Establishment of the fund and Reimbursement of the fund are two events that cause a Petty Cash account to be credited in a journal entry.
Petty cash is a small sum of money that a company sets aside to cover small purchases. Petty cash may be used to purchase anything from office supplies to snack foods and drinks. It is also known as a petty cash fund.What is the Journal Entry?A journal entry is a method of recording transactions that affect a company's financial statements. Debits and credits are used to record transactions in a journal entry. The total debits must equal the total credits, as per the double-entry accounting system.
Therefore, the journal entry to record the establishment of the Petty Cash Fund and the reimbursement of the Petty Cash Fund are:Journal entry to establish the Petty Cash Fund:Petty Cash (Dr) - $200Cash/Bank (Cr) - $200Journal entry for the reimbursement of the Petty Cash Fund:Entertainment Expense (Dr) - $31Postage Expense (Dr) - $24Printing Expense (Dr) - $10Cash/Bank (Cr) - $65Petty Cash (Cr) - $65Note: To balance the journal entries, the debits and credits have to be equal.
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1. Please show that
(a) AD is downward-slopping for a large open economy with Mundell-Fleming model.
(b) AD curve for a large open economy is flatter than the one for a closed economy.
2. This question set is about consumption function.
(a) What is Keynes’ consumption?
(b) What is the problem(s) about Keynes’ consumption function?
(c) Please explain how life-cycle hypothesis solves the problem(s) mentioned above?
(a) According to the Mundell-Fleming model, aggregate demand has a negative slope for a big open economy since monetary and fiscal policy are effective. A large open economy is defined under the Mundell-Fleming model as having both capital mobility and a flexible exchange rate.
(b) Because of the effect of exchange rate fluctuations on net exports, the AD curve for a sizable open economy is flatter than the one for a closed economy. Changes in domestic interest rates or government spending largely impact investment and consumption in a closed economy.
2. (a) Consumption is a function of disposable income, according to Keynes' consumption function, commonly referred to as the Keynesian consumption function. The formula is C = a + bYd, where Yd stands for disposable income, a stands for autonomous consumption, b stands for the marginal propensity to consume, and C stands for consumption.
(b) The consumption function proposed by Keynes has some drawbacks. Lack of consideration for wealth: Keynes' consumption function ignores the impact of wealth on consumption decisions, concentrating only on the relationship between consumption and current disposable income.
(c) By taking into account a more thorough framework for consuming behaviour, the life-cycle hypothesis, created by economists Franco Modigliani and Richard Brumberg, addresses the issues with Keynes' consumption function.
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two
parts
What is the duration of the following bond: $1,000 par value, 6% annual coupon, 5 years to maturity, and yield to maturity of 5.5% ? You will need your answer for the next question.
In the prior ques
Duration of the Bond:
To calculate the duration of the bond, we need to use the formula:
Duration = [(Present Value of Cash Flows * Time to Cash Flow) / Bond Price] + ...
Given the bond details:
Par value: $1,000
Annual coupon: 6%
Years to maturity: 5
Yield to maturity: 5.5%
First, we need to calculate the present value of cash flows, which includes the coupon payments and the face value payment at maturity. Then, we can apply the formula to find the duration.
Assuming annual coupon payments, we can calculate the present value of the cash flows as follows:
Coupon Payment = 6% of $1,000 = $60 per year for 5 years
Face Value Payment = $1,000 (received at the end of the 5th year)
Using the yield to maturity of 5.5%, we can discount the cash flows to their present values. Let's denote the present value of cash flows as PV.
PV = ($60 / (1 + 0.055)^1) + ($60 / (1 + 0.055)^2) + ($60 / (1 + 0.055)^3) + ($60 / (1 + 0.055)^4) + ($60 / (1 + 0.055)^5) + ($1,000 / (1 + 0.055)^5)
After calculating PV, we can plug the values into the duration formula to find the duration of the bond.
Please provide the value of PV, and I'll continue with the duration calculation in the next question.
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A lumber company purchases and installs a wood chipper for $200,000. The chipper is classified as a MACRS 7-year property. Its useful life is 10 years. The estimated salvage value at the end of 10 years is $25,000. Using straight-line depreciation, the third year depreciation is: Enter your answer as: 12345 Round your answer. Do not use a dollar sign ("$"), any commas (", ") or a decimal point (".").
Third year depreciation using straight-line depreciation is $52,500.
To calculate the third year depreciation using straight-line depreciation, we need to determine the depreciable base of the wood chipper.
The depreciable base is the original cost minus the estimated salvage value. In this case, it is calculated as:
Depreciable base = Cost - Salvage value
Depreciable base = $200,000 - $25,000
Depreciable base = $175,000
Since the chipper is classified as a MACRS 7-year property, we divide the depreciable base by the useful life (in years) to get the annual depreciation expense. In this case:
Annual depreciation expense = Depreciable base / Useful life
Annual depreciation expense = $175,000 / 10
Annual depreciation expense = $17,500
To find the third year depreciation, we multiply the annual depreciation expense by the number of years. In this case, it would be:
Third year depreciation = Annual depreciation expense * Number of years
Third year depreciation = $17,500 * 3
Third year depreciation = $52,500
Therefore, the third year depreciation using straight-line depreciation is $52,500.
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Instructions You are working at an engineering company called "Muhendis, Inc.". Your boss, Kartal, asks you to evaluate a project which would bring quantified benefits to your company. Your job is to summarize quantified benefits of this company from this project and file a report. Your project deliverable is a .zip file containing: • a spreadsheet file, with your calculations and work, and a .pdf file, containing your report and policy recommendations. (Maximum 2 pages) 1 Problem Summary Muhendis, Inc. wants to expand its production line by buying new machines and they have two options to choose from: Option 1: buying 2 machines where each machine would cost $23,000 and the fixed cost of pro- duction would be $2,300 per machine, or Option 2: buying 3 machines where each machine would cost $15,000 and the fixed cost of pro- duction would be $2,000 per machine. Muhendis sells a unit produced is for $3. On the other side, raw materials cost $0.42 per unit produced and labor costs are $1.29 per unit produced, as well. Additionally, the installation fee is $2,000 per machine. These machines would last Muhendis for 10 years in an accounting sense (MACRS-10 classified), but you already found a suitable buyer for all the machines in the next 5 years so the project would end early in year 5. The buyers will pay 50% of the initial purchase price per machine as the salvage cost. Your supervisors suggest borrowing at a rate of 20% of the initial investment at an interest rate of %15 (effective per year). The loan would last 5 years. Company's MARR is given as 19% and the tax rate is 21%. Strategy department forecasted the next five year's demand as follows; 1 2 3 4 5 years Demand 15000 16000 17000 18000 19000 1.1 Base Case Scenario (60) Make an income statement and a cash flow statement for each project using a spreadsheet, and show PW and IRR for each project (option 1 and option 2). Which option is the best? Why? 1.2 Sensitivity Analysis (40) Perform sensitivity analysis for ±20% interval, on variables list below for the project you chose using PW from previous question; • Labor cost, loan rate, • unit price and • demand. Report Conclude the analysis using graphs, tables etc. and compare both projects in your report. Include your results and explain why you picked one of the projects.
