Answer:
Required 1 Balances :
Direct Materials = $432,000
Work in Process = $183,060
Finished Goods = $40,000
Required 2 total manufacturing costs for September :
Total manufacturing costs = $905,060
Explanation:
Ending September balance of the Direct Materials,
Raw Materials T - Account
Debit :
Opening Balance $31,500
Purchases $3,708,000
Totals $3,739,500
Credit :
Ending Balance $3,307,500
Work In Process $432,000
Totals $3,739,500
Ending September balance of Work in Process,
Work in Process T - Account
Debit :
Opening Balance $152,000
Raw Materials $432,000
Labor Cost $291,060
Overheads Applied $166,000
Totals $1,041,060
Credit :
Ending Balance $183,060
Transfer to Finished Goods $858,000
Totals $1,041,060
Ending September balance Finished Goods .
Finished Goods T - Account
Debit :
Opening Balance $260,000
Transfer from Work In Process $858,000
Totals $1,118,000
Credit :
Ending Balance $40,000
Trading Account $1,078,000
Totals $1,118,000
Calculation of Total Manufacturing Cost
Raw Materials $432,000
Labor Cost $291,060
Overheads Incurred $182,000
Total Manufacturing Cost $905,060
A certain company has an acid test ratio of 0.97. This implies which of the following?1. Current liabilities are less than the quick assets of the company.
2. Current liabilities are greater than the quick assets of the company.
3. Current liabilities are greater than the current assets of the company.
4. Current liabilities are less than the current assets of the company.
Answer: 2. Current liabilities are greater than the quick assets of the company.
Explanation:
The acid-test ratio is a method of checking if the company has enough quick assets ( most liquid current assets) to enable it cover its current liabilities.
It is calculated by dividing the current assets less the inventory by the current liabilities. A ratio of 0.97 therefore means that the denominator which are the current liabilities are more than the quick assets of the company.
Taxes help prices communicate costs and benefits to producers and consumers.
a) true
b) false
Answer:
The correct answer is the option B: False.
Explanation:
To begin with, the taxes are financial charges that are imposed upon a taxpayer with the only purpose to increase the incomes of the government who are mainly taxes. Therefore that the taxes will never be or communicate a benefit nither to producers or consumers in any form or type that they could be. The taxes will only help the government to increase its income and to pay for the expenditures and therefore that it will never help to communicate nither costs or benefits to producers or consumers.
Use the starting balance sheet and the list of changes to create an updated balance sheet.Valley TechnologyBalance SheetAs of December 31, 2017(amounts in thousands)Cash 22,000 Liabilities 36,000Other Assets 28,000 Equity 14,000Total Assets 50,000 Total Liabilities & Equity 50,000Valley TechnologyIncome StatementJanuary 1 to March 31, 2018(amounts in thousands)Revenue 7,200Expenses 3,600Net Income 3,600Between January 1 and March 31, 2018:
1. Cash decreases by $200,000
2. Liabilities decrease by $100,000
3. Paid-In Capital does not change
4. Dividends paid of $400,000
What is the value for Other Assets on March 31, 2018?
Answer:
$31,300,000
Explanation:
cash account balance = 22,000,000 - 200,000 (cash decrease) = 21,800,000
total liabilities balance = 36,000,000 - 100,000 (decrease in liabilities) = 35,900,000
equity balance = 14,000,000 - 400,000 (dividends) + 3,600,000 (net income) = 17,200,000
total assets = 35,900,000 + 17,200,000 = 53,100,000
other assets = total assets - cash = 53,100,000 - 21,800,000 = 31,300,000
Complete the following sentence: If people think that the price of televisions will decrease in the near future, that belief may cause a(n):__________
a. decrease in the quantity demanded for televisions today.
b. decrease in the demand for televisions today.
c. increase in the supply of televisions today.
d. increase in the price of televisions today.
Answer:
b. decrease in the demand for televisions today.
