If the ending inventory is overstated, it will lead to an overstatement of net income. An overstatement of ending inventory can occur if the inventory count is inaccurate or if there are any other discrepancies in inventory records.
It may also occur if the company's management team intentionally inflates the inventory level to show higher profits than the actual.The overstatement of inventory results in a decreased cost of goods sold and hence an increased gross profit in the income statement. Consequently, the company's net income is overstated. This also results in an increase in taxes that must be paid to the government. If the company's internal auditors do not detect the inventory overstatement, the financial statements will misrepresent the company's financial position, and potential investors will have incorrect information when they make investment decisions.
Thus, the financial integrity of the company may be compromised.
To know more about Inventory visit-
https://brainly.com/question/31146932
#SPJ11
In which quadrant or quadrants of the strategic grid, throughout the timeline of the case, would
you place Bharti Airtel’s Information Technology? Motivate your answer
The factory, strategic, support, and turnaround quadrants make up the strategic impact grid. The IT Strategic Grid is a structure comprised of four quadrants, each of which refers to one of four possible functions for information systems and IT inside an organisation.
One of the four divisions on a Cartesian plane is a graph quadrant. There is a certain set of negative and positive values for x and y in each of the four sections. An ordered pair is plotted on graph quadrants. Ordered pairs have values for x and y. In an ordered pair, X is the first value and y is the second. The strategic grid enables analysis of the placement of the IT department within the organisational structure and of IT management.
To learn more about Strategic, click here.
https://brainly.com/question/26960576
#SPJ4
if a small company has average daily sales of $6,700 and accounts receivable of $281,400, what is the average days of accounts receivable?
The average days of accounts receivable is 42 days.
To calculate the average days of accounts receivable, divide the accounts receivable balance by the average daily sales. In this case, the accounts receivable is $281,400 and the average daily sales is $6,700. Dividing $281,400 by $6,700 gives us approximately 42 days. This means that, on average, it takes the small company 42 days to collect payment from its customers for credit sales. The average days of accounts receivable is an important financial metric that indicates the efficiency of a company's credit and collection processes.
A lower number of days indicates a faster collection of receivables, which is beneficial for cash flow management. A higher number of days suggests that customers are taking longer to pay, potentially indicating issues with credit terms, collections efforts, or customer payment behavior. Monitoring and managing the average days of accounts receivable can help companies optimize their cash flow and ensure timely collection of outstanding receivables.
Learn more about cash flow here:
https://brainly.com/question/15859568
#SPJ11
Disadvantages of choosing a job that is extremely popular or in demand
The disadvantage of choosing a job that is very popular or a job that is in high demand is that after a while such a job may become saturated or it would become monotonous.
What is a high demand job?This is the term that is used to refer to a job that the people that wpould employ labor are constantly in need of. Such a job is one that would require the people that have the qualification to opt in and get the places and the roles that they are to fill.
The issues that may arise from such a job that is in high demand is that after a period, such a job may have a lot of persons that would want to fulfil the role.
The number of qualified persons may become more than the job that is available for the people to do in the long run.
Hence this is a disadvantage. Therefore I would conclude by saying that the disadvantage of choosing a highly popular job is that the number of persons that are willing to fulfil the role may exceed the job overtime.
Read more on jobs here: https://brainly.com/question/26355886
#SPJ1
Which of the following choices incur speculative risk?
a.stocks
b.fire insurance on a house
c.options
d.life insurance
e.high interest savings account
Answer: correct option is A.
Explanation: A speculative risk can be defined as risk that is taken willingly either it results in profit or loss and the stocks involve in probability of gain and loss making it a speculative risk.
Stocks incur speculative risk. Therefore option A is correct.
What are Stocks?A stock usually referred to as equity, is a type of investment that denotes ownership in a portion of the issuing company. Shares, also known as units of stock, entitle their owners to a share of the company's assets and income in proportion to the number of shares they possess.
Common stock and preferred stock are the two primary categories of stocks.
