$7,600 of money actually goes to buy shares in the mutual fund
How much of her money actually goes to buy shares in the mutual fund?Liliana de la Cruz puts $8,000 into a load mutual fund. She knows that her up-front sales charge is 5 percent.
To "mutually" purchase stocks, bonds, and other investments, mutual funds allow you to combine your funds with those of other investors. They are managed by seasoned money managers who select the stocks, bonds, and other securities to acquire and determine when to sell them. You are exposed to every investment in the fund as well as any revenue they produce.$8,000 × 0.05 = $400; $8,000 − $400 = $7,600
$7,600 of money actually goes to buy shares in the mutual fund
To learn more about mutual fund refer to:
https://brainly.com/question/25300925
#SPJ1
Why are credit card companies more willing to offer a young person a secure
credit card than an unsecured card?
Answer:
Some of the best credit cards for college students often include secured credit cards because approval rates are high on these cards. Secured credit cards for families with no credit or poor credit are great for building up good credit with minimal risk compared to unsecured cards
Explanation:
In a many-worker economy the consumption possibilities line touches the production possibility curve
At one point, the PPC curve crosses the consuming possibility curve.
That is where the two curves meet at that moment.
What does the phrase "consume" mean?Institutional units consume up products or services through the activity of consuming, which can be either final or intermediary. It is the utilization of products and services to fulfill personal or social needs and desires.
What kinds of consumption are there?Consumption may be grouped into two types: depersonalized consumption and personalized consumption. Depersonalized ingestion occurs when commodities are produced by a world organization that is only dimly comprehended. The distinction between business and non-market-based consumption is another.
To know more about consumption visit:
https://brainly.com/question/28521763
#SPJ4
Wolf Company is giving a net bonus check of $500 to all of its employees. If each of the payments are subject to FIT (22% supplemental rate) and FICA taxes, but no state taxes, the gross amount of each bonus check would be
a. $662.75
b. $710.73
c. $663.75
d. $656.00
e. None of these choices are correct.
Answer:
e. None of these choices are correct.
Explanation:
Calculation for the gross amount of each bonus check
Using this formula
Gross amount=Net bonus/(1-Supplemental rate-
FICA taxes)
Note that FICA taxes includes :
Social Security tax = 6.2%
Medicare tax on earnings=1.45%
Let plug in the formula
Gross amount=$500/(1-22%-6.2%-1.45%)
Gross amount=$500/(1-14.35%)
Gross amount=$500/0.1335
Gross amount= $3,745.32
Therefore the gross amount of each bonus check would be $3,745.32
Wolf Company is giving a net bonus check of $500 to all of its employees. If each of the payments are subject to FIT (22% supplemental rate) and FICA taxes, but no state taxes, the gross amount of each bonus check would be
CWN Company uses a job order costing system and last period incurred $82,000 of actual overhead and $100,000 of direct labor. CWN estimates that its overhead next period will be $73,000. It also expects to incur $100,000 of direct labor. If CWN bases applied overhead on direct labor cost, its predetermined overhead rate for the next period should be:
Answer:
the predetermined overhead rate is 65%
Explanation:
The computation of the predetermined overhead rate is shown below;
The Predetermined overhead rate
= Expected overhead ÷ expected total direct labour cost
= $73,000 ÷ $100,000
= 0.73
= 65%
hence, the predetermined overhead rate is 65%
The same would be considered and relevant
Promoters of an LLC are Select one: a. are never personally liable on pre-formation debt. b. always liable on pre-formation debt. c. only liable on pre-formation debt until a novation occurs.
Answer:
The answer is C. only liable on pre-formation debt until a novation occurs.
Explanation:
The corporation and the third-party agree to release the promoter from liability and to substitute the corporation in place of the promoter as the party liable on the contract. May be express or implied.
All of the following are the ways property can be transferred at death, except by: Group of answer choices disclaimer. will. contract. title.
Answer: Disclaimer
Explanation:
At death, it should be noted that property can be transferred through will, contract or title. On the other hand, property can't be transferred through disclaimer.