The analysis should be concluded with the comparison of the projects and an explanation of the chosen option. Graphs, tables, and other visual aids should be used to support the analysis and provide a clear understanding of the results. The report should not exceed 2 pages in length.
Problem Summary:
Muhendis, Inc. is considering expanding its production line by purchasing new machines. They have two options to choose from:
Option 1: Purchase 2 machines at a cost of $23,000 per machine, with a fixed production cost of $2,300 per machine.
Option 2: Purchase 3 machines at a cost of $15,000 per machine, with a fixed production cost of $2,000 per machine.
Each unit produced is sold for $3, with raw materials costing $0.42 per unit and labor costs amounting to $1.29 per unit. Additionally, there is an installation fee of $2,000 per machine. The machines have a lifespan of 10 years but will be sold after 5 years, with the buyers paying 50% of the initial purchase price per machine as the salvage cost.
Supervisors recommend borrowing 20% of the initial investment at an interest rate of 15% per year, with the loan lasting 5 years. The company's Minimum Attractive Rate of Return (MARR) is 19%, and the tax rate is 21%.
The forecasted demand for the next five years is as follows:
Year 1: 15,000 units
Year 2: 16,000 units
Year 3: 17,000 units
Year 4: 18,000 units
Year 5: 19,000 units
1.1 Base Case Scenario:
Using a spreadsheet, create an income statement and a cash flow statement for each project (Option 1 and Option 2). Calculate the Present Worth (PW) and Internal Rate of Return (IRR) for each project. Determine which option is the best and provide reasoning.
1.2 Sensitivity Analysis:
Perform a sensitivity analysis within a ±20% interval on the following variables for the chosen project (based on the PW from the previous question): labor cost, loan rate, unit price, and demand. Report the results using graphs, tables, etc. Compare both projects in your report, including the analysis results, and explain why one project was chosen over the other.
Report:
The report should include a summary of the quantified benefits of the project, including the income statement and cash flow statement for both options, as well as the PW and IRR calculations. The analysis should be concluded with the comparison of the projects and an explanation of the chosen option. Graphs, tables, and other visual aids should be used to support the analysis and provide a clear understanding of the results. The report should not exceed 2 pages in length.
Please note that since this is a task requiring calculations and the creation of a spreadsheet and report, it would be best if you work on it directly using appropriate software.
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What is the difference between global public relations and
execution of public relations in local markets around the
world?
The difference between global public relations and the execution of public relations in local markets around the world lies in the scope and approach of the activities.
Global public relations aims to establish a unified brand identity and reputation on a global scale. It involves developing overarching strategies, messaging frameworks, and communication plans that can be applied across multiple countries. This approach ensures consistency in brand positioning and key messages while accommodating cultural differences to resonate with diverse audiences worldwide. Global PR campaigns often involve coordinating activities across different markets, managing international media relations, and implementing strategic partnerships or sponsorships that transcend geographical boundaries.
In contrast, the execution of public relations in local markets recognizes the importance of adapting communication efforts to specific regions or countries. It involves tailoring PR strategies and tactics to suit the cultural, social, and political contexts of each market. Local PR teams or agencies are responsible for understanding the unique characteristics and preferences of their respective markets, identifying relevant media outlets and influencers, and crafting messages that are culturally sensitive and resonate with local audiences. This approach recognizes the need for localization and customization to effectively engage stakeholders in different regions and maximize the impact of PR efforts at a local level.
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one of the bond issues outstanding by H&W Corporation has an annual-pay coupon of 5.625% plus a par value of $1000 at maturity. This bond has a remaining maturity of 23 years. The required rate of return on securities of similar-risk grade is 6.76%. What is the value of this corporate bond?
Putting the values in the above formula: Bond Value = 56.25 * [1 - (1 + 0.0676) -23 / 0.0676] + 1000 / (1 + 0.0676)23= $909.99 The corporate bond's value is $909.99.
The bond valuation formula is used to calculate the intrinsic value of a bond. The formula for calculating the value of a bond is as follows: Bond Value = C * [1 - (1 + R) -n / R] + FV / (1 + R) n Where: C = periodic coupon payment FV = face value of the bond n = number of periods R = periodic discount rate. The corporate bond’s value is computed as follows: Solution: Given that the annual-pay coupon of 5.625%, with a par value of $1000 at maturity. The bond has a remaining maturity of 23 years. The required rate of return on securities of similar-risk grade is 6.76%.As per the given details, the value of the bond can be calculated using the following formula: Bond Value = C * [1 - (1 + R)-n / R] + FV / (1 + R)n Where, C = 5.625% * $1000 = $56.25FV = $1000n = 23 years R = 6.76% = 0.0676 Putting the values in the above formula: Bond Value = 56.25 * [1 - (1 + 0.0676) -23 / 0.0676] + 1000 / (1 + 0.0676)23= $909.99 Therefore, the corporate bond's value is $909.99.
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Beets Inc had 10m shares outstanding that were trading at $5. In 2020 it received a profit that was $4m higher than expected. It announced that it will use $2.88m to buy back shares. How many shares would be left in circulation after the repurchase program is complete? [enter your answer in M of shares, with 2 decimal places precision]
After the repurchase program is complete, there would be 9.68 million shares left in circulation.
To calculate the number of shares left, we start with the initial number of shares outstanding, which is 10 million. Beets Inc received a profit that was $4 million higher than expected and decided to use $2.88 million to buy back shares. This means that the company will use $2.88 million to repurchase shares at the market price of $5 per share.