Explanation:
Since it is generally believed that, consumers buy more quantity of a particular commodity or product when the price of such commodity is lower and that they buy less, when the price is higher, which is a simple illustration of the law of demand.
Therefore, if people think that the price of televisions will decrease in the near future, that belief may cause a "decrease in the demand for televisions today."
A takeover is an attempt to seize control of a corporation by purchasing the majority of its outstanding stock.
A. True
B. False
Answer:
A. True.
Explanation:
Organizations sometimes makes a bid to take control of another company by acquiring them, through the purchase of majority of the stocks or outstanding shares in the company to be acquired. Where the above is successful, the process is known as takeover.
In a takeover, the company that is being taken over is the target company, while the company taken over the target is the acquirer. A larger company may take over the smaller company through mutual agreement .
Takeover occurs when a larger company is trying to initiate a change in the smaller company by making it more profitable. They may also find value in the smaller company hence the takeover and also to eliminate competition.
Prepare the income statement of Centerpiece Arrangements for the year ended December 31, 2018.Centerpiece Arrangements has just completed operations for the year ended December 31, 2018. This is the third year of operations for the company. The data below have been assembled for the business:Insurance Expense $2,500Service Revenue 84,000Utilities Expense 1,500Rent Expense 12,000Common Stock 5,500Cash 5,800Retained Earnings, January 1, 2018 4,700Salaries Expense 47,000Accounts Payable 600Office Supplies 1,900Dividends 4,500Accounts Receivable 7,000Equipment 12,600Prepare the income statement of Pink Arrangements for the year ended December 31, 2018.
Answer:
Income statement for the year ended December 31, 2018.
Service Revenue $84,000
Less Expenses :
Insurance Expense $2,500
Utilities Expense $1,500
Rent Expense $12,000
Salaries Expense $47,000 ($63,000)
Net Income / (Loss) $21,000
Explanation:
The Income Statement shows the Profit or Loss arising from operating activities of the company during the year. Profit or Loss = Revenue less Expenses.
CPAs become involved in a variety of types of engagements. For each of the following statements, indicate whether it relates to an examination (E), review (R), or agreed-upon procedures (A) engagement. If the statement does not relate to examinations, reviews, or agreed-upon procedures, reply N.
Statement
Type of Engagement
a. When financial statements are involved, this is referred to as an audit.
b. The term "We are not aware of any material modifications that should be made" is often included in the report.
c. The report issued provides a summary of procedures followed and findings.
d. The report issued provides "reasonable assurance."
e. The procedures involved are generally limited to inquiry and analytical procedures.
f. The report issued provides "absolute assurance."
g. The report issued provides "limited assurance."
h. The procedures followed are agreed upon with the specified user or users.
i. This type of engagement provides more assurance than a review.
j. The CPA need not be independent to perform this service.
Answer:
a. Examination
b. Review
c. Agreed upon procedures
d. Examination
e. Reviews
f. None
g. Reviews
h. Agreed upon procedures
i. Examination
j. None
Explanation:
Examinations are meant to provide higher level of assurance in audits, in order to provide detailed view and opinion on the audit area.
Reviews are meant to provide the certificate of approval that financial reporting framework is followed or not, or whether their is no material change in the financial statements etc:
Under agreed upon procedures the CPA is to report on some specific areas agreed with the management to report upon rather than complete financial statements.
Remaining explanation:
In f. absolute assurance can never be provided as even in examination there are certain limitations which are inherent in the procedure.
In j the statement provides no independence which is not available condition in any engagement.
True or False Liability protection covers both personal liability and the medical expenses of anyone accidentally injured on your property.
