Calculate the future value of the following annuity streams:

a. $5,000 received each year for 6 years on the last day of each year if your investments pay 6 percent compounded annually.
b. $5,000 received each quarter for 6 years on the last day of each quarter if your investments pay 6 percent compounded quarterly.
c. $5,000 received each year for 6 years on the first day of each year if your investments pay 6 percent compounded annually.
d. $5,000 received each quarter for 6 years on the first day of each quarter if your investments pay 6 percent compounded quarte

Calculate the future value of the following annuity streams:

a. $5,000 received each year for five years on the last day of each year if your investments pay 6 percent compounded annually.

b. $5,000 received each quarter for five years on the last day of each quarter if your investments pay 6 percent compounded quarterly.

c. $5,000 received each year for five years on the first day of each year if your investments pay 6 percent compounded annually.

d. $5,000 received each quarter for five years on the first day of each quarter if your investments pay 6 percent compounded quarterly.

Woodplex Ltd is a medium-size company that specializes in making a hand-made furniture cover. The company has been relatively successful over the years due to its good quality product and the good relations it has with its suppliers of materials and staff on the production line. Woodplex Ltd’s management, however, anticipates the market becoming more competitive in the near future, not least due to the weak UK economy and forecasts of slow growth. They are now seeking a way to lower the price of their product. A cheaper substitute material has been identified for the furniture cover but securing this material would involve signing a long-term contract with a new supplier. Woodplex Ltd’s management believe that it would be prudent to delay signing a long-term contract until an analysis can be made of how switching to a new material (and supplier) would affect the production process and operating profit. As a result of the above concern, the prospective supplier was therefore asked to supply Woodplex Ltd the materials they needed for production during the most recent quarter.

The managing director of Woodplex Ltd has now asked for your help on this matter. You have been provided with the following standard cost data (i.e., based on the old supplier) and budgets.

Additional information:

• Actual direct material usage totalled 57,200 metres. All materials used during the quarter were sourced from the prospective supplier.
• A total of 132,000 direct labour hours were worked during the quarter.
• During the quarter, a promotional price for the furniture cover was introduced following the recommendation of Woodplex Ltd’s marketing director. The marketing director argued that this would not only boost sales but also provide an opportunity to evaluate how customers would respond to their product when the substitute material is used.
• Woodplex Ltd uses a standard variable costing system for internal reporting purposes.
• Calculate for the quarter:
  1. Sales margin price and volume variances
  2. Direct material quantity and price variances
  3. Direct labour efficiency and rate variances
  4. Variable overhead efficiency and spending variances
  5. Fixed overheads spending variance

3. Drawing on your answers in (a) and (b) and any other financial or non-financial consideration you think would be relevant in this case, advise Woodplex Ltd whether or not it should sign a long-term contract with the new supplier.

Consider an economy, but don't know the marginal propensity to consume (MPC) for the average person. If the government decides to increase its government spending by 1 billion dollars in education (building more public schools, etc.) To nance the increase in government spending, the government decides to increase tax by 1 billion dollars as well. How would the GDP respond to this series of change in the Goods Market Equilibrium? Explain.

1) What effect will the following have on the demand for UK-produced goods and services ceteris paribus?

a) the Chancellor of the Exchequer, George Osborne increases taxes
b) there is an increase in interest rates
c) there is an increase in interest rates in Germany
d) additional spending on the National Health Service to reduce waiting lists
e) reduced spending on Child Benefit
f) Samsung builds a new factory in Scotland

4. Suppose that investment demand increases by $100. Assume that households have a marginal propensity to consume of 80 percent. Compute the first three rounds of multiplier effects as follows:

a) What are the first cycle changes in spending? Total cumulative change equals?

b) What are the second cycle changes in spending? Total cumulative change equals?

c) What are the third cycle changes in spending? Total cumulative change equals?  

5. If a balanced budget government passes a new fiscal stimulus or restraint, it can lead to a deficit or surplus. In order to avoid an imbalance, how much of a tax hike or tax cut would be required? In the event of an extra $50 Billion of government purchases, $30 Billion of transfer payments, what should be the offsetting tax package?

Hillyard Company, an office supplies specialty store, prepares its master budget on a quarterly basis. The following data have been assembled to assist in preparing the master budget for the first quarter:

1. As of December 31 (the end of the prior quarter), the company’s general ledger showed the following account balances:

2. Actual sales for December and budgeted sales for the next four months are as follows:

3. Sales are 20% for cash and 80% on credit. All payments on credit sales are collected in the month following sale. The accounts receivable at December 31 are a result of December credit sales.