A disclaimer simply refers to a statement that denies someone the responsibility to a particular thing. It delimit the scope of rights of an individual.
Joseph and Krystal are part of your social group. They joined Missile’s Financial Services together as middle managers. Each one, reports to a different senior manager. These senior managers report to the Managing Director. Once a month after payday, Joseph, Krystal and other members of the social group all try to have lunch together.
Joseph is very distressed. ‘I’ve had an awful week and this morning was the worst!’ He recounts what happen between himself and Nicholas, his manager.
‘Nicholas and I were to meet with a new supplier to finalize a contract. I have been dealing with the supplier all this time, over two and a half months and we just needed to finalize the costing. We had reached an agreement about the cost that both of us were comfortable with. For the past two weeks, I have been trying to get Nicholas to look at the contract and agree the figures etc. We really need this guy’s company. They are fast and have a great reputation for products and services. The price is good and they are willing to customize the stationary, with no additional cost to us. Anyway, Nicholas was always too busy to meet. I emailed him the contract and my teams thoughts on how we should proceed hoping he would read it.’ My team consists of the Accounts/Finance Manager, Inventory Manger, Legal, Research & Development, Public Relations Manager and I, and we meet at different times and days, whether collectively or selectively.
‘Anyway we, Nicholas and I, met with the supplier this morning. We are going through the contract, the next thing I know Nicholas says, ‘This won’t work for us. The cost is too high. Where did these calculations come from?’ ‘If the floor had opened up and swallowed me I could have not been more embarrassed. I mean I spent three weeks, working on it with the team Accounting, PR and Legal! Joseph shaking his head continued, ‘he just took over the conversation. I mean we got the contract signed but in the end all that happened was that the figures were rearranged we still end up paying the same.’ ‘I am tired of this foolishness. He stays locked in his office on his cell every day. Only God knows what he does in there.’
1. Do you believe that Nicholas is an unethical manager? Justify your response by choosing one of the ethical decision making concepts outlined in unit 2 to argue/support your writing.
2. From the chosen ethical decision making concept selected by you in question 1, show its relationship to any one of the variables in an analytical tool, outlined in unit 1, read.
1. Based on the information provided, it is not possible to ascertain whether Nicholas is an unethical manager. However, Joseph’s account of the situation raises some red flags about Nicholas’ behavior.
2. The chosen ethical decision-making concept is fairness, which is one of the key ethical principles in business.
1. Based on the information provided, it is not possible to ascertain whether Nicholas is an unethical manager. However, Joseph’s account of the situation raises some red flags about Nicholas’ behavior. It appears that Nicholas did not take the time to review the contract or the team’s thoughts, but still took over the conversation with the supplier and changed the figures. This behavior could be seen as a violation of the ethical principle of fairness, which involves treating others in a reasonable, equitable, and impartial way. Nicholas’ actions suggest that he did not give due consideration to the team’s input or their efforts to finalize the contract, which could affect their working relationship and trust in him as their manager.
2. The chosen ethical decision-making concept is fairness, which is one of the key ethical principles in business. Fairness is based on the idea of treating all stakeholders equitably and impartially, taking into account their needs, interests, and perspectives. In this case study, Nicholas’ actions appear to violate the principle of fairness by disregarding the efforts of Joseph and his team to finalize the contract, and making unilateral changes without adequate review or discussion.
To analyze this situation using an analytical tool, we can use the Stakeholder Mapping tool, which helps to identify and categorize stakeholders based on their level of interest and power. In this tool, stakeholders are divided into four categories: High power/high interest, High power/low interest, Low power/high interest, and Low power/low interest. In this case, Joseph and his team are the stakeholders with high power and high interest in the situation, as they are responsible for finalizing the contract.
