Accounting Assignment
1. During a period of inflation, the cost of good rise. FIFO (First In, First Out) method would report the highest inventory balance. This is because the price rotates with the goods. If the first term of an item is purchased for $1, then a second term of that same item is purchased for $2, the first term items will be reported as being taken off inventory first.
I would be considered ethical of the reports that show the highest net income are used throughout all reporting processes. These would interest investors and owners and profit-sharers. At the same time for tax purposes the same net incomes should be used.
2. The first in first out inventory method is the old way of selling off the oldest goods valued in the company due to them being around the longest and therefore would have the most inflation value. The earliest cost methods would have these goods sold off using the valuation of those earliest cost values. The cost of the older goods being sold currently would be that of the cost of the current goods being sold now. This would make sense for a company to do this because they would want to show the highest numbers possible rather than sit on the goods that they have had the longest.
Financial Management class
3. Call feature is beneficial when market rate is lower than coupon rate. the comapny can call its bond at pre specified payment on call premium. the comapny can issue new bond at lower rate.
Call option is risk for bondholder because there is a risk of call the bond before its maturity period. in this case bondholder face reinvestment. the investor has to invest at low rate.
In convertible bond, the bondholder excercise the conversion option when market value of after conversion is higher than market value of bond. also the dividend payment on total stock is higher than annual coupon payment.
4. "Callable bonds provide a corporation the right to repay the bonds before the maturity date. Callable bonds protect the corporation from having to pay high interest rates on existing debt if interest rates drop. For example, if the market rate drops to 4%, the corporation could call the bonds and replace them with bonds that pay a 4% interest rate. The corporation would be able to essentially refinance the higher interest debt with a lower interest rate bond. By offering the bonds as callable, the corporation prevents itself from being locked into a high interest rate and not being able to change it. If the bonds are called, investors would no longer receive semiannual interest payments and would be presented with the challenge of investing their money in another investment that offers a comparable return" (Miller, Mattison & Matsumura, 2016, p.744). Horngren's Accounting 11th ed.
Business Law
5. Although is was a hand shake deal. Charles had no control over the weather and no one stated what happens if the crop don't come in or if it is damage. So, I think Charles should win because although they did agree on $1.00 per bushel which is $20,000 he had no control over the weather and besides that they did not state what will happen if anything happens to the crops. I wouldn't consider this a breach of contract. Charles had every attention to follow through with his deal on the corn but it got damaged in the storm. Why couldn't they go over another contract for what Charles do have. After all it wasn't his fault the crop got damaged.
6. I believe Charles did not breach the contract he made. Charles did produce the corn crops that were not damged by the rain storm. Charles could not control the weather. It would be differnet if Charles just did not finish the corn crops but he did. With the hand shake contract no one stated what would happen if there was inclement weather. Charles defense would be the weather and he should win because he had all intention of delivering what they agreed upon.
Principle of Macro class
1. What determine the shape and position of the short-run aggregate supply curve is that the normal wage rate has to be fixed. This will increase prices and make for higher profit. What makes the supply curve increase is because some prices are normal and fixed in the short-term, this means that aggregate supply curve will slope upwards.
2. The short run aggregate supply curve is determined by the connection between genuine creation and the value level. As the value level ascents, genuine creation is more noteworthy. As the value level falls, genuine generation additionally decays. The connection between the short-run total supply bend and the total request bend, and additionally the long-run total supply bend is the center instrument of the total market (AS-AD) examination. This investigation is then used to clarify and comprehend macroeconomic wonder, including business cycles, expansion, joblessness, and adjustment arrangements.