How will the following adjusting journal entry affect the accounting equation? "Sinc It does a 10-for-1 stock split. In which of the following types of accounts are decreases recorded by credits: Debts owed by business are referred to as: Of the following steps of the accounting cycle, which step should be completed first? She is the founder and CEO of Fulfilled Finances LLC, the Social Security Presenter for AARP, and the Treasurer for the Financial Planning Association of NorCal. Widget CO has a market capitalization of $100M. $8,400 b. Economies of scale is the cost advantage that arises with increased output of a product. When an increase or decrease in price does not change total revenue, demand is unit elastic. And if you take on a large loan, you could be in trouble when interest rates rise: SomeARMsare structured so that interest rates can nearly double in just a few years. Following a bumpy launch week that saw frequent server trouble and bloated player queues, Blizzard has announced that over 25 million Overwatch 2 players have logged on in its first 10 days. Study with Quizlet and memorize flashcards containing terms like 11. gracedansby. and more. $34,000 Beginning Inventory (11,000) + Net Purchases (23,000) = Cost of Goods Available for Sale (34,000) and more. Traditional lending institutions offer fixed-rate mortgages for a variety of terms, the most common of which are 30, 20, and 15 years. As mentioned earlier, the fixed-rate period of an ARM varies, typically from one year to seven years, which is why an ARM might not make sense for people who plan to keep their home for more than that. Although the amount ofprincipalandinterestpaid each month varies from payment to payment, the total payment remains the same, which makes budgeting easy for homeowners.. c) both are estimated in advance by analysts. B. Which of the following is the best driver to use? These financial elements inform key decisions in every business. In contrast, fixed assets are illiquid, but generate revenue for the firm. If you plan to move before the five-year ARM resets, you are going to save a lot of money on interest. Should government do more or less to solve countrys problems (HELPNOT: 1 = Government should do more; 2, 3, 4, 5 = Government does too much)? A fixed amount that you are paid over a period of time, regardless of how many hours you work. The variable expense ratio for Plush & Cushy's chairs is ____________%. How large a mortgage payment can you afford today? Sales this year equals $927,500. Assuming that a Markov chain applies to these facts, find the steady-state vector. A graduated payment mortgage (GPM) is a type of mortgage for which the payment increases from a low initial rate to a higher rate. Which of the following must be subtracted from sales to reach the contribution margin? Other Quizlet sets. c. Fixed-rate loans are preferable when interest rates are expected to fall. A measure of how sensitive net operating income is to a given percentage change in sales dollars is known as _________ __________. Variable costs are $4 per unit and fixed costs total $30,000. If the business is producing or selling less, these costs will fall. Which of the following allocation methods is used by Zigma to allocate the joint costs of cultivating rice? The margin of safety in units is ____________. Study with Quizlet and memorize flashcards containing terms like A company has reached its break-even point when the contribution margin ___________ fixed expenses., At the break-even point: (select all that apply) a. net operating income is zero b. the company is experiencing a loss c. total revenue equals total cost d. the company is earning a profit, A company's break-even ARMsare also attractive because their low initial payments often enable the borrower to qualify for a larger loan and, in a falling-interest-rate environment, allow the borrower to enjoy lower interest rates (and lower payments) without the need torefinancethe mortgage. Find the markup. To reach a target profit of $180,000, 90,000 units need to be sold. The lists do not show all contributions to every state ballot measure, or each independent expenditure committee formed to support or What is the ability-to-repay rule? In that case, an ARM will work for you. An ARM may be an excellent choice if low payments in thenear termare your primary requirement, or if you dont plan to live in the property long enough for the rates to rise. Fixed-rate mortgages andadjustable-rate mortgages(ARMs) are the two primarymortgagetypes. Which of the following amounts would be recorded as insurance expense during the adjusting process at the end of Diane's first month of operations on March 31? Theinitial interest rateon an adjustable-rate mortgage (ARM) is setbelow the marketrate on a comparable fixed-rate loan, and then the rate rises (or possibly lowers) as time goes on. If Shonda must sell 284 pairs of shoes to break-even, sales dollars needed to break-even equals $___________. All income statement accounts will be closed at the end of the period. Individualspersonal financesoften experience periods of advance and decline, interest rates rise and fall, and the strength of theeconomywaxes and wanes. bought at 95.976? The company's fixed costs are $305,000. That person may be forced to purchase the new home while the old one is in contract and, as a result, will take out a one- or two-year ARM. A written promise that a customer will pay a fixed amount of principal plus interest by a certain date in the future. The contribution margin per putter is $65. Monthly fixed costs traceable to each division are $\$ 200,000$. a) defines the industries in which the company operates. Ideally, you should use the savings compared to a fixed-rate mortgage to make extra principal payments each month, so that the total loan is smaller when the reset occurs, further lowering costs.. Know Before You Owe: Mortgage shopping study., Freddie Mac. Units sold b. Those who have a checking or savings account, but also use financial alternatives like check cashing services are considered underbanked. Selling price c. Total variable costs d. Fixed costs of a product, Which of the following is not an assumption of cost-volume-profit analysis? _____ are variables or activities within a producing department that provoke the incurrence of support costs. If Candle Central sells 500 units: (select all that apply), Terry's Trees has reached its break-even point and