Using the Stakeholder Mapping tool, we can see that Nicholas’ actions have the potential to undermine the trust and collaboration of high power/high-interest stakeholders, who are critical to the success of the project. Specifically, his actions may cause frustration, resentment, and loss of confidence in his management ability. This could result in a breakdown of communication and cooperation, which would ultimately affect the team’s performance and the overall success of the project. Therefore, it is important for Nicholas to consider the perspectives and input of all stakeholders, including those with high power and high interest, when making decisions that affect them. By doing so, he can ensure that his decisions are ethical, fair, and aligned with the needs of all stakeholders.
for more such questions on manager
https://brainly.com/question/1276995
#SPJ8
Y’all I need a know if this is correct PLEASE
Answer:
Correct.
Explanation:
Paint is made using other chemicals and products.
Cloth has to be manufactured in order to be used.
Nails, are made up of raw materials and other things.
Wood is straight from a tree, with no extra processing. This makes it a raw material.
Answer: yes it is correct
Explanation:
what are the important seo features ?
The important seo features are Keyword Research, On-Page Optimization, High-Quality and Engaging Content, Link Building, Mobile-Friendly Design, Site Speed and Performance and User Experience (UX).
While SEO is a complex and multifaceted field, there are several important features that contribute to an effective SEO strategy. Let's explore some of these features:
Keyword Research: Keyword research involves identifying the specific search terms and phrases that users are likely to use when searching for information related to your website's content. On-Page Optimization: On-page optimization refers to optimizing individual web pages to make them more search engine-friendly. This includes optimizing title tags, meta descriptions, headers, URLs, and incorporating relevant keywords naturally within the content. High-Quality and Engaging Content: Creating high-quality, informative, and engaging content is crucial for SEO. Search engines prioritize content that provides value to users.Link Building: Link building involves acquiring high-quality backlinks from other reputable websites. Backlinks act as "votes of confidence" for your website, indicating to search engines that your content is trustworthy and authoritative. Mobile-Friendly Design: With the increasing use of mobile devices for internet browsing, having a mobile-friendly website is essential. Site Speed and Performance: Website speed and performance play a vital role in SEO. Search engines prioritize delivering fast and efficient user experiences.User Experience (UX): Providing a positive user experience is critical for SEO success. Factors such as easy navigation, clear site structure, intuitive design, readable fonts, and engaging multimedia elements contribute to a better user experience.For such more question on Research:
https://brainly.com/question/20365163
#SPJ8
discuss how business risks are both inevitable and unavoidable
Answer:
Risk is inevitable in everything we do. ... There may be some unlikely but high impact risks, for example, the risk that the solution could cause the destruction of the organisation (see the case studies below). The good Project Manager will constantly assess the risks and take action as needed.
Prior to beginning work on this discussion, complete the reading assignment in the text and review the articles listed in recommended resources. In addition, review the material in the Introduction section and pay attention to the Sustainable Growth Rate (SGR) ratio. Your business partner told you that she feels the business will grow by 115% next year. What is your initial reaction in terms of information you need to put this growth estimate in perspective and to justify assumptions? As you develop your response, focus on the following information (you are encouraged to go beyond the course text for information): You are presenting this information about projected sales growth to an interested investor. Projections based on guessing will be unimpressive so you must be able to identify and defend the assumptions you and your partner used to make sales projections. Analyze the financial ratio categories and determine if there is a financial ratio that will provide a foundation for your growth projections. Offer your peers a link to a video or an article that complements your answer to the items above.
Answer:
1121
Explanation:
i dont know the answeer
I have to earn a bachelor's degree before I can begin a master's degree program.
O True
O False
Answer:
true
Explanation:
true because it's true
Answer:
true
Explanation:
fact
Ms. Tanja Umstead is 46 years old and lives in Richmond, British Columbia. She is in good health
and works in the sales department of a large publicly traded company.
Employment Information
1. Tanja's 2022 salary is $93,500. In addition, she was awarded a year-end bonus of $12,000, all
of which is payable in January 2023.