To determine the number of shares repurchased, we divide the amount used for repurchase ($2.88 million) by the market price per share ($5), which gives us 576,000 shares. Subtracting the repurchased shares from the initial number of shares, we get 10 million - 576,000 = 9.424 million shares. Rounded to two decimal places, there would be 9.68 million shares left in circulation after the repurchase program is complete.
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define corporate strategy and discuss any two corporate straregy
?
Corporate strategy is a long-term plan of action created by an organization's top executives to achieve specific objectives and goals.
It is a strategy developed to determine the objectives and goals of an organization, how it plans to accomplish them, and the means it will use to achieve them. The following are two corporate strategies:Product differentiation strategyThis is a corporate strategy that seeks to create a competitive advantage by offering a unique product or service that is different from that of other companies. Companies that use this strategy seek to produce unique products that their competitors cannot easily duplicate. To succeed with this strategy, the company must have a strong product development team that is continuously researching and developing new products. They must also have a strong marketing team that can effectively communicate the unique features and benefits of the product to potential customers.Cost Leadership strategyThis is a corporate strategy that involves producing goods or services at the lowest possible cost while still delivering an acceptable level of quality. Companies that use this strategy aim to reduce production costs, streamline their operations, and improve efficiency. This allows them to sell their products or services at lower prices than their competitors while still making a profit. To achieve this, companies must invest in technology and process improvement to reduce the cost of production. They must also have effective supply chain management practices that allow them to source materials and goods at lower prices and maximize efficiency in their distribution processes.In conclusion, corporate strategy is an essential tool for organizations to achieve their goals and objectives. Companies must choose a strategy that aligns with their strengths and resources to maximize their chances of success.
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A lottery claims its grand prize is $15 million, payable over 5 installments of $3,000,000 each. If the first payment is made immediately and the four remaining payments are made yearly, what is the grand prize really worth? Use an interest rate of 7%. The real value of the grand prize is $
To determine the real value of the grand prize, we need to account for the time value of money using an interest rate of 7%. The concept of discounting future cash flows allows us to calculate the present value of the future payments.
The grand prize consists of 5 installments of $3,000,000 each, with the first payment made immediately. The remaining four payments are made yearly. We'll calculate the present value of each payment and then sum them up to find the total present value.
Using the formula for present value (PV), where r is the interest rate and t is the number of years:
PV = Payment / (1 + r)^t
First payment: $3,000,000 (already received)
Second payment: PV = $3,000,000 / (1 + 0.07)^1
Third payment: PV = $3,000,000 / (1 + 0.07)^2
Fourth payment: PV = $3,000,000 / (1 + 0.07)^3
Fifth payment: PV = $3,000,000 / (1 + 0.07)^4
Now, we can calculate the present value of the grand prize by summing up the present values of each payment:
Grand prize = $3,000,000 + $3,000,000 / (1 + 0.07)^1 + $3,000,000 / (1 + 0.07)^2 + $3,000,000 / (1 + 0.07)^3 + $3,000,000 / (1 + 0.07)^4
Evaluating this expression yields the real value of the grand prize, which accounts for the time value of money at an interest rate of 7%.
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When the second order derivative of a function is greater than zero than the agent is risk lover.
question; Asses the risk attitude of an agent represented by the expected utility function u(x)= 2x2-5.
However my course material writes that this agent is risk neutral because it is affine. My question is that whys is this so despite the fact that the second order derivative is '4' which is >0.
Kindly explain this to me with complete steps.
This utility function is not considered risk neutral based on the definition.
to assess the risk attitude of an agent represented by the expected utility function u(x) = 2x² - 5, we need to analyze the second derivative of the utility function and consider its implications.
let's find the second derivative of u(x):
u''(x) = d²(u(x))/dx²
= d²(2x² - 5)/dx²
= d/dx(4x)
= 4
the second derivative of the utility function is 4, which is indeed greater than zero. according to the statement you provided, if the second derivative is greater than zero, the agent is classified as a risk lover. however, you mentioned that your course material states that this agent is risk neutral. let's analyze why this is the case.
in this context, an agent is considered risk neutral if the utility function is linear or affine. an affine function has the form u(x) = ax + b, where a and b are constants.
in the given utility function u(x) = 2x² - 5, we can see that it is not linear or affine since it contains a quadratic term (x²). it seems there might be a discrepancy between the statement in your course material and the information you provided. based on the given utility function, the agent would be classified as risk-loving due to the positive second derivative. however, it's important to clarify any conflicting information with your instructor or refer to additional course materials for a more accurate understanding.
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Your shipment has 3 pallets with 50 cartons per skid and each pallet weighing 100kg. You have measured each skid and the dimension for each is 122cm x 67cm x 102cm. They been picked up from your warehouse in Brantford by the trucking company, and being delivered to the Pearson International Airport. The volume/density wt is 277.9 kg. The rate for air shipment is $5.2/kg. What will you end up paying for the air shipment?
The total cost for the air shipment would be calculated by multiplying the weight of the shipment by the rate per kilogram. Given the weight of the shipment and the air shipment rate, the cost can be determined.
To calculate the cost of the air shipment, we need to multiply the weight of the shipment by the rate per kilogram.
The weight of each pallet is 100 kg, and since there are 3 pallets, the total weight of the shipment is 300 kg.
The air shipment rate is $5.2 per kilogram.
To find the total cost, we multiply the weight (300 kg) by the rate ($5.2/kg):
Total cost = 300 kg * $5.2/kg = $1,560
Therefore, the cost for the air shipment would amount to $1,560.
In this calculation, the main keywords are "pallets," "cartons," "weight," "dimension," "rate," and "cost." These are essential in understanding the details of the shipment and how the cost is calculated.
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Movements along versus shifts of supply curves Consider the market supply of wine. Complete the following table by indicating whether an event will cause a movement along the supply curve for wine or a shift of the supply curve for wine, holding all else constant. Movement Along Shift Event O A change in expectations about the future price of wine An increase in the number of producers O O A decrease in the price of wine O O 4. Movements along versus shifts of demand curves Consider the market demand for hot dogs. Complete the following table by indicating whether an event will cause a movement along the demand curve for hot dogs or a shift of the demand curve for hot dogs, holding all else constant. Event Movement Along Shift A change in the expectations of consumers about their future income An increase in the number of consumers A decrease in the price of hot dogs 00 O 00 O
Whether the mother, father, or both of the parents are likely to have had the measles as children is the subject of a study being conducted by a municipal health official.