has calculated its contribution margin ratio to be 70%. A company's selling price is $90 per unit, variable cost per unit is $28 and total fixed expenses are $320,000. a. Study with Quizlet and memorize flashcards containing terms like Which of the following is true of fixed-rate loans? Why is it important to me?, Debt.org. Therefore, the credit to Supplies in the adjusting entry is for the amount of supplies. if the earnings per share of a company are $1 and the earnings yield is 2% what is the price per share? The monthly payments for shorter-term mortgages are higher so that the principal is repaid in a shorter time frame. Cash flow to stockholders is defined as: A. cash flow from assets plus cash flow to creditors. which of the following statements is true? An ARM index is what lenders use as a benchmark interest rate to determine how adjustable-rate mortgages are priced. when a corporation adopts a fiscal year that ends when business activities have reached the lowest point in its annual operating cycle, the ability of a business to pay its debts. Fixed and Variable Rate Loans: Which Is Better? read more. 4. What Are the Main Types of Mortgage Lenders? The margin of safety is $27,300. Our tips from experts and exam survivors will help you through. Study with Quizlet and memorize flashcards containing terms like A project is a temporary activity that is launched for a specific purpose to carry out a particular objective., A difference between projects and processes is that processes are unique, whereas projects are recurring., Every project is constrained by three fundamental, interrelated forces: time, cost, and scope. Which of the following are examples of subsections found on a classified balance sheet? If, though, you are purchasing a home with an eye toward upgrading to a bigger home once you start a familyor you think youll be relocating for workthen an ARM may be right for you. (For more, seeAdjustable Rate Mortgage: What Happens When Interest Rates Go Up. By clicking Accept All Cookies, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. The following are reasons to close the accounts at the end of the year except, The journal entry to record cash received from clients on account would include a, The annual accounting period (fiscal year) most commonly adopted by businesses is. Here are some concepts borrowers need to know before selecting an ARM: The biggest advantage of an ARM is that it is considerably cheaper than afixed-rate mortgage, at least for the first three, five, or seven years. Deciding what marketing strategy to use. You may get a similar rate at the time of reset, but it is a serious gamble. The company's contribution margin ratio is 77%. (For more, see Understanding the Mortgage Payment Structure. Thus, shorter term mortgages cost significantly less overall. For an adjustable-rate mortgage (ARM), what are the index and margin, and how do they work? Analysing the financial performance of a business - AQA, Home Economics: Food and Nutrition (CCEA). The contribution margin per unit is $32 and fixed costs total $120,000. Afixed-ratemortgage charges a setrate of interestthat does not change throughout the life of the loan. Fixed costs are costs for a business that do not change, no matter what the level of output for the business. However, if you expect to see an increase in your income, going with an ARM could save you from paying a lot of interest over the long haul. How much must twin $2$ put aside at the end of each year for the next $25$ years in an account that earns $8 \%$ compounded annually to in an account that earns $8 \%$ compounded annually to years (when they turn $65$)? Smith, Inc. earned revenue on account. Costs are split into three main categories, fixed, variable, and total costs. Who would you rather be? a. Total costs = fixed costs + variable costs For example if a business have fixed costs of 18,500 and variable costs of 9,250 their total costs would be 18,500 + 9,250 = 27,750. to report amounts for only 1 period temporary accounts should have ____ balance at the beginning of next period, Revenue and expense account balances are transferred to the owners capital account, the balance of the owner's drawing account is transferred to the owner's capital account, the accounting process that begins with analyzing and journalizing transactions and ends with the post-closing trial balance, transaction are analyzed and recorded in the journal, adjustment data are assembled and analyzed, an optional end of period spreadsheet is prepared, adjusting entries are journalized and posted to ledger, Financial statements are prepared (income, owner's equity, balance sheet, statement of cash flow). Thus, the higher the liquidity ratios, the less liquidity risk a firm has. Regardless of the loan type you select, choosing carefully will help you avoid costly mistakes. Although the rate of interest is fixed, the total amount of interest youll pay depends on the mortgage term. For people who have a stable income but dont expect it to increase dramatically, a fixed-rate mortgage makes more sense. He received his double major Bachelor of Arts in professional and creative writing from Carnegie Mellon University and his Master of Journalism at Temple University. a. In this method, we determine the cost of equity by summing up the beta and risk premium product with the risk-free rate. 36 terms. If, on the other hand,you ultimately decide to stay in the house longer, especially if rates are higher when your loan adjusts, then the mortgage is going to cost more than the fixed-rate loan would have. If break-even sales equals $935,000, Seth's margin of safety in dollars is: If a company only has a single product, total sales can be calculated using only: c. Sales price per unit multiplied by the number of units sold. Suppose the following table shows information on the market basket for the CSPI and the prices of each of the goods in 2014, 2015, and 2016. _____ loans do not have to be repaid until after you graduate from college. Variable expenses/Sales is the calculation of the __________ __________ ratio. Sales generated by the Standard Division totaled $\$ 1,200,000$, and its contribution margin ratio averaged 50 percent. Run Like the Wind sells ceiling fans. b. change in cost resulting specifically from the decision. $3,250 c. $11,500 d. None of these choices are correct. d. Margin of safety in dollars divided by total budgeted (or actual) sales in