Answer:
True
Explanation:
Homeowner's personal liability insurance protects against personal accidents that can happen in your house as long as they are not intentional. The coverage includes accidents that happen to visitors including:
medical billspain and sufferinglost wagesdeath benefitslegal costsTransactions that affect earnings do not necessarily affect cash. Identify the effect, if any, that each of the following transactions would have upon cash and net income. The first transaction has been completed as an example. (If an amount reduces the account balance then enter with negative sign preceding the number e.g 15,000 or parentheses e.g. (15,000). Cash $-133 Net Income $0 (a) Purchased $133 of supplies for cash. (b) Recorded an adjusting entry to record use of $31 of the above supplies. (c) Made sales of $1,297, all on account. (d) Received $865 from customers in payment of their accounts. (e) Purchased equipment for cash, $2,528 (f) Recorded depreciation of building for period used,
Answer and Explanation:
The identification of the given transactions are as follows
Item cash net income
a -$133 -
Since the cash is paid so it would be shown in negative and no impact on the net income
b - -$31
Here the adjusting entry is passed for supplies so the expenses are increased which ultimately reduced the net income
c - $1,297
Since the sale is made so the same should be shown in the net income
d $865 -
Since cash is received so it shown in the positive amount
e -$2,528 -
Since the cash is paid so it would be shown in negative and no impact on the net income
f - -$610
Since there is depreciation, the expenses are increased which ultimately reduced the net income
"A married couple, where both individuals work, earns in excess of $124,000 in year 2020. Both individuals are covered by qualified retirement plans. Which statement is TRUE regarding contributions to Individual Retirement Accounts for these persons?"
Answer:
The question is not complete. Let me explain Individual Retirement Accounts (IRA)
Explanation:
There are two types of Individual Retirement Accounts (IRA). These are the Roth IRA and the Traditional IRA.
The maximum contributions allowed to Roth IRAs for 2020 are $6,000 for investors younger than 50 and $7,000 for investors older than 50.
If you’re single and you have no workplace plan, or if you’re married and neither you nor your spouse has a workplace plan, you may fully deduct your IRA contribution--regardless of your income. However, if you don’t have an employer-sponsored plan, but your spouse has one, you may deduct the full amount if you’re married filing jointly, and your modified adjusted gross income (MAGI) is $196,000 or less.
For Traditional IRA, married couples filing jointly can take the full deduction if they make less than $104,000. If you collectively earn between $104,000 and $124,000, you can take a partial deduction. And if you earn more than $124,000, you may not deduct anything.For Roth IRA, single filers with modified adjusted gross income (MAGIs) ranging between $124,000 to $139,000 may contribute a reduced amount.Traditional IRAs are funded with pre-tax dollars, this means that you can write off the contribution during the year you make it. But this is governed by numerous factors.
How much money should Timothy and Tiffany deposit annually for 20 years in order to provide an income of $30,000 per year for the next 10 years? Assume an interest rate is a constant 4%
Answer:
$8,171.37
Explanation:
first we must find the value of their account before they start receiving the distributions, (i.e. how much money they need to have in 20 years):
present value = annual payments x annuity factor
annual payments = $30,000annuity factor (PV, 4%, 10 periods) = 8.1109present value = $30,000 x 8.1109 = $234,327
now we need to calcualte the annual contribution in order to have $234,327 in 20 years:
future value = annual payment x annuity factor
annual payment = future value / annuity factor
future value = $234,327annuity factor (FV, 4%, 20 periods) = 29.778annual payment = $234,327 / 29.778 = $8,171.37
Answer: $8,171.44
Explanation:
The present value of the income of 10 years now is the future value of the payments in 20 years.
The present value is therefore;
= 30,000 * Present value of annuity interest factor, 4%, 10 years
= 30,000 * 8.111
= $243,330
As $243,330 is the future value of the payments in 20 years.
The payment is therefore;
243,330 = Payment * Future value of annuity interest factor, 4%, 20 years
243,330 = Payment * 29.7781
Payment = 243,330/29.7781
= $8,171.44
Mr. and Mrs. Perry own three personal residences, all of which are subject to an acquisition mortgage. The mortgage on the first residence is $290,000, the mortgage on the second residence is $400,000, and the mortgage on the third residence is $357,000. Which of the following statements is true?
