BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $117,000 paid to its employee, and FICA Medicare taxes are 1.45% of gross pay. For BMX, its FUTA taxes are 0.6% and SUTA taxes are 2.9% of the first $7,000 paid to its employee. Compute BMX€™s amounts for each of these four taxes as applied to the employee€™s gross earnings for September under each of three separate situations (a), (b), and (c).
Gross pay through August Gross pay for September
a. 6400 800
b. 18,200 2100
c. 11700 8000

Answers

Answer 1

Answer:

Scenario       Accumulated     September    FICA taxes      FUTA / SUTA

                    gross pay           gross pay      7.65%              3.5%      

a.                   $6,400               $800             $61.20             $21

b.                   $18,200             $2,100           $160.65           $0

b.                   $11,700              $8,000          $611.20            $0


Related Questions

Identifying and Classifying Balance Sheet and Income Statement Accounts
Following are selected accounts for Staples, Inc., for the fiscal year ended January 3, 2016
(a) Indicate whether each account appears on the balance sheet (B) or income statement (I).
Staples, Inc. ($ millions) Amount Classification
Sales $24,381 I
Accumulated depreciation 4,067 B
Depreciation expense 408 I
Retained earnings 6,694 B
Net income (loss) (211) I
Property, plant & equipment, net 6,030 B
Selling, general and admin expense 4,884 I
Accounts receivable 1,816 B
Total liabilities 6,144 B
Stockholders' equity 6,136 B
(b) Using the data, compute total assets and total expenses.
Total Assets = $Answer
Total Expenses = $Answer
(c) Compute net profit margin (net income/sales) and total liabilities-to-equity ratio (total liabilities/stockholders' equity). (Round your answers to two decimal places.)
Net Profit Margin = Answer
Total Liabilities-to-Equity Ratio = Answer

Answers

Answer:

Staples, Inc.

a. Indication of whether each account appears on the balance sheet (B) or income statement (I):

Staples, Inc. ($ millions) Amount Classification

Sales                                                 $24,381 (I)

Accumulated depreciation                 4,067 (B)

Depreciation expense                           408 (I)

Retained earnings                              6,694 (B)

Net income (loss)                                   (211) (I)

Property, plant & equipment, net      6,030 (B)

Selling, general and admin expense 4,884 (I)

Accounts receivable                            1,816 (B)

Total liabilities                                     6,144 (B)

Stockholders' equity                          6,136 (B)

b) Total Assets = $3,779

Total Expenses = $5,292

c) Net Loss Margin = -0.87%

Total Liabilities-to-Equity Ratio = = 100.13%

Explanation:

a) Data and Calculations:

Total assets:

Accumulated depreciation                (4,067) (B)

Property, plant & equipment, net      6,030 (B)  

Accounts receivable                            1,816 (B)

Total assets  =                                  $3,779

Total Expenses:

Depreciation expense                           408 (I)  

Selling, general and admin expense 4,884 (I)

Total expenses =                              $5,292

Net profit (loss) margin = $(211)/ $24,381  * 100 = -0.865%

Total  liabilities-to-equity ratio = total liabilities/stockholders' equity * 100

= $6,144/$6,136 * 100

= 100.13%

You need to have $32,250 in 9 years. You can earn an annual interest rate of 4 percent for the first 5 years, and 4.6 percent for the next 4 years. How much do you have to deposit today? A. 23341.12 B. 20769.78 C. 22142.99 D. 24936.86

Answers

Answer:

The deposit today is:

C. 22142.99

Explanation:

a) Data and Calculations:

Future expected value = $32,250

Time period = 9 months

Annual interest rate = 4% for the first 5 years

Annual interest rate = 4.6% for the next 4 years

Today's deposit to earn the above future value is calculated from an online financial calculator as follows:

N (# of periods)  5

I/Y (Interest per year)  4

PMT (Periodic Payment)  0

FV (Future Value)  26940.33

Results

PV = $22,142.99

Total Interest $4,797.34

N (# of periods)  4

I/Y (Interest per year)  4.6

PMT (Periodic Payment)  0

FV (Future Value)  32250

PV = $26,940.33

Total Interest $5,309.67

Project A requires a $280,000 initial investment for new machinery with a five-year life and a salvage value of $30,000. The company uses straight-line depreciation. Project A is expected to yield annual net income of $20,000 per year for the next five years. QS 26-6 Accounting rate of return LO P2 Compute Project A’s accounting rate of return.