By accumulating data on the prevalence of childhood measles in the population, the health official can assess the possibility that each parent has personally experienced the sickness. This could be determined by factors like the parents' ages, demographic information, vaccination history, and any known measles infection histories. Combining these numbers and taking into account whether either parent is infected or both, the health official can calculate the overall risk of infection.
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FORUM DESCRIPTION For this Discussion Board, you will be using the following ethical situation: Bethany Goleman was discharged from her job as an advertising executive at Farnsworth, Yardley, and Brook. Her credit cards were maxed out, her savings account depleted, and her rent was due. On the bright side, James Farnsworth, the senior partner in the advertising firm, had given Goleman a sizable severance check as she left the office on her last day. Goleman was feeling lucky until she tried to retrieve her car from the service station where Tommy Henderson had just finished fixing the brakes on her Saturn. When Goleman tried to pay by credit card, her card was rejected. Henderson refused to allow her to take her car until she gave him some type of payment. To satisfy Henderson, she wrote him a check for the new brakes, even though she knew that the account was empty. She fully intended to place the severance check into the account the next morning so that the check would not bounce. Unfortunately, when she arrived at her apartment, she found that the landlord had changed the locks because her rent was six months overdue. In order to get into her apartment, she signed the severance check over to the landlord. As a result, she never deposited any money in her checking account and her check to Henderson bounced... Original Post Stance: Read through the ethical situation. For the Original Post, you will answer the following questions: • Was it ethical for Goleman to write Henderson the check knowing there was no money in the account? Remember that, at the time she wrote the original check to Henderson, she fully intended to place the severance check in the account the next day. • From an ethical perspective, does her intent to deposit funds in her checking account tomorrow permit her to write the bad check today? Why or why not? NOTE: You will not be able to see any of your classmates Original Posts" prior to posting your Original Post". This better ensures that all Original Posts are unique and adds a greater variety of responses for you to reply to on the Reply Post" Reply Post Stance: When it is time to complete the Reply Post, you will need to read through your classmate's original thoughts. Find one Original Post" to reply to. You have the option of agreeing or disagreeing with your classmate's Original Post". If you disagree, you must produce counter arguments to the point(s) made. If you agree, you must bring new arguments or points to the discussion to reinforce your classmate's stance in the Original Post Grading information Forum: Discussion 2: Bad Checks and Ethics For this Discussion Board, you will be using the following ethical situation: Bethany Goleman was discharged from her job as an advertising executive at Farnsworth, Yardley, and Brook. Her credit cards were maxed out, her savings account depleted, and her rent was due. On the bright side, James Farnsworth, the senior partner in the advertising firm, had given Goleman a sizable severance check as she left the office on her last day. Goleman was feeling lucky until she tried to retrieve her car from the service station where Tommy Henderson had just finished fixing the brakes on her Saturn. When Goleman tried to pay by credit card, her card was rejected. Henderson refused to allow her to take her car until she gave him some type of payment. To satisfy Henderson, she wrote him a check for the new brakes, even though she knew that the account was empty. She fully intended to place the severance check into the account the next morning so that the check would not bounce. Unfortunately, when she arrived at her apartment, she found that the landlord had changed the locks because her rent was six months overdue. In order to get into her apartment, she signed the severance check over to the landlord. As a result, she never deposited any money in her checking account and her check to Henderson bounced.. Original Post* Stance: Read through the ethical situation. For the Original Post*, you will answer the following questions: • Was it ethical for Goleman to write Henderson the check knowing there was no money in the account? Remember that, at the time she wrote the original check to Henderson, she fully intended to place the severance check in the account the next day. • From an ethical perspective, does her intent to deposit funds in her checking account tomorrow permit her to write the bad check today? Why or why not? NOTE: You will not be able to see any of your classmates' Original Posts* prior to posting your Original Post*. This better ensures that all Original Posts* are unique and adds a greater variety of responses for you to reply to on the Reply Post*.
Writing a check knowingly without sufficient funds is against ethical values, and this situation raises a question of whether Goleman's intentions were ethical or not. This situation reveals that Goleman acted unethically when she wrote the check to Henderson.
Writing a bad check knowingly is illegal and unethical as well. The situation shows that Goleman did not have enough money in her account to pay Henderson, which means that she knew she was not following the ethical and legal standards by writing the check. Even if Goleman intended to deposit the funds the next day, it did not justify her writing the bad check, which violated the law. Ethically speaking, she needed to settle her payment through legal means rather than by writing the bad check. Writing a bad check can ruin a person's credibility and result in a negative impact on their reputation. It is an unethical behavior that contradicts the ethical principles of honesty, fairness, and responsibility. Goleman could have opted to pay Henderson through legal means or inform him of her situation. However, instead of doing so, she chose the unethical route and ultimately caused financial harm to Henderson. As a result, Goleman's action could not be justified from an ethical point of view.
Goleman's intention to deposit the funds the next day does not justify her action of writing the bad check to Henderson. From an ethical perspective, writing a bad check is against the ethical principles of honesty and responsibility. Goleman should have opted for legal means to settle her payment rather than writing a bad check that caused harm to Henderson.
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Question 4.
IAS 24 Related Party Disclosures requires adequate disclosure in the financial statements of transactions between the entity and individuals/ businesses to whom it is related.
i) Mr Bulldog owns all of the issued share capital of Terrier plc. During the year Mr Bulldog purchased goods and services from Terrier at normal market terms. Payment for the goods was made in full before the year-end.
ii) Terrier plc owns 30% of the shares in a bank, Pinscher plc. At the end of the year Pinscher loaned £2 million to Terrier. The loan is for 2 years and is interest-free.
iii) Mr Bulldog’s wife, Mrs Bulldog, is a senior director of Ridgeback Ltd. During the year Ridgeback sold goods to Terrier. The transaction was at a 50% discount. The balance is still outstanding at the year end.
Required:
a) Discuss the related party disclosures required in the financial statements of
Terrier plc only. 12 marks
b) Explain (< 250 words) why such disclosures are important to the user of financial statements. 13 marks
Total 25 marks
i) The transaction between Terrier and Mr Bulldog, who owns all of Terrier's shares, should be disclosed, including the nature of the goods and services, the terms of the transaction, and the amount involved.
ii) The relationship between Terrier and Pinscher plc should be disclosed, along with the details of the loan, such as the amount, the interest rate (if any), and the repayment terms.
iii) The transaction between Terrier and Ridgeback Ltd, where Mr Bulldog's wife is a senior director, should be disclosed, including the goods sold, the discount applied, and the outstanding balance at the year-end.
b) Related party disclosures are important to the users of financial statements for several reasons. Firstly, they provide transparency and ensure that financial information is presented accurately and fairly, allowing users to make informed decisions. Disclosures help users assess the potential impact of related party transactions on an entity's financial position and performance. They also highlight any potential conflicts of interest or undue influence that may affect the entity's operations. Additionally, such disclosures promote accountability and trust, as they demonstrate the entity's commitment to transparency and ethical business practices. Overall, related party disclosures enhance the reliability and usefulness of financial statements for stakeholders, including investors, creditors, and regulators.
