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Allushta [10]
3 years ago
7

Adam is a traveling salesperson for Peter Petri Plumbing Supply Corp. Adam has express authority to solicit orders from customer

s and to offer a 5 percent discount if payment is made within thirty days of delivery. Petri has said nothing to Adam about extending credit. Adam calls on a new prospective customer, John's Plumbing Firm. John tells Adam that he will place a large order for Petri products if Adam will give him a 10 percent discount with payment due in equal installments thirty, sixt, and ninety, days from delivery. Adam says he has authority to make such a contract. John calls Petri and asks if Adam is Authorized to make contracts giving a discount. No mention is made of payment terms. Petri replies that Adam has authority to give discounts on purchase orders. On the basis of this information, John orders $10,000 worth of plumbing supplies and fixtures. The goods are delivered and are being sold. One week later, John receives a bill for $9,500 due in thirty days. John insists he owes only $9,000 and can pay it in these equal installments, at thirty, sixty, and ninety days from delivery. Discuss the liability of Petri and John only.
Business
1 answer:
Juliette [100K]3 years ago
6 0

Answer:

Explanation:

Liability of Petri:

On all the purchases, if payment is made within 30days from delivery, Petri gave the authority of a 5% discount to Adam. Upon extension of credit to customers,  no terms were given to Adam.

In the case under consideration, Adam explicitly gave a false representation of his authority to get more sales on his account and thus, Petri is NOT accountable to John on his terms with Adam.

Liability of John:

Being a customer to Petri, John has to discover the detailed terms on discount and other payment terms with Petri when he called Petri. John is also accountable to make clarifications whether Adam has the authority to give a 10% discount and making payment in three installments.

In the case under consideration, John has failed to find the exact details on whether Adam has the authority to give a 10% discount. Thus, he is accountable to make the payment of $9500 in 30days.

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Mariulka [41]

The matter that will considered when calculating a country's balance of payments is the military expenditures.

<h3>What is a balance of payments?</h3>

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These balance of payments helps to measures the inflows and outflows of money from sectors such as tourism, foreign aid, military expenditures and foreign investments as well as flows resulting from exports and imports.

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8 0
1 year ago
cobb co. purchased 10,000 shares (2% ownership) of roe co. on february 12. cobb received a stock dividend of 2,000 shares on mar
stiks02 [169]

cobb must include $18,000 as dividend income in its income statement for the current year.

Given,

10,000 shares were bought.

2 ownership

2,000 shares of stock were received as a dividend.

The market price per share is $40.

$1.50 per share in cash dividends

The formula listed below can be used to determine dividend income:

Number of Shares x Dividend Per Share = Dividend Income

Dividend Income = 12,500 divided by $1.50

$18,000 is the dividend income.

the dividend income is $18,000 as a result.

Amounts delivered to the company's shareholders are referred to as dividend income dividend income. As a result, the company's profits or earnings are used to pay out dividends.

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7 0
1 year ago
Powell Plastics, Inc. (PP) currently has zero debt. Its earnings before interest and taxes (EBIT) are $80,000, and it is a zero
Svet_ta [14]

Answer:

How many shares remain after the repurchase, and what is the stock price per share immediately after the repurchase?

  • 6,500 stocks remaining at $64.33 each stock

Explanation:

EBIT $80,000

zero growth rate

Cost of equity (Re) 10%

tax rate 40%

10,000 common stocks outstanding at $48

they want to change from 100% equity to 35% debt and 65% equity

WACC = 9.4%

new value of operations $510,638

PP's value of operations = {$80,000 x (1 - 40%)} / WACC = $510,638

the new stock price should = $510,638 / 10,000 stocks = $51.06

Stock price will be $51.06

approximately $178,723 / $51.06 = 3,500 stocks should be repurchased

9.4% = ($480,000/$658,723 x 10%) + ($178,723/$658,723 x cost of debt x (1 - 40%)

9.4% = 7.29% + ($178,723/$658,723 x cost of debt x (1 - 40%)

2.11% = 0.2713 x cost of debt x 0.6

2.11% = 0.1628 x cost of debt

cost of debt = 2.11%/0.1628 = 12.96%

new WACC = ($178,710/$357,433 x 10%) + ($178,723/$357,433 x 12.96% x 0.6) = 5% + 6.48% = 11.48%

PP's value of operations = {$80,000 x 0.6} / 11.48% = $418,118

the new stock price should = $418,118 / 6,500 stocks = $64.33

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2 years ago
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d1i1m1o1n [39]

Answer:

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Explanation:

Giving the following information:

The estimated overhead costs for the year are $9,000,000.

The estimated machine hours are 30,000.

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= 9,000,000/30,000= $300 per machine-hour

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