Answers

Answer:

12.90%

Explanation:

Annual average investment = (Initial investment + Salvage value) / 2

Annual average investment = ($280000 + $30000) / 2

Annual average investment = $155,000

Accounting rate of return = Annual after­-tax net income / Annual average investment

Accounting rate of return = $20,000 / $155,000

Accounting rate of return = 0.1290322581

Accounting rate of return = 12.90%

Enviro Company issues 14.00%, 10-year bonds with a par value of $500,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 11.00%, which implies a selling price of 129.625. The straight-line method is used to allocate interest expense.

Required:
a. Using the implied selling price of 129 5/8. what are the issuer's cash proceeds from issuance of these bonds?
b. Whet total amount of bond interest expense will be recognized over the life of these bonds?

Answers

Answer: a. $648,125

b. $551875

Explanation:

a. Using the implied selling price of 129 5/8. what are the issuer's cash proceeds from issuance of these bonds?

Bonds Face Value = $500,000

Cash Proceeds will then be:

= 129.625% × $500,000

= $648,125

b. What total amount of bond interest expense will be recognized over the life of these bonds?

20 payments of $35000 = $700000

Pee value at maturity = $500000

Total repaid = $1200000

Less: Amount borrowed = $648125

Total bond Interest expense = $551875

Durable goods $3,000
Services $6,000
Business purchases of capital goods $400
Fixed investment $850
Exports $600
Imports $800
Nondurable goods $700
Inventory investment $200
Government transfer payments $100
Purchases of new residential housing $450
Government purchases $900

GDP is equal to:_______

a. $14,000
b. $11,550
c. $11,450
d. $8,600
e. $13,050

Answers

Answer:

c. $11,450

Explanation:

GDP = Consumption (C) + Investment (I) + Government Expenditure (G) + Net Export (NX)

GDP = [Non durable goods+Durable goods+Services] + [Fixed investment+Inventory investment] + Government purchase + [Export-Import]

GDP = [$700+$3000+$6000] + [$850+$200] + $900 + [$600-$800]

GDP = $9700 + $1050 + $900 - $200

GDP = $11,450

Hardening A. You and your opponent calmly discuss the objective issues involved in the conflict. Fragmentation of the enemy B. Your opponent tells your coworkers that you lied to her about how much money was left in the budget that you both have been discussing how to manage. Images and coalitions C. Rather than discussing the issues the goal becomes winning. You try to mobilize your colleagues to support your position. Loss of face D. Communication with your opponent is ended as winning is no longer possible. The goal becomes outlasting your opponent and destroying her power base.

Answers

Answer:

A. Hardening.

B. Loss of face.

C. Images and coalitions.

D. Fragmentation of the enemy.

Explanation:

A conflict can be defined as any form of disagreement that arises between two or more parties due to opposing views, opinions, or incompatibility.

Some examples of the conflict escalation stage includes;

A. Hardening: you and your opponent calmly discuss the objective issues involved in the conflict. It involves having a fixed position on how an issue or conflict is to be handled.

B. Loss of face: your opponent tells your coworkers that you lied to her about how much money was left in the budget that you both have been discussing how to manage. It typically occurs when an individual is accused of lying and would result in attacking the opponent's public personality.

C. Images and coalitions: rather than discussing the issues the goal becomes winning. It involves the mobilization of colleagues to support one's position.

D. Fragmentation of the enemy: communication with your opponent is ended as winning is no longer possible. It's focused on outlasting an opponent and destroying the person's power base.

Use the following information to create an Excel workbook and write the appropriate Excel formula.

Single Payment Compound Amount-
SPCA = (1+i)^n

i, interest rate per period, has a value of 0.00675
n, number of periods, has a value of 89.

Your answer must be the value produced by the Excel formula. Your answer must contain TWO and only TWO decimal places.


Answers

Answer:

id k

Explanation:

I=Prt try that if it helps

intrest = principla x rate x time

Prepare journal entries to record each of the following four separate issuances of stock.

a. A corporation issued 3,000 shares of $10 par value common stock for $36,000 cash.
b. A corporation issued 1,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $23,000. The stock has a $2 per share stated value.
c. A corporation issued 1,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $23,000. The stock has no stated value.
d. A corporation issued 750 shares of $75 par value preferred stock for $79,250 cash.

