Answer:
a) patent and copyright laws
d) ownership of a critical factor of production
Explanation:
a monopoly is when there is only one firm operating in an industry.
the different reasons why monopoly exists are :
ownership of a key resource. this is natural monopoly
high start up cost
legal barriers - patent and copyright laws
Economies of scale.
debit Product Warranty Expense; credit Cash b. debit Product Warranty Expense; credit Product Warranty Payable c. debit Product Warranty Payable; credit Cash d. debit Product Warranty Payable; credit Product Warranty Expense
Answer:
b. debit Product Warranty Expense; credit Product Warranty Payable
Explanation:
The journal entry for recording the estimated product warranty liability is shown below;
Product Warranty expense Dr XXXXX
To Product warranty payable XXXXX
(being the estimated product warranty liability is recorded)\
For recording this we debited the product warranty expense as it increased the expenses and credited the product warranty payable as it also increased the liabilities
Calculate the cost of goods manufactured using the following information: Direct materials used $ 298,700 Direct labor used 132,200 Factory overhead costs 264,200 General and administrative expenses 85,700 Selling expenses 49,000 Work in Process inventory, January 1 118,700 Work in Process inventory, December 31 126,100 Finished goods inventory, January 1 232,300 Finished goods inventory, December 31 238,900
Answer:$687,700
Explanation:
$
Direct Materials 298,700
Add: Direct Labour 132,200
--------------
Prime Cost 430,900
Factory Overhead 264,200
Add: Opening WIP 118,700
Less: Closing WIP 126,100
--------------
256,800
--------------
Cost of Good Manufacture 687,700
----------------
if the broker dies or loses her license, the state's real estate licensing agency may choose to appoint a ________ to close any transactions that are pending.
Answer:
temporary broker
Explanation:
A temporary broker is someone who is charged with responsibility of closing, or winding up the existing or pending business of a permanent or original licensed broker, in the event that, the original licensed broker dies or loses her license.
To become a temporary broker, the state's real estate licensing agency will issue a temporary license as a broker to a licensed or unlicensed person for a period of not more than ninety days and will not be extended, except on a special cases such as personal representative.
Hence, if the broker dies or loses her license, the state's real estate licensing agency may choose to appoint a TEMPORARY BROKER to close any transactions that are pending.
A new operating system for an existing maching is expected to cost $786000 and have a useful life of six years. The system yields an incremental after-tax income of $230000 each year after deducting its straight line depreciation. The predicted salvage value of the system is $90000. Assume the company requires a 10% rate of return on its investments. Compute the net present value of each potential investment.
Answer:
NPV is $771,739
Explanation:
As we know that:
Net Present Value = Present Value of Cash inflow (STEP 1) - Present Value of Cash outflow
STEP 1. Present Value of Cash Inflow
Here
Present Value of Cash Inflow = Annuity of Annual Cash flow - PV of Scrap Value
Annual Cash flow is $346,000 ($230,000 + ($786,000 - $90,000)/6)
So
Annuity of annual cash inflow = $346,000 * Annuity Factor
Here
Annuity Factor for 6 years is 4.3553
Now this means that:
Annuity of annual cash Inflow = $346,000 * 4.3553 = $1,506,934
Present Value of Residual Value ($90,000 * 0.5645) = $50,805
Present Value of cash inflows $1,557,739
Now putting values in the above equation, we have:
Net Present Value = $1,557,739 - $786,000
Net Present Value = $771,739
3. When Blackstone investment company borrowed funds to buy out the stockholders of Busch Entertainment, it was participating in a(n)
Answer: c. Leveraged Buyout
Explanation:
A Leveraged buyout as the term suggests, is when a buyout is sponsored mainly by the use of debt. In Business Leveraged Buyouts usually occur when either the management, employees or private investors buys out or attempts to buy out the Shareholders of a company by using debt funding so that they can then own the company. The debt is acquired by using both assets of the company being bought and that of the company buying (unless they do not have any) as collateral.
