computing the cost of inventory that was sold, The Cost of Goods sold is given as $1,334.30.

<h3 /><h3>The calculations related to the exercise are as follows:</h3>

From the information provided (see full question attached),

Inventory at hand as at November 1:

  • there are 29 Units of Inventory at the cost of $5.90 dollars each.

Purchases:

  • 118 units are purchased at $6.30 dollars each;
  • 59 units are purchased at $6.15 dollars each; and
  • 88 units are bought at $6.50 dollars each.

If at the end of the period there are 25 units each form the purchases above and 7 from the existing inventory as at Nov. 1st, then the cost of goods sold is:


((29-7) X 5.9) +((118-25) x 6.3) + ((59-25) x 6.15) + ((88-25) x 6.5))

= $1,334.30

Learn more about Inventory at:
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5 0
2 years ago
Adrian Corp. sells goods on account for $100,000 on May 1. On May 15, the customer returns $40,000 of the merchandise. The custo
ololo11 [35]

Answer:

C. DEBIT TO SALES RETURNS

D. CREDIT TO ACCOUNTS RECEIVABLE

Explanation:

The journal entry to record the May 15 transaction is shown below:

Sales return and allowance A/c Dr $40,000

                     To Accounts receivable $40,000

(Being sales return is recorded)

For recording the given transaction we debited the sales return and credited the account receivable. Both are recorded for $40,000

5 0
3 years ago
Park Ridge Company is considering the replacement of a machine that is presently used in production. The following data are avai
Ainat [17]

Answer:

The Relevant Cost for Five Years     $52,000.00

Explanation:

‘Relevant costs’ can be defined as any cost relevant to a decision. A matter is relevant if there is a change in cash flow that is caused by the decision.

The Park Ridge Company's Relevant Old Machine Cost for Five Years is

Disposal value now                      $32,000.00  

Annual cash operating costs      $20,000.00

Relevant Cost for Five Years     $52,000.00

Old Machine

Original cost $200,000 is <em>Sunk Cost</em>

Useful life in years 10 5   - <em>Will be used for the calculation of Depreciation, Therefore is an Irrelevant cost</em>

Current age in years 5 0  - <em>irrelevant year</em>

Book value $100,000 -  <em>are not cash flows and so are not relevant. </em>

Disposal value now $32,000 -  

Disposal value in 5 years 0 <em>is without a cost</em>

4 0
3 years ago
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