Systematic sample
When preparing a representative sample from a list of 200 customers who complained about errors in their statements, this type of sample might select every tenth customer for review.
Answer:
a) $12,500 unfavorable
b) 0
Explanation:
variable factory overhead controllable variance = actual variable overhead expense - (standard variable overhead per unit x standard number of units)
actual variable overhead expense = $725,000
standard variable overhead per unit = $712,500 / 60,000 = $11.875
standard number of units = 60,000
variable factory overhead controllable variance = $725,000 - $712,500 = $12,500 unfavorable
Controllable factory overhead is not related to any changes in the actual volume or quantity produced.
Fixed factory overhead volume variance = actual fixed overhead - standard fixed overhead = $262,500 - $262,500 = 0
Fixed overhead was exactly the same as the standard or budgeted overhead.
Answer:
$50
Explanation:
Dividend discount model (DDM) is used to calculate intrinsic value of a stock. Since the dividends are expected to grow indefinitely, the formula will be as follows;
Price (P0) = D1 / (r-g)
where D1 = Next year's dividend = 2.50
r = required rate of return = 12% or 0.12 as a decimal
g = dividend growth rate = 7%
Price (P0) = 2.50/(0.12-0.07)
P0 = 2.50 /0.05
P0 = $50
Answer:
nominal interest rate = 4% annual
effective interest rate = 5.56% annual
Explanation:
the bond's nominal rate is basically the coupon rate
to calculate the bond's effective interest rate we must calculate its yield to maturity:
YTM = [coupon + [(face value - present value) / n]} / [(face value + present value) / 2]
- coupon = $1,000 x 4% x 1/2 = $20
- FV = $1,000
- PV = $800
- n = 40
YTM = [20 + [(1,000 - 800) / 40]} / [(1,000 + 800) / 2]
YTM = 25 / 900 = 2.777 semiannual ⇒ 5.56% annual