When Blackstone investment company borrowed funds to buy out the stockholders of Busch Entertainment, it was participating in a Leveraged Buyout.
a) While excavating, the Contractor hits a rock layer. Since the plans and soil report did not mention such rock, the contractor files a claim under: i. Force majeure. ii. Differing site conditions. iii. Design errors/omissions. iv. Unusual weather conditions. v. Changes in owner’s requirements.
Answer:
Differing site conditions
Explanation:
A differing site condition is a condition that has been changed. Since the plan did not mention this rock, the contractor can file a claim under this.
It is a hidden physical condition that is discovered at a site which is actually different from what was expected. It can also be regarded as unforeseen site condition.
Fernando Designs is considering a project that has the following cash flows and WACC data. What is the project's discounted payback period? (6 points) What is the project’s modified internal rate of return?
Answer:
Discounted Payback period 3 years
Modified Internal rate of return 4.833%
Explanation:
Fernando Designs has following cash flows ,
year 1 : -$900
Year 2 : $500
Year 3 : $500
Year 4 : $500
Using 10% discount factor the cashflows will be,
discounted values
Year 1 : -900
Year 2 : 454.54
Year 3 : 445.45
Year 4 : 4132231
Payback period is -900 + 454.54 +445.45 = 3 years.
Modified Internal rate of return; [tex]\sqrt[n]{\frac{FV of cash inflows}{PV of cash outflow} }[/tex]
[tex]\sqrt[4]{\frac{1314}{900} }[/tex] = 4.833%
You have a portfolio that is invested 16 percent in Stock A, 36 percent in Stock B, and 48 percent in Stock C. The betas of the stocks are .61, 1.16, and 1.45, respectively. What is the beta of the portfolio
Answer:
Beta= 1.2112
Explanation:
Giving the following information:
Stock A:
Proportion= 0.16
Beta= 0.61
Stock B:
Proportion= 0.36
Beta= 1.16
Stock C:
Proportion= 0.48
Beta= 1.45
To calculate the beta of the portfolio, we need to use the following formula:
Beta= (proportion of investment A*beta A) + (proportion of investment B*beta B) + (proportion of investment C*beta C)
Beta= (0.16*0.61) + (0.36*1.16) + (0.48*1.45)
Beta= 1.2112
Salary expense was 15.5% of sales this year. If sales this year are $1,300,000 and are forecasted to be $1,500,000 next year, what is forecasted salary expense next year if all expenses maintain a constant percent of sales?
Answer:
Salary expense next year=$232,500
Explanation:
The ratio of expense to ales is an important which helps in the management and control overhead.
We can be predict the Salary expense using the information given about the relationship between salary expense and sales .
If salary expense is 15.5% of sales, then Salary expense this year =
15.5% × 1,300,000=$201,500
Salary expense next year = 15.5% × foretasted sales next year
= 15.5% × 1,500,000 = $232,500
We use 15.5% because the relationship between the expenses and the sales in proportion is expected to remain the same
Salary expense next year=$232,500
LSM subcontracted with Henry Isaacs Home Remodeling and Repair (Isaacs) to perform the roofing work on the project. Isaacs in turn subcontracted with Hal Brewster Home Improvements (Brewster), to conduct the roofing work on Isaacs' behalf. When Brewster performed work on the roof, he "botched the job" and caused extensive leaking inside the house. LSM and Issacs attempted to correct the problems, but eventually abandoned the project, leaving Logan-Baldwin to hire others to complete the renovations. Logan-Baldwin sued LSM, Isaacs, and Baldwin for breach of contract. Isaacs sought to dismiss Logan-Baldwin's claim against it, arguing no privity of contract existed between themselves and Logan-Baldwin, and therefore Isaacs should not be liable for any damages.
Required:
Does Logan-Baldwin have contract rights over Isaacs as an intended third-party beneficiary?
