Question

In: Finance

Please give me the correct answer with necessary calculations 2. Doggie company has the following production...

Please give me the correct answer with necessary calculations

2. Doggie company has the following production budget for one of the products for the first quarter of 2016:

Month production

January 18300

February 15500

March 12000

Each units required 2 pounds material K9 which cost $5 per pound. Doggie has 1000 pounds of K9 on hand on December 31, 2015, and wants an inventory of K9 equal to 10% percent of the need month’s production requirements. What is the cost of K9 purchased in February?

a. 176400

b. 188600

c. 152400

d. 193600

3. The production budget is required to prepare all of the following budgets except :

A.the overhead budget.

B.the selling and administrative budget.

C.the labor budget

D.the materials purchase budget.

4. Which of the following statement is correct?

a. All the answers are incorrect.

b. A cash flow can be an inflow (a deposit, a cost, or an amount paid to others) or an outflow (a receipt from others).

c. A regular amortizing loan calculates a monthly interest charge by multiplying the beginning loan balance by the effective rate.

d. Annual compounding means that interest is paid twice a year.

e. Annuities must have constant payments for a fixed number of periods and if these conditions do not hold, then the series is not an annuity.

5. Which of the following statement is incorrect?

a. Discounting is the process of finding the present value (PV) of a future cash flow or a series of cash flows.

b. Most of the answers are correct.

c. The nominal annual interest rate or just the nominal rate is the rate quoted by banks, brokers, and other financial institutions.

d. As a result of compounding, the effective annual rate on a bank deposit or a loan is always equal to or greater than the nominal rate on the deposit or loan.

e. Discounting is the same as compounding.

6. Which of the following statement is incorrect?

a. Before 1968, lenders were not required to tell borrowers the APR but this changed when the Congress passed the Consumer Credit Protection Act in 1968.

b. The cash flows for an annuity due must all occur at the beginning of the periods.

c. An amortized loan is paid off with uneven payments over infinitely many periods.

d. A bank loan's nominal interest rate will always be equal to or less than its effective annual rate, assuming positive interest rates and holding other things constant.

e. Most of the answers are correct.

7. Which of the following statement is correct?

a. When compounding occurs more frequently than once a year, the nominal rate must be converted to a periodic rate, and the number of years must be converted to periods.

b. If the annuity payments occur at the end of each period, then we call it an annuity due.

c. All the answers are incorrect.

d. An ordinary annuity is a series of cash flows in which the amount varies from one period to the next.

e. An ordinary annuity has payments occurring at the beginning of each period.

8. Which of the following statement is correct?

a. The process of going forward, from present values (PVs) to future values (FVs), is called discounting.

b. Discounting is the process of determining the future value (FV) of a cash flow or a series of cash flows.

c. If you know the cash flows and the PV of a cash flow stream, you can determine its interest rate.

d. All the answers are incorrect.

e. Compounding is the process of finding the present value of a single payment or series of payments.

9. Which of the following statement is incorrect?

a. An inflow is a deposit, a cost, or an amount paid to others, while an outflow is a receipt collected from others.

b. Regarding a 20-year monthly payment amortized mortgage with a nominal interest rate of 10%, a smaller proportion will be principal, than for the last monthly payment.

c. Most of the answers are correct.

d. To find the PV of an uneven series, find the PV of each individual cash flow and then sum them.

e. The greater the number of compounding periods within a year, then the smaller the present value of a given lump sum to be received at some future date.

10. Which of the following statement is incorrect?

a. An ordinary annuity has payments occurring at the end of each period.

b. A cash flow can be an inflow (a receipt from others) or an outflow (a deposit, a cost, or an amount paid to others).

c. If interest is earned only on the principal, we call it compound interest.

d. Most of the answers are correct.

e. An amortized loan is paid off with equal payments over a specified period.

Solutions

Expert Solution

Answer to Q4 -

Correct Statement is - b. A cash flow can be an inflow (a deposit, a cost, or an amount paid to others) or an outflow (a receipt from others).

The below statement could have been correct if - words in bold would have been there

e. Annuities must have constant payments/receipts for a fixed number of periods and if these conditions do not hold, then the series is not an annuity. (Payments - Loan Installments, Receipts - Pension, Interests payouts)

Answer to Q5 (incorrect statement)

e. Discounting is the same as compounding.

Answer to Q7 (Correct Statement)

a. When compounding occurs more frequently than once a year, the nominal rate must be converted to a periodic rate, and the number of years must be converted to periods.

Answer to Q8 Correct Statement

Option C - c. If you know the cash flows and the PV of a cash flow stream, you can determine its interest rate.