Owners of common stock are entitled to dividends and the right to vote at shareholder meetings.
Common stockholders often do not have voting rights, while preferred stockholders typically get dividend payments ahead of time and are given preference over common investors in the event of a firm bankruptcy and asset liquidation.
To learn more about Stocks follow the link.
https://brainly.com/question/14649952
#SPJ2
consider the following balance sheet for wells fargo bank. suppose that someone deposited $500 at wells fargo. assets liabilities reserves 500 deposits 4000 loans 3500 what is the maximum amount by which the money supply will increase?
The maximum amount by which the money supply will increase is $100. The maximum amount by which the money supply will increase can be calculated by considering the reserve requirement ratio.
In this case, the balance sheet of Wells Fargo Bank shows reserves of $500 and deposits of $4,000. To determine the maximum increase in the money supply, we need to consider the reserve requirement ratio, which is the fraction of deposits that banks are required to hold as reserves.
Let's assume a reserve requirement ratio of 10% (0.10). This means that banks must hold 10% of their deposits as reserves and can lend out the remaining 90%.
Reserves: $500
Deposits: $4,000
Required reserves = Reserve requirement ratio * Deposits
Required reserves = 0.10 * $4,000
Required reserves = $400
Excess reserves = Reserves - Required reserves
Excess reserves = $500 - $400
Excess reserves = $100
The maximum amount by which the money supply will increase is determined by the lending capacity based on excess reserves. In this case, the bank can lend out a maximum of $100.
Therefore, the maximum amount by which the money supply will increase is $100.
To learn more about the reserve requirement ratio click here
https://brainly.com/question/30076175
#SPJ11
Which is an example of a small business showing social responsibility to individuals within the company?
A. starting an office recycling program
B. developing sustainable business practice
C. donating money to local organizations
D. allowing employees to work from home
Starting an office recycling program, developing sustainable business practice and donating money to local organizations are examples of a small business showing social responsibility to individuals within the company.
Company have a social responsibility to the communities in which they operate. This includes ensuring that they are good corporate citizens, providing support for local causes and charities, and protecting the environment.
Sustainable business is a term that is often used to describe businesses that are environmentally friendly or that have a positive social impact.
Hence, the correct options are "A, B & C".
To know more about social responsibility, click here.
https://brainly.com/question/24176816
#SPJ1
In the U.S., cash takes which two forms
its takes the form of paper money and coins
generally speaking, filter list operations produce a different number of list elements compared to map operations.
True, In comparison to map operations, filter list operations typically result in a different amount of list components.
The word "map" originates from the Medieval Latin Mappa mundi, where mappa denoted a napkin or piece of fabric and mundi denoted the entire world. A two-dimensional representation of the earth's surface was thus referred to as a "map," which is a shorthand phrase. A map is a representation of all or a portion of the surface of the Earth. Showing where things are is its primary goal. Maps may display physically discernible elements like rivers and lakes, woods, structures, and roadways. In addition, they may display invisible elements like limits and temperatures. A flat surface is typically used to draw maps. Maps are visual depictions of characteristics on the Earth or another celestial body that are drawn to scale and typically on a flat surface. These features might be geographical, geological, or political.
Learn more about map here
https://brainly.com/question/25922463
#SPJ4
A major disruption in financial markets characterized by sharp declines in asset prices and firm failures is called a.
A major disruption in financial markets characterized by sharp declines in asset prices and firm failures is called a financial crisis.
A financial crisis occurs when the value of financial assets and instruments drastically declines. As a result, firms struggle to pay their debts, and financial institutions lack the cash or convertible assets needed to fund initiatives and take care of urgent demands.
Falling US housing values and an increase in the number of borrowers unable to make loan payments were the GFC's main causes. Around the middle of 2006, the supply of newly constructed homes in some places grew quickly, and house prices in the United States reached their peak.
