Answer:
Fewer than 1% of all individual tax returns are audited in a given tax year. However, certain types of both taxpayers and income—including, for instance, high-income individuals, cash- oriented businesses, real estate transactions, and estate- and gift-taxable transfers—are subject to much higher probabilities of audit. The ethical tax professional does not "play the audit lottery" and lower his/her reporting standards because of a perception that such actions "will not be caught," nor should the tax professional allow clients to do so.
Explanation:
Fewer than 1% of all individual tax returns as well as all corporate tax return are been audited in a given tax year.
However, certain types of both taxpayers and the income for example high-income individuals, cash- oriented businesses, real estate transactions, estate as well as gift-taxable transfer are often subject to much higher probabilities of audit.
Furthermore the ethical tax professional does not "play the audit lottery" and lower his/her reporting standards because of a perception that such actions "will not be caught," nor should the tax professional allow clients to do so which is why thethe IRS has developed ways of document matching/ maximizing income in which Treasury can help determine if a transaction has been properly and effectively reported by comparing all related party information, third party information and yearly averages to relevant taxpayers' returns for the year.
Red Cross WIC
Food packages 300 or 0 200 or 0
First-aid kits 0 50 0 20
NYC homeless shelters need a total of 20 first-aid kits per week. Currently, they get 10 kits from the Red Cross and 10 kits from WIC. With their remaining resources, how many food packages can each organization provide to NYC homeless shelters?
B. At a required return of 28 percent, what is the NPV of the project?
C. At what discount rate would you be indifferent between accepting the project and rejecting it?
Answer:
A. $8,187.17
B. $597.38
C. 30%
Explanation:
Calculate the Net Present Value of the Project at the Required Return of 9%
The following is the calculation of NPV using a financial calculator :
($8,000) CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
9.00 % i/yr
Shift NPV $8.187.1666 or $8,187.17
Calculate the Net Present Value of the Project at the Required Return of 9%
The following is the calculation of NPV using a financial calculator :
($8,000) CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
28.00 % i/yr
Shift NPV $597.3765 or $597.38
You will be indifferent between accepting the project and rejecting it at the internal rate of return. The Internal Rate of Return is the interest rate that makes the Present Vale of Cash Flows to equal the Initial Cost of the Investment.
Use the Data given to find the Internal Rate of Return :
($8,000) CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
$2,700 CFj
Shift IRR 30%
Answer:
B. will increase
Explanation:
Assuming that 50 firms in a monopolistically competitive industry in country A and 50 firms in the same monopolistically competitive industry in country B. If country A and country B engage in international trade, we expect that the total number of firms in this industry will increase .Because after trade, assuming firms in both countries make economic (excess) profits, this will attract entry of other firms into the industry in both markets. So, number of firms will increase.The correct answer is Option (B).
Years 11-20: 12%
Required: What is the maximum amount the Claussens should pay John Duggan for the hardware store?
Answer:
Explanation:
Calculate maximum that should pay:
Compute present value of cash flows from the store, year 1 to 5:
Annual cash flows are $70,000
Desired rate of return on investment for 1 to 5 years is 7%
Number of years is 5
Present value of cash flows generated during 1 to 5 years =
= $287,013.82
Compute present value of cash flows from the store for years 6 to 10
Annual cash flows are $70,000
Desired rate of return on investment for 6 to 10 years is 10%
Desired rate of return on investment for 1 to 5 years is 7%
Number of years is 5
Present value of cash flows generated during 6 to 10 years = annual cash flows x PVIFA (10%,5) x PVIF (7%,5)
= $70,000 x 3.79079 x 0.7130 = $189,198.33
Compute present value of cash flows from the store for years 11 o 20
Annual cash flows are $70,000
Desired rate of return on investment for 11 to 20 years is 12%
Desired rate of return on investment for 6 to 10 years is 10%
Desired rate of return on investment for 1 to 5 years is 7%
Number of years is 10
Present value of cash flows generated during 11 to 20 years = [annual cash flows x PVIFA (12%,10)] x PVIF (10%,5) x PVIF (7%,5)
= $70,000 x 5.65022 x 0.62092 x 0.7130 = $175,100.98
Calculate present value of estimated sale amount to be received for sale of store
Present value of estimted sale amount to be received = [Estimated sale amount x PVIF (12%,10)] x PVIF (10%,5) x PVIF (7%,5)
=$400,000 x 0.32197 x 0.62092 x 0.7130=
=$57,016.50
Calculate total maximum amount that should be paid
Particulars Amount ($)
Present value of cash flows during 1 to 5 years $287,013.82
Present value of cash flows during 6 to 10 years $189,198.33
Present value of cash flows during 11 to 20 years $175,100.98
Present value of estimated sale value $57,016.50
Maximum amount that C should pay to JD for store $708,329.63
Therefore, Maximum amount that should be paid $708,329.63
b. What is an example of a Veblen good?
c. Why do some consumers purchase Veblen goods?
Answer:
Find the answers below
Explanation:
A. Veblen goods are luxury goods sought after by wealthy people and for which these category of people increase their demand as the prices of the good increase (in contrast to the popular law of demand).
2. Examples are luxury houses or cars, jewelry etc.
3. Some customers buy these type of goods in order to show how wealthy they are or show their status.
A Veblen good is a luxury good that defies the law of demand by having an upward-sloping demand curve. An example is a luxury brand handbag. Some consumers purchase Veblen goods as a status symbol and for the exclusivity they confer.
a. A Veblen good is a type of luxury good that has an upward-sloping demand curve, meaning that as the price of the good increases, the quantity demanded also increases. This is contrary to the law of demand, which states that as the price of a good increases, the quantity demanded decreases.
b. An example of a Veblen good is a luxury brand handbag. As the price of the handbag increases, the demand for it also increases, as some consumers perceive the higher price as a status symbol and are willing to pay more for it.
c. Some consumers purchase Veblen goods because they derive satisfaction from owning and displaying luxury items as a symbol of their status and wealth. The higher price of Veblen goods can make them more desirable to certain consumers, as it signifies exclusivity and scarcity.
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Please find full question attached
Answer and Explanation:
I will use Apple and HP in this comparison.Here I would compare Apple's laptop to that of Hewlet Packard as this is where they meet in the industry. Apple employs a strategy of differentiation and standing out in competition through their products. They aim to create products that are quite different and unique/innovative from other products in the market, and yet what the customer wants. In doing this, Apple has a trade-off for cost as they charge alot higher for their products than their competitors. HP on the other hand focus on making the best possible products that get the job done/meet the needs of customers while also being affordable. HP is more focused on affordable devices for their market and therefore have a different market segment for laptops from that of Apple. There is a trade-off for cost and market segment in this comparison