Answer:
A. $147,000
Explanation:
All cost incurrend in the installation of the assembly line, and their put to use to meet the company demand will be capitalized
the machine cost
the labor to install the machine
the parts added to the assembly line
rearrange of the assembly line
All those cost were incurred to leave the assembly line ready to use, are associate with the long-term asset so it can be capitalized through it.
75,000 + 14,000 + 40,000 + 18,000 = 147,000
Answer:
Possible outcome of stock price at end of 6 months (0.5 years)
Outcome 1:
Stock price = 35
Strike price = 45
Payoff call = max{ST - K,0} = max{35-45,0} = 0
Present value =
PV = 0/(1+5%)^0.5 = 0
Outcome 2:
Stock price = 49
Strike price = 45
Payoff call = max{ST - K,0} = max{49-45,0} = 4
Present value =
PV = 4/(1+5%)^0.5 = 3.903
Probability of both outcomes = 0.5
Value of call option = 0.5*0 + 0.5*3.903 = 1.95
Short sale arbitrage opportunity:
Short the stock and buy a call option. Invest the proceeds at 5% for 6 months:
Short stock = +41.6
long call = -1.95
Proceeds = 41.6 - 1.95 = 39.65
Amount after 6 months = 39.65*(1+5%)^0.5 = 40.629
Case 1:
Stock price = 35
Payoff from long call = 0
Buy the stock at market price and close the short stock position = -35
Total payoff = 40.629 - 35 = 5.629
Case 2:
Stock price = 49
Payoff from long call = 49 - 45 = 4
Buy the stock from market price and close the short stock position = -49
Total payoff = 40.629 + 4 - 49 = -4.3708
Present value of payoff from both cases = (0.5*5.629 + 0.5*(-4.3708))/(1+5%)^0.5
= 1.2581/1.0246 = 1.2277
Arbitrage payoff = 1.2277
Answer:
The short sale proceeds in an arbitrage strategy is 1.2277
Explanation:
From the question given,
The Possible outcome of stock price at end of 6 months (0.5 years)
The Outcome is:
The Stock price = 35
The Strike price = 45
The Payoff call = max(ST - K,0) = max(35-45,0) = 0
The Present value = PV = 0/(1+5%)^0.5 = 0
The possible Outcome 2:
The Stock price = 49
The Strike price = 45
The Payoff call = max{ST - K,0} = max{49-45,0} = 4
The Present value =
PV = 4/(1+5%)^0.5 = 3.903
Then,
The Probability of both outcomes = 0.5
Value of call option = 0.5*0 + 0.5 x 3.903 = 1.95
Therefore, the Short sale arbitrage opportunity is:
The Short the stock and buy a call option.
Invest the proceeds at 5% for 6 months:
Short stock = +41.6
long call = -1.95
Proceeds = 41.6 - 1.95 = 39.65
Amount after 6 months = 39.65*(1+5%)^0.5 = 40.629
The Case 1:
Stock price = 35
Payoff from long call = 0
Buy the stock at market price and close the short stock position = -35
The Total payoff = 40.629 - 35 = 5.629
For Case 2:
Stock price = 49
Payoff from long call = 49 - 45 = 4
Buy the stock from market price and close the short stock position = -49
Total payoff = 40.629 + 4 - 49 = -4.3708
The Present value of payoff from both cases = (0.5*5.629 + 0.5*(-4.3708))/(1+5%)^0.5
= 1.2581/1.0246 = 1.2277
Then the Arbitrage payoff = 1.2277
Answer:
$22,245.44
Explanation:
For computing the future value we need to apply the future value which is to be shown in the attachment below:
Provided that,
Present value = $0
Rate of interest = 8%
NPER = 18 years
PMT = $550
The formula is shown below:
= -FV(Rate;NPER;PMT;PV;type)
So, after applying the above formula, the future value is $22,245.44
Activities not on the critical path cannot become critical after crashing.
Crashing shortens the project duration by assigning more resources to one or more of the critical tasks.
Crashing a project often reduces the time it takes for lengthy or complex, but noncritical activities.
Answer:
The correct answer is letter "A": Crashing is not possible unless there are multiple critical paths.
Explanation:
Project crashing is a technique used to reduce the duration of a project to the least amount of extra cost by decreasing one or more critical activities. All of this is usually arranged in multiple entry charts where each critical activity receives the name of "critical path". It is imperative to have several critical paths so the crashing can be the most effective possible.
Answer:
A
Explanation:
the sales price increase and because the variable cost are the same the contribution margin will increase, which lead to think the BEP is lower.
But, because the fixed cost also increase we cannot determinate where the new BEP Will be higher or lower. The fixed cost could increase so much that nulifies the increase in the contribution margin or even be higher enought that the BEP goes higher.
So Option A is the only true statment.
Answer:
C. $ 140 comma 625 unfavorable
Explanation:
The formula to compute the direct labor efficiency variance is shown below:
= Standard labor rate × (Standard hours for actual output - Actual hours)
where,
Standard labor rate is $11.25
Standard hours for actual output is 27,500
And, actual hour is 40,000
Now put these values to the above formula
So, the value would equal to
= $11.25 × (27,500 hours - 40,000 hours)
= $140,625 unfavorable
Since actual hours is more than the standard hours so there is a unfavorable variance
b. provide specifics if further action is required.
c. omit the sender's name to avoid legal liability.
d. avoid repeating the information provided or referring to its use.
Answer: b. provide specifics if further action is required.
Explanation:
In a response message, one must be cordial and seek to promote GOODWILL with a customer. This can be done by simply referring to any provided information, providing specifics if any further action is required and including the sender's full contact information. Naturally there must also be a tone indicating a willingness to help but not with such cliché phrases such as, " Call me if you need any help". Such responses do not fit well in well written conclusions.