Answer: Based on the provided information, here is Tanja Umstead's employment information:
2022 Salary: $93,500
Year-end Bonus (2022): $12,000 (payable in January 2023)
Therefore, Tanja's total income for 2022 would be the sum of her salary and the year-end bonus:
Total Income for 2022 = Salary + Year-end Bonus
= $93,500 + $12,000
= $105,500
It's important to note that the year-end bonus of $12,000 will be paid in January 2023, which means it will be considered as part of her income for the following year (2023) rather than 2022
Explanation:
00 For Market failures means that the market has not achieved its optimum production outcome. This means that it has not produced the correct quantity of goods and services. QUESTION 1 Conduct a research to any small business that is manufacturing goods in your community. Make an appointment to interview the owner for the purpose of collecting the information using the questionnaire below. 1.1 General information: ● Name of the firm / business Specify the type of goods or service ● ● Position of the person interviewed ● Date of the interview 1,2 Explain briefly the negative impact the following factors have in your business. (10) Lack of information: ● Price discrimination Immobility of factors of production with special reference to: Physical capital Structural changes ● ● (1) ● (1) (1) (1) [14] QUESTION 2: Interview 3-4 community members that reside near the business you have visited. 2.1 Ask them to name any TWO negative externalities and TWO positive externalities caused by the local business, (2 x 2) (4) 2.2 Request them to list any TWO characteristics of public goods. (2 x 1) (2) 2.3 Use the negative externality and positive externality graphs to explain the impact this business have to the society (10) [16]
The first step in researching a small business in your neighborhood is to find a suitable nearby manufacturing company.
Once you do, contact the manager or owner to arrange an interview. Gather general information during the interview, such as the name of the company or business, what types of products or services they provide, the interviewer's position, and the time and date of the interview.
Then, focus on the detrimental effects different situations can have on the company. Briefly describe the impact on business of informational gaps, price discrimination, immobility of production variables (with a focus on physical capital), and structural changes.
Interview three to four locals who live close to the establishment you just visited. Ask them to list two unfavorable and two beneficial externalities brought about by the neighborhood business. Ask them to add two properties of public goods to the list as well.
Finally, use the data from the interviews to create graphs showing the positive and negative externalities of business on society. These infographics will graphically describe the costs and benefits that the company's neighborhood has.
Learn more about business, here:
https://brainly.com/question/15826604
#SPJ1
Calculate the simple interest and maturity vale. (do not round intermediate calculations. Round your answers to the nearest cent). principal $20,000 interest rate 6 3/4% time 9 months what is the simple interest? and what is the maturity value ?
The simple interest given the principal, time and interest rate is $1012.50.
The maturity value is $21,012.50.
What is the simple interest?An amount earns simple interest only if the principal increases in value when interest is paid and not both the principal and the interest already accrued.
Simple interest = principal x time x interest rate
$20,000 x 9/12 x 0.0675 = $1012.50
Maturity value = $1012.50 + $20,000 = $21,012.50
To learn more about interest, please check: https://brainly.com/question/26164549
At the market close on May 12 of a recent year, Sherman Corporation had a closing stock price of $110. In addition, Sherman Corporation had a dividend
per share of $5.39 during the previous year.
Sherman Corporation's dividend yield is 4.9%.
What is the dividend yield?The dividend yield is the financial ratio that explains the percentage of a company's share price paid out in dividends annually.
Investors calculate the dividend yield to evaluate the potential investment company's ability to meet their financial needs, depending on their return expectations.
Some investors favor dividend-paying investments to maintain their financial strength. Some other investors value investment growth more than dividend payments.
The formula for Dividend yield is Dividend per share divided by the current share price per unit, multiplied by 100.
Data and Calculations:Stock price = $110
Dividend per share = $5.39
Dividend yield = 4.9% ($5.39/$110 x 100)
Thus, Sherman Corporation's dividend yield is 4.9%.
Learn more about dividend yields at https://brainly.com/question/20704820
#SPJ1
Question Completion:Determine Sherman Corporation's dividend yield. (round to one decimal place)
How can you best protect your own intellectual property?
Answer:
Explanation:
The four primary ways to protect intellectual property are:
Copyrights.
Trademarks.
Patents.
Trade secrets.
Question 5
the total amount of money you are allowed to take from the account in the form of cash.
Your saving done in any bank is allowed to take from your account in form of cash
:)
Mark me Brainlliest
What is google pay level? How do you define and measure its pay level?
