.Find some recent projections for the future path of the U.S. government debt as a percentage of GDP. What assumptions are made about government spending, taxes, and economic growth? Do you think these assumptions are reasonable? If the United States experiences a productivity slowdown, how will reality differ from this projection?
In: Economics
In: Nursing
COST-VOLUME ANALYSIS
During its first year of operations, the S-Ray Corporation produced the following income statement results:
| Income Statement | 2013 |
| Net Sales | 400,000.00 |
| less: Cost of Goods Sold | 240,000.00 |
| Gross Profit | 160,000.00 |
| less: General & Administrative | 60,000.00 |
| less: Marketing expenses | 60,000.00 |
| less: Depreciation | 20,000.00 |
| EBIT | 20,000.00 |
| less: Interest expenses | 10,000.00 |
| Earnings before taxes | 10,000.00 |
| less: Income taxes (30%) | 3,000.00 |
| Net earnings (loss) | 7,000.00 |
Costs of goods sold are expected to vary with sales and be a constant percentage of sales. The general and administrative employees have been hired and are expected to remain a fixed cost. Marketing expenses are also expected to remain fixed since the current sales staff members are expected to remain on fixed salaries and no new hires are planned. The effective tax rate is expected to be 30 percent for a profitable firm.
Estimate the survival or EBDAT breakeven amount in terms of survival revenues necessary for the S-Ray Corporation to breakeven next year, or the Survival revenues (SR) to achieve EBDAT = 0.
Use the attached spreadsheet for analysis,
| 1 | From question | per unit | |||||||
| 2 | |||||||||
| 3 | computer chips | 70 | <-- from question | ||||||
| 4 | plastic casings | 15 | <-- from question | ||||||
| 5 | assembly hardware | 5 | <-- from question | ||||||
| 6 | direct labor | 5 | <-- from question | ||||||
| 7 | total cost | 95 | <-- from question | ||||||
| 8 | price | 142.5 | <-- from question | ||||||
| 9 | |||||||||
| 10 | Sales | ||||||||
| 11 | Jan | Feb | Mar | 1st Qtr | |||||
| 12 | |||||||||
| 13 | units of sales | 200 | 400 | 800 | 1400 | <-- from question | |||
| 14 | dollar sales | ?? | ?? | ?? | ?? | <-- from question | |||
| 15 | |||||||||
| 16 | Cost of production schedule | ||||||||
| 17 | |||||||||
| 18 | per unit | Jan | Feb | Mar | 1st Qtr | ||||
| 19 | Production | 500 | 500 | 500 | 1500 | <-- from question | |||
| 20 | Production Cost | ||||||||
| 21 | computer chips | 70 | ?? | ?? | ?? | ?? | <-- prodution * unit cost | ||
| 22 | plastic casings | 15 | ?? | ?? | ?? | ?? | <-- prodution * unit cost | ||
| 23 | assembly hardware | 5 | ?? | ?? | ?? | ?? | <-- prodution * unit cost | ||
| 24 | direct labor | 5 | ?? | ?? | ?? | ?? | <-- prodution * unit cost | ||
| 25 | Total production cost | 95 | ?? | ?? | ?? | ?? | <-- prodution * unit cost | ||
| 26 | |||||||||
| 27 | Cost of goods sold schedule | ||||||||
| 28 | |||||||||
| 29 | per unit | Jan | Feb | Mar | 1st Qtr | ||||
| 30 | Units of sales | 200 | 400 | 800 | 1400 | <-- from question | |||
| 31 | Sales | ?? | ?? | ?? | ?? | <-- price * unit of sales | |||
| 32 | Cost of goods sold | 95 | ?? | ?? | ?? | ?? | <-- sales * unit cost | ||
| 33 | Gross profit | ?? | ?? | ?? | ?? | <-- sales - cost of goods sold | |||
| 34 | |||||||||
| 35 | Inventories schedule | ||||||||
| 36 | Jan | Feb | Mar | ||||||
| 37 | Beginning finished goods | ?? | ?? | ?? | <-- previous ending inventories | ||||
| 38 | Production | ||||||||
| 39 | Materials | ?? | ?? | ?? | <-- computer + plastic + assembly | ||||
| 40 | Direct labor | ?? | ?? | ?? | <-- labor | ||||
| 41 | Additions | ?? | ?? | ?? | <-- sum of materials and labor cost | ||||
| 42 | Total (beg + additions) | ?? | ?? | ?? | <-- beginning + additions | ||||
| 43 | Less: cost of goods sold | ?? | ?? | ?? | <-- cogs | ||||
| 44 | Ending finished goods | ?? | ?? | ?? | <-- ending inventories | ||||
| 45 | |||||||||
| 46 | |||||||||
| 47 | |||||||||
| 48 | |||||||||
| 49 | Jan | Feb | Mar | 1st Qtr | |||||
| 50 | Total production cost | ?? | ?? | ?? | ?? | ||||
| 51 | Sales | ?? | ?? | ?? | ?? | ||||
| 52 | Cost of goods sold | ?? | ?? | ?? | ?? | ||||
| 53 | Beginning finshed goods | ?? | ?? | ?? | |||||
| 54 | Ending finished goods | ?? | ?? | ?? | |||||
| Item | Results | Formula |
| Revenue (R ) | ?? | <-- Revenue |
| Variable Cost (VC) | ?? | <-- cost of goods sold |
| CFC | ?? | <-- Admin + Marketing + Interest |
| VCRR | ?? | <-- VC / R |
| Survival | ?? | <-- CFC / (1 - VCRR) |
In: Finance
Each part should be no more than 1 page in length.
Part I
The rules of accounting provide management with “some” latitude in determining when revenue is earned. Assume that a company normally required acceptance by its customers prior to recording revenue as earned, delivers a product to a customer near the end of the quarter. The company believes that customer acceptance is assured, but cannot obtain it prior to the quarter-end. Recording the revenue would assure “making its numbers” for the quarter. Although formal acceptance is not obtained, the salesperson records the sale, fully intending to obtain written acceptance as soon as possible.
1. What are the revenue recognition requirements in this case?
2. What are the ethical issues relating to this sale?
3. Assume you are on the board of directors of this company. What safeguards can you put in place to provide assurance that the company’s revenue recognition policy is followed?
Part II
Research and review what a financial statement derivative is. Identify an example and how company’s use to leverage the business activities.
Part III
A company’s return on net operating assets (RNOA = NOPAT/Average NOA) is commonly used to evaluate financial performance. If managers cannot increase NOPAT, they can still increase this return by reducing the amount of net operating assets (NOA). In bullet form, list specific ways that managers could reduce the following assets:
1. Receivables
2. Inventories
3. Plant, property equipment
In: Finance
(a-1) Use MegaStat or Minitab to deseasonalize Coca-Cola’s quarterly data. (Round your answers to 3 decimal places.)
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In: Statistics and Probability
The Barberton Municipal division of Road Maintenance is charged with road repair in the city of Barberton and the surrounding area. Cindy Kramer, road maintenance director, must submit a staffing plan for the next year based on a set schedule for repairs and on the city budget. Kramer estimates that the labor hours required for the next four quarters are 6000, 12000, 19500, and 9000, respectively. Each of the 11 workers on the workforce can contribute 500 hours per quarter. Payroll costs are $ 6000 in wages per worker for regular time worked up to 500 hours, with an overtime pay rate of $ 17 for each overtime hour. Overtime is limited to 20 percent of the regular-time capacity in any quarter. Although unused overtime capacity has no cost, unused regular time is paid at $ 12 per hour. The cost of hiring a worker is $ 3800, and the cost of laying off a worker is $ 2000. Subcontracting is not permitted. (Hint: When calculating the number of workers, make sure to round up to the next whole number before proceeding with any further calculations.) a. Find a level workforce plan that relies just on overtime and the minimum amount of undertime possible. Overtime can be used to its limits in any quarter.
Use a chase strategy that varies the workforce level without using overtime or undertime. What is the total cost of this plan?
In: Accounting
Your new baby was born yesterday. To save for her education, you
decide to invest in a 529 plan and will make QUARTERLY
contributions until your child enters the great UNLV when she turns
18. That is, you will save for the next 17 years (Or should it be
18 years? Think about it), and the contribution will be made at the
END of each quarter. You expect that the 529 plan will return 8.5%
per year with quarterly compounding. The current in-state cost
(tuition and other expenses, if living with parents) for UNLV is
about $20,176 per year, and you expect your child to spend 4 years
in college. You expect this cost to go up 4% per year until your
child finishes college.
1. How much will you need to save per quarter so that your child
will have enough funding for college? (Assume: Tuition payments are
made ONCE per year at the BEGINNING of the year. Your 529 plan
remains invested until your child finishes college.)
2. Construct a one-way data table to perform a what-if analysis by
varying the annual investment return between 5% to 12%, with
one-percentage-point increment. That is, how much you need to save
each quarter to reach your goal if the investment return varies
between 5% and 12%.
In: Accounting
A. A beverage company hires a manager to work in China. The contract states that if the manager works there for 3 years she will receive an extra bonus of $ 5,000 at the end of each quarter for 6 years following her assignment. Find the lump sum that would have to be deposited today to equal the ending value of the annuity after 6 years assuming money can earn 5.2% interest compounded quarterly.
B. Betty's Cola, Inc. will need a new bottling machine in 5 years and has been told to deposit $10,000 at the end of each quarter for 5 years to accumulate the needed funds. Assuming money can earn 6% compounded quarterly, what lump sum deposited today will generate the same ending value of the annuity after 5 years?
C. Sandy Chen borrows money at 8% compounded quarterly for her college tuition fee. She agrees to repay the note with a payment of $2,000 per quarter for 5 years. What is this annuity worth today?
D. Monica took out a loan for a new business. She needed $665,000 for start-up costs. She used $65,000 of her own money and took out the loan for the remaining $600,000. Assuming it is a 30-year loan at 7.2% compounded monthly, find the amount of her monthly payment.
Please explain each question :)
In: Finance
Coca-Cola Revenues ($ millions), 2005–2010 Quarter 2005 2006 2007 2008 2009 2010
Qtr1 5,206 5,131 6,090 7,410 7,180 7,516
Qtr2 6,310 6,480 7,720 9,060 8,232 8,665
Qtr3 6,037 6,422 7,677 8,314 8,040 8,417
Qtr4 5,551 5,920 7,318 7,100 7,498 10,485
Click here for the Excel Data File (a-1) Use MegaStat or Minitab to deseasonalize Coca-Cola’s quarterly data.
(Round your answers to 3 decimal places.)
1 2 3 4 2005 2006 2007 2008 2009 2010 mean
(a-2) State the adjusted four quarterly indexes. (Round your answers to 3 decimal places.)
Q1 Q2 Q3 Q4 (a-3) What is the trend model for the deseasonalized time series? (Round your answers to 2 decimal places.)
yt = xt + (b) State the model found when performing a regression using seasonal binaries. (A negative value should be indicated by a minus sign. Round your answers to 4 decimal places.) yt = + t + Q1 + Q2 + Q3
(c) Use the regression equation to make a prediction for each quarter in 2011. (Enter your answers in millions rounded to 3 decimal places.) Quarter Predicted Q1 Q2 Q3 Q4
In: Statistics and Probability
64. Alani’s Hawaiian segment had revenues of $2,029 million, operating income of $973 million, and average assets of $1,283 million. The Hawaiian segment return on assets is: 63.23% 47.95% 75.84% 131.86% 158.14%
73. A company has $101,000 in outstanding accounts receivable and it uses the allowance method to account for uncollectible accounts. Experience suggests that 3% of outstanding receivables are uncollectible. The current balance (before adjustments) in the allowance for doubtful accounts is a(n) $910 debit. The journal entry to record the adjustment to the allowance account includes a debit to Bad Debts Expense for: $3,940 $910 None of these is correct. $3,030 $2,120
74. A company has $100,000 in outstanding accounts receivable and it uses the allowance method to account for uncollectible accounts. Experience suggests that 5% of outstanding receivables are uncollectible. The current balance (before adjustments) in the allowance for doubtful accounts is a(n) $900 credit. The journal entry to record the adjustment to the allowance account includes a debit to Bad Debts Expense for: $5,900 $5,045 $4,100 $4,955 $5,000
80. Big Box Store has operated with a 30% average gross profit ratio for a number of years. It had $113,000 in sales during the second quarter of this year. If it began the quarter with $19,300 of inventory at cost and purchased $73,300 of inventory during the quarter, its estimated ending inventory by the gross profit method is: $19,300. $13,500. $33,900. $23,730. $30,900. ?
In: Accounting