1. Because Henry Isaacs delegated its duty to repair the roof to Brewster, Henry Isaacs remains responsible for Brewster's failure to install the new roof on the residence properly.
a. True
b. False
2. Logan-Baldwin is entitled to compensatory damages (covering the cost of hiring other contractors to fix the roof) caused by the breach of contract by LSM and Henry Isaacs.
a. True
b. False
3. Logan-Baldwin qualified as a third party creditor beneficiary of the contract between LSM and Henry Isaacs and the contract between Henry Isaacs and Brewster, even if Logan-Baldwin is not named in those contracts.
a. True
b. False
4. Palisades Plaza is not entitled to damages for breach contract by LSM, Henry Isaacs, and Brewster unless Palisades Plaza has clean hands and has tendered performance under the contract.
a. True
b. False
5. If the agreement between Henry Isaacs and Brewster to install a new roof is a novation, Henry Isaacs is not liable for breach of contract for the failure to install the new roof properly.
a. True
b. False
Answer:
1. true
2. true
3. false
4. true
5. false
The petty cash fund has a current balance of $ 350, which is the established fund balance. Based on activity in the fund, it is determined that the balance needs to be changed to $ 550. Which journal entry is needed to make this change?
A. No journal entry is needed because this change only involves cash.
B. Debit the Petty Cash account and credit the Cash account for $200.
C. Debit the Cash account and credit the Petty Cash account for $200.
D. Debit the Petty Cash account and credit the Cash account for $550.
Answer:
i think the answer is B. Debit the Petty Cash account and credit the Cash account for $200.
Explanation:
Suppose you inherited $275,000 and invested it at 8.25% per year. How much could you withdraw at the end of each of the next 20 years
Answer:
$28,533.5
Explanation:
Principal value (PV) = $275,000
Time = 20 years
Rate = 8.25%
Present Value = P ((1-(1+R)^-n) / r)
275,000 = P ((1- (1 + 0.0825)^-20) /.0825)
275,000 x .0825 = P (1-(1/1.0825)^20)
22687.5 = P ((1.0825^20 - 1) / (1.0825 ^20))
22687.50 = P (4.8816 - 1 / 4.8816)
22687.5 = P (3.886 / 4.8816)
22687.5 = p(0.7951)
P = 22687.5 / 0.7951
P = $28533.5
The Mixing Department of Complete Foods had 62,000 units to account for in October. Of the 62,000 units, 38,000 units were completed and transferred to the nest department, and 24,000 units were 20% complete. All of the materials are added at the beginning of the process. Conversion costs arc added evenly throughout the mixing process and the company uses the weighted-average method.
Compute the total equivalent units of production for direct materials and conversion costs for October.
Answer:
The total equivalent units of production are as follows:
For direct materials = 62,000 units
For conversion costs = 42,000 units
Explanation:
These can be computed by preparing statements of equivalent units as follows:
Statement of Equivalent Units (EU) (Weighted average)
For October
For Materials
Particulars Units (a) Complete (%) (b) EU (c = a * b)
Transferred 38,000 100% 38,000
Ending WIP 24,000 100% 24,000
Total 62,000 62,000
Statement of Equivalent Units (EU) (Weighted average)
For October
For Conversion Costs
Particulars Units (a) Complete (%) (b) EU (c = a * b)
Transferred 38,000 100% 38,000
Ending WIP 24,000 20% 4,800
Total 62,000 42,000
Conclusion
The total equivalent units of production are as follows:
For direct materials = 62,000 units
For conversion costs = 42,000 units
what is the most important function of a leader within an organization
Answer:
Leadership is the action of leading people in an organization towards achieving goals. Leaders do this by influencing employee behaviors in several ways. A leader sets a clear vision for the organization, motivates employees, guides employees through the work process and builds morale.
Explanation:
Answer:
building consouis
Explanation:
i hopppeee this helps :)
You purchased a bond 69 days ago for $891.26. You received an interest payment of $24.00 56 days ago. Today the bond’s price is $884.89. What is the holding period return (HPR) on the bond as of today?
Answer:
1.97%
Explanation:
The formula to calculate the holding period return is:
HPR=(Income generated+(ending value-initial value)/Initial value)*100
Income generated= $24
Ending value= $884.89
Initial value= $891.26
HPR=(24+(884.89-891.26)/891.26)*100
HPR=(24+(-6.37)/891.26)*100
HPR=(17.63/891.26)*100
HPR=0.0197*100
HPR= 1.97%
According to this, the holding period return (HPR) on the bond as of today is 1.97%.