A. Mr. and Mrs. Perry can report an itemized deduction for the interest paid on all three mortgages.
B. The Perrys’ itemized deduction is limited to the interest on $1 million of their acquisition debt.
C. The Perrys’ itemized deduction is limited to the interest on the $400,000 mortgage.
D. None of the statements is true.
Answer: D. None of the statements is true.
Explanation:
When multiple residences are owned, tax laws indicate that itemized deductions for interest paid on mortgages are limited to the mortgages of 2 residences alone being the primary residence and any other residence that will be chosen as the second residence in the tax year.
As such, all the options are wrong as they would be limited to itemized deductions on mortgage interest for;
= $290,000 + $400,000
= $690,000 being the first 2 residences
The insurer may suspect that a moral hazard exists if the policyholder:______.
a. is not honest about his health on an application for insurance.
b. is prone to depression.
c. is indifferent to activities that may be dangerous.
d. always drives over the speed limit.
Answer:
a. is not honest about his health on an application for insurance.
Explanation:
The moral hazards refer to the hazard that arises when the applicants do not tell the truth at the time of filling the application form for the insurance or in the past they claimed some amount which is totally fraud against to an insurer
So in case when the insurer may suspect whether there is an existence of moral hazard so the honesty regarding with the health for insurance should be taken as relevant pant
Therefore the option a is correct
The use of which tool of the Federal Reserve has the smallest impact on money supply levels?a. Open market operationsb. Discount ratec. Reserve requirementsd. Margin on securities
Answer: d. Margin on securities
Explanation:
Margin Requirements on securities are collateral that a trader must keep when they want to borrow money. The Fed can control money supply using this by increasing the margin requirement which would reduce the amount that the trader will have to trade with thereby reducing money supply.
This represents the least effective monetary tool of the 4 options listed for the simple reason that it mainly affects the stock market which is although big, is not big enough to match the influence of the other instruments of monetary policy.
Unlike tangible goods,virtually all services are susceptible to inconsistency and variations in quality.Why is this so?A) Because services depend on people for their delivery.B) Because services cannot be managed due to their intangibility.C) Because services are extremely time-and-place dependent.D) Because service marketers cut corners to reduce expenses.E) Because service marketers make unrealistic promises to customers.
Answer:
A) Because services depend on people for their delivery.
Explanation:
Given that the same or similar type of services are or can be carried out by various personnel, and the level of quality of the rendered services is dependent on the skills and professionalism of the person who rendered such services.
Hence, Unlike tangible goods, virtually all services are susceptible to inconsistency and variations in quality, because services depend on people for their delivery.
Therefore, the right answer is Option A. the
-What factors determine an individual’s ethics. For you, which factor has been the most significant?
Answer:
Individual's Cultural/Familys Ethics. Individuals Religion. Individuals Experiences. And Societal pressures. The Factor that has contributed most to my morals is Religous Background and Societal Pressure.
Explanation:
An individuals own ethics is largely founded upon what they are taught to value. This foundation begins at a young age, but is subject to change over time and experience. The first foundation of ethics is what your family values or what you are are taught to value. The second factor is Religion or world view. Everyone has a god or God all religions though will have a moral law. Societal pressure or what society thinks is ethically Just will pressure ones own ethics.
Should leadership be the manager's job or should leadership be a shared process?
Answer:
leadership be a shared process
Explanation:
Leadership may be defined as when a person leads to a particular group or a community. Leader always motivate to people for the purpose so that they can achieve the goal in a particular period of time. On the other hand an organization have always leader so that high authority gives responsibility to a leader for achieving the goal with the help of directing their employees.
Therefore leadership should be a shared process as leader need to corporate their employees.
the money you borrow from a bank is called
Answer: it is called a loan
Explanation:
forest management defination
Answer:
It is the process of controlling the use or exploitation of forested land.
