Consider the following statement:"Statistics tell us that ice cream sales increase during the summer months. It is also the case

Answer:

Case 1.

Dr Vacation Benefit Expense $8,740

Cr Vacation Benefit Payable              $8,740

Case 2.

Dr Warranty Claim Expense $6,120

Cr             Provision for Warranty $6,120

Explanation:

Now here, we have two cases. The first case is related to the monthly benefits given to employees which will be accounted for according to the accrual basis. The second case is of the warranty which would be accounted for according to the International Accounting Standard IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

Case 1. The accrual basis says that the expense must recognized when it has been incurred. In the current scenario, the vacation benefits were promised so the firm must recognize $8,740 as an expense.

The entry would be:

Dr Vacation Benefit Expense $8,740

Cr Vacation Benefit Payable              $8,740

Now, the second case is the recording of the warranty claims expected which must be recognized as an expense. The warranty claim can be calculated as the number of units are 8% of total units sold during December which is 360 units (4,500 * 8%). Furthermore, the cost of maintenance per unit is $17 per unit which means the total cost of maintenance would be $6,120. So the entry would be recognizing provision for the warranty claim of $6,120 for the month.

The entry would be:

Dr Warranty Claim Expense $6,120

Cr             Provision for Warranty $6,120

Answer:

$70.26

Explanation:

Dividend payout ratio = Dividend per share / Earning per share

r = cost of equity = 10%, or 0.10

Discounting factor = 1 /(1 + r)^n

n = year

a. For during the rapid growth period

Dividend payout ratio = 20%, or 0.20

Growth rate = 20%, or 0.20

Earnings per share in year 1 =  Last year's earnings per share * (1 + Growth rate) = $2 * (1 + 0.20) = $2.40 per share

Dividend per share in year 1 = Dividend payout ratio * Earning per share in year 1 = 0.20 * $2.40 = $0.48 per share

PV of year 1 dividend per share = $0.48 * (1/1.10^1) = $0.436363636363636

Earnings per share in year 2 =  Earnings per share in year 1 * (1 + Growth rate) = $2.40 * (1 + 0.20) = $2.88 per share

Dividend per share in year 2 = Dividend payout ratio * Earning per share in year 2 = 0.20 * $2.88 = $0.5760 per share

PV of year 2 dividend per share = $0.5760 * (1/1.10^2) = $ 0.47603305785124

Earnings per share in year 3 =  Earnings per share in year 2 * (1 + Growth rate) = $2.88 * (1 + 0.20) = $3.4560 per share

Dividend per share in year 3 = Dividend payout ratio * Earning per share in year 3 = 0.20 * $3.4560 = $0.6912 per share

PV of year 3 dividend per share = $0.6912 * (1/1.10^3) = $0.51930879038317

b. For during the slow growth period

Dividend payout ratio = 50%, or 0.50

Growth rate = 8%, or 0.08

Earnings per share in year 4 =  Earnings per share in year 3 * (1 + Growth rate during slow growth) = $3.4560 * (1 + 0.08) = $3.73248

Dividend per share in year 4 = Dividend payout ratio * Earning per share in year 4 = 0.50 * $3.73248 = $1.86624 per share

Dividend per share in year 5 = Dividend per share in year 4 * (1 + Growth rate during slow growth) = $1.86624 * (1 + 0.08) = $2.0155392

Stock price in year 4 = Dividend per share in year 5 / (r - Growth rate during slow growth) = $2.0155392 / (0.10 - 0.08) = $100.77696

PV of stock price in year 4 = $100.77696 * (1/1.10^4) = 68.8320196707875

c. Calculation of the current price of the common stock

Current price of the common stock = PV of year 1 dividend per share + PV of year 2 dividend per share + PV of year 3 dividend per share + PV of stock price in year 4 = $0.436363636363636 + $0.47603305785124 + $0.51930879038317 + $68.8320196707875 = $70.26

Therefore, the current price of the common stock is $70.26.

<span>A german firm raising capital by selling stock through the london stock exchange is an example of transnational financing.

Transnational financing occurs when a firm goes to another country to raise capital through the issue of stocks and bonds.
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Answer:

The answer is: A) formed a valid contract because Rachel's outward expressions showed the formation of a contract.

Explanation:

A valid contract is binding and enforceable agreement, where all parties are legally bound to perform the contract.

Probably the most important part of a contract is the existence of an offer and acceptance. Once a valid offer is accepted, it binds the parties into a valid contract.

In this case, Rachel accepted Julius´s offer to buy her boat, so an offer and acceptance exists.

Goal clarity simply put involves making goals clear. Clear goals are specific and measurable. It is important tp make goals clear to all stakeholders like employees.