A bond's credit ratingt provides a guides to its risk. suppose that long term bonds Aa currently offers yield to mjaturity of 7.5%. A-rated bonds sell at yields of 7.8%. Sud- pose that a 10-year bond with a coupon rate of 7.6% is downgraded by Moody's from an Aa to A rating.
Required:
a. Is the bond likely to sell above or below par value before the downgrade?
b. Is the bond likely to sell above or below par value after the downgrade?
Answer:
a.- above par (premium)
b.- below par (discount)
Explanation:
Currenly the bonds par yield will be of 7.6%
Before the downgrade the expected return on that risk was 7.5% so it was above par.
Once the downgrade occurs: the expected return considering the increased risk is 7.8% Therefore the market price will decrease. This will move the yield to maturity from 7.5% to 7.8% and the market price below par.
Motors is a chain of car dealerships. Sales in the fourth quarter of last year were $4,600,000. Suppose management projects that its current year's quarterly sales will increase by 3% in quarter 1, by another 7% in quarter 2, by another 5% in quarter 3, and by another 4% in quarter 4. Management expects cost of goods sold to be 45% of revenues every quarter, while operating expenses should be 30% of revenues during each of the first two quarters, 25% of revenues during the third quarter, and 20% during the fourth quarter.Required:a. Prepare a budgeted income statement for each of the four quarters and for the entire year.b. Prepare the first portion of the budgeted income statement through gross profit, then complete the statement.
Answer:
Budgeted Income Statement for each of the four quarters and for the entire year
Quarter 1st 2nd 3rd 4th
Sales $4,738,000 $5,069,660 $5,323,143 $5,536,069
Cost of Sales ($2,132,100) ($2,281,347) ($2,395,414) ($2,491,231)
Gross Profit $2,605,900 $2,788,313 $2,927,729 $3,044,838
Operating Costs ($1,421,400) ($1,520,898) ($1,330,786) ($1,107,214)
Operating Profit $1,184,500 $1,267,415 $1,596,943 $1,937,624
Explanation:
Pay attention to the calculation of the following amounts :
Sales - These are based on increments per quarterCost of Sales - The Cost for quarter is at 45% of RevenueOperating Costs - Based on Sales amounts ( 30 % in the first two quarters , 25% in third and 20% in the 4th quarter.)The following data concerns a proposed equipment purchase: Cost$144,000 Salvage value$4,000 Estimated useful life 4years Annual net cash flows$46,100 Depreciation methodStraight-line Ignoring income taxes, the annual net income amount used to calculate the accounting rate of return is:
Answer: $74,000
Explanation:
The Average Investment refers to the average cash invested into a particular project and is useful in calculating the rate of return. The simple formula is to add the beginning value of the asset to its ending value and divide this by 2.
The ending value in this case would be the salvage value;
Average Investment = [tex]\frac{Beginning Cost of Machine + Salvage Value}{2}[/tex]
= [tex]\frac{144,000 + 4,000}{2}[/tex]
= $74,000
Giannitti Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the upcoming year appear below: Estimated machine-hours 72,700 Estimated variable manufacturing overhead $ 3.30 per machine-hour Estimated total fixed manufacturing overhead $ 838,730 The predetermined overhead rate for the recently completed year was closest to:
Answer:
The predetermined overhead rate for the recently completed year was closest to: $11.54 per machine-hour
Explanation:
Predetermined Overheads = Budgeted Fixed Overheads / Budgeted Activity
= $ 838,730 / 72,700
= $11.536864 or $11.54 per machine-hour.
A researcher who has no concern for issues of control or ability to generalize, instead choosing focus on providing rich descriptions would be following the _________ approach.
A. positivistic/empirical
B. interpretive
C. critical
D. scientific
Answer:
B. interpretive
Explanation:
A researcher who has no