dollars, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Daniel F Viele, David H Marshall, Wayne W McManus. These include white papers, government data, original reporting, and interviews with industry experts. If Daisy incurred $250,000 of fixed expenses, net operating income for the year is: To estimate the effect on profits for a planned increase in sales, multiply the increase in units sold by the unit __________ __________. A company has a target profit of $204,000. A deferred interest mortgage allows the borrower to delay paying some or all of a loans interest, resulting in smaller payments for a specified time. True False, A public good: is characterized by rivalry and excludability. b. Whats the new market cap? The 30-year mortgage is the most popular choice because it offers the lowest monthly payment. What effect will this adjustment have on the accounting records? Which of the following are considered temporary accounts? C. operate according to government regulations. For example if a business have fixed costs of 18,500 and variable costs of 9,250 their total costs would be 18,500 + 9,250 = 27,750. In process costing, transferred-in goods are treated as: Which of the following is true of the just-in-time (JIT) manufacturing approach? As you can see, the payments made during the initial years of a mortgage consist primarily of interest payments. All business have costs that need to be paid regularly. The chances are high that you are going to earn more in the coming years and will be able to afford the increased payments when your loan adjusts to a higher rate. D) modular, continuous, and technological. Which of the following accounts should be closed to the capital account at the end of the year? a. etermine the adjusting journal entry for the following scenario: $1,000 supplies are purchased January 1. d) a stocks P/E ratio can remain above or below market average for extended periods. Study with Quizlet and memorize flashcards containing terms like What lists can be imported from Excel spreadsheets, when setting up a QuickBooks online company?, Which of the following is TRUE regarding your chart of accounts, when setting up a new QuickBooks company?, What company information does QuickBooks ask for when you first create a new QuickBooks Types, How They Work, and Examples, 5 Things You Need to Be Pre-Approved for a Mortgage, 11 Mistakes First-Time Homebuyers Should Avoid. Why is it important to me? The financial statement that presents a summary of the revenues and expenses of a business for a specific period of time, such as month or year is called a(n), assets, liabilities, owner's equity, revenues, and expenses, The post-closing trial balance will include. Once the borrower has the proceeds from the sale, they can turn around to pay off the ARM with the proceeds from the home sale. a. b) when you buy an equity, your potential loss is 100% and your maximum potential gain is unlimited. Fixed or Variable Rate Mortgage: Which Is Better Right Now? Please do have a look at it if you need more information. Lance's profit is $__________. For each in a sample of 24 recent movies, opening weekend box office revenue (in millions of dollars) was measured as well as the movie's tweet rate (the average number of tweets referring to the movie one week prior to the movie's release). Taking out an adjustable-rate mortgage is very attractive tomortgage borrowers who have, or will have, thecashto pay off the loan before the new interest rate kicks in. The partialamortizationschedule below demonstrates the way in which the amounts put toward principal and interest alter over the life of the mortgage. 55 terms. Chapter 21 Test. The results for conventional and activity-based costing (ABC) computations will be the same as long as: Which of the following is true of a firm that has adopted just-in-time? The company sells a single product for $50 per unit. The variable cost is $60 per putter and fixed costs total $400,000. a. To achieve a target profit of $930,000, Sniffles' sales rounded to the nearest dollar must be: Pete's Putters sells each putter for $125. Generally accepted accounting principles require that companies use the ____ of accounting. You are building a financial model of a bifocal lens manufacturer. Suppose that twin $1$ invests $\$ 2000$ at the end of each year for $10$ years only (until age $33$) in an account that earns $8 \%$ compounded annually. Study with Quizlet and memorize flashcards containing terms like Which of the following is not a factor in cost-volume-profit analysis? Compulsive Shopping: An unhealthy obsession with shopping that materially interferes with the daily life of the afflicted. It does not provide information about the manufacturing costs associated with - *eitheror* Consumers whose debt burden has become very heavy might apply for a(n): A legal claim that allows creditors to liquidate a loan collateral is a: Which of the following is true of a consumer loan. Examples of costs for a business include rent, bills, and raw materials, staffing costs, petrol and postage. This brings the total of Covid-related spending in the 2021 budget to Lk17.2bn (1 percent of GDP). If each fan's contribution margin is $32 and fixed costs total $222,640, the number of fans required to meet the company's goal is: Contribution margin divided by sales is the formula for ___________ ___________ ____________. Could you still afford an ARM if interest rates rise? Sign in, choose your GCSE subjects and see content that's tailored for you. Prepare Robinns Company's responsibility income statement for the current month. How do earnings yields differ from bond yields? **Describing** What aspects of the economy do communist governments control. When choosing a mortgage, you need to consider a wide range of personal factors and balance them with the economic realities of an ever-changing marketplace. However, if you know you are going to move within a short period, or you dont plan to hold on to the house for decades to come, then an ARM is going to make a lot of sense.. The cost of borrowing fixed-rate loans increases with an increase in the market interest rate. The excess of the current assets of a business over its current liabilities. When the end-of-period spreadsheet is complete, the adjustment columns should have. Adjustable-Rate Mortgage: What Happens When Interest Rates Go Up. A. defeat the competition. In this section's Application Preview, we considered