Answer to Q9 - Incorrect Statement

Option A - a. An inflow is a deposit, a cost, or an amount paid to others, while an outflow is a receipt collected from others. (Reverse would be correct statement)

Answer to Q10 - Incorrect Statement

c. If interest is earned only on the principal, we call it compound interest. (it is called simple interest)


Related Solutions

please give me the correct answer with a necessary calculation Charlotte Watson is studying towards a...
please give me the correct answer with a necessary calculation Charlotte Watson is studying towards a Business BS, Financial Management Specialization degree from Grenoble Ecole de Management (France) and currently working as Market Risk Analyst Intern for Morgan Stanley. Charlotte is a part of the team that has buyside experience in M&A, IBD, Equity Research and Private Equity. The team is providing consulting services to Ohio Teachers and the pension plan representatives want to know if their investment is worth...
please give me the correct answer Which of the following statement is incorrect? 1. Most traditional...
please give me the correct answer Which of the following statement is incorrect? 1. Most traditional mutual funds allow investors to redeem their share of the fund only at the close of business. 2. Investment banks underwrite security offerings, advise corporations regarding the design and pricing of new securities, buy these securities from the issuing corporation, and resell them to investors. 3. When a firm sells goods and services to public first time and the Federal Reserve issues IPOs for...
please give me your answer 11) Which of the following is a business transaction? A company...
please give me your answer 11) Which of the following is a business transaction? A company hires a new marketing manager. A company signs a contact for services to be provided during the first quarter of the next fiscal year. A company pays its employees a year-end bonus. A company applies for a mortgage that will be used to purchase a new office building. 12) The owner of a_____ is personally liable for all the business debts. A) proprietorship                                             B) corporation...
please give me true answer only without rationale (choose correct answer) , quickly?? Where does child...
please give me true answer only without rationale (choose correct answer) , quickly?? Where does child sexual abuse occur most often?       Reflection Summarization Empathy Silence **** Which is a NON-therapeutic technique?       Offering self     Broad openings Making observations Advising **** The nurse realizes that the pt. is having a hard dealing with their diagnosis. The pt. states that he is feeling alone with no one who understands. Which type of communication could be the most useful...
Please give me the correct answer: Lucy’s Music Emporium purchased $50 million in fixed assets in...
Please give me the correct answer: Lucy’s Music Emporium purchased $50 million in fixed assets in January and their accountant told them that they would have to depreciate the assets over 20 years (they use the same depreciation calculations for shareholder reporting and income tax purposes). In December they learned that their accountant did not have a college degree and fired him. They hired a new accountant with a college degree and she told them that they could depreciate the...
Please give me the correct answer: Jacobs Engineering Group had its target price increased by analysts...
Please give me the correct answer: Jacobs Engineering Group had its target price increased by analysts at KeyCorp from $82.00 to $86.00 in a research note issued to investors on Wednesday, Benzinga Ratings Tables reports. The firm currently has an "overweight" rating on the construction company's stock. KeyCorp's price target indicates a potential upside of 7.69% from the company's current price. Other research analysts have also issued research reports about the company. MKM Partners lifted their price target on Jacobs...
please give me an reflection for this reading Textbook: Is It Necessary to Reduce Carbon Emissions...
please give me an reflection for this reading Textbook: Is It Necessary to Reduce Carbon Emissions to Fight Global Warming? In the YES selection, D. J. Wuebbles et al. argue that, particularly given the tendency of climate models to underestimate the effects of carbon emissions (from large-scale combustion of fossil fuels and from deforestation), avoiding dangerous warming of the climate will require reducing net global CO2 emissions In the No selection, Kevin D. Dayaratna, Nicholas D. Loris, and David W....
Can someone please tell me if these calculations are correct! I'm reviewing my notes, and my...
Can someone please tell me if these calculations are correct! I'm reviewing my notes, and my professor said to always multiply the lipids by 3 and then divide by 7 to get the total amount of cals of lipids per day... I'm not completely sure why you do that? Can someone explain. Why don't you just stop at 700 cals for lipids? 1. Calculate the number of calories and grams protein for the following TPN solution: D50W in 500cc 10%...
Please give a brief justification for the correct answer you select: Which of the following is...
Please give a brief justification for the correct answer you select: Which of the following is NOT included in 2004’s GDP? The value of a car produced in the United States and exported to England. The profit earned in 2004 from selling a stock that you purchased in 2001. The value of a computer chip that is used in the production of a personal computer. The commission earned by an employment counsellor when she locates a job for a client....
i have 2 chemistry questions. please give me correct answers. thank you . 1. Calculate the...
i have 2 chemistry questions. please give me correct answers. thank you . 1. Calculate the pH of a 0.23 M solution of acetic acid (CH3COOH). DATA : pKa (CH3COOH) = 4.76 Answer: 2. Calculate the pH of a 0.37 M solution of potassium cyanide (KCN). DATA : pKa (HCN) = 9.21 Answer:
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT