Economic Order Quantity. Assume that Every- man's Bookstore uses up cash at a steady rate of $200,000 per year. The interest rate is 2% and each sale of securities costs $20. (LO1) a. How many times a year should the store sell securities? b. What is its average cash balance
Q: Nrangler Incorporated uses the percentage of credit sales method to estimate Bad Debt Expense. At th...
A: As per percentage of credit sales method Bad debt expense = Net credit sales × % of bad debt
Q: In this scenario, you are presented with the company’s financial records. This activity requires vig...
A: You have posted multiple questions, s as per Bartleby policy, only the first question is answered. I...
Q: Which of the following statements is true regarding minimum corporate income tax? Minimum corporate ...
A: minimum corporate income tax in Philippines, 2 % of gross profit is imposed on domestic and residen...
Q: Mr. and Mrs. Tan own 100% of the common stock of ABC Company and 90% of the common stock of XYZ Comp...
A: Total shareholders equity shall be 100% shareholders equity of ABC + 90% shareholders equity of ABC ...
Q: You have the following information for Metlock, Inc. for the month ended October 31, 2022. Metlock u...
A: Inventory Valuation Methods - Inventory valuation involve FIFO Method, LIFO Method and Average Cost ...
Q: an Luis Obispo, California based SLOboards, Inc. manufactures a single line of paddleboards. For t...
A: Introduction Cost volume profit analysis is a technique that determines how change in variable cost,...
Q: Bursey Company uses a standard cost system. Manufacturing overhead is applied to units of product on...
A: The predefined overhead rate is determined at the start of each fiscal year and is computed as the e...
Q: Gary wants you to calculate his personal income tax liability. He is a tax resident of Australia. Du...
A: Gary Resident - Australia Year ended - 30/06/2022 Income Details Gross Salaries and Wages- $ 13800...
Q: Among the inherent powers of the State: O Taxation is the most punitive and restricting. O Taxation ...
A: Among the inherent powers of the state: Taxation constitutes the most direct form of equivalent com...
Q: Which of the following best describes a voucher? A supporting document prepared for each cash recei...
A: A voucher checks are commonly used by a company's payroll department and are referred to as payroll ...
Q: 6. An insurance company has an obligation to pay the medical costs for a claimant. Average annual cl...
A: Step 1:Calculation of Inflated Value of Claims for next 16 years For Example Claim...
Q: Alphabet Inc. is a small business that produces wood cabinets. The company collected the following d...
A: Calculation of total cost of the Job Cutting Department Assembly Department Finishing Depa...
Q: 1. From the data above, calculate the Ending Inventory (quantity and cost), Cost of Goods Sold, and ...
A: Date Incoming goods Goods out Ending inventory Total units Cost / unit Total units Cost /...
Q: T/F. A major contentious issue with Internal Service Fund is the distribution of losses to various c...
A: Introduction: An Internal Service fund is one that primarily provides benefits, commodities, or serv...
Q: machinery purchased under terms FOB shipping point Interest on loans borrowed to purchase an equip...
A: cost of property plant and equipment includes any cost that has been paid for acquiring such as it a...
Q: Bonds Payable has a balance of $1,135,000 and Discount on Bonds Payable has a balance of $11,350. If...
A: The discount on bond is an expense for the issuer which denotes the lesser amount that the issuer re...
Q: is P4. 5. We agreed that I should receive a P1 bonus in addition to my P1 salary while you receive a...
A: in partnerships two or more person come together to start a business in order to share their skill ...
Q: unes Corporation uses the weighted-average method in its process costing system. This month, the beg...
A:
Q: The company purchased a computer system at a cost of $100,000. The estimated useful life is 4 years,...
A: Since you have asked multiple question, we will solve the first question for you. If you want any sp...
Q: Although he has enough to start the business now as a partnership, he believes cash flow may be an i...
A: corporation is such a form of business that is started requireds rules and regulation to be followed...
Q: Danica Corporation's standard cost system contains the following overhead costs, computed based on a...
A:
Q: primary purpose of preparing a trial balance is to determine that: The ledger contains an equal pes...
A: In trial balance: Number of ledger accounts in debit and credit column can differ. Debit and credit...
Q: Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near ...
A: Calculation of revenue and spending variance Excel Formulas that are used for calculations:-
Q: Required information [The following information applies to the questions displayed below.] Trey Mons...
A: Under FIFO Method, using perpetual inventory system, value of inventory is calculated at the end of ...
Q: Pascal Ltd intends to tender for a contract to make warning triangles to be carried in cars in the e...
A: Introduction:- Historical costs are treated as sunk costs. Which are not relevant for decision maki...
Q: Use the following to answer the questions Net Sales $750,000 Gross profit $310,000 Beginning invento...
A: Gross profit = Net sales - cost of goods sold Operating income = Gross profit - Operating expense En...
Q: Yummy Food is expanding its business and wants to open a new facility to make frozen lasagna, which ...
A: Lease payment is the rentals to be paid by the lessee for using the asset of the lesser for certain ...
Q: Vhat amount of cash should Hechter Co. report on its December 31, 2020 statement of financio РOsitio...
A: Solution:- Introduction:- Cash and Cash equivalents includes bills, checks received but not deposit...
Q: On January 1, 2021, PARKSOOYOUNG acquired all the outstanding shares of SUNGJAE for P600,000. The sh...
A: In the context of the given question, we should compute the goodwill or gain from the acquisition of...
Q: What role do management accounting principles and practices play in assisting managers in solving re...
A: Firm managers are faced with the challenging problem of managing people while also grasping the real...
Q: 1. Compute depreciation expense for 2019 and 2020 using the following methods: (Round your answers t...
A: Depreciation is the reduction in the value of asset due to its normal use and tear and wear. It is c...
Q: Determine the present value of $250,000 to be received at the end of each of four years, using an in...
A: Present value refers to the current worth of an amount that is receivable in the future.
Q: Which of the following is not a benefit of budgeting It is a basis for performance evaluation.
A: A budget is a forecast of the financial position and the results of the company for the period of on...
Q: A company uses an overhead absorption rate of £6·50 per labour hour, based on 40,000 budgeted labour...
A: Under (over)absorbed overhead for the period = Actual total overhead expenditure - Applied overhead ...
Q: What was the effect of W's purchase of XYZ's bond on the retained earnings amount reported in XYZ's ...
A: The effect of W's purchase of XYZ's bond on the retained earnings amount reported in XYZ's March 31,...
Q: What do documentation procedures and independent internal verification procedures have in comm O The...
A: Internal control are the procedures and policies that ensure the safeguarding of Assets and reduce t...
Q: Under the realization principle, revenue from sale of products is recognized a. At date of delivery...
A: Recognition of Revenue - Recognition of Revenue is the recording of revenue in the financial year. T...
Q: The Company acquireda machine on January 1, Year 1. The machine cost $500,000 and had an estimated r...
A: Depreciation: Depreciation means the reduction in the value of an asset over the life of the assets ...
Q: The following data were taken from the records of a citizen decedent: Land inherited from his mothe...
A: Vanishing deduction is deducted at 80%: Value to Take/Initial Basis 15,000,000 Proportional D...
Q: A company reports the following: Sales $1,460,000 Average accounts receivable (net) 100,000 Determi...
A: a. Accounts receivable turnover = Net sales / average accounts receivable Accounts receivable turnov...
Q: Heather Products expects the following sales of its single product: Units May 15,000 June 16,000 Jul...
A: Introduction:- The following notes required to calculate as follows:- 1)Ending inventory of May = 20...
Q: The costs most relevant to be used in decision making are: a. sunk costs O b. current costs O c. est...
A: Cost: It implies to the expense that is incurred on the manufacturing of a product or rendering serv...
Q: EyeGuard Equipment Incorporated (EEI) manufactures protective eyewear for use in commercial and home...
A: Calculation of Activity Rates Activity Centre Cost Driver Manufacturing overheads (In $) Activity...
Q: PT Water Canon sells 2 types of water pumps. HP7 Pumps are used for factories and WP7 Pumps for hous...
A: You have posted multiple questions, as per Bartleby policy only the first question will be answered....
Q: Explain what is meant by the term decision model. 2. Distinguish between qualitative and quantitat...
A: Solution Every business have to take various decisions regarding their business to ensure the smooth...
Q: TK Co. manufactures a single product that goes through two processes, mixing and cooking. The data p...
A: 9) Equivalent units of Y =27000+ 60000-17000 =70000 units total cost of Y = 89100+138400 =227500 eq...
Q: T/F. A major contentious issue with Internal Service Fund is the distribution of losses to various c...
A: Introduction: An Internal Service fund is one that primarily offers benefits, commodities, or serv...
Q: Prepare an analysis of the month's transactions using a tabular format (please see answer sheet).
A: Cash + Accounts Receivable + Supplies Inventory + Equipment = Accounts Payable + Owner's Equity ...
Q: Common shares, 600,000 authorized, 60,000 shares issued $500,000 Contributed surplus (from a 2010 ...
A: Stockholder's Equity - Stockholder's Equity includes the amount contributed by shareholders issued i...
Q: Refund of value added taxes in the current year which were errone paid in a prior year is generally ...
A: Refund of value added tax is not a income. It is just refund of amount which was erroneously paid.
Economic Order Quantity. Assume that Every-
man's Bookstore uses up cash at a steady rate of
$200,000 per year. The interest rate is 2% and each sale
of securities costs $20. (LO1)
a. How many times a year should the store sell
securities?
b. What is its average cash balance?
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- note: can you help me answer the question for a, and b? For Nibong Prawn Paste Enterprise (NPPE), the average age of accounts receivable (AAR) is 60 days, the average age of accounts payable (AAP) is 45 days, and the average age of inventory (AAI) is 72 days. Assume a 365-day year. a. The length of the company’s cash conversion cycle (CCC) is? (days) b. Based on the CCC calculated in (a) above, if the forecasted sales turnover is $5 million the working capital requirement (WCR) of NPPE is? c. If NPPE is able to reduce its AAI to 65 days; maintain its AAR at 60 days, stretch its AAP to 60 days and maintain the same forecasted sales turnover of $5 million, the new CCC is _____ (days) and the new WCR is ______ (dollars) d. Which of the following are TRUE about the impacts of the change in the CCC of NPPE? A) The WCR would be reduced to $310,000 B) NPPE’s trade creditors can be said to be financing part of its WCR by allowing the company an extension of credit C) NPPE can also…еВook Zane Corporation has an inventory conversion period of 90 days, an average collection period of 34 days, and a payables deferral period of 48 days. Assume 365 days in year for your calculations. a. What is the length of the cash conversion cycle? Round your answer to two decimal places. days b. If Zane's annual sales are $3,454,540 and all sales are on credit, what is the investment in accounts receivable? Do not round intermediate calculations. Round your answer to the nearest cent. $ c. How many times per year does Zane turn over its inventory? Assume that the cost of goods sold is 75% of sales. Use sales in the numerator to calculate the turnover ratio. Do not round intermediate calculations. Round your answer to two decimal places.Suppose that Ken-Z Art Gallery has annual sales of $870,000, cost of goods sold of $560,000, average inventories of $244,500, average accounts receivable of $265,000, and an average accounts payable balance of $79,000. Assuming that all of Ken-Z's sales are on credit, what will be the firm's cash cycle? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.)
- The Dire Corporation has an inventory conversion period of 75 days, a receivables collection period of 38 days, and a payables deferral period of 30 days. What is the length of the firm’s cash conversion cycle? If Dire’s annual sales are $3,421,875 and all sales are on credit, what is the firm’s investment in accounts receivable? How many times per year does Dire turn over its inventory?1. Makmak Corporation uses the Baumol Cash Management Model to determine its optimal cash balance. For the coming year, the expected cash disbursement total P432,000. The interest rate on marketable securities is 5% and P8 is the cost per transaction. What is the optimal Cash Balance of the company? 2. If Hot Tubs Inc. had annual credit sales of P2,027,773 and its days sales outstanding was equal to 35 days, what was its average A/R outstanding? (Use a 365-day year.)The following formula is used in determining its optimal level of cash. Assume that the fixed cost of selling marketable securities is P10 per transaction and the interest rate on marketable securities is 6% per year. The company estimates that it will make cash payments of P12,000 over a 1-month period. What is the average cash balance (rounded to the nearest peso)? (check the attached photo) choose the letter of the correct answer a. P1,732.00b. P3,464.00c. P6,928.00d. P8,660.00e. P15,588.00
- mekmek Corporation uses the Baumol Cash Model to determine its optimal cash balance. For the coming year, the expected cash disbursement total to P432,000. The interest rate on marketable securities is P8 per transaction. Using 5% carrying cost rate, what is the optimal cash balance of the company? A. 1,175.76 B. 5,878.78 C. 11,757.55 D. 142,000Suppose that LilyMac Photography has annual sales of $230,000, cost of goods sold of $165,000, average inventories of $4,500, average accounts receivable of $25,000, and an average accounts payable balance of $7,000.Assuming that all of LilyMac’s sales are on credit, what will be the firm’s cash cycle? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.)Suppose that LilyMac Photography has annual sales of $233,000, cost of goods sold of $168,000, average inventories of $4,800, average accounts receivable of $25,600, and an average accounts payable balance of $7,300. Assuming that all of LilyMac's sales are on credit, what will be the firm's cash cycle? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.) What will be the firm's operating cycle? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.)
- (D) Receivables and Cash: Collection Float A firm has daily cash receipts through checks. On average 150 checks are received per day while each check has an average value of P2,500. It takes an average of 3 days for the bank to clear the checks. A bank has offered to decrease the clearing period to one day for a monthly fee of P500. The bank gives an interest rate of 3% per year. Required: 16. How much is the daily cash receipts? 1. How much is the decrease of the clearing float in days? 2. How much would the average cash in bank balance increase by if the ABC took the bank's offer? 3. How much would ABC receive as total annual interest on the freed cash? 4. How much is the annual cost of the service? 21. What is the annual net benefit or loss) from having this service?PROBLEM Buccaneer, Inc., has determined that it needs $10 million in cash per week. If Buccaneer needs additional cash, it can sell marketable securities, incurring a fee of $100 for each transaction. If Buccaneer leaves funds in its marketable securities, it expects to earn approximately 0.2% per week on their investment. 1. How much is the weekly opportunity cost of cash? (Use a number, must be in decimal form. eg. 6.3%/100, encode 0.063 , no commas, no currency, no space) * 2. How much is the total demand for cash per week? (Use a number, no decimal value, no commas, no currency, no space) * 3. How much is the cost per transaction? (Use a number, no decimal value, no commas, no currency, no space) * 4. Using the Baumol Model, how much cash should Buccaneer raise from selling securities each week to minimize its costs of cash? (Use a number, no decimal value, no commas, no currency, no space) * PLEASE ANSWER ALL QUESTIONS. THANK YOU2. Suppose you start each month with a cash balance of P100,000 and you use cash evenly throughout the month, ending each month with a zero cash balance. a. What is the average cash balance each month? b. If you could earn 1% per month investing your cash, what is the opportunity cost, per month, associated with your cash balance?