the investment strategies of twins and found that starting early and stopping was a significantly better strategy than waiting, in terms of total contributions made as well as total value in the account at retirement. A move to a larger facility would increase rent expense by $8,000, and allow the company to meet its demand for an additional 1,000 units. what is one possible weakness of this peer approach to valuation? all of the information from the journal was correctly transferred to the ledger, Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means, Smith Inc. In another scenario, if you expect to start receiving money from atrustat a certain age, you could get an ARM that resets in the same year. when an analyst is looking at a company for the first time, which of the following four activities does he do first? The monthly payment on an 8%, 36-month, add-on loan for $10,000 would be: Which of the following is true of installment loans? Total liabilities and owner's equity equals $44,750; total current assets equals $19,800; land equals $15,000; and accumulated depreciationequipment equals $1,550. They are usually fixed for at least a year and mean that a business will pay the same amount each week, month or year. The contribution margin income statement allows users to easily judge the impact of a change in _________ on profit. Company A produces and sells 10,000 units of its product for $10 per unit. 2. (also)* The impact of this change on total contribution margin would be a(n) ___________ (increase/decrease) of $__________. a rise in which of the following inputs will increase an absolute valuation? Study with Quizlet and memorize flashcards containing terms like 10) Three of the four types of processes are: A) goods, services, and hybrids. Which of the following is a feature of a home equity loan? E. create value. Oh, what a wonderful way to spend a holiday! The variable expenses per chair is $85.05 and the chairs sell for $189.00 each. Study with Quizlet and memorize flashcards containing terms like Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's annual purchases. The rice milling process of Zigma Enterprises yields 6,000 pounds of rice grain and 2,000 pounds of hay. - *just asso* Suppose a government study estimated that the probability of successive generations of a rural family remaining in a rural area was $0.7$ and the probability of successive generations of an urban family remaining in an urban area was $0.9$. In the following sentences, underline the interjections. Prepaid insurance is reported on the balance sheet as a, Accrued expenses are ordinarily reported on the balance sheet as, Accounts payable would appear on the balance sheet as a(n), Accumulated Depreciation and Depreciation Expense are classified, respectively, as, If there is a balance in the unearned subscriptions account after adjusting entries are made, it represents a(n). you are promised a stream of fixed dividends. Fixed-rate loans are preferable when interest rates are expected to rise. If the contribution margin is $22 per unit and 26,000 units are sold, net operating profit will be: Profit = (selling price per unit x quantity sold) - (variable expense per _________ x quantity sold) - _________ expenses. it then does a 1-for-16 reverse stock split. Fortunately, since then government regulations andlegislationhave been instituted toincreasetheoversight that transformed a housing bubble into a global financial crisis. A portion of the total cost of an item, such as a car or house, that must be paid at the time of purchase. Fixed expenses are $240,400. Adjustable-Rate Mortgages: An Overview, What Is a Mortgage? For an adjustable-rate mortgage (ARM), what are the index and margin, and how do they work?, Consumer Financial Protection Bureau. By matching revenues and expenses in the same period in which they incur, net income or loss will be properly reported on the income statement, Supplies are recorded as assets when purchased. B) manual, automated, and service. Sweet Dreams sells pillows for $25 each. The two categories of completed units needed in the first-in-first-out (FIFO) method are: In the weighted average costing method, prior-period output and manufacturing costs found in beginning work in process are: Which of the following is a disadvantage of the weighted average costing method? Lance, Inc. has sales of 9,000 units. Which of the accounts below would not appear in the balance sheet columns of the end-of-period spreadsheet? \hline \text { Item } & {\text { Selling Price }} & {\text { Cost }} & {\text { Markup }} \\ Borrowers faced sticker shock when theirARMsadjusted, and their payments skyrocketed. The underbanked represented 14% of U.S. households, or 18. $1+\frac{1}{2}+\frac{1}{3}+\frac{1}{4}+\frac{1}{5}+\frac{1}{6}$. Diane's Designs purchased a one-year liability insurance policy on March 1 of a year for $8,400 and recorded it as a prepaid expense. The balance of the owner's drawing account on the adjusted trial balance of the end-of-period spreadsheet is reported on which of the following financial statements? We can Calculate the cost of debt using the following formula Cost of Debt = (Risk-Free Rate + Credit Spread) * (1 Tax Rate) Gov chap 3-4. The relative proportions in which a company's products are sold is referred to as __________ _________. In the process of preparing a production report for process costing, the step of unit cost calculation is followed by: The five steps that are needed to build a production report for process costing are as follows: Which of the following is true of the first-in, first-out (FIFO) costing method? Variable costs are costs that change depending on the output of a business. If interest rates are climbing or a steady, predictable payment is important to you, a fixed-rate mortgage may be the way to go. Place the following items in order to create the equation used to calculate the variable expense ratio using total values. It serves as a source document for transferring costs from the work-in-process account of a prior department to the work-in-process account of a subsequent department. a) making the assumptions upon which to project future performance, what is a reason one discounts future cash flows as part of the absolute valuation process. If the move is made, profits will: The equation used to calculate the variable expenses ratio using total values is total variable expenses divided by total: Plush & Cushy sells high-end