Answers

Answer:

Transaction a

Debit : Cash $36,000

Credit : Common Stock (3,000 x $10) $30,000

Credit : Common Stock - Paid in excess of par $6,000

Transaction b

Debit : Cash $23,000

Credit : Common Stock $23,000

Transaction c

Debit : Cash $23,000

Credit : Common Stock $23,000

Transaction d

Debit : Cash $79,250

Credit : Preferred Stock (750 x $75) $56,250

Credit : Preferred Stock - Paid in excess of par $23,000

Explanation:

The journal entries to record each of the following four separate issuances of stock have been prepared above.

Step 1 : Distinguish if Stock has par value or not

For par value stock, any amount paid in excess of par value is places in a reserve - Paid in Excess of Par on issuance.

For non par value stocks, we value stocks at market price of item exchanged

Step 2 : Recording

On Issuance, Cash is increasing so we debit Cash Account. The Stock Account as well as the Reserve - Paid in Excess (if applicable) both increases on the credit side, so that will be a Credit entry

how to develop a deaf social club?​

Answers

i’d say make some friends that are deaf first, either online or in person, and maybe do video calls? i have no clue what it’s like to be deaf or had experience with someone that is deaf, but anything that includes visual stuff is good.

Each year Capital Two retains 75 percent of its customers, and the annual discount rate is 5 percent. What annual retention rate doubles the value of a customer?

Answers

Answer:  87.5%

Explanation:

Value of a Customer = Margin * Retention rate / (1 + Annual discount rate - Retention rate)

We shall assume a margin of 1 so no need to include it:

= 75% / ( 1 + 5% - 75%)

= 2.5

This value needs to double so assume the retention rate to double this is x and use the formula above to find it:

5 = x / (1 + 5% - x)

5 *  (1 + 5% - x) = x

5 + 0.25 - 5x = x

5.25 = 5x+ x

6x = 5.25

x = 5.25 / 6

x = 87.5%

The Allowance for Bad Debts account had a balance of $10,600 at the beginning of the year and $12,200 at the end of the year. During the year (including the year-end adjustment), bad debts expense of $18,800 was recognized.
Required:
Calculate the total amount of past-due accounts receivable that were written off as uncollectible during the year. (Hint: Make a T-account for the Allowance for Bad Debts account, plug in the amounts that you know, and solve for the missing amount.)
Bad debt write-offs _________

Answers

Answer:

Written off = $17,200

Explanation:

                               Allowance for Bad Debt Account

Debtors (Write off) (Bal. fig)  $17,200     Beginning Bal.         $10,600

                                                                 Bad debt expense  $18,800

Ending Balance                     $12,200

Thus, the total amount of past-due accounts receivable that were written off as uncollectible during the year is $17,200.

g If it is difficult to substitute for a good in the short run, but easy in the long run, then _____ . Group of answer choices the elasticity of demand is more elastic in the short un elasticity changes along the demand curve the elasticity of demand is more elastic in the long run the good is an inferior good

Answers

Answer:

the elasticity of demand is more elastic in the long run

Explanation:

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.

Price elasticity of demand = percentage change in quantity demanded / percentage change in price  

If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.  

Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one

Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.  

Infinitely elastic demand is perfectly elastic demand. Demand falls to zero when price increases  

Perfectly inelastic demand is demand where there is no change in the quantity demanded regardless of changes in price.

In the long run, people have more time to search for suitable alternatives than when compared to the short run. Thus, demand tends to be more elastic in the long run

When it comes to Risk Mitigation, which risk counter measure involves not even taking the chance with the risk?

Answers

Answer:

The risk countermeasure that involves not even taking the chance with the risk is:

risk avoidance.

Explanation:

Risk avoidance is a risk mitigation strategy.  To avoid risk, risk exposures and hazards are completely eliminated.  This means that risk avoidance seeks to completely avoid compromising events while other risk mitigation or management efforts try to control the damages and financial consequences of threatening events.

A company needs 510,000 items per year. It costs the company $850 to prepare a production run of these items and $9 to produce each item. If it also costs the company $0.75 per year for each item stored, find the number of items that should be produced in each run so that total costs of production and storage are minimized. 33995 Incorrect: Your answer is incorrect. items/run

Answers

Answer:

20,824 units

Explanation:

850x + [ 0.75 - 510,000 ] / x

solving the equation we get,

[tex]x^{2}[/tex] = [ 0.75 - 510,000 ] / 850

x = 24.49

The number of items produced in each run should be;

510,000 / 24.49 = 20,824

List of ten household items (clothing, shoes, accessories, electronics, food (fruit is particularly good for this activity), etc.) that includes:

a. the name of the item
b. where it was made/produced/manufactured (country is usually all that is provided) . Identify and discuss the different infrastructure systems that facilitated the production, transportation, and your eventual purchasing of the product. Drawing on Massey’s "global sense of place," explain how these infrastructure system fold the global into the local (and vice versa, fold the local into the global).

