Emma, the marketing manager, is constantly seeking information about her competition while looking online or speaking to people.

Answer:

a. What is the initial investment at t=0?

• -$90,000

b. What is the Cash Flow at year 1?

• $33,950

c. What is the Cash Flow at year 3?

• $40,270

d. What is NPV?

• $1,788.50

Explanation:

Initial investment amounts to $90,000

Annual depreciation calculated using straight-line depreciation method = $90,000 / 3 = $30,000

Year 1 cash flow = [($40,000 - $5,000 - $30,000) × 0.79] + $30,000 = $33,950

Year 2 cash flow = [($45,000 - $6,000 - $30,000) × 0.79] + $30,000 = $37,110

Year 3 cash flow = [($50,000 - $7,000 - $30,000) × 0.79] + $30,000 = $40,270

Using an Excel spreadsheet, I calculated the NPV = $1,788.50

Answer: 1. On March 1, record the insurance purchase in advance. Debit Prepaid Insurance $36,000. Credit Cash $36,000. 2. On December 31, make the adjusting entry. Debit Insurance Expense $30,000. Credit Prepaid Insurance $30,000. Explanation: Mountaineer excavation preemptively acquires one year’s worth of flood insurance on March 1, totaling $36,000 ($3,000 a month). The insurance is documented as prepaid insurance: Debit Prepaid Insurance $36,000, Credit Cash $36,000. By December 31, at the conclusion of the following 10 months, an adjustment is recorded to Credit Prepaid Insurance for $30,000 ($3,000 per month for 10 months) and Debit Insurance Expense for the same amount.

Response:

The total amount subject to tax will come to $7000

Thus option (d) would be the correct choice

Clarification:

According to IRS regulations, benefits received under a disability policy are fully taxable only if

The employee pays premiums on the policy entirely with pre tax dollars

In this instance, the premium was paid by the employee herself and is assumed to have been with pre tax dollars, thus it is fully taxable i.e 6500$

Consequently, the $500 sick pay from the welfare fund is categorized as earned income and is therefore fully taxable.

Thus the total taxable income amounts to $6500 + $500 = $7000

Consequently, option (d) will be the correct answer

Complete Question:

Baldwin's workforce is set to increase by 10% next year, preserving the same extra recruitment costs above the $1,000 baseline, amounting to $694 for each employee. The current complement is 434, with 67 new employees last year. How much will they allocate to recruiting this year?

Answer: $84,700

Explanation:

Total employees = 434 + 67 = 501

As stated, Baldwin's workforce is expected to grow by 10%.

Thus, existing staff x 110% = 501 x 110% = 551 (employee count cannot include decimals).

Indicating an increase of 50 employees.

Baldwin will incur a cost of $694 + $1,000 = $1,694

So, for the additional 50 employees, the total costs will be $1,694

Consequently, Baldwin's overall recruiting expenditure would be (50 x $1,694) = $ 84,700

Answer:

No, he cannot

Explanation:

In an insurance agreement, the insured consents to pay a modest sum regularly, termed the insurance premium, to avoid taking on potentially significant liability that could arise unexpectedly in the future. This liability is instead carried by the insurer —the insurance provider.

In this specific situation, Ronald opted not to acquire dental insurance initially and chose to make repayments on his student loans instead. Since he did not have insurance at the time the accident occurred, he cannot sign up post-event for an injury that has already taken place.

An insurance policy can protect him from costs related to future accidents or injuries, but it will not cover the prior accident that happened when he had no insurance.