desk chairs. Study with Quizlet and memorize flashcards containing terms like 1. The random variable is the number of successes in a fixed number of trials. Cengage Unlimited is a subscription that gives you access to all Cengage online learning platforms, plus our entire library of Cengage eTextbooks for a one-time, flat price. Coahffee. C. dividends paid plus the change in retained earnings. Lets say the interest-rate environment means you can take out a five-year ARM with an interest rateof 3.5%. Study with Quizlet and memorize flashcards containing terms like When critics of unemployment insurance claim that some of the unemployed are not exerting much effort to find jobs because of the unemployment benefits, they are referring to the moral hazard problem. - *not only but. Namely, some percentage change in price causes an equal percentage change in quantity demanded (Qd) and therefore, no effect on total revenues. By continuing to use the site you agree to our cookie policy. While the marketplace offers numerous varieties within these two categories, the first step whenshopping for a mortgageis determining which of the two mainloantypes best suits your needs., Afixed-ratemortgage charges a setrate of interestthat remains unchanged throughout the life of the loan. On January 31, it is determined that $600 supplies are remaining. In this example, the mortgage term is 30 years, the principal is $100,000, and the interest rate is 6%. A financial statement user would determine if a company was profitable or not during a specific period of time by reviewing the, Accounts reported on the balance sheet that are carried forward from year to year are known as permanent accounts. The calculation for total costs is: Total costs = fixed costs + variable costs. Gapminder uses cookies to improve its statistics and user experience. Polly's Day Planners sells its planners for $35 each. Financial terms and calculations includes revenue, costs, profits and loss, average rate of return, and break-even. A 30-year fixed-rate mortgage, in comparison, would give you an interest rate of 4.25%. Company A's profit (loss) is: The break-even point is the level of sales at which profit equals ___________. Which of the following accounts will be closed with a debit? Can we infer from the data that there are differences between the seven political viewpoints in their answer to the question? Current assets divided by current liabilities. Alternative mortgage instrument (AMI) is any residential mortgage loan with different terms from a fixed-rate, fully amortizing mortgage. (select all that apply). Payroll Vocabulary. The posting of depreciation expense will be done during which step of the accounting cycle? Of the following steps of the accounting cycle, which step should be completed last? Below are lists of the top 10 contributors to committees that have raised at least $1,000,000 and are primarily formed to support or oppose a state ballot measure or a candidate for state office in the November 2022 general election. 25 terms. Which of the following are decisions in which using CVP analysis could be useful? The cost of each item in the basket and the Fixed-Rate vs. X Close The cost of office supplies to be used in future periods is ordinarily shown on the balance sheet as a(n). If an owner wanted to know how much money flowed into and out of the company, which financial statement would the owner use? The probability of success is the same for each trial. The balance of the accumulated depreciation account on the adjusted trial balance of the end-of-period spreadsheet would be reported on which of the following financial statements? Which of the following statements is true about the support department of an organization? Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n), The general term used to indicate delaying the recognition of an expense already paid or of a revenue already received is, The account type and normal balance of Unearned Revenue is. Another situation in which an ARM would make sense is if you can afford to accelerate the payments each month by enough to pay it off before it resets. Investopedia requires writers to use primary sources to support their work. A company has reached its break-even point when the contribution margin ___________ fixed expenses. These costs are dependent on how much the business produces or sells. B. serve all consumers. The amount of solar energy that reaches the earths surface in one hour is more than the planets total energy requirements for a whole year. Under the weighted average method, equivalent units of output are computed by: Which of the following is an assumption made under the process-costing method? Although it sounds like a perfect renewable energy source, the amount of solar energy we can use varies according to the time of day and the season of the year as well as geographical location. The Language of Composition: Reading, Writing, Rhetoric, Lawrence Scanlon, Renee H. Shea, Robin Dissin Aufses. ARMshave a fixed period of time during which the initial interest rate remains constant, after which the interest rate adjusts at a pre-arranged frequency. Place the following items in the order in which sales dollars are applied on a contribution margin income statement: Sniffles, Inc. produces facial tissues. ARMs are typically more complicated than fixed-rate mortgages. What is the ability-to-repay rule? Applying to Mortgage Lenders: How Many Are Necessary? Randomly listed below are the steps to preparing a Trial Balance: The process of transferring data from the journal to the ledger accounts is called, according to the steps of the accounting cycle in what order should the trial balance be prepare, The ____________ is where a transaction can first be found in the accounting records, The process of transferring debits and credits from the journal entries to the account ledger is called. Selling price is $7 per unit, contribution margin is $4 per unit, and the fixed expenses total $632,000. E. net income minus the addition to retained earnings., 15. Freddie Mac Clears Path for New Index Rate., Consumer Financial Protection Bureau. and more. To account for this decrease in usefulness, the cost of fixed assets is systematically allocated to expense through a process called, The unexpired insurance at the end of the fiscal period represents, An end-of-period spreadsheet includes columns for, is used to summarize account balances and adjustments for the financial statements. \hline \text { Textbook } & \$ 45.50 & \$ 21.35 & \\ Which of the following can be achieved by implementing just-in-time (JIT) manufacturing? Suppose that twin $2$ waits until turning $40$ to begin investing. Also, shorter-term mortgages offer a lower interest rate, which allows for a larger amount of principal repaid with each mortgage payment. A company's net income or net loss for a period is determined during which of the following steps of the accounting cycle? For each $1 increase in sales: (select all that apply), a. net operating income will increase by $0.70. While you may be able to afford to make accelerated payments now, if you get sick, lose your job, or the boiler goes, that may no longer be an option. A company's break-even point is 17,000 units. The main advantage of a fixed-rate loan is that the borrower is protected from sudden and potentially significant increases in monthly mortgage payments if interest rates rise. The highest interest rate installment loans are usually made by: Which of the following is true of a loan collateral? (b) Contracts negotiated under part 15 may be of any type or combination of types that will promote the Governments interest, except as restricted in this part (see 10 U.S.C.2306(a) and 41 U.S.C.3901).Contract types not described in this If a loan has a prepayment penalty, there will be _____. A mortgage is a loan used to purchase or maintain real estate. Company X was expected to have earnings per share of the results, the company reported earnings per share of $0.83. (select all that apply). While thatdoesnt include the vast majority of Americans, there are situations in which it may be possible to pull it off. What is the gerund form of the verb poner. This would be recommended when: Which of the following loan sources is the most expensive? decrease liabilities, increase net income, increase revenues reported for the period, The difference between the balance of a fixed asset account and the related accumulated depreciation account is termed, Prepaid rent, representing rent for the next six months' occupancy, would be reported on the tenant's balance sheet as a(n), As time passes, fixed assets other than land lose their capacity to provide useful services. But liquid assets generate little, if any, profits for the firm. How might you use Kbler-Ross's stages of dying to help you determine whether a person is psychologically able to terminate his or her life. The contribution margin per unit is $40. In allocating the cost of a support department, single charging rate: The allocation bases to determine charging rates at the beginning of a year on the basis of budgeted usage permits: The need for support department cost allocation is virtually being eliminated due to: Which of the following statements is true about the direct method of allocation? Actual costs of a support department should not be allocated to producing departments because: The benefit of the dual-rate charging method of cost allocation is: A profit-volume graph is a graph of the _____. Fixed-rate mortgages are easy to understand and vary little fromlenderto lender. With an ARM, your monthly payment may change frequently over the life of the loan. Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Fundamentals of Financial Management, Concise Edition. 27 terms. - *neither nor* James McWhinney is a long-tenured Investopedia contributor and an expert on personal finance and investing. Which of the following is true of the cost of transferred-in material? What is the first account that should be listed in the post-closing trial balance? One thing is for sure: Dont go with the ARM because you think the lower monthly payment is theonlyway to afford that dream house. The annual percentage rate is equivalent to the stated rate of interest when the _____ is used to calculate finance charges. \begin{array}{|c|c|c|c|c|} How long do you intend to live on theproperty? With over 25 years of experience as a full-time communications professional, James writes about finance, food, and travel for a variety of publications and websites. No more guesswork - Rank On Demand Daisy's Dolls sold 30,000 dolls this year for $40 each. Purchased supplies on account. When making a decision using incremental analysis consider the: (select all that apply). $$. \end{array} Looking To Improve Your Website's Search Engine Optimization? previous Which of the following sources of consumer loans often has the most favorable terms? Common fixed costs for the month amount to $\$ 100,000$. the "fixed cost" (the one-time front-end load) is spread over a greater number of years. 3. The most expensive method of calculating the dollar cost of the interest on this installment loan will be the: Sometimes it may be better to use one's savings rather than borrowing to make a purchase. To put your loan selection into the context of these factors, consider the following questions: If you are considering an ARM, you should run the numbers to determine the worst-case scenario. Adjustable Rate Mortgage: How they Work, Pros and Cons. A borrower who chooses an ARM may save several hundred dollars a month for up to seven years, after which their costs are likely to rise. Which of the following is true of consumer finance companies? When demand is unit elastic, it refers to the effect on total revenue due to changes in price. Based on the following information, determine the amount of equipment on the balance sheet. What is the BREAK-EVEN point in unit sales? Study with Quizlet and memorize flashcards containing terms like d. equal to net sales less cost of goods sold., c. $400,000, b. The downside to fixed-rate mortgages is that when interest rates are high, qualifying for a loan is more difficultbecause the payments are less affordable. Refer to the above diagram. When forced to be in public, the demure Kelly Construct a logical sentence by adding a pair of correlative conjunctions from the italicized list. To qualify for a subsidized Stafford loan, you must: Credit unions lend money to qualified people who are: Which of the following is recommended if you loan money to a friend or relative? Prop 30 is supported by a coalition including CalFire Firefighters, the American Lung Association, environmental organizations, electrical workers and businesses that want to improve Californias air quality by fighting and preventing wildfires and reducing air pollution from vehicles. Which of the following is true of a production report? Which one of the fixed asset accounts listed below will not have a related contra asset account? Study with Quizlet and memorize flashcards containing terms like A multinational enterprise is a firm that engages in foreign direct investment by directly investing in, controlling, and managing value-added activities in other countries T/F, The term "emerging markets" refers to all markets other than the developed markets T/F, GDP is the sum of value added by resident firms, Over Fixed-Rate vs. Place the following items in the correct order in which they appear on the contribution margin format income statement. Which of the following steps is optional during the closing process? Given the following Account Balances, the entry to close Capital during step one of the two step closing process would be a ______________. What is the purpose of the owner capital account in the closing process? Opportunity Zones are economically distressed communities, defined by individual census tract, nominated by Americas governors, and certified by the U.S. Secretary of the Treasury via his delegation of that authority to the Internal Revenue Service. Closing entries are journalized and posted to the ledger. "What is negative amortization? Commercial banks generally charge lower interest rates than other lending institutions because: When the simple interest method is used to determine finance charges, the interest is calculated based on the: A single-payment loan is advantageous only if: The majority of loans made by savings and loan associations are: If Liza's debt safety ratio is 15% and her monthly take-home pay is $4,500, which of the following equals to her total credit payments? Which of the following statements is true regarding cost allocation? This is then the rate until the next reset, which may be the following year. Which of the following forms is used to identify direct materials, quantity and prices, and work order numbers? fixed assets, include land and assets that depreciate over period of time (equipment, machinery, building), balance sheet that is expanded by adding subsection for assets and liabilities, assets commonly divided into 2 sections on balance sheet, current assets and property, plant and equipment, liabilities divided into 2 sections on balance sheet, accounts that are relatively permanent from year to year. Study with Quizlet and memorize flashcards containing terms like Why do companies do IPOs, Why do company manager-owners smile when they ring the stock exchange bell at their IPO, What is the prime reason that Jennys discretionary income is more volatile than her salary and more. C) process focus, repetitive focus, and product focus. Other Quizlet sets. Take a borrower who is buying one house and selling another one at the same time. the cash flow from equities can continue indefinitely while the cash flow from most bonds comes to an end. The annual accounting period adopted by a business. Youll also get at least 4 FREE hardcopy textbook rentals (you only pay for shipping & handling). What affect will this entry have on the accounting records? ), The interest rate for an adjustable-rate mortgage is a variable one. Variable costs are $15 per pillow. B) Cost of Debt. Study with Quizlet and memorize flashcards containing terms like In the above diagram the range of diminishing marginal returns is:, In the above diagram, total product will be at a maximum at:, Refer to the above diagram. What affect does the following transaction have on the accounting records? In what direction are interest rates heading, and do you anticipate that trend to continue. You can learn more about the standards we follow in producing accurate, unbiased content in our, When to Buy a Home Based on Mortgage Rates. Candle Central has $1,440 of total variable expense for a sales level of 600 units and $2,160 of total variable expense for a sales level of 900 units. - *whetheror* Which of the following accounts will be reported in the subsection of the balance sheet called Current Assets? ARMs are significantly more complicated than fixed-rate loans, so exploring the pros and cons requires an understanding of some basic terminology. Adjustable-Rate Mortgages: What's the Difference? Target profit for the year is $470,000. We also reference original research from other reputable publishers where appropriate. How many units does JVL have to sell to BREAK-EVEN? We would like to show you a description here but the site wont allow us. Explain why a probabilistic model is more appropriate than a deterministic model. B. operating cash flow minus cash flow to creditors. Generally if the business is producing or selling more, these costs will rise. If each unit sells for $7.50, the total sales dollars needed to reach the target profit is $____________. D. dividends paid minus net new equity raised. IPOs incentivize entrepreneurs to innovate as IPOs provide a way for entrepreneurs to monetize their work, Why do company manager-owners smile when they ring the stock exchange bell at their IPO, An IPO crystalizes the value of the manager-owners stake, What is the prime reason that Jennys discretionary income is more volatile than her salary, Her mortgage payments and necessities are fixed. $$ The type of account and normal balance of Prepaid Insurance is. Would you expect a typical open-end fixed-income mutual fund to have higher or lower operating expenses than a fixed-income unit investment trust? Seth's Speakers had actual sales of $1,630,000. The ARM, however, can pose some significant downsides. Owner capital is where the period's net income or loss is transferred. WebStudy with Quizlet and memorize flashcards containing terms like The marginal cost to produce an additional copy of a software product is effectively zero., With the advent of cloud computing and SaaS, smaller firms no longer have access to the kinds of sophisticated computing power they had access to in the past., The cost of producing an additional unit Which of the following is not an essential part of the accounting records? Luke_Finchum Teacher. what input do both absolute valuation and relative valuation typically require? _____ a slave _____ a slaveholder, all people are harmed by slavery. What distinguishes a merchandising business from a service business? ", Consumer Financial Protection Bureau. assets liabilities and owner's equity are permanent (real) accounts and do not get closed at the end of the period, the post-closing trial balance will generally have fewer accounts than the trial balance, what is the first account that should be listed in the post-closing trial balance. They include a new phase of short-term work arrangement (June 2021), fixed cost subsidy, hardship fund for small businesses, revenue replacement, and unemployment assistance. Study with Quizlet and memorize flashcards containing terms like Which of the following is true of a production report? the most important output of the accounting cycle is the financial statement, which of the following financial statements reports information as of a specific date. What happened to the share price when the stock market opened? Finally, it does a 35-for-1 stock split. Choose the correct journal entry, debit accounts receivable; credit fees earned. which of the accounts below would be closed by posting a debit to the account? Accounts that report amounts for only one period. The contribution margin is equal to sales minus: JVL Enterprises has set a target profit of $126,000. ARMs are considerably cheaper thanfixed-rate mortgages. Read about our approach to external linking. Nothing else changes. b. However, the trade-off for that low payment is a significantlyhigher overall cost, because the extra decade, or more, in the term is devoted primarily to paying interest. Activity-based costing (ABC) can have a role in process settings provided: Which of the following is true of a physical flow schedule? A. Total Rewards refers to all forms of pay and compensation, tangible benefits, and other intangible rewards that an organization provides Having a lower-cost product or service at the highest priority throughout its processes. Total costs are simply just fixed and variable costs for the business added together, giving the total overall costs for the business. Its more prudent to search for a house with a smaller price tag instead. D. stimulate short-term sales. Complete the sentence in a way that shows you understand the meaning of the italicized vocabulary word. which of the following accounts will be debited in the closing entry at the end of the year, beginning capital + net income - withdrawals = ending capital, assets liability and owner's equity account flow into. Each doll's variable cost was $19. Mortgage Brokers: Advantages and Disadvantages, What to Know When Dealing With Mortgage Loan Officers and Brokers, How Rocket Mortgage (Formerly Quicken Loans) Works, Adjustable Rate Mortgage: What Happens When Interest Rates Go Up, Know Before You Owe: Mortgage shopping study, Freddie Mac Clears Path for New Index Rate. A study presented at the 2010 IEEE international Conference on Web intelligence and Intelligent Agent Technology investigated whether the volume of chatter on Twitter.com could be used to forecast the box office revenues of movies. Pamela Rodriguez is a Certified Financial Planner, Series 7 and 66 license holder, with 10 years of experience in Financial Planning and Retirement Planning. Choose the correct journal entry. How Much Money Do I Need to Put Down on a Mortgage? Theinitial interest rateon an ARM is setbelow the marketrate on a comparable fixed-rate loan, and then the rate rises as time goes on. When pulling the owner's capital balance from the end-of-period spreadsheet into the statement of owner's equity, why is it also important to check the detail in the owner's capital account in the general ledger? If the ARM is held long enough, the interest rate will surpass the going rate for fixed-rate loans.. A wedding planning company has a high fixed cost base and a lot of debt. The fundamental goal of marketers when creating goods, services, or combinations of both, is to: The Consumer Financial Protection Bureau (CFPB) has been preventing predatory mortgage practices that hurt the consumer. The company is considering improving the quality of materials which will increase variable costs to $19. debit supplies expense $400; Credit supplies $400. If interest rates are high and expected to fall, an ARM will ensure that you get to take advantage of the drop, as youre not locked into a particular rate. After the initial term, the loan resets, meaning there is a new interest rate based on current market rates. which of the following assigns the same relative weightings to short-term and long-term outcomes as the absolute valuation process? Employing this strategy can be risky because life is unpredictable. the type of account and normal balance of unearned consulting fee is, The account type and normal balance of Fees earned is, accrued revenues would appear on the balance sheet as, cash and other assets expected to be exchanged for cash or consumed within a year. The fixed-rate period can vary significantlyanywhere from one month to 10 years; shorter adjustment periods generally carry lower initial interest rates. Which of the following account groups includes temporary (nominal) accounts? Which of the following is true of the process-costing system? T13- prevention of personnel accidents. Study with Quizlet and memorize flashcards containing terms like The marginal cost to produce an additional copy of a software product is effectively zero., With the advent of cloud computing and SaaS, smaller firms no longer have access to the kinds of sophisticated computing power they had access to in the past., The cost of producing an additional unit of a product is known What does the release of earnings announcements have in common with the release of economic indicators? If you can still afford it if the mortgage resets to the maximum cap in the future, an ARM will save you money every month. Consumer Financial Protection Bureau. What may be a problem of comparing the P/E of a stock to the P/E of the overall market? A 2/28 adjustable-rate mortgage (2/28 ARM) maintains a low fixed interest rate for a two-year period, after which the rate floats semiannually. DIY Seo Software From Locustware Is Exactly What You Need! the company currently sells 1,200 pillows per month and expects that the improved materials would increase sales to 1,500 per month. Adjustable-Rate Mortgages Overview., Freddie Mac. 22. The time value of money is incorporated in the analysis. Total liabilities and owner's equity equals $44,750; total current assets equals $19,800; land equals $15,000; and accumulated depreciationequipment equals $1,550. 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