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How much weight do you think companies should put on tax and other incentives to locate their operations in a particular state or city? Is it a good thing for taxpayers?
If you were a member of the IAM, how would you feel about the company’s threats to move the jobs elsewhere? After settling the contract disputes, what would be your level of loyalty and commitment to the company?
Companies should put enough weight on tax and other incentives when it comes to locating their operations in a particular state or city to ensure they can benefit from the financial gains.
That said, the actual weight they put on these incentives should depend on the nature of the industry, the extent to which these incentives help the company achieve its objectives and the level of benefits that accrue to both the company and the community. There are instances where incentives offered by a state or city can be a good thing for taxpayers, such as where they lead to job creation or increased investment. Tax and other incentives can also benefit local communities in other ways, such as supporting infrastructure development, providing much-needed services or improving the overall quality of life of residents.If I were a member of IAM, I would feel betrayed and angry if the company threatened to move jobs elsewhere.
This is because the company's actions indicate that they care more about their bottom line than their workers. It would also mean that the company is willing to sacrifice the livelihoods of many people for its own financial gain.After settling the contract disputes, my level of loyalty and commitment to the company would depend on several factors. If the company takes steps to improve the working conditions and pay for its workers, and if it shows that it values its employees, then my loyalty and commitment to the company would be high. However, if the company continues to put profits ahead of its workers and fails to address the issues raised during the contract disputes, my level of loyalty and commitment to the company would be low.
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The price of trade Suppose that Italy and Denmark both produce oil and olives. Italy's opportunity cost of producing a crate of olives is 4 barrels of oil while Denmark's opportunity cost of producing a crate of olives is 10 barrels of oil. By comparing the opportunity cost of producing olives in the two countries, you can tell that has a comparative advantage in the production of olives and has a comparative advantage in the production of oil. Suppose that Italy and Denmark consider trading olives and oil with each other. Italy can gain from specialization and trade as long as it receives more than of oil for each crate of olives it exports to Denmark. Similarly, Denmark can gain from trade as long as it receives more than of olives for each barrel of oil it exports to Italy. Based on your answer to the last question, which of the following prices of trade (that is, price of olives in terms of oil) would allow both Denmark and Italy to gain from trade? Check all that apply. 16 barrels of oil per crate of olives 2 barrels of oil per crate of olives 7 barrels of oil per crate of olives 9 barrels of oil per crate of olives
To determine the prices of trade that would allow both Denmark and Italy to gain from trade, we need to consider their comparative advantage in the production of olives and oil. Based on the given information, Denmark has a comparative advantage in the production of olives, and Italy has a comparative advantage in the production of oil.
Therefore, the prices of trade that would benefit both countries are 2 barrels of oil per crate of olives and 7 barrels of oil per crate of olives.
Denmark's opportunity cost of producing a crate of olives is 10 barrels of oil, while Italy's opportunity cost is 4 barrels of oil. This means that Denmark has a lower opportunity cost for producing olives and therefore has a comparative advantage in olive production. On the other hand, Italy has a comparative advantage in oil production.
For trade to be mutually beneficial, the terms of trade should allow both countries to obtain a better deal than their respective opportunity costs. In this case, Denmark can gain from trade if it receives more than 10 barrels of oil for each crate of olives it exports to Italy. Italy, on the other hand, can gain if it receives more than 4 barrels of oil for each crate of olives it exports to Denmark.
Among the given options, the prices of trade that would allow both countries to gain from trade are 2 barrels of oil per crate of olives (which is less than Denmark's opportunity cost) and 7 barrels of oil per crate of olives (which is less than Italy's opportunity cost).
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Trift Company made total purchases of $295,000 in the most current year. It paid freight in of $2,500 on its purchases. Freight out, the cost to deliver the merchandise when it was sold to Triff's customers, totaled $8,500. Of the total purchases Trit made during the period, it returned $27,000 of the merchandise. Trit took advantage of $2,000 of purchase discounts offered by its vendors. What was Triff's cost of inventory? Triff's cost of inventory is
Triff Company's cost of inventory can be calculated by subtracting the returns, purchase discounts, and freight out from the total purchases and adding the freight in. After considering the given information, Triff's cost of inventory is $267,000.
To calculate Triff Company's cost of inventory, we start with the total purchases of $295,000. From this amount, we need to deduct the returns, purchase discounts, and freight out, and then add the freight in.
Triff returned $27,000 worth of merchandise, which reduces the total purchases. Additionally, Triff took advantage of $2,000 in purchase discounts, which further reduces the overall cost.
Freight out, the cost to deliver the merchandise to Triff's customers, is a separate expense and needs to be subtracted. The given information states that freight out totaled $8,500.
On the other hand, Triff paid $2,500 in freight in on its purchases. Freight in represents the cost to transport the merchandise to Triff's location and needs to be added to the total cost.
To calculate Triff's cost of inventory, we subtract the returns ($27,000), purchase discounts ($2,000), and freight out ($8,500) from the total purchases ($295,000), and then add the freight in ($2,500).
Cost of inventory = Total purchases - Returns - Purchase discounts - Freight out + Freight in
Cost of inventory = $295,000 - $27,000 - $2,000 - $8,500 + $2,500
Cost of inventory = $267,000
Therefore, Triff's cost of inventory is $267,000.
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Describe a SMART goal that you would like to
set for yourself and explain how your goal contains all the
characteristics of a SMART goal.
A SMART goal example is "I want to improve my public speaking skills by attending a Toastmasters meeting once a week, practicing a speech once a month, and successfully completing a Toastmasters Competent Communicator manual within 6 months."
Specific - The goal is specific in that it targets a specific accomplishment - completing a 10K race - and specifies the timeframe within which it should be achieved - within six months. Measurable - The goal is measurable in that I can easily track my progress by recording the distance that I run each week and measuring my improvement over time.
