Question
In: Economics
In July 2020, Delta Air Lines reported earnings for the second quarter of 2020. Delta’s CEO...
In July 2020, Delta Air Lines reported earnings for the second quarter of 2020. Delta’s CEO Ed Bastian stated “[d]emand has stalled as the virus has grown...coupled with the quarantine measures”. Delta’s posted a $5.7 billion net loss in the second quarter. Which of the following is correct?
- A. Delta's accounting profit is -$5.7 billion with a lower economic profit.
- B. Delta's accounting profit is -$5.7 billion with a higher economic profit.
- C. Delta's economic profit is -$5.7 billion with a lower accounting profit.
- D. Delta's economic profit is -$5.7 billion with a higher accounting profit.
- E. None of the above.
Solutions
Expert Solution
A net loss is when expenses exceed the income or total revenue . So here the accounting profit is negative = - $5.7 billion . And economuc profit is always lower than accounting profit because it takes into consideration , implicit costs also along with explicit costs . Answer : A. Delta's accounting profit is -$5.7 billion with a lower economic profit.
Rahul Sunny answered 2 years agoRelated Solutions
Your company is considering buying a 787 airplane and then lease it to Delta Air Lines....
Your company is considering buying a 787 airplane and then lease
it to Delta Air Lines. Your task is to determine the before tax
leasing payment
You may follow the Leasing example we discussed in the
class.
You may choose an airplane of your choice (747, 767, 777,
787)
Assume 20 year depreciation period in your lease analysis.
Make your assumptions about tax rate, required rate of return,
insurance cost, maintenance and operating costs, and salvage
value.
Delta Air Lines wants to determine if the number of no-shows for flights originating from Detroit...
Delta Air Lines wants to determine if the number of no-shows for
flights originating from Detroit is higher than from Minneapolis. A
sample of 20 flights is taken from each city, and the number of
no-shows is determined for each flight. Which nonparametric test
would you use to determine whether the number of no-shows is
greater in Detroit?
Multiple Choice
Wilcoxon signed-rank test
Kruskal-Wallis test
Wilcoxon rank sum (Mann-Whitney) test
Wald-Wolfowitz one-sample runs test
Twenty customers are randomly chosen, and...
The Indicator from Planet Money reported that GDP fell by 32.9% in the second quarter of...
The Indicator from Planet Money reported that GDP fell by 32.9%
in the second quarter of 2020. Wha† value from the GDP calculations
are they using to measure the growth rate? Did the economy really
shrink by 32.9
% in 3 months? Explain.
Delta Air Lines reports that the average delay time of all arriving domestic flights in 2018 was 60 minutes.
Delta Air Lines reports that the average delay time of all arriving domestic flights in 2018 was 60 minutes. A flight is considered delayed if it arrives more than 15 minutes later than the scheduled arrival time. Average delayed minutes are calculated from delayed flights only. A random sample of 20 Delta flights in 2018 had an average delay of 65 minutes with a standard deviation of 5 minutes.
a) Categorical or Quantitative Variable?
b) Is 60 minutes a Sample...
1. Ulrich Inc. just announced the quarterly earnings report for its fiscal second quarter and a...
1. Ulrich Inc. just announced the quarterly earnings report for
its fiscal second quarter and a quarterly dividend. The net income
for the second quarter was $650,000, of which 30% will be paid as
dividends. The balance sheet at the end of the fiscal first quarter
had a retained earnings balance of $3,545,000. Calculate the
retained earnings that will be shown on the balance sheet at the
end of Ulrich's fiscal second quarter.
2. Ulrich Inc.'s articles of incorporation authorize...
Many companies incurred costs related to Covid-19 in the second quarter of 2020. In their 2nd...
Many companies incurred costs related to Covid-19 in the second
quarter of 2020. In their 2nd quarter earnings announcements,
many of them reported non-GAAP earnings that exclude costs related
to Covid-19. Which of the following is more likely to be
true?
a). Firms can disclose non-GAAP earnings that exclude costs
related to Covid-19 from GAAP-based earnings as long as they
provide reconciliation between non-GAAP earnings and GAAP
earnings
b). The SEC does not allow firms to disclose non-GAAP earnings
that...
The second quarter of 2020 (i.e., the months of April, May, June) saw the deepest recession...
The second quarter of 2020 (i.e., the months of April, May,
June) saw the deepest recession in the Canadian economy in terms of
contraction in economic activity and employment. which recovery
path for output and employment from the following set of
possibilities is the economy likely to take over the next year or
so: V-shaped, U-shaped, L-shaped, W-shaped, K-shaped Please pick
only one and justify reasoning
Santana Rey expects second-quarter 2020 sales of Business Solutions’s line of computer furniture to be the...
Santana Rey expects second-quarter 2020 sales of Business
Solutions’s line of computer furniture to be the same as the first
quarter’s sales (reported below) without any changes in strategy.
Monthly sales averaged 39 desk units (sales price of $1,200) and 15
chairs (sales price of $450).
BUSINESS SOLUTIONS—Computer Furniture Segment
Segment Income Statement*
For Quarter Ended March 31, 2020
Sales†
$
160,650
Cost of goods sold‡
119,400
Gross profit
41,250
Expenses
Sales commissions (10%)
16,065
Advertising expenses
7,500
Other fixed...
Santana Rey expects second-quarter 2020 sales of Business Solutions’s line of computer furniture to be the...
Santana Rey expects second-quarter 2020 sales of Business
Solutions’s line of computer furniture to be the same as the first
quarter’s sales (reported below) without any changes in strategy.
Monthly sales averaged 42 desk units (sales price of $1,270) and 22
chairs (sales price of $520).
BUSINESS SOLUTIONS—Computer Furniture Segment
Segment Income Statement*
For Quarter Ended March 31, 2020
Sales†
$
194,340
Cost of goods sold‡
145,440
Gross profit
48,900
Expenses
Sales commissions (10%)
19,434
Advertising expenses
9,600
Other fixed...
Santana Rey expects second-quarter 2020 sales of Business Solutions’s line of computer furniture to be the...
Santana Rey expects second-quarter 2020 sales of Business
Solutions’s line of computer furniture to be the same as the first
quarter’s sales (reported below) without any changes in strategy.
Monthly sales averaged 41 desk units (sales price of $1,260) and 21
chairs (sales price of $510).
BUSINESS SOLUTIONS—Computer Furniture Segment
Segment Income Statement*
For Quarter Ended March 31, 2020
Sales†
$
187,110
Cost of goods
sold‡
140,160
Gross
profit
46,950
Expenses
Sales
commissions (10%)
18,711
Advertising
expenses
9,300
Other fixed...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- In this programming assignment, you will write C code that performs recursion. For the purpose of...
- Suppose you purchase one WM May strike=102 call contract at $5 and write one WM May...
- The three call options issued by Tesla Inc are listed below. Suppose that the current price...
- 1. Explain why times of economic distress caused classical liberalism to fall out of favor.
- To demonstrate the practical implementation of the public\private encryption, you have been asked to compete the...
- Suppose we are thinking about replacing an old computer with a new one. The old one...
- The project has a critical path that is 4 months long. We are now part way...
ADVERTISEMENT