Answer:
the people who works to preserve and protect the animal and forest is called forest manager
Citizens are allowed to act in their own self-interest when given __________. A. job security B. political stability C. economic freedom D. government restrictions
Answer:
c
Explanation:
Answer:
C.Job security
Explanation:
did the quiz edge 2020
Alissa quickly expresses her frustration. She says, "Just recently I found out the executives got incredibly large bonuses and I thought there was no more money. This is very frustrating…and I don't understand why you wouldn't tell me the truth." At this moment, Alissa is most likely to experience what type of noise as she decodes messages?
Answer: d. psychological noise
Explanation:
Psychological noise refers to the distortion of information due to the distraction on the part of either the speaker or the listener borne from them having biases or preconceived notions.
Alissa is already upset with the person she is talking to as she believes that they hid information from her so regardless of what the person says, she will probably interpret it with the notion that the person is lying or rather hiding the truth.
Red font in the opening information is used to:_________
Answer: a. draw your attention to important input requirements.
Explanation:
The color red is a very visual color that attracts attention to it. This is why most signs that warn of danger are painted in red.
As the color draws attention, its purpose in the opening information is to draw the attention of the reader to important input requirements so that they will not miss it.
When an investor accounts for an investment in common stock at fair value through net income, cash dividends are classifies by the investor as:_________
A) A return of capital
B) A loss
C) A deduction from the investment account
D) Dividend income
Answer: dividend income
Explanation:
When an investor accounts for an investment in common stock at fair value through net income, cash dividends are classifies by the investor as dividend income.
The fair value of an asset is simply the sale price that is agreed upon by a buyer and seller, with the assumption that both of them enter the transaction without bias and are both knowledgeable. Based on the above scenario, the cash dividends are classifies by the investor as dividend income.
For most high-income countries of the world, GDP _________________ over time.
Answer:
For most high-income countries of the world, GDP HAS INCREASED GRADUALLY over time.
Explanation:
Both GDP and GDP per capita has increased for almost all high income countries. Actually the only country in the world that was once rich and had a very high GDP and GDP per capita that turned into a developing country (AKA poor country) is Argentina. It is a unique case in all the world, since Argentina had the highest GDP per capita for 2 years (1895 and 1896) and continued to have a relatively high GDP per capita more than 60 years. Then political turmoil and corruption resulting in it falling from number one spot to number 73.
What are 2 relevant settings related to Projects?A. Track inventory quantity on handB. Show Items table on expense and purchase formsC. Track expenses and items by customerD. Create multiple partial invoices from a single estimateE. Track billable expenses and items as income in multiple accounts
Answer:
TWO relevant settings related to projects are
(A) and (C)
Explanation:
Two of the relevant settings related to projects - among the options given - are:
(A) Track inventory quantity on hand
Materials, not just humans, are involved in every project. The Project Manager will need to track inventory-on-hand (presently available materials or goods) from time to time; to know when there is a shortage, excess, or a need for specific goods.
(C) Track expenses and items by customers
The Administrator, Invoice Manager, or Project Manager will track the expenses or items bought/returned by customers. Money spent by customers is to be tracked and recorded.
Accounting Equation Annie Rasmussen is the owner and operator of Go44, a motivational consulting business. At the end of its accounting period, December 31, 2018, Go44 has assets of $625,790 and liabilities of $197,750. Using the accounting equation and considering each case independently, determine the following amounts.A. Annie Rasmussen, capital, as of December 31, 2018. 428,040B. Annie Rasmussen, capital, as of December 31, 2019, assuming that assets increased by $98,870 and liabilities increased by $59,450 during 2019. 467,460C. Annile Rasmussen, capital, as of December 31, 2019, assuming that assets decreased by $49,440 and liabilities increased by 17,520 during 2019 400-500.D. Annie Rasmussen, capital, as of December 31, 2019, assuming that assets increased by $82,600 and liabilities decreased $31,290 during 2019. 14,390E. Net income (or net loss) during 2019, assuming that as of December 31, 2019, assets were $913,200, liabilities were $148,580, and there were no additional investments or withdrawals. 660,210
Answer:
Go44
A. Annie Rasmussen, capital, as of December 31, 2018. 428,040
Capital = Assets - Liabilities
= $628,790 - 197,750
= $431,040
B. Annie Rasmussen, capital, as of December 31, 2019, assuming that assets increased by $98,870 and liabilities increased by $59,450 during 2019. 467,460
Capital = Assets - Liabilities
= ($628,790 + 98,870) - (197,750 + 59,450)
= $727,660 - 257,200
= $470,460
C. Annile Rasmussen, capital, as of December 31, 2019, assuming that assets decreased by $49,440 and liabilities increased by 17,520 during 2019 400-500.