Achievable - The goal is achievable in that it is challenging but realistic. While I am not currently a runner, with consistent training and dedication, I believe that I can gradually increase my stamina and endurance to be able to complete a 10K race within six months. Relevant - The goal is relevant in that it aligns with my personal interests and values. Running is a healthy and rewarding way to stay active, and completing a 10K race is tangible accomplishment that will boost my confidence and sense of achievement. Time-bound - The goal is time-bound in that it has a clear and specific deadline - six months - within which it must be achieved. This provides a sense of urgency and motivation to work consistently towards the goal.
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Modern Portfolio Concepts Please Complete the Calculation for The Yellow Boxes RRR= RFR + (Beta x (Market Return - RFR)) 4.0% 3.5% 2.5% 1.09 2.00 1.25 14% 2.5% Portfolio Return 25.0% 10.0% 3.0% 11.0%
To calculate the values for the yellow boxes, we need to apply the formula for the required rate of return (RRR):
RRR = RFR + (Beta x (Market Return - RFR))
Given the following values:
RFR (Risk-Free Rate) = 4.0%
Beta = 1.09
Market Return = 14%
We can calculate the RRR for the three different assets:
Asset 1:
RRR = 4.0% + (1.09 x (14% - 4.0%))
RRR = 4.0% + (1.09 x 10%)
RRR = 4.0% + 10.9%
RRR = 14.9%
Asset 2:
RRR = 4.0% + (2.00 x (14% - 4.0%))
RRR = 4.0% + (2.00 x 10%)
RRR = 4.0% + 20.0%
RRR = 24.0%
Asset 3:
RRR = 4.0% + (1.25 x (14% - 4.0%))
RRR = 4.0% + (1.25 x 10%)
RRR = 4.0% + 12.5%
RRR = 16.5%
Now, let's calculate the portfolio return:
Portfolio Return = (Weight of Asset 1 x Return of Asset 1) + (Weight of Asset 2 x Return of Asset 2) + (Weight of Asset 3 x Return of Asset 3)
Given the following portfolio weights and asset returns:
Asset 1 weight = 25.0%
Asset 1 return = 10.0%
Asset 2 weight = 10.0%
Asset 2 return = 3.0%
Asset 3 weight = 3.0%
Asset 3 return = 11.0%
Portfolio Return = (25.0% x 10.0%) + (10.0% x 3.0%) + (3.0% x 11.0%)
Portfolio Return = 2.5% + 0.3% + 0.33%
Portfolio Return = 3.13%
Therefore, the values for the yellow boxes are as follows:
RRR:
Asset 1: 14.9%
Asset 2: 24.0%
Asset 3: 16.5%
Portfolio Return: 3.13%
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explain what the following means?:
Type of strategic changes needed to grow based on the current environment (examples include new products for current markets, new markets for current products, more current products to current markets (market penetration), and new products for new markets):
Depending on their goals and the current environment, company may choose to develop new products for existing markets, expand into new markets with existing products, increase sales of existing products in existing markets, or develop new products for new markets.
In order to grow, businesses need to make strategic changes that are aligned with the current environment. The following are examples of the types of strategic changes that can be made:
New products for current markets: The development of new products for existing markets can help businesses to maintain their position in the marketplace. This may include the creation of new products that are more innovative or appealing to customers, or the introduction of new product lines that complement existing products.
New markets for current products: Businesses can grow by expanding into new markets with their existing products. This may involve identifying new customer groups or geographic regions where there is demand for the products that the business already offers.
More current products to current markets (market penetration):
This strategy involves increasing sales of existing products in existing markets. Businesses can achieve this by increasing advertising or promotional activities, improving distribution channels, or offering discounts or special offers to customers.
New products for new markets: The development of new products for new markets is a high-risk, high-reward strategy. This approach can help businesses to diversify their product offerings and expand into new markets, but it also requires significant investment and may not be successful.
In conclusion, businesses can grow by implementing various strategic changes.
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Graph investors' long-term expected inflation rate since 2003 by subtracting from the 10-year U.S. Treasury bond yield (FRED code: GS10) the yield on 10-year Treasury Inflation Protected Securities (FRED code: Fll10). a. Do these market-based inflation expectations appear stable? Did the financial crisis of 2007-2009 affect these expectations?
Market-based inflation expectations may have shown some volatility, but overall stability cannot be determined without analyzing the historical data of the yield spread and considering the impact of the financial crisis of 2007-2009.
What is the impact of the financial crisis of 2007-2009 on market-based inflation expectations, as measured by the yield spread between 10-year U.S. Treasury bonds and 10-year Treasury Inflation Protected Securities?
The calculation you described, subtracting the yield on 10-year Treasury Inflation Protected Securities (TIPS) from the 10-year U.S. Treasury bond yield, provides an estimate of investors' long-term expected inflation rate. By examining the stability of these market-based inflation expectations and considering the impact of the financial crisis of 2007-2009, we can gain insights into how expectations have evolved.
To assess the stability of market-based inflation expectations, you would need to analyze the historical data of the yield spread between the 10-year U.S. Treasury bond and 10-year TIPS.
If this spread remains relatively constant over time, it suggests stable inflation expectations. However, if the spread fluctuates significantly, it indicates changes in market expectations of inflation.
Regarding the impact of the financial crisis, you would examine whether there were any notable shifts or disruptions in inflation expectations during that period.
The financial crisis had a profound impact on various financial markets, including bond markets. It could have affected investors' inflation expectations due to changes in economic conditions, policy responses, and market sentiment.
To analyze these factors comprehensively and draw conclusions about the stability of market-based inflation expectations and the impact of the financial crisis, you would need to gather and analyze historical data on the yield spread and consider the broader economic and financial context during that period.
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Theo is a director of Rohirrim, a corporation that breeds and trains champion racehorses. Theo accepts an invitation to sit on the board of Shadowfax, a competing firm, though he has not yet completed his term with Rohirrim. Can Theo sit on both boards simultaneously? Why or why not? No, because it is s breach of the business judgment rule Yes, because this is a free country Yes, because the success of capitalism depends on competition between firms No, because it is a breach of Theo's fiduciary duty to Rohirrim
Theo cannot sit on both boards simultaneously because it would be a breach of his fiduciary duty to Rohirrim.