Answer: Google pay level involves the total compensation for its employees.
Hope it helps.
Explanation:
QUESTION 15
When the P < AVC for a firm in perfect competition the firm should shut down.
O True
O False
The statement "When the P < AVC for a firm in perfect competition, the firm should shut down" is FALSE.
In perfect competition, a firm should not shut down solely based on the condition of P < AVC (Price is less than Average Variable Cost). Let me explain why:
1. Perfect competition: In perfect competition, there are many buyers and sellers in the market, and no individual firm has control over the price. Firms are price takers, meaning they have to accept the market price for their product.
2. Shutting down decision: In the short run, a firm should continue producing as long as the price (P) is greater than the average variable cost (AVC). This is because even if the firm is not covering its total costs, it can at least contribute towards covering its variable costs. By shutting down, the firm would incur a loss equal to its fixed costs, which is not beneficial in the short run.
3. Long run perspective: In the long run, if a firm consistently faces prices below average total cost (ATC), it may consider exiting the market. This decision is based on the idea that if a firm cannot cover its total costs, it would be better off using its resources elsewhere or exiting the industry altogether.
For more questions on firm
https://brainly.com/question/29698190
#SPJ8
QUESTION 1 of 10: When buying an existing business, it is important to:
a) Find out why the business is for sale
b) Review existing financial statements
c) Both a) and b)
d) None of the above
Answer:
C
Explanation:
Consumer behavior is generally influenced by four elements. Whether or if your target customer purchases your goods depends on these considerations. They are social, psychological, personal, and cultural. Thus, option C is correct.
What is required to purchase an existing business?The examination of a business can be broken down into four clusters: the seller's background and motivations, any legal issues that may impact the operation.
The company's financial situation, and the company's standing and future prospects in its industry (its products, services, and future).
This is because an established business already has a proven track record of success. Higher chance of surviving, Numerous new businesses fail during their first few years of operation.
Therefore, Review existing financial statements and find out why the business is for sale.
Learn more about existing business here:
https://brainly.com/question/6336724
#SPJ2
What is the link between managing ineffective performers and organizational productivity?
Ineffective performance is defined as an employee's inability to meet a specified level of performance and is usually ascribed to the working environment. The capacity of an organization to fulfill its goals while avoiding costs is referred to as organizational productivity.
What effect does organization have on productivity?According to studies, competent management may considerably enhance production, market value, and growth, as well as the capacity to resist bad events such as a recession.
Ineffective personnel have a significant negative impact on organizational productivity. To increase the performance of such personnel, certain managerial steps must be taken.
Managers should closely monitor, engage, encourage, and guide ineffective employees. Bosses should design motivational strategies and identify the root reason of an employee's incapacity to succeed. Employees are affected by a variety of circumstances, including coworkers, the environment, family disruptions, and salaries.
As a result, supervisors must recognize the issue and properly aid the employee. Criticism from superiors causes work-related stress, which leads to ineffectiveness; thus, empathic managers may resolve these differences and strengthen the working relationship.
Learn more about organization here:
https://brainly.com/question/29675844
#SPJ1
I
5. In a few sentences, explain the difference between a fixed exchange rate and a
flexible exchange rate. What are the basic advantages and disadvantages of each?
(4 points)
A fixed exchange rate is a type of exchange rate regime in which the government or central bank ties the official exchange rate to another country's currency or the price of gold.
The official exchange rate is fixed by the government or central bank, and it is kept constant. The government or central bank must be prepared to buy or sell its currency at the official exchange rate in order to keep it fixed. A flexible exchange rate, on the other hand, is a type of exchange rate regime in which the value of a currency is determined by supply and demand on the foreign exchange market.
Advantages of Fixed Exchange Rate:
Stable exchange rates are beneficial for businesses that require currency predictability. The central bank may employ monetary policy tools more effectively, resulting in lower inflation rates. It is less likely that a currency crisis would occur.
Disadvantages of Fixed Exchange Rate:
It limits a country's monetary policy independence because it must have sufficient foreign currency reserves to maintain the fixed rate. The country's economy may be hurt if the fixed exchange rate is too high.
