According to the text, the exception amount for active owners is phased out as income increases: the $25,000 maximum exception amount is phased out by 50 cents for every dollar the taxpayer’s adjusted gross income (before considering the rental loss) exceeds $100,000. 120,000-100,000*.5= 10,000 phase out 25,000-10,000= 15,000 total deductible loss; Alexa can still deduct the $2,400 because her loss is less than the 15,000. New AGI 120,000-2,400= $117,600 d. Assume that Alexa’s AGI from other sources is $200,000. This consists of $150,000 salary, $10,000 of dividends, and $25,000 of
This implies that we can be 95% confident that the average (mean) sales per week exceeds 41.5 per salesperson since 41.654 > 41.5 and therefore our confidence interval does not include 41.5. If samples of size 100 are to be taken from the population of 1000 salespeople of the company again and again, the average (mean) sales per week will exceed 41.5 per salesperson, 95% of the times. b) The true population proportion of salespeople that received online training is less than 55%. Regarding this claim, the statistical evidence in not sufficient to conclusively say that the true population proportion of salespeople that received online training is less than 55%. The p-value associated with it is .157 or approximately 16% this is higher than the acceptable 5% level.
In this case, the only cost saving is approximately $500k. However, the addition of an extra level to an already mismanaged distribution center will not help in improving the problems of stock outs and may further deteriorate performance. The assumptions made in this case are: 1. Inventory carrying costs of 25% 2. The average salary of supervisors is $60,000 annually 3.
[pic] [pic] Leverage goes down because we are further away from the break-even point, thus the firm is operating on a larger profit base and leverage is reduced. d. If Healthy Foods has an annual interest expense of $10,000, calculate the degree of financial leverage at both 20,000 and 25,000 bags. a. First determine the profit or loss (EBIT) at 20,000 bags. As indicated in part b, the profit (EBIT) at 25,000 bags is $45,000: | | | | |20,000 bags | | | | |Sales @ $10 per box |$200,000
The Herrestad Company has a classic problem: two products that use fixed overhead disproportionately ("Activity based costing", n.d.). That is, according to the data given in Table A below, product A uses more production runs and more sales reps than product B. Also, there are far fewer units of Product A, meaning that each unit requires a great deal of overhead resources to support. Although the sales price of Product A is high, and therefore one might think that they are charging enough to carry all this extra overhead attention, but profitability analysis indicates otherwise. Table A Use of fixed overhead resources by product line Productionruns(not$) Numberofsalesreps(not$) Total 100 25 ProdA 65 15 ProdB 35 10 Profitability will be reviewed in two parts, first we will analyze the contribution margin, and then product line profitability overall, including fixed costs.
Suppose further that if the Federal Reserve changes the discount rate by 1 percentage point, banks change their reserves by 300. To increase the money supply by 2700 the Federal Reserve should A. reduce the discount rate by 3 percentage points B. reduce the discount rate by 10 percentage points C. raise the discount rate by 3 percentage points D. raise the discount rate by 10 percentage points 6. In the short run, a trade deficit allows more consumption, but in the long run, a trade deficit is a problem because A. the country eventually will consume more and produce less B. the country eventually will
It would be $111,600. Even though the assets have appreciated, the taxpayers will not realize or recognize the gain for income tax purposes until the taxpayer is able to sell their investment assets. At that time they will then increase their gross income from the
• It is assumed that Working Capital increases in proportion to growth in Revenue of 9% till 2019 and 4% for 2020. • Interest is not in calculation of Cash flows since we have considered its effect while calculating WACC. On analyzing the revenue streams of the Company, we see that it generates roughly 40% of its income from Broadcasting rights, followed by Attendance (23%), Sponsorship (21%) and Merchandise (7%). Whereas on the expenses side, payroll accounts for 74% of the Operational costs while only 24% is spent for the stadium operations. With the current high operating cost (Operating costs: Revenue = 0.93) it is not a surprise that the EBIT is only 3.7% of total Revenues while Net income account only for 0.5%.
At 10 cents each, the expected revenue of $500 per day, and the amount will be lost while the copier is broken. The standard number of breakdowns per year to be 12.255 (dividing 52 weeks/year by 4.243 weeks/breakdown), the profit lost per breakdown to be $1,125 (days lost/breakdown * revenue lost/day), and finally the profit lost per year due to breakdowns to be $13,787 (breakdowns/year * profit lost/breakdown). 6. The profits lost per year due to breakdowns is $13,787, which is bigger than $12,000, they should procure a backup copier. A high
However, exhibit 6 showed that there was a decline in market demand for conventional lenses, but an increase in both planned replacement and disposal lenses. B&L does not produce either of those products, yet the reports indicated a healthy growth in revenue. This increase was largely due to sales revenue recognized from the 1993 large volume shipment to the distributors, transferring inventories from B&L to various distributors and recognized as revenues to B&L. This strategy not only increased the revenue for the year significantly but also reduced the excess inventory held by B&L, and increased their AR significantly, thus portraying a positive outlook on the Balance Sheet. 2.Does the new distribution and sales strategy make sense from an operational standpoint? Why or why not?