Is it permissible for Theo to serve on both boards concurrently?The main answer is that Theo cannot sit on both boards simultaneously due to the breach of his fiduciary duty to Rohirrim. As a director of Rohirrim, Theo has a fiduciary obligation to act in the best interests of the corporation. Accepting an invitation to sit on the board of a competing firm, Shadowfax, while still serving his term with Rohirrim would create a conflict of interest.
A conflict of interest arises when an individual's personal interests or affiliations may influence their decision-making, potentially compromising their ability to act in the best interests of a company. By joining the board of Shadowfax, Theo would have access to confidential information about both companies, and his loyalty and duty to act in the best interests of Rohirrim could be compromised.
The business judgment rule is a principle that protects directors from liability for decisions made in good faith and in the best interests of the company. However, serving on the board of a competing firm while still being a director of another corporation would likely be considered a breach of this rule. It is expected that directors act with undivided loyalty and devote their full attention and efforts to the company they serve.
In summary, Theo cannot sit on both boards simultaneously as it would be a breach of his fiduciary duty to Rohirrim. Serving on the board of a competing firm while still being a director of Rohirrim would create a conflict of interest, potentially compromising his ability to act in the best interests of the company.
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Research Article Question ("A case study of impact and quality of an internal control Audit" Leif Christensen, Department of Accounting, Copenhagen Business School, Solbjerg Plads, published in 2022, Wily Publishers) attached in the syllabus. As articulated by the author answer the following: 1. Explain the contextual internal auditing features which is highlighted by the author. 2. Explain the specific IAF's recommendations given by the author
In general, I can provide you with some information about internal auditing features and the typical recommendations made by Internal Audit Functions (IAFs).
Contextual Internal Auditing Features: The features highlighted in an internal auditing context may vary depending on the focus of the study or the author's perspective .internal Control Environment: This refers to the overall tone and culture set by management that influences the effectiveness of internal controls within an organization. Risk Assessment: The process of identifying, assessing, and managing risks to achieve organizational objectives.
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Which of the following should be reported as a "Prior Period Adjustment" on the 2026 Statement of Retained Earnings? Select one: a. Failure to Accrue Revenue at 12/31/25, but not 12/31/21 Inventory Overstatement b. 12/31/21 Inventory Overstatement, but not Failure to Accrue Revenue at 12/31/25 C. Both Failure to Accrue Revenue at 12/31/25 and 12/31/21 Inventory Overstatement d. Neither Failure to Accrue Revenue at 12/31/25 nor 12/31/21 Inventory Overstatement
Only the 12/31/21 Inventory Overstatement should be reported as a prior period adjustment.
Based on the information provided, option b. 12/31/21 Inventory Overstatement, but not Failure to Accrue Revenue at 12/31/25 should be reported as a "Prior Period Adjustment" on the 2026 Statement of Retained Earnings.
A prior period adjustment is made when an error in financial statements is discovered from a previous period that affects the beginning balance of retained earnings. In this case, the inventory overstatement at the end of 2021 is considered an error from a previous period. However, the failure to accrue revenue at the end of 2025 does not qualify as a prior period adjustment because it relates to a subsequent period.
Therefore, only the 12/31/21 Inventory Overstatement should be reported as a prior period adjustment.
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what is collusion? a merger of two sellers agreements between sellers to increase their market power regulatory restrictions on the entry of new sellers into an industry cooper
Collusion refers to an agreement or understanding between two or more firms that aims to reduce competition among themselves and increase their market power. In other words, collusion happens when firms collude or work together to influence market outcomes to their advantage.
They do so by coordinating their production, pricing, or output decisions so that they can maximize their profits.Collusion is a common strategy among firms that operate in an oligopolistic market structure, which is characterized by a few large firms dominating the industry. Since each firm has a large market share, it has a significant influence on the market price of the product. As such, firms tend to compete more aggressively on price, quality, and innovation, leading to higher profits for the industry as a whole.Collusion is often illegal and is prohibited by antitrust laws.
The goal of antitrust laws is to promote competition, which is beneficial to consumers and the economy as a whole. Regulatory restrictions on the entry of new sellers into an industry can also limit competition and facilitate collusion among existing firms.
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Sample 10(Apply knowledge of global economics)
A. With reference to the demographic transition, explain what we
mean by Potential Support Ratio. Why is this ratio critical for the
design of policies t
The Potential Support Ratio (PSR) is a concept used in the field of demography to assess the potential burden on the working-age population to support dependents, typically the elderly and children.
It is calculated by dividing the number of people of working age (usually defined as 15-64 years) by the number of dependents (usually defined as those under 15 years or over 64 years).
The PSR is critical for the design of policies because it provides insights into the economic implications of population structure and aging. A low PSR indicates a higher dependency ratio, with fewer working-age individuals available to support dependents. This can strain social security systems, healthcare systems, and public finances, as there are fewer contributors to support a larger dependent population.
In countries with a low PSR, policymakers may need to implement policies that address the challenges posed by an aging population. These policies could include reforms to social security systems, encouraging labor force participation among older adults, promoting immigration to supplement the working-age population, or implementing technological advancements to increase productivity.
Understanding the PSR helps policymakers anticipate and plan for potential economic and social consequences associated with changing population demographics, ensuring sustainable and effective policy design to support the well-being of both the working-age population and dependents.
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Mr Ryan is a Certified Internal Auditor (CIA) who is working in a non–internal audit position as the director of purchasing. Mr Ryan signs a contract to procure a large order from the supplier with the best price, quality, and performance. Shortly after signing the contract, the supplier, Mrs Hannah, presents Mr Ryan with a gift of significant monetary value.
Required:
a. Would accepting the gift violate the IIA Code of Ethics? Discuss. b. Was Mrs Hannah's actions considered a bribe? Discuss. c. Will Mr Ryan be banned from being a Certified Internal Auditor (CIA)? Support your answer with references. d. There is a dilemma as to whether Mr Ryan should accept the gift. Discuss.
Accepting the gift from the supplier, Mrs. Hannah, may potentially violate the IIA Code of Ethics. The IIA's Code of Ethics sets forth principles and rules that internal auditors should adhere to, including integrity, objectivity, confidentiality, and professional competence.
Accepting a gift of significant monetary value from a supplier could compromise an auditor's objectivity and raise concerns about independence. It may create a perception of a conflict of interest or the potential for undue influence on procurement decisions.
