<span>Given:
Cost of the roof of a property = $14,000
Economic life = 18 years
To find: value after 4 years using straight-line depreciation method.
Solution:
Loss of value per year = cost of roof of property / economic life of property
14000/18 = $777.78
Every year, value of property is getting depreciated by $777.78.
So, value after four years is calculated below:
Value after 1 year = $(14000 - 777.78) = $13222.22
Value after 2 year = $(13222.22 - 777.78) = $12444.44
Value after 3 year = $(12444.44 - 777.78) = $11666.66
Value after 4 year = $(11666.66 - 777.78) = $10888.88
Value after four years = $10888.88</span>
Answer:
Debt ratio is 0.5
Explanation:
The DEBT ratio tells us how much debt a firm has as a ratio to its assets. So it is calculated by dividing total debt by total assets. The firm has current liabilities of 100 million and long term liabilities of 200 million, we will add both of them up in order to find total liabilities.
Total Liabilities = 100 million + 200 million = 300 million
The firms total assets are 600 million, in order to find the debt ratio we will divide 300 million by 600 million
300/600= 0.5
This means that the total debt of the firm is half the amount of total assets.
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Answer:
The Parts Division of Nydron Corporation
The Transfer Price for this transaction would lie between $16.85 and $17.00.
Relevant costs of making Part Y6P per unit is computed as the variable or marginal costs:
Sales Price to outside companies = $17
Buying Price from outside supplier = $16.85
Marginal Costs:
Direct Materials $7
Direct Labor $3
Var. Mfg O/H $4.50
Total Variable = $14.50
Fixed Costs = $1.20
Total costs = $15.20
Explanation:
This is a Transfer Price decision, in a buy or make situation. In making such decision, management of Nydron Corporation should concentrate on the relevant costs and the lowest and higher transfer prices. The costs that are relevant in this decision are those that can be avoided, called avoidable costs. They make the difference in making choices.
Since the relevant costs equal $14.50 (without the fixed cost of $1.20, which must be incurred irrespective of the decision taken) and the part can be sold for $17.00 to outside buyers, the transfer price would lie within the relevant manufacturing cost and the outside selling price. However, since the part can be bought from outside at $16.85, this becomes the lowest transfer price and $17.00 the highest transfer price.
Transfer price is the price that a division can sell its products or services to another division of the company and between subsidiaries and parent companies. Transfer pricing is an accounting and taxation practice that enables prices to be set for transactions done internally within businesses and between subsidiaries that operate under common control or ownership. The transfer pricing practice extends to cross-border transactions as well as domestic ones, and have taxation implications.
Answer:
D) 4.04 percent
Explanation:
Spot rate is £1 = $1.5701
Forward exchange rate after 1 year is £1 = $1.5574
Risk free rate in US = 3.2 %
Forward rate = {Spot rate * (1 + risk free rate in US)} / (1 + risk free rate in UK)
1.5574 = {1.5701 * ( 1 + 0.032)} / (1 + risk free rate in UK)
(1 + risk free rate in UK) = (1.5701 * 1.032) / 1.5574
Risk free rate in UK = (1.62034 / 1.5574) - 1
Risk free rate in UK = 1.0404 - 1
Risk free rate in UK = 0.0404
Risk free rate in UK = 4.04%
