Answer:
d. $255,000
Explanation:
Data provided
Net income = $665,000
Capital budget = $1,025,000
Debt = 60%
The calculation of total dividends is shown below:-
Total dividend (using residual dividend approach) = Net income - Equity
= $665,000 - ($1,025,000 × (1 - 0.60))
= $665,000 - ($1,025,000 × 0.40)
= $665,000 - $410,000
= $255,000
Total dividend to be paid by Torrence Inc. = $ 255,000
Answer: See explanation
Explanation:
The correct cost of goods sold for 2021 will be:
= Beginning inventory + Cost of goods bought - Correct ending inventory
= 34500 + 177000 - 32550
= 178950
The correct cost of goods sold for 2022 will be:
= Beginning inventory + Cost of goods bought - Correct ending inventory
= 32550 + 155000 - 40850
= 146700
Note:
Correct ending inventory for 2021 will be: = Ending inventory - Overstated value
= 36000 - 3450
= 32550
Correct ending inventory for 2021 will be: = Ending inventory + Understated value
= 34500 + 6350
= 40850
Answer:
Instructions are listed below.
Explanation:
Giving the following information:
The company expects to sell 520 units in May and 650 units in June. Beginning and ending finished goods for May is expected to be 180 and 145 units, respectively. June’s ending finished goods are expected to be 155 units. Each unit requires 3 wheels at a cost of $22 per wheel. Becker requires 20 percent of next month’s material production needs on hand each month. July’s production units are expected to be 620 units.
May:
Sales= 520*3= 1,560
Ending inventory= 145* 3 + (650*3*0.20)= 825
Beginning inventory= 180*3= (540)
Total= 1,845 wheels
Total cost= 1,845*22= $40,590
June=
Sales= 650*3= 1,950
Ending inventory= (155*3) + (620*3*0.20)= 837
Beginning inventory= (825)
Total= 1,962
Total cost= 1,962*22= $43,164
The 2-year annuity factor can be computed as 1.7355 if the desired rate of return is 10%.
<h3>What is the annuity factor?</h3>
The amount of money that can be taken out of retirement funds ahead of schedule without being penalized can be calculated using the annuity factor approach. For annuities and individual retirement funds, the computation mostly uses life expectancy statistics (IRAs).
The formula for calculating an annuity's present value can be used to calculate the 2-year annuity factor.
Such are:
= Amount x (number of periods - (1 + rate)) x rate
When figuring out the amount for the factor:
equals 1 x (1 - (1 + 10%)2) / 10%
= 1 time 0.173553719% of the total
= 1.7355
Thus, the annuity factor of 2 years is 1.7355.
Learn more about annuity factors:
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Answer:
The correct answer is FALSE.
- First it's not sound investment advice to put all his savings into an investment because as the narrative rightly points out, he may have other needs.
- Second, high growth stock are also
- high risk
- they only pay in the long term only if the company is successful because dividends are re-invested which is one of the reasons the companies grow quickly.
Although they are high risk, they also have great advantages such as:
- High growth rate: this means if all goes well David will enjoy a good return on his investment;
- It's also a way to protect his money from erosion by inflation
What can David do?
Subject to the advise of a professional investment professional
- David needs to take into consideration his immediate needs, set aside some funds to take care of that.
- Invest the balance into a mix of high growth rate stock which are high yielding but risky and low growth rate but secure investment like government bonds.
- Start a small business by the side or get a job in the interim as he continues with his new life.
Cheers!