Advantages of Flexible Exchange Rate:
A flexible exchange rate enables a country to adjust to changes in economic circumstances such as inflation, international competitiveness, and other economic conditions. It allows a nation to conduct an independent monetary policy.
Disadvantages of Flexible Exchange Rate:
Price stability may be difficult to achieve because the exchange rate is more volatile. Businesses may find it more challenging to plan for the future because of the unpredictability of exchange rates.
Know more about Fixed exchange rate here:
https://brainly.com/question/32784534
#SPJ8
The operating budget provides a roadmap for financial plans for a short-term, future period. What is a typical “future period” for an operating budget?
An operating budget is a financial statement that outlines the organization's expenditures and revenues for a specific period.
The operating budget is typically for a fiscal year, which is usually twelve months. The future period for an operating budget is usually a fiscal year or less than a year. The operating budget is critical because it establishes guidelines for financial activities and operations in an organization. It provides a roadmap for financial plans for a short-term, future period, which typically begins on January 1st and ends on December 31st.
An organization creates an operating budget to aid in the allocation of resources and expenditures to achieve its objectives for a given period. A typical operating budget is for a fiscal year. A fiscal year is the period when an organization prepares its financial statements. It is usually 12 months, but it may be shorter or longer depending on the organization. An operating budget typically covers one fiscal year; however, it may be longer or shorter based on the organization's preferences.
The future period for an operating budget is frequently updated to reflect the company's current situation and financial standing. It takes into account the actual results of the previous period and the estimated expenditures and revenues for the upcoming year to develop the operating budget for a future period.
Know more about Operating budget here:
https://brainly.com/question/30766715
#SPJ8
virus such as norovirus and hepatitis A are directly related to contamination from..
Hepatitis and the norovirus one contracts a virus through the faecal-oral route when they consume contaminated food or water, come into contact with an infected person, or touch contaminated objects.
What do you mean by Hepatitis?Hepatitis refers to liver inflammation. The liver is a crucial organ that filters blood, processes nutrients, and fights infections. The function of the liver can be impacted by inflammation or injury. Hepatitis can be brought on by chemicals, drugs, some medical disorders, and heavy alcohol consumption.
An inflammation of the liver is known as hepatitis. This syndrome can be brought on by drinking alcohol, a number of medical disorders, and several drugs. However, the most typical cause of hepatitis is viral infections.
Learn more about Hepatitis here
https://brainly.com/question/1389918
#SPJ1
Bob, an age 55 taxpayer with family coverage under his HDHP, may make an HSA contribution not exceeding ____ in 2022
Answer: hope it helps
\
Explanation:
The annual contribution maximum for 2022 is increasing by $50 for individuals with self-only HSA qualified high deductible health plan (HDHP) coverage to $3,650, and increasing by $100 for individuals with family HSA qualified HDHP coverage to $7,300.
Bob, an age 55 taxpayer with family coverage under his HDHP, may make an HSA contribution not exceeding $50 for in 2022.
Healthy High Deductible Plan (HDHP) a more expensive deductible than a standard insurance plan. Although the monthly premium is typically smaller, the insurance company doesn't begin to cover its share of your medical expenses until later;
For 2022, the IRS considers any health plan with a deductible of at least $1,400 for an individual or $2,800 for a family to be a high deductible health plan. Total yearly out-of-pocket costs for an HDHP cannot exceed $7,050 for a person or $14,100 for a family.
With an HDHP, you will pay less in monthly premiums, but you will be responsible for a higher portion of your medical costs up front before your insurance starts to cover care.
Thus, it is $50.
For more information about HDHP, click here:
https://brainly.com/question/28488217
#SPJ2
Consider the following BPMN diagram:
If we look at the process model, we can see that Task A is the first task and must always be completed in order for the model to be run. Further observation reveals that because an exclusive gateway is employed, any of the two jobs, B and C, is carried out individually rather than simultaneously. As we continue to move through the BPMN diagram, we see that task M is the conversing task and is therefore always run along with a networks message flow from it to task F, which is done as soon as a message is received in pool 2 and finishes.