Answers

Answer:

BR UH

Explanation:

what type of qs is this even

bannana

fridge

pencil

sink

spoon

fork

knife

sisscors

toaster

cup

bowl

bed

pillows

desk

door

tv

couch

chair

table

apple

grapes

cherries

peaches

napkins

toilet

Explain (with theories support) the elements that can affect an individual behavior

Answers

Answer:

wow who has theory support THAT MENAS YOU HAVE wow but none of them has it

Explanation:

Social Cognitive Theory3,4

Bandura’s Social Cognitive Theory proposes that  

people are driven not by inner forces, but by external factors. This model suggests that human functioning can be explained by a triadic interaction of  

behavior, personal and environmental factors (see

figure 1). This is often known as reciprocal determinism. Environmental factors represent situational  

influences and environment in which behavior is preformed while personal factors include instincts,  

drives, traits, and other individual motivational forces. Several constructs underlie the process of human  

learning and behavior change.3 These variables may also intervene in the process of behavior change4.

• Self-efficacy — A judgment of one’s ability to perform the behavior.

• Outcome Expectations — A judgment of the likely consequences a behavior will produce. The  

importance of these expectations (i.e., expectancies) may also drive behavior.

• Self-Control — The ability of an individual to control their behaviors.

• Reinforcements — Something that increases or decreases the likelihood a behavior will continue

Assume a pro rata reinsurance agreement with a 35% retention. Further assume a primary insurance contract with limits of $2,500,000, premiums of $20,000 and deductible $10,000. a)How much premium will the primary insurance company retain

Answers

Answer: $7000

Explanation:

Since there is a pro rata reinsurance agreement with a 35% retention, primary insurance contract with limits of $2,500,000, premiums of $20,000 and deductible $10,000, then the amount of premium that the primary insurance company will retain will be:

= Retention rate × Premium

= 35% × $20000

= 0.35 × $20000

= $7000

Blue Co. recorded a right-of-use asset of $210,000 in a 10-year operating lease. Payments of $37,167 are made annually at the end of each year. The interest rate charged by the lessor was 12% and was known by Blue. The balance in the right-of-use asset after two years will be:

Answers

Answer:

The balance in the right-of-use asset after two years will be $184,629.96.

Explanation:

This can be calculated as follows:

First year interest = Cost of the right-of-use asset * Interest rate = $210,000 * $12% = $25,200

Principal paid in the first year = Annual payment - First year interest = $37,167 - $25,200 = $11,967

Balance in the right-of-use asset after one year = Cost of the right-of-use asset - Principal paid in the first year = $210,000 - $11,967 = $198,033

Second year interest = Balance in the right-of-use asset after one year * Interest rate = $198,033 * $12% = $23,763.96

Principal paid in the second year = Annual payment - Second year interest = $37,167 - $23,763.96 = $13,403.04

Balance in the right-of-use asset after two years = Balance of the right-of-use asset after one year - Principal paid in the second year = $198,033 - $13,403.04 = $184,629.96

Therefore, the balance in the right-of-use asset after two years will be $184,629.96.

In much of the country, homeowners choose to heat their houses with either natural gas or heating oil, both of which are normal goods. Which factor would cause an increase in the demand for natural gas

Answers

Group of answer choices.

a. an increase in consumer incomes

b. an increase in the price of natural gas

c. a decrease in the price of heating oil

d. a decrease in the price of natural gas

Answer:

a. an increase in consumer incomes

Explanation:

A market demand curve is used to graphically represent the quantity of goods demanded by all the buyers or consumers at different price points.

This ultimately implies that, a market demand curve can be determined by the horizontal summation of the various quantities for which, each buyer or consumer in a market is willing to pay for at different prices.

Thus, the market demand curve is downward sloping due to the fact that as the price of a product increases, the quantity demanded by the consumer decreases.

Generally, the demand for a good or service increases when consumer income increases and it decreases when the income earned by consumers fall. Thus, the demand for goods or services is directly proportional to consumer income.

Hence, a factor which would cause an increase in the demand for natural gas is an increase in consumer incomes.

An American clothing manufacturer has recently purchased a clothing factory in Taiwan. This action is known as ________.

Answers

Answer: Foreign Direct Investment / Direct Investing

Explanation:

When a foreign company buys a domestic company with the intent of owing it and managing it actively, the foreign company is said to have directly invested in the domestic country.