To know more about the banking crisis: https://brainly.com/question/25664180
#SPJ4
A major disruption in financial markets characterized by sharp declines in asset prices and firm failures is called a financial crisis.
During a financial crisis, asset values endure a sharp decrease in value, firms are unable to pay their loans and financial institutions face a shortage of liquidity. During a panic or bank run, investors sell off their assets or withdraw cash from savings accounts out of fear that their value will decline if they keep them in a financial institution. This is a common feature of the financial crisis.
The deflation of a credit boom, a stock market collapse, a sovereign default or a currency crisis are further circumstances that could be classified as a financial crisis. A financial crisis might only affect certain banks, or it might affect the entire global economy or just one particular economy.
To read about stock market see:
https://brainly.com/question/690070
#SPJ4
Weights of 20 foot shipping containers have a Normal distribution with a mean of 27000 pounds and a standard deviation of 3000 pounds. What is the 97th percentile (highest 3 percent) of container weights? Multiple Choice a) 28,114. b) 32,642. c) 34,201. d) 21,358. e) 31,806.
The weight at the 97th percentile is approximately 32,642 pounds can be determined using the mean and standard deviation of the Normal distribution.
The weights of the 20-foot shipping containers follow a normal distribution with a mean of 27,000 pounds and a standard deviation of 3,000 pounds, we can use the properties of the Normal distribution to determine the percentile.
The 97th percentile corresponds to a Z-score of approximately 1.88, which represents the number of standard deviations above the mean. We can use a Z-score table or a statistical calculator to find the corresponding value.
Using the Z-score of 1.88 and the formula: X = mean + (Z-score * standard deviation), we can calculate the weight at the 97th percentile:
\(X = 27,000 + (1.88 * 3,000)\)
Solving the equation, we find that the weight at the 97th percentile is approximately 32,642 pounds.
Therefore, the correct answer is option b) 32,642.
Learn more about Normal distribution here:
https://brainly.com/question/15103234
#SPJ11
the capability index (cpk) calculates the percentage of items being produced within specifications. True or false ?
The statement The capability index (Cpk) calculates the percentage of items being produced within specifications" is false because Cpk measures the process capability, not the percentage of items produced within specifications.
The capability index (Cpk) is a statistical measure used to assess the ability of a manufacturing process to consistently produce products within specified tolerance limits. It quantifies the relationship between the process variability and the tolerance range.
Cpk compares the spread of the process output to the width of the specification limits and provides a numerical value that indicates how well the process meets the specified requirements.
Cpk is calculated using a formula that takes into account the process mean, process standard deviation, and the upper and lower specification limits. The result is a value that represents the process capability relative to the specifications.
A Cpk value of 1 indicates that the process spread is equal to the specification width, while a value greater than 1 indicates better capability.
To know more about capability index, refer here:
https://brainly.com/question/15734839#
#SPJ11
One way to straighten out an unstructured flowchart segment is to use the "____" method.
1. detective (not)
2. spaghetti code (not)
3. pasta bowl
4. spaghetti bowl
One way to straighten out an unstructured flowchart segment is to use the "spaghetti bowl" method. The spaghetti bowl method involves carefully analyzing and rearranging the flowchart to remove unnecessary loops, crossings, and overlaps, resulting in a more organized and understandable structure.
The term "spaghetti bowl" refers to the tangled and confusing nature of an unstructured flowchart segment, resembling a jumble of tangled spaghetti. By applying the spaghetti bowl method, the flowchart is straightened out, much like untangling a bowl of spaghetti, to improve clarity and logic.
This method involves identifying the logical flow of the process, reordering the sequence of steps, and simplifying the connections between different elements of the flowchart. The goal is to create a more coherent and readable representation of the process, making it easier to understand and follow.
To learn more about flowcharting techniques and related topics, you can visit
brainly.com/question/32464349
#SPJ11.
What is the education level of a majority of the Power, Structural, and Technical Systems workers?
