Answer: Speculative inventory
Explanation:
Speculative inventory, is also called the anticipatory inventory, and this occurs when an inventory is purchased so that it can be held for future need. Therefore z buying it early then becomes a necessity.
Therefore, the situation whereby a 4-pack Sensodyne Extra Whitening Toothpaste at $29.99, was bought and will last three months for the family to use is referred to as speculative inventory.
Answer:
Allocated MOH= $240
Explanation:
<u>To calculate the predetermined manufacturing overhead rate we need to use the following formula:</u>
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= (3,648,000 + 960,000) / 96,000
Predetermined manufacturing overhead rate= $48 per direct labor hour
<u>Now, we can allocate overhead:</u>
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 48*5
Allocated MOH= $240
<span>Making a credit card minimum payment means you are paying a small portion of your total credit card debt. The minimum payment on your credit card is ordinarily set at the more noteworthy of a rate of your adjust, or a money sum, for example, 3%. Added to this will be any enthusiasm due for the month, any charges caused due to a default in installment, and perhaps some portion of the yearly expense if there is one.</span>
Answer:
Each of the following is a characteristic of a defined benefit retirement plan EXCEPT:
The plan assigns the risk of pre-retirement inflation, investment performance, and adequacy of retirement income to the employee.
Explanation:
No. With a defined benefit retirement plan, the risk of pre-retirement inflation, investment performance, and adequacy of retirement income is never assigned to the employee. Instead, the employer bears this risk. The defined benefit plan always specifies the benefit to which an employee is entitled to at retirement. It also demands that the employee must work for a certain defined period to be entitled to this benefit. By its nature, the defined benefit plan provides a fixed and pre-established benefit for employees. This is why it is preferred by employees.
Answer:
Both A and B are true.
- A. All else held constant, if a company has a beta of 1.2, then the cost of equity for this company will increase if the risk-free rate decreases.
- B. If you assume a company has debt, then an increase in the tax rate will decrease the weighted average cost of capital for the company.
Explanation:
A)
The formula to calculate the cost of equity is:
cost of equity = risk free rate of return + [Beta × (market rate of return – risk free rate of return)]
e.g. market rate 15%, risk free rate 5%:
cost of equity = 5% + [1.2 x (15% - 5%)] = 5% + 12% = 17%
if the risk free rate decreases to 3%:
cost of equity = 3% + [1.2 x (15% - 3%)] = 3% + 14.4% = 17.4%
B)
the WACC formula = (cost of equity x weight of equity) + [cost of debt x weight of debt x (1- tax rate)]
if the tax rate increases, then the WACC will decrease because (1 - tax rate) will be lower.
