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3 years ago

On January 1 of this year, Shannon Company completed the following transactions (assume a 8% annual interest rate):

Business

1 answer:

inessss [21]3 years ago

4 0

Answer:

a. The cost of the truck that should be recorded at the time of purchase is:

= $48,741.

b. The option of paying $11,400 annually for 3 years results in a PV of $29,379, which is lower than $30,000 paid immediately.

c. The single amount that must be deposited in this account on January 1 of this year is:

= $54,148.

d. The single sum that must be deposited in the bank on January 1 of this year to provide 8 equal annual year-end payments of $41,400 to a retired employee is:

= $237,910.85

Explanation:

a) Data and Calculations:

a. Bought a delivery truck and agreed to pay $61,400 at the end of three years.

From an online financial calculator:

(# of periods) 3

I/Y (Interest per year) 8

PMT (Periodic Payment) 0

FV (Future Value) $61400

Results

PV = $48,741.30

Total Interest $12,658.70

b. Rented an office building and was given the option of paying $11,400 at the end of each of the next three years or paying $30,000 immediately.

From an online financial calculator:

N (# of periods) 3

I/Y (Interest per year) 8

PMT (Periodic Payment) $11,400

FV (Future Value) 0

Results

PV = $29,378.91

Sum of all periodic payments $34,200.00

Total Interest $4,821.09

c. Established a savings account by depositing a single amount that will increase to $92,800 at the end of seven years.

From an online financial calculator:

N (# of periods) 7

I/Y (Interest per year) 8

PMT (Periodic Payment) 0

FV (Future Value) $92,800

Results

PV = $54,147.91

Total Interest $38,652.09

d. Decided to deposit a single sum in the bank that will provide 8 equal annual year-end payments of $41,400 to a retired employee (payments starting December 31 of this year.

From an online financial calculator:

N (# of periods) 8

I/Y (Interest per year) 8

PMT (Periodic Payment) $41,400

FV (Future Value) 0

Results

PV = $237,910.85

Sum of all periodic payments $331,200.00

Total Interest $93,289.15

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The Rosa model of Mohave Corp. is currently manufactured as a very plain umbrella with no decoration. The company is considering

user100 [1]

Solution :

1. Incremental analysis when the demand for the decorated umbrella is 10,000 units.

$\text{Particulars}$ $\text{Rosa umbrella}$ $\text{Decorated umbrella}$ $\text{Incremental}$

$\text{Sales revenue}$ $80000 $190000 $110000

$\text{Less: Variable cost}$ $ 45000 $120000 $75000

Contribution $35000 $70000 $35000

$\text{Less: Additional}$ --- $10000 $10000

development cost.

$\text{Differential profit}$ $35000 $60000 $25000

The company earns an additional profit of $\$25,000$ if it decorates and sells the Rosa umbrella.

2. The company, Mohave should add the decorations to the Rosa umbrella as this would increase the net revenues of the company by an amount of $25,000.

3.a. The demand for he decorated umbrella will fall to 8,000 units due to the higher price. If the company does not make any changes to the Rosa umbrella, it could sell 10,000 units.

The incremental profit or loss is :

Incremental analysis when the demand for the Rosa umbrella is 10,000 units and for the decorated umbrella is 8,000 units is given below:

$\text{Particulars}$ $\text{Rosa umbrella}$ $\text{Decorated umbrella}$ $\text{Incremental}$

$\text{Sales revenue}$ $80,000 $152,000 $72,000

$\text{Less: Variable cost}$ $45,000 $96,000 $51,000

Contribution $35,000 $56,000 $21,000

$\text{Less: Additional}$ ---- $10,000 $10,000

development cost.

$\text{Differential profit}$ $35,000 $46,000 $11,000

The incremental profits are : $11,000.

3.b. The company should decorate and sell 8000 units of the decorated umbrellas as the increase in the net profit is $11,000.

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3 years ago

The ______ is a flexible market that allows you to work short-term, independent jobs.

andreyandreev [35.5K]

Answer:

A. Gig economy

Explanation:

Gig economy is a job system where organizations and independent workers agree on short-term work contracts. The term Gig means a <em>job for a specific time</em>. The gig economy is growing fast. It is predicted that by 2020, 40m percent of all the workers in the US will be independent contractors.

The advance in technology has helped propel the popularity of the gig economy. Organizations can recruit workers from across the globe. The workers will perform their duties form any location and submit their work through technology.

Examples of workers in the gig economy include.

Freelancers
Independent contractors and professionals
Consultants
Temps (temporary contract workers)

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3 years ago

Read 2 more answers

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givi [52]

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3 years ago

Eddy Jones Pottery produces serving bowls among other items. If they reengineer their automated equipment, a serving bowl can be

Ganezh [65]

Answer and Explanation:

Old equipment=2.5 mins per serving bowl

New equipment=1.5 mins per serving bowl

With old equipment, in one hour Eddy Jones can produce 60/2.5= 24 serving bowls

With new equipment, in one hour Eddy Jones can produce 60/1.5= 40 serving bowls

With old equipment, in 8 hours Eddy Jones can produce 24*8=192 serving bowls

With new equipment, in 8 hours Eddy Jones can produce 40*8=320 serving bowls

Therefore in 8 hours with new equipment Eddy Jones will produce 320-192= 128 more serving bowls than with old equipment.

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3 years ago

The Standards of Ethical Conduct for Practitioners of Management Accounting and Financial Management states that significant eth

posledela

Answer:

a. submitted to the next higher managerial level.

Explanation:

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