4. The company’s gross margin is 40% of sales. (In other words, cost of goods sold is 60% of sales.)

5. Monthly expenses are budgeted as follows: salaries and wages, $33,000 per month: advertising, $63,000 per month; shipping, 5% of sales; other expenses, 3% of sales. Depreciation, including depreciation on new assets acquired during the quarter, will be $44,980 for the quarter.

6. Each month’s ending inventory should equal 25% of the following month’s cost of goods sold.

7. One-half of a month’s inventory purchases is paid for in the month of purchase; the other half is paid in the following month.

8. During February, the company will purchase a new copy machine for $2,800 cash. During March, other equipment will be purchased for cash at a cost of $79,000.

9. During January, the company will declare and pay $45,000 in cash dividends.

10. Management wants to maintain a minimum cash balance of $30,000. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter.

Required:

Using the data above, complete the following statements and schedules for the first quarter:

1. Schedule of expected cash collections:

2-a. Merchandise purchases budget:

2-b. Schedule of expected cash disbursements for merchandise purchases:

3. Cash budget:

4. Prepare an absorption costing income statement for the quarter ending March 31.

5. Prepare a balance sheet as of March 31.

mplete the cash budget. (Cash deficiency, repayments and interest should be indicated by a minus sign.)

Requirement 4

pare an absorption costing income statement for the quarter ending March 31.

Requirement 5:

Prepare a balance sheet as of March 31.

NOTE__ some of my numbers already imputted could be wrong.

1) Economic growth occurs when

2)

Saving is important for economic growth

3)

1. The circular flow of income shows

   		goods and services flowing in one direction and money payments in the other direction.
   		goods, services, and money payments flowing in the same direction.
   		goods and money payments flowing in one direction and services flowing in the opposite direction.
   		goods flowing in one direction and services and money payments flowing in the other direction. 4) The real rate of interest is
   		a value that depends upon the stock market.
   		the interest rate observed in the market minus the anticipated inflation rate.
   		not influenced by inflation.
   		the interest rate observed in the market

1) The Top Shop Company produces T-shirts. Each T-shirt requires 1.30 m of fabric, which company obtains at a cost of $5 per meter. The company sells the T-shirts for $12 per T-shirt. The Company would like to maintain an ending stock of fabric equal to 10% of the next month’s requirements. The company would also like to maintain an ending stock of finished T-shirts equal to 20% of the next month’s sales. Sales (in units) are projected to be as follows for the first three months of the year:

Month January February March 1st Quarter
Unit Sales 7,200 11,600 17,600 ?

Requirements:
Prepare the following budgets for the first three months of the year, as well as a summary budget for the quarter:
a) Prepare the sales budget, including a separate section that details the type of sales made. For this section, assume that 10% of the company’s T-shirts are cash sales, while the remaining 90% are sold on credit terms.
b) Prepare the production budget. Assume that the company anticipates selling 21,600 units in April.
c) Prepare the direct materials purchases budget. Assume the company needs 20,800 m of fabric for production in April.
d) Prepare the direct labour budget for the first three months of the year. Assume that each T-shirt requires 0.50 of an hour. Direct labourers are paid $25 per hour.
e) Assume April sales are projected to be $259,200. Credit collections are 15% two months following the sale, 45% in the month following the sale and 35% in the month of sale. The remaining 5% is expected to be uncollectible.
f) Calculate the Cost of Goods Sold and the Gross Profit assuming that,
i. manufacturing cost pe unit is $10 and,
ii. the management sets its prices to achieve an overall 45% gross profit. Management would like to maintain an ending inventory equal to 10% of the next month’s Cost of Goods Sold. The December 31 balance is 10% of January’s Cost of Goods Sold.

SmithSmith

Foods produces specialty soup sold in jars. The projected sales in dollars and jars for each quarter of the upcoming year are as? follows:

SmithSmith

anticipates selling

226 comma 000226,000

jars with total sales revenue of

$ 266 comma 000$266,000

in the first quarter of the year following the year given in the preceding table.

SmithSmith

has a policy that the ending inventory of jars must be

3030?%

of the following? quarter's sales.

Requirement

Prepare a production budget for the year that shows the number of jars to be produced each quarter and for the year in total.

Prepare the production budget by first calculating the total units? needed, then calculate the units to produce.

Enter any number in the edit fields and then click Check Answer.