Capital = Assets - Liabilities
= ($628,790 - 49,440) - (197,750 + 17,520)
= $579,350 - 215,270
= $364,080
D. Annie Rasmussen, capital, as of December 31, 2019, assuming that assets increased by $82,600 and liabilities decreased $31,290 during 2019. 14,390
Capital = Assets - Liabilities
= ($628,790 + 82,600) - (197,750 - 31,290)
= $711,390 - 166,460
= $544,930
E. Net income (or net loss) during 2019, assuming that as of December 31, 2019, assets were $913,200, liabilities were $148,580, and there were no additional investments or withdrawals. 660,210
Assets = Liabilities + Equity (Capital + Retained Earnings or Net Income or Loss)
= $913,200 = ($148,580 + $431,040 + Net Income)
Net Income = $913,200 - 579,620
= $333,580
Explanation:
Go44 Balance Sheet as of December 31, 2018:
Assets = $628,790
Liabilities 197,750
Equity = $431,040
b) Accounting equation is Assets = Liabilities + Equity. Equity includes owner's capital and accumulated profits (Retained Earnings).
c) The accounting equation shows that the value of Go44's assets will always be equal to the liabilities and equity.
Deanne is a vocal critic of socialism. She likes to point out that in recent years the governments in many socialistic nations have cut back on government services and have reduced taxes. Deanne believes that this trend will ultimately result in all nations adopting pure capitalistic ideals. Recent evidence suggests that Deanne's views are essentially correct.
a. True
b. False
Answer: False
Explanation:
Socialism is a theory that posits that production, and distribution, of goods and services should be in charge of the government. This is quite different from capitalism which advocates for the individuals to be in charge.
Even though it is true that governments of many socialistic nations have cut back on government services and have reduced taxes, this doesn't mean that all nations are adopting pure capitalistic ideals according to Deanne.
She's incorrect because there are still some elements of socialism and government interference, hence, such economies are regarded as mixed economies as they've attributes of both capitalism and socialism.
Deanne's observations is untrue as government involvement in free market economies is being ignored by her.
Transactions Simmons Consulting Co. has the following accounts in its ledger: Cash; Accounts Receivable; Supplies; Office Equipment; Accounts Payable; Michael Short, Capital; Michael Short, Drawing; Fees Earned; Rent Expense; Advertising Expense; Utilities Expense; Miscellaneous Expense.
Oct. 1. Paid rent for the month, $6,000.
3. Paid advertising expense, $3,820.
5. Paid cash for supplies, $1,640.
6. Purchased office equipment on account, $25,100.
10. Received cash from customers on account, $8,180
15. Paid creditors on account, $2,400.
27. Paid cash for miscellaneous expenses, $1,040,
30. Paid telephone bill (utility expense) for the month, $380.
31. Fees earned and billed to customers for the month, $54,500.
31. Paid electricity bill (utility expense) for the month, $650.
31. Withdrew cash for personal use, $4,100.
Journalize the selected transactions for October 2013. If an amount box does not require an entry, leave it blank.