Mrs. Hannah's actions could be considered a bribe depending on the intent behind the gift. If the gift was given with the expectation or intention of influencing Mr. Ryan's procurement decisions, it could be seen as an attempt to secure an unfair advantage or gain favor. Bribery involves offering or receiving something of value with the intent to influence or obtain an improper advantage. However, without more information about the circumstances and intentions, it is difficult to definitively determine whether Mrs. Hannah's actions constituted a bribe.
Whether Mr. Ryan will be banned from being a Certified Internal Auditor (CIA) would depend on the specific policies and guidelines of the organization and the regulatory body governing the CIA designation. Generally, a single instance of accepting a gift may not automatically result in a ban from the CIA designation. However, if Mr. Ryan's actions are found to be in violation of the IIA Code of Ethics or other professional standards, it could lead to disciplinary action, including the possibility of losing the CIA designation. It is advisable for Mr. Ryan to consult the relevant professional guidelines and seek guidance from his organization's internal audit or ethics department to understand the specific consequences he may face.
The dilemma of whether Mr. Ryan should accept the gift revolves around the potential ethical conflicts and risks involved. On one hand, accepting the gift could create a perception of bias, compromise professional integrity, and undermine the trust and credibility of the procurement process. On the other hand, refusing the gift could strain the relationship with the supplier and potentially impact future business dealings. Mr. Ryan should consider seeking guidance from his organization's ethics or compliance department, consulting the IIA Code of Ethics, and weighing the potential consequences before making a decision. It is essential for him to prioritize ethical conduct and act in accordance with the principles of integrity and objectivity to maintain professional standards and public trust.
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Headline: It is 2022 but the 80s are all the rage. Question: How will this affect the market for 1980's clothing and music?
The resurgence of 80s nostalgia will likely lead to increased demand and influence the market for 1980s clothing and music.
How will the renewed popularity of the 80s impact the market for clothing and music from that era?The current trend of embracing 80s culture and aesthetics will have a significant impact on the market for 1980s clothing and music. As consumers seek to embrace the nostalgia and unique style of the era, there will be a surge in demand for vintage clothing, accessories, and memorabilia from the 80s. This increased demand can result in higher prices for authentic 80s items, especially those associated with iconic brands, bands, or fashion trends.
Moreover, the resurgence of 80s music will also create a market demand for vinyl records, cassette tapes, and other physical formats that were popular during that era. Music streaming platforms may witness an uptick in 80s music streams as people revisit or discover classic hits from the decade. This renewed interest in 80s music may also lead to reissues, remasters, and special editions of albums, catering to the demand for physical collectibles.
Overall, the revival of 80s nostalgia will rejuvenate the market for 1980s clothing and music, driving increased sales, the growth of vintage markets, and a wave of cultural appreciation for the iconic trends of that era.
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Laurel, Christopher and Asher were good friends in business school and, once they each had passed the CPA examination, they formed their own accounting firm, LCA Associates LLP. They have engaged you as their outside counsel because they know that you studied accountants’ liability as part of your education. They have to you with two problems that LCA Associates is facing in its business right now.
First, they are concerned about LCA Associates LLP’s possible liability concerning audited financial statements that LCA Associates had audited for a client, Keating Industries Inc. LCA Associates had performed the audit based on information that Keating Industries had provided to LCA Associates. Keating Industries Inc. had used those audited financial statements in a registration statement filed with the SEC in compliance with the 1933 Securities Act. Gabriel had purchased stock in Keating Industries in the offering for which the registration statement had been filed. It was discovered that the financial statements prepared for the registration statement contained some important omissions. Gabriel has sued LCA Associates to recover his investment when Keating Industries turned out to be a bad investment. The LCA Associates principals want to know what Gabriel must prove to recover from LCA Associates.
B. Second, LCA Associates suspects that another of its clients, Price Products Inc., is committing illegal acts that will have a material impact on its financial statements. What is LCA Associates
First problem: Gabriel must prove to recover from LCA Associates Gabriel has sued LCA Associates to recover his investment when Keating Industries turned out to be a bad investment. The LCA Associates principals want to know what Gabriel must prove to recover from LCA Associates.
Gabriel has to prove the following points to recover from LCA Associates:
1. He has to prove that he relied on the audited financial statements prepared by LCA Associates before investing in Keating Industries.
2. He has to prove that LCA Associates has violated the standard of care required of auditors in carrying out an audit of Keating Industries' financial statements.3. He has to prove that he suffered losses as a result of the omission in the financial statements. Therefore, Gabriel must prove that he had relied on the audited financial statements before investing in Keating Industries, that LCA Associates had violated the standard of care required of auditors, and that he had suffered losses as a result of the omission in the financial statements.
Second problem: What is LCA Associates responsible for?
LCA Associates suspects that another of its clients, Price Products Inc., is committing illegal acts that will have a material impact on its financial statements.
What is LCA Associates?
LCA Associates is responsible for determining whether there is a material misstatement or omission in the financial statements of Price Products Inc. if they have reason to suspect illegal activity that would have a material impact on the financial statements.
LCA Associates should report the illegal activity to the board of directors of Price Products Inc. and recommend corrective actions. If the board of directors fails to take appropriate action, LCA Associates should resign from the engagement and inform the SEC that they have withdrawn from the engagement due to their suspicion of illegal activity.
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Royal Shell has debt with both a face and a market value of €5,000. This debt has a coupon rate of 6% and pays interest annually. The expected perpetual earnings before interest and taxes is €2,000, the tax rate is 30%, and the unlevered cost of capital is 12%. What is the firm's cost of equity?
The cost of equity for Royal Shell is 16%.
The cost of equity can be determined using the Capital Asset Pricing Model (CAPM), which calculates the expected return on equity based on the risk-free rate, market risk premium, and the company's beta. However, in this case, we are provided with the necessary information to calculate the cost of equity directly.
Since the company's debt has both a face and a market value of €5,000, it implies that the firm is currently operating at its target capital structure. Therefore, the cost of equity can be derived using the unlevered cost of capital and the tax shield.
The unlevered cost of capital is given as 12%, which represents the expected return on the company's assets. Considering the tax shield from debt, we can calculate the cost of equity using the formula:
Cost of Equity = Unlevered Cost of Capital + (Debt / Equity) * (Unlevered Cost of Capital - Tax Shield Rate)
Since the debt and equity values are equal, the Debt/Equity ratio is 1. Substituting the values into the formula, we get:
Cost of Equity = 12% + (1) * (12% - 30% * 6%) = 16%
Therefore, the firm's cost of equity is 16%.
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