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Bas_tet [7]
3 years ago
5

If the reserve requirement is 20 percent, then excess reserves of $800 can increase M1 money supply by ___. g

Business
1 answer:
Llana [10]3 years ago
3 0

Answer:

If the reserve requirement is 20 percent, then excess reserves of $800 can increase M1 money supply by ___.

$3,200.

Explanation:

a) Data and Calculations:

Excess reserves = $800

Reserve requirement = 20%

Therefore, M1 money supply = $800/20% = $4,000

The increase in the M1 money supply will be $3,200 ($4,000 - $800)

b) The amount of funds that a bank is required by the central bank to hold in reserve to meet liabilities in case of sudden withdrawals by depositors is called the reserve requirement. It is usually stated as a percentage by the Fed Reserve.  The Fed uses reserve requirement as a tool to increase or decrease money supply in the economy and influence interest rates.  What the Fed does with the reserve requirement, therefore, depends on the monetary policy that it chooses to respond to the money market.

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Assume that Crane Company uses a periodic inventory system and has these account balances: Purchases $630,000; Purchase Returns
Veseljchak [2.6K]

Answer:

Cost of goods sold =$61,5300

Gross Profit = $144,700

Explanation:

Given the information:

  • Purchase : $630,000
  • Purchase Returns and Allowances $25,700
  • Prchases Discounts $10,900
  • Freight-In $18,300
  • beginning inventory of $45,000
  • ending inventory of $64,600
  • net sales of $760,000

As we the, the fomular for total Goods Available for Sale

=   Beginning Inventory + Purchases + Freight-In - Purchase Returns and Allowances - Purchases Discounts

= $45,000 +  $630,000 + $18,300 - $25,700 - $10,900

= $67,9900

=> Cost of goods sold =  Total Goods Available for Sale - ending inventory

= $67,9900 - $64,600

= $61,5300

=> Gross Profit = Net sales - Cost of goods sold

= $760,000 - $61,5300

= $144,700

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7 0
2 years ago
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Cute Camel Woodcraft Company just reported earnings after tax (also called net income) of $9,750,000 and a current stock price o
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Answer:

Explanation:

a)

earning per share =  Net income / outstanding shares  

= $9,750,000 / 5,500,000  = $1.77

price earning ratio = Current stock price \  earning per share

= $39.50 \ $1.77  = 22.32

new Earning per share = Net income / outstanding shares

= $9,750,000 * 125% / 8,400,000  = $1.45

the stock price after one year would be

= Price earning ratio * New earning per share  = 22.32 * $1.45  = $32.36

b)

Market to book ratio = Market value/ book value  

Market value = Share price * number of outstanding shares

= $47.12 * 8,400,000 shares  = $395,808,000

book value is $54,364,800

M/B = $395,808,000 / $54,364,800  = 7.28 times

Is it possible for a company to exhibit a negative EPS and thus a negative P/E ratio?

Yes, if company is having losses

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Explanation:

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Hahn Corp. has three employees. Each earns $600 per week for a five-day workweek ending on Friday. This month the last day of th
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Answer:

D. Debiting Wage Expense for $1,080 and crediting Wages Payable for $1,080.

Explanation:

Salary Calculation for three employees for one day = $ 600 + $ 600 + $ 600/5= 1800/5= $ 360

Salary for 3 days for 3 workers= $ 360 * 3= $ 1080

Adjusting Entry would be recognizing the expense and liability for the payment of wages.

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Wages expense will be debited  with $ 1080

And wages payable would be credited with $ 1080

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