20Y3 Oct. 1 Rent Expense 6,000
Cash
20Y3 Oct. 3 Advertising Expense 3,820
Cash
2013 Oct. 5 Supplies 1,640 20Y3
Cash
20Y3 Oct. 6 Office Equipment 25,100
Accounts Payable
20Y3 Oct. 10 Cash 8,180
Accounts Receivable
20Y3 Oct. 15 Accounts Payable
Cash
20Y3 Oct. 27 Miscellaneous Expense 1,040
Cash
20Y3 Oct. 30 Utilities Expense 380
Cash
20Y3 Oct. 31: Accounts Receivable
Fees Earned
20Y3 Oct. 31: Utilities Expense 650
Cash
2013 Oct. 31: Utilities Expense 650
Cash ID
20Y3 Oct. 31: Michael Short, Drawing
Cash
Answer:
Journal Entry
Date Account Title and Explanation Debit Credit
Oct 1 Rent expense $6,000
Cash $6,000
( Being rent paid in cash)
Oct 3 Advertising expense $3,820
Cash $3,820
(Being advertising expenses paid)
Oct 5 Supplies $1,640
Cash $1,640
(Being cash paid to suppliers)
Oct 6 Office equipment $25,100
Accounts Payable $25,100
(Being office equipment purchased on credit)
Oct 10 Cash $8,180
Account Receivable $8,180
(Being amount received from customers)
Oct 15 Accounts Payable $2,400
Cash $2,400
(Being amount paid to creditors)
Oct 27 Miscellaneous expense $1,040
Cash $1,040
(Being miscellaneous expenses paid)
Oct 30 Utility expense $380
Cash $380
(Being expenses paid in cash)
Oct 31 Account Receivable $54,500
Fee earned $54,500
(Being fee earned and charge to customers)
Oct 31 Electricity expense $650
Cash $650
(Being amount paid for electricity)
Oct 31 Michael short, Drawing $4,100
Cash $4,100
(Being amount paid for Micheal short)
Zwick Company bought 28,000 shares of the voting common stock of Handy Corporation in January 2018. In December, Handy announced $200,000 net income for 2018 and declared and paid a cash dividend of $2 per share on all 200,000 shares of its outstanding common stock. Zwick Company's dividend revenue from Handy Corporation in December 2018 would be:
Answer:
Zwick Company's dividend revenue = $56,000
Explanation:
Given:
Shares by Zwick Corporation = 28,000
Handy announced dividend per share = $2
Find:
Zwick Company's dividend revenue
Computation:
Zwick Company's dividend revenue = Shares by Zwick Corporation × Handy announced dividend per share
Zwick Company's dividend revenue = 28,000 × $2
Zwick Company's dividend revenue = $56,000
Remember, an agency relationship can degenerate into an agency conflict when an agent acts in a manner that is not in the best interest of his or her principal. In large corporations, these conflicts most frequently involve the enrichment of the firm's executives or managers (in the form of money and perquisites or power and prestige) at the expense of the company's shareholders. This usurping and reallocation of shareholder wealth is most likely to occur when shareholders do not have sufficient information about the decisions and actionsbeing made by the firm's management Consider the following scenario and determine whether an agency conflict exists: Jacob owns Jacob's Tantalizing Tees, a T-shirt shop in a small college town in Virginia. With a staff of three part-time employees, Jacob operates the business in accordance with his personal goals, dreams, and capabilities. Does Jacob have an agency conflict to deal with? a. Yes; as both the owner and operator of Jacob's Tantalizing Tees, Jacob has created the necessary agency relationship through which an agency conflict can exist. b. No; by having part-time, as opposed to full-time, employees, Jacob is prevented from experiencing an agency conflict. c. Yes; there is always an inherent conflict of interest between owners and operators (managers). d. No; as both the owner and operator of Jacob's Tantalizing Tees, Jacob has not created the necessary agency relationship through which an agency conflict can exist.
Answer:
Statement C.
Explanation:
In every business shareholders invests their money and hire some great potential managers so that the business runs smooth even without their presence.
The shareholder is the owner, and that the manager is the employee who works on the direction of shareholders. Accordingly there is an inbuilt relationship of an agent and principal.
Agent = managers
Principal = Shareholders
And there is an inherent risk as the managers might not agree to certain terms of shareholders and vice-e-versa. But even both of them cannot work without each other.