An item of networking hardware or software called a gateway is used in telecommunications networks to allow data to go from one distinct network to another.
The way that gateway differ from routers and switches is that they can join various networks using more than one protocol to communicate and that they can function at any of the seven OSI levels.
Learn more about gateway , from :
brainly.com/question/31847202
#SPJ1
Strict liability offenses:
1 impose liability on a defendant for the act of third parties.
2 dispense with the requirement of proof of any criminal intent on the part of the defendant.
3 are so classified because the punishments imposed on violators are especially harsh in comparison to the punishments for other criminal offenses.
4 require proof of some form of mens rea.
Strict liability offenses dispense with the requirement of proof of any criminal intent on the part of the defendant. The correct answer is option 2.
In these cases, it is not necessary to demonstrate men's rea or a guilty mind. Instead, the mere act of committing the offense is sufficient to impose liability, regardless of the defendant's intent or awareness.
Strict liability offenses dispense with the requirement of proof of any criminal intent on the part of the defendant. This means that the defendant can be held liable for committing the offense even if they did not intend to do so. However, it is important to note that strict liability offenses do not impose liability on a defendant for the actions of third parties and require some form of men's rea.
Additionally, while punishments for strict liability offenses may be harsh, this is not the reason for their classification as such.
Learn more about Strict Liabilities :- https://brainly.com/question/13612859
#SPJ11
At the end of 20X4, Sherpa Lighting Ltd. has a large stock of incandescent lighting fixtures that are becoming obsolete due to a new trend to low-energy fluorescent and LED lighting fixtures. The current inventory of incandescent fixtures has a cost of $170,000. The sales manager of Sherpa estimates that the inventory can be sold through the normal course of business over the next several reporting quarters for approximately $150,000. Sales personnel are given a 10% commission on sales. In addition, Sherpa will grant an additional 5% sales commission for sales of these almost-obsolete fixtures, intended to make up for the reduced sales prices as well as an additional incentive to sell them. In early 20X5, Sherpa's production manager decided that the fixtures can be adapted to not only accept the new LED lighting but also compete quite effectively with new products coming on the market. During 2005, the fixtures are converted at a cost of $25,000. The sales manager estimates that after the conversion, the newly adapted inventory can be repriced to fetch $185,000 (before 10% sales commission) in the market. Required: Using the valuation allowance method, prepare the appropriate journal entries to record inventory adjustments at the end of each of 20X4 and 20X5.
Answer:
Sherpa Lighting Ltd.
Journal Entries, using the valuation allowance method:
December 31, 20X4:
Debit Inventory Write-down Expense $20,000
Credit Inventory $20,000
To write down inventory because of obsolescence.
December 31, 20X5:
Debit Inventory $25,000
Credit Cash Account $25,000
To record the cost of converting the fixtures.
Explanation:
a) Data and Calculations:
December 31, 20X4:
Cost of Inventory of incandescent fixtures = $170,000
Estimated sales value of the inventory = $150,000
Obsolete inventory Expense = $20,000 ($170,000 - $150,000)
December 31, 20X5:
Balance of Inventory of incandescent fixtures = $150,000
Add conversion cost = 25,000
Ending balance of inventory = $175,000
If a savings account has a nominal interest rate of 2% and compounds quarterly, what is the effective annual interest rate?
Answer:
To calculate the effective annual interest rate (EAR) from a nominal interest rate with quarterly compounding, you can use the following formula:
EAR = (1 + (r/n))^n - 1
Where:
r is the nominal interest rate (expressed as a decimal), which is 2% in this case (0.02).
n is the number of compounding periods per year, which is 4 (quarterly compounding).
Plugging in the values, we have:
EAR = (1 + (0.02/4)) - 1
= (1 + 0.005) ⁴- 1
= (1.005) 1
≈ 0.0202
Therefore, the effective annual interest rate for a savings account with a nominal interest rate of 2% and quarterly compounding is approximately 2.02%.