Answer:
bachelor’s degree or apprenticeship
Explanation:
Given that Power, Structural, and Technical Systems workers require the knowledge of engineering, hydraulics, pneumatics, electronics, power, structures, and controls to the field of agriculture to become successful in the field. The majority of the workers in this field possess bachelor's degrees.
However, given that the role involves practical and on the job experience, some of them start as an apprentice right as High school leavers or Diploma.
Hence, in this case, the correct answer is "bachelor’s degree or apprenticeship"
A cell phone company charges $1.25 for a long-distance phone call, plus an additional $0.15 per minute. If Kyle wants to spend less than $5, how many minutes can he talk?
Answer:
465 minutes or 8 hours and 15 minutes
Step-by-step explanation:
her monthly bill was 72.25 and she has to pay 2.50 per month
72.25 - 2.50 = 69.75
69.75/ 0.15 = 645 minutes
645 minutes/ 60 minutes= 7.75 = 8 hours 15 minutes
If you observe a co-worker, customer, or stranger in your workplace exhibiting any of the warning signs of workplace violence, who should you talk to?.
If you observe a co-worker, customer, or stranger in your workplace exhibiting any of the warning signs of workplace violence you should first report your concern to your supervisor, or human resources department.
What is workplace violence?Workplace violence is any act of, or threat of, physical violence, harassment, intimidation, or other threatening disruptive behavior that takes place at the workplace. Threats, slander, and physical and verbal abuse are all included, as well as murder. Customers, clients, visitors, and staff all may be impacted. The third-leading cause of fatal workplace injuries in the United States is now acts of violence and other injuries. In 2019, there were 5,333 fatal workplace injuries in the United States, and 761 of those injuries were caused intentionally by another person, according to the Bureau of Labor Statistics Census of Fatal Occupational Injuries (CFOI). Employers and employees across the country are very concerned about workplace violence, regardless of how it presents.
To learn more about workplace violence, visit:
https://brainly.com/question/3807227
#SPJ4
Answer: Your co-worker is late to work one or two days each week.
Explanation:
20 POINTS
What are the six ethical values AMA identifies for all marketing professionals?
The product life cycle refers to the stages a product moves through from the time it enters the market until the time
It's the stage by which a product move through from the time it enters the market until the time it is cleared. My own definition states that it's the length of time by which a product is introduced to consumers in the market until it has been removed
Explain how making this substitution affects each of the
following instructions:
add $9, $8, $7
sw $4,16($2)
beq $3, $11, exit ; the label "exit" corresponds to address
0x400BD000
The substitution of `$4` for `$5` affects each of the given instructions as explained below:
add $9, $8, $7Substituting `$4` for `$5` does not affect this instruction. It will still add the contents of registers `$8` and `$7`, then store the result in register `$9`.sw $4,16($2)This instruction will be affected by the substitution. `$4` will be stored at memory address `$2+16`, which is the same as `$2+0x10` in hexadecimal notation. Thus, `$5` will be stored at the memory location `$2+16` rather than `$2+20`.beq $3, $11, exit the label "exit" corresponds to address 0x400BD000This instruction will also be affected by the substitution. The label "exit" will correspond to memory address `0x400BD000`. Therefore, the instruction will compare the contents of registers `$3` and `$11`, and if they are equal, the program will branch to memory address `0x400BD000`. However, this address will not be the actual address of the exit label due to the substitution. Thus, the branch will go to a different memory address that corresponds to the new location of the exit label after the substitution has been made.
About SubstitutionSubstitution are goods that can be exchanged for other products. Substitute goods are goods that are the same as other products. In a sense, substitute goods can be an alternative to the main product you are looking for. This one element can be considered in business strategy. What is meant by substitution? Substitution is the process of replacing a language element by another element to produce a distinguishing element or to explain a certain element. Substitution has the same structural function as what it replaces and can be replaced by interpretation items.