This is what the American clothing company has done so this qualifies as a direct investment into Taiwan. If the American company had simply purchased shares in a company in Taiwan, this would be a Foreign portfolio investment.

An account is opened with an initial deposit of $5,500 and earns 2.5% interest compounded annually. What will the account be worth in 10 years

Answers

Answer:

Explanation:

Every year the 5,500 Dollars, make an interest of 2.5% so if ten years have passed.

2.5x10

=25% are added to the money so find out the 25% of 5,500

5,500 x 0.25

= 1375

1375 + 5500

= 6875 Dollars is the total money in 10 years

Thank you!!

Who's Candice?you get 61 points if you answer

Answers

Candice is a delightful young lady

Answer:

A strong ,courageous, beautiful , educated woman

Verer Custom Carpentry manufactures chairs in its Processing Department. Direct materials are included at the inception of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Inspection takes place as units are placed into production. After inspection, some units are spoiled due to nondetectible material defects. Spoiled units generally constitute 4% of the good units. Data provided for March 20X5 are as follows:

WIP, beginning inventory 3/1/20X5 32,000 units
Direct materials (100% complete)
Conversion costs (85% complete)

Started during March 70,000 units
Completed and transferred out 80,000 units
WIP, ending inventory 3/31/20X5 18,000 units
Direct materials (100% complete)
Conversion costs (80% complete)

Costs:
WIP, beginning inventory:
Direct materials $70,000
Conversion costs 40,000
Direct materials added 105,000
Conversion costs added 128,160

Required:
What are the normal and abnormal spoilage units, respectively, for March when using FIFO?

Answers

Answer:

Verer Custom Carpentry

Processing Department

Normal spoilage units = 3,920

Abnormal spoilage units = 80

Explanation:

a) Data for March 20X5 and Calculations:

WIP, beginning inventory 3/1/20X5 32,000 units

Direct materials (100% complete)

Conversion costs (85% complete)

Started during March 70,000 units

Completed and transferred out 80,000 units

WIP, ending inventory 3/31/20X5 18,000 units

Direct materials (100% complete)

Conversion costs (80% complete)

Costs:

WIP, beginning inventory:

Direct materials $70,000

Conversion costs 40,000

Direct materials added 105,000

Conversion costs added 128,160

Spoilage units:

                                                    Units   Direct materials    Conversion

Beginning inventory 3/1/20X5 32,000            0 (0%)           6,400 (20%)

Started during March               70,000

Total units available               102,000

Completed and transferred    80,000          

Ending inventory 3/31/20X5    18,000

Spoilage units =                         4,000 (102,000 - 80,000 - 18,000)

Good units = 98,000 (80,000 + 18,000)

Normal spoilage units = 3,920 (98,000 * 4%)

Abnormal spoilage units = 80 (4,000 - 3,920)

mwakilembe Co.ltd is a micro business which buys and sell toys on 1 January 2020 the company predicted its annual sales to be 1000000 units. Each order would cost the company TZS 80 . The company pays TZS 160 per unit of a product. Estimated inventory carrying costs are 25 percent of inventory value. Establish the EOQ units.

Answers

Answer:

2000

Explanation:

Given:

Annual DEMAND, D = 1,000,000

Holding cost, H = (I * C)

Cost per order, S = 80

Unit cost, C = 160

Holding cost (%) = 25% = 0.25

The Economic order quantity :

EOQ = √[(2 * D * S) / (I * C)]

EOQ = √[(2 * 1000000 * 80) / (0.25 * 160)]

EOQ = √[(160000000) / 40]

EOQ = √4000000

EOQ = 2000

Jane has discovered that she is bored and frustrated working for others. She wants to open a business where she alone will have control and the least interference from government regulation. Which form of business would best meet her needs

Answers

Answer:

Sole proprietorship.

Explanation:

A sole proprietorship is a type of business that is owned by a single person and as such their profits are taxed once as personal income tax. It is a type of business that is typically owned by an individual or one person and as such is solely responsible for its debts.

In this scenario, Jane discovers she is bored and frustrated working for other business owners and as a result, she wants to open her own business, wherein, she alone will have control over the business and with the least interference of any form through government regulation. Thus, the form of business which would best meet Jane's needs is a sole proprietorship business because it is offers an exclusive ownership and control to its owner while preventing third-party interference.

Signature Appliance Group decided to remove the grill unit from the ovens it sells in South America after customers complained they preferred to grill outside and would never use this feature. Which environmental force caused the company to change its product

Answers

Answer:

Signature Appliance Group

The environmental force that caused the company to change its product features is:

the Social and Cultural Environment.