Learn More About Substitution at https://brainly.com/question/30241383
#SPJ11
Which of the following is an example of cross-trading
A. A contractor focuses solely on heating and air conditioning
B. A business produces more goods then their competitors because they can do it at a lower cost
C. A graphic designer is taking classes in project management and finance to improve her skills in those areas
D. An experienced pilot mentors newer pilots on their flying skills
The option that is an example of cross-trading among the following is option C. A graphic designer is taking classes in project management and finance to improve her skills in those areas.
A graphic designer invents visual concepts, using computer software or by hand, to communicate ideas that inspire, inform, and captivate consumers. A graphic designer forms the total design and production design for applications such as advertisements, brochures, magazines, and reports.
For such professional to take classes in project management and finance to improve her skills in those areas is tantamount to cross-trading since it is another field entirely.
What is cross-trading?A cross trade is a practice where buy and sell orders for the same asset are offset without recording the trade on the exchange. It is an activity that is not permitted on most major exchanges.
Therefore, the correct answer is option C. A graphic designer is taking classes in project management and finance to improve her skills in those areas.
learn more about cross- selling: https://brainly.com/question/4978438
#SPJ1
Drag the tiles to the correct boxes to complete the pairs. Match the credit types to the examples. Paying by credit card: House mortgage: Student loan: Tiles: Unsecured credit Installment credit Secured credit
Answer and Explanation:
The matching of the items are as follows
House mortgage = Secured credit
The mortgage of the house would be considered as a secured credit in which the person who takes a loan have to mortgage his property
Student loan = Unsecured credit
This could be considered as an unsecured credit
Paying by credit card = Installment credit
If the amount is paid by the credit card so it would be considered as an installment like emi
The match up are:
House mortgage = Secured creditPaying by credit card = unsecured creditStudent loan is installment credit What is credit?Credit is known to be the ability that a person has to borrow money or collect goods or services using a loan.
Note that The match up are correct and as such:
House mortgage = Secured creditPaying by credit card = unsecured creditStudent loan is installment creditLearn more about credit from
https://brainly.com/question/14279491
#SPJ5
which of the following actions would be likely to shorten the cash conversion cycle? a. begin to take cash discounts on inventory purchases; the terms are 2/10 net 30. b. adopt a new manufacturing process that saves some labor costs but slows down the conversion of raw materials to finished goods from 10 days to 20 days.
The option a. Taking cash discounts on inventory purchases (2/10 net 30) would be likely to shorten the cash conversion cycle.
The cash conversion cycle (CCC) measures the length of time it takes for a company to convert its investments in inventory and other resources into cash. A shorter CCC is generally desirable because it means that a company is able to generate cash more quickly and efficiently.
Taking cash discounts on inventory purchases (2/10 net 30) can shorten the CCC by allowing the company to pay its suppliers more quickly and receive payment from its customers more slowly.
The terms 2/10 net 30 mean that the company will receive a 2% discount if it pays its bills within 10 days, otherwise it must pay the full amount within 30 days. By taking advantage of the discount, the company can reduce the amount of time it takes to pay its suppliers and thus reduce its CCC.
Hence , correct option is A.Taking cash discounts on inventory purchases (2/10 net 30)
To know more about conversion cycle here
https://brainly.com/question/29857000
#SPJ4
ASAPP PLZZZZ
3. In the mythical kingdom of Erehwon, the basic unit of money is the rudolf. At today's exchange rate, 4 rudolfs are equal to $1. A U.S. tourist in Erehwon wishes to purchase a guidebook to the country. The price is 6 rudolfs. How much is this in U.S. money?
(A) $1.50
(B) $6
(C) $4
(D) $24
2) Moonlight Company wrote off the account of one of its customers, X, in 2018 for $500. On January 21, 2019, X unexpectedly repaid his account in full. The company uses the direct write-off method to account for uncollectible receivables. Journalize the entries required for Moonlight Company on January 21, 2019
Answer:
A journal entry was carried out for Moonlight Company for January 21, 2019, and is shown below in the explanation section
Explanation:
Solution
Given that:
Moonlight Company Journal Entries on January 21, 2019
JOURNAL ENTRY
Date Account name Debit Credit
Jan. 21, 2019 Cash 500
(Income statement -Bad debts recovered) 500
(record the bad debts recovery from customer X)
Which government agency could possibly provide a loan of up to $5 million to a small U.S. business that needed a short-term loan to start an export business?
a. Internal Revenue Service b. U.S. Small Business Administration c. International Monetary Fund d. Inter-American Development Bank
The U.S. Small Business Administration (SBA) is the government agency that provides loans to small businesses, including short-term loan, and also to start an export business.
It provides different types of loans, such as, , SBA 7(a) loan program, which can provide loans up to $5 million to eligible small businesses. However, it's important to note that SBA loans are provided through participating lenders, not directly from the SBA itself. To qualify for this loan, the business should meet certain requirements, such as being a for-profit business, having a certain number of employees or revenue, and meeting SBA size standards for its industry. The SBA loan application process can be lengthy and require extensive documentation, but can be a valuable source of financing for small businesses.
To know more about SBA:
https://brainly.com/question/30767220
#SPJ11
An asset for drilling was purchased and placed in service by a petroleum production company. Its cost basis is $60,000 and it has an estimated MV of $12,000 at the end of an estimated useful life of 14 years. Compute the depreciation amount in the third year and the BV at the end of the fifth year of life by each of these methods:a. The SL methodb. The 200% DB method with switchover to SLc. The GDSd. The ADS
The SL method = $42,855. , The 200% DB method with switchover to SL ,=$25,185. The GDSd = $14,006.. The ADS= $17,130.
a. Straight Line (SL) method: The annual depreciation expense can be calculated as (Cost basis - Salvage value) / Useful life = ($60,000 - $12,000) / 14 = $3,429. In the third year, the accumulated depreciation would be $3,429 * 3 = $10,287, and the book value (BV) would be $60,000 - $10,287 = $49,713. At the end of the fifth year, the accumulated depreciation would be $3,429 * 5 = $17,145, and the BV would be $60,000 - $17,145 = $42,855.
b. 200% Declining Balance (DB) method with switch over to SL: The annual depreciation rate is twice the straight-line rate, or 2 / 14 = 14.29%. In the first year, the depreciation expense would be $60,000 * 14.29% = $8,574. The second year's depreciation expense would be $51,426 * 14.29% = $7,356. After two years, the accumulated depreciation would be $8,574 + $7,356 = $15,930. Since the BV is less than 20% of the cost basis, the depreciation method switches to straight line. The third year's depreciation expense would be ($60,000 - $15,930) / 12 = $3,723. After three years, the accumulated depreciation would be $15,930 + $3,723 = $19,653, and the BV would be $60,000 - $19,653 = $40,347. At the end of the fifth year, the accumulated depreciation would be $3,723 * 5 + $15,930 = $34,815, and the BV would be $60,000 - $34,815 = $25,185.
c. General Depreciation System (GDS): The GDS for 7-year property assigns 14.29% for the first year, 24.49% for the second year, 17.49% for the third year, and 12.49% for the fourth year. In the third year, the depreciation expense would be $60,000 * 17.49% = $10,494. After three years, the accumulated depreciation would be $8,562 + $13,449 + $10,494 = $32,505, and the BV would be $60,000 - $32,505 = $27,495. At the end of the fifth year, the accumulated depreciation would be $8,562 + $13,449 + $10,494 + $7,494 + $4,995 = $45,994, and the BV would be $60,000 - $45,994 = $14,006.
d. Alternative Depreciation System (ADS): The ADS for 7-year property assigns equal depreciation for each year, or 1/7 = 14.29%. In the third year, the depreciation expense would be $60,000 * 14.29% = $8,574. After three years, the accumulated depreciation would be $8,574 * 3 = $25,722, and the BV would be $60,000 - $25,722 = $34,278. At the end of the fifth year, the accumulated depreciation would be $8,574 * 5 = $42,870, and the BV would be $60,000 - $42,870 = $17,130.
Learn more about Straight Line
https://brainly.com/question/29223887
#SPJ4
Which of the following is true of intent to form a contract?
Intent is not a required element of an offer or acceptance to form a contract.
Intent is determined based on the specific motivations of the offeror or offeree, including hidden motivations.
Intent is assessed by considering proof of an offeree or offeror's internal thought process.
Intent is a required element of an offer or acceptance only if a contract is a contract for the sale of goods.
An offeror must show intent to be bound by the offeree's acceptance.
The statement "An offeror must show intent to be bound by the offeree's acceptance" is true of the intent to form a contract. In order for a contract to be formed,
both parties must have a mutual intention to create a legal relationship. The intent to form a contract is assessed by considering whether the parties objectively manifested an intention to be bound by their agreement.
In the context of an offer, the offeror must demonstrate an intention to be bound by the terms of the offer. This means that the offeror must intend to enter into a legally binding contract if the offeree accepts the offer.
In the context of acceptance, the offeree must demonstrate an intention to accept the offer and be bound by its terms. This means that the offeree must accept the offer without reservation or qualification and must intend to be bound by the terms of the offer.
Overall, intent is a required element of both an offer and acceptance in order for a contract to be formed.
Learn more about contract here:
https://brainly.com/question/2669219
#SPJ11
Which is an example of E-commerce? A. Hot dog stand B. Cable company C. Online boutique D. Car wash
An example of an E-commerce is an online boutique.
What is E-commerce?
E-commerce is a business that exists online. For example, if a person establishes sells items on a website or on a social media platform, the person is operating an e-commerce. An example of an e-commerce business is ASOS.
To learn more about e-commerce, please check:
https://brainly.com/question/14157556
#SPJ1
Mary is writing a letter of transmittal to accompany a report to her client. The transmittal letter should announce the topic of the report, tell how it was authorized, briefly describe the project, and __________.
a. identify the writer of the report
b. list the sections of the report and any appendixes
c. highlight the report's findings, conclusions, and recommendations
d. market additional services or products
Answer:
No ablo taka taka mi querido amigo ehh ni si quiera lo voy a intentar
Likely Oil Company owns the working interest in a small lease in Louisiana that has a
1/5 royalty interest. The royalty interest owner is Mr. Neal. Likely also owns the working
interest in numerous leases in Texas. Not having the facilities in Louisiana to develop the
Louisiana Lease, Likely assigns its entire working interest in the lease to Jones for a
consideration of $400,000, and retains a 15% overriding royalty. Assuming revenues of
$800,000 and costs of $500,000 for the first year of operations the working interest
owner will receive in revenue the first year of operation this amount. $___________.
Answer: 544,000
How to get the $544,000
The answer provided is $544,000. A company is an organization or entity engaged in business activities with the goal of generating profits.
To calculate the amount the working interest owner will receive in revenue for the first year of operation, we need to consider the various interests and deductions involved.
Calculate the gross revenue:
Gross Revenue = Revenues - Costs
= $800,000 - $500,000
= $300,000
Determine the net revenue for the working interest owner:
Net Revenue = Gross Revenue - Royalty Interest - Overriding Royalty
= $300,000 - Royalty Interest - Overriding Royalty
Calculate the Royalty Interest:
Royalty Interest = Gross Revenue * Royalty Interest Percentage
= $800,000 * 1/5
= $160,000
Calculate the Overriding Royalty:
Overriding Royalty = Gross Revenue * Overriding Royalty Percentage
= $800,000 * 15%
= $120,000
Calculate the net revenue for the working interest owner:
Net Revenue = $300,000 - $160,000 - $120,000
= $20,000
Learn more about company here:
https://brainly.com/question/15184016
#SPJ11
In terms of SUPPLY, what factors have contributed to the fall in oil prices?