Explanation:

The Social and Cultural Environment refers to the changing needs of customers in South America as a result of the values, attitudes, and preferred styles of consumers. These are always in a state of flux every year.  Since customers preferred to grill outside rather than inside their kitchens, adding the grill unit in the ovens that the company sells in South America will not enable customers to choose its ovens over competitors'.  To respond to the stated needs of its customers, the grill must be removed, thereby reducing the cost of the ovens.

The United States requires that 50 percent of all parts used to construct an automobile in the United States be manufactured in the United States. As a result of this, when Toyota Motor Company builds automobile manufacturing plants in Tennessee and Ohio, it faces economic risks associated with _______

Answers

Answer:

Local-content laws

Explanation:

Local content laws are designed to encourage increased impact of locally produced goods on the local, regional, or national economy.

It goes beyond just making profit for the firm, but also how much the local products contribute to the economy.

In the given scenario the local content law in the United States is that 50 percent of all parts used to construct an automobile in the United States be manufactured in the United States.

This is a local content requirement.

So Toyota motor Company is facing risk associated with local content laws.

Simpson Company makes and sells a single product. Budgeted sales for April are $1,150,000. Gross margin is budgeted at 30% of sales. If the net income for April is budgeted at $155,000, budgeted selling and administrative expenses must be:

Answers

Answer:

Budgeted selling and administrative expenses must be $190,000.

Explanation:

Budgeted selling and administrative expenses can be calculated as follows:

Budgeted gross margin = Budgeted sales * Percentage of budgeted sales that is budgeted gross margin = $1,150,000 * 30% = $345,000

Budgeted net income = Budgeted gross margin - Budgeted selling and administrative expenses …………. (1)

Substituting the relevant values into equation (1) and solve for budgeted selling and administrative expenses, we have:

$155,000 = $345,000 - Budgeted selling and administrative expenses

Budgeted selling and administrative expenses = $345,000 - $155,000 = $190,000

Therefore, budgeted selling and administrative expenses must be $190,000.

Debt levels across industries vary widely. Debt ratios in most countries are considerably less than 100 percent. Some firms use no debt. Capital structures are fairly constant across industries. Most corporations have relatively low debt-asset ratios.

Answers

Complete Question:

Which one of the following is not empirically correct?

A. Debt levels across industries vary widely

B. Debt ratios in most countries are considerably less than 100 percent.

C. Some firms use no debt.

D. Capital structures are fairly constant across industries.

E. Most corporations have relatively low debt-asset ratios.

Answer:

The not empirically correct statement is:

D. Capital structures are fairly constant across industries.

Explanation:

Instead, the capital structures across industries vary significantly.  Firms with large asset investments tend to have more leverage than others with less asset investments.  And this situation of having or not having large investments in assets cuts across firms in the same industry.  This suggests that their capital structures will always vary not because of the industry but the choices made by the firm's management.  Capital structures are also influenced by taxes and operating income uncertainties, which also vary within the same industry.

An elevator company has redesigned their product to be 50% more energy efficient than hydraulic designs. Two designs are being considered for implementation in a new building.
(a) Given an interest rate of 20% which bid should be accepted?
Alternatives
Installed cost
Annual cost
Salvage value
Life, in years
​ A
$45,000
2700
3000
10
​ B
$54,000
2850
4500
15
(b) Research and list a few attributes that the company might be using in the elevators' major systems drive, cab, hoist, and control mechanisms that make them more energy efficient.

Answers

Answer:

An Elevator Company

a) Given an interest rate of 20%, bid A should be accepted.

b) Attributes that make the Elevators More Energy Efficient:

1. software- and microprocessor-based controls without using electromechanical relays

2. in-cab sensors and software to automatically turn off lights, ventilation, and other facilities when not in use.

3. destination dispatch control software to batch elevator stops.

4. Using dispatch controls that rely on personalized calls instead of in-cab controls.

Explanation:

a) Data and Calculations:

Interest rate = 20%

Alternatives             A                     B

Installed cost        $45,000      $54,000

Annual cost               2,700          2,850

Salvage value           3,000          4,500

Life, in years           10 years       15 years

Present value

 annuity factor         4.192          4.675

Discount factor        0.162          0.065            

Present values:

Installed cost        $45,000      $54,000

Annual cost               11,318          13,324

Salvage value             (486)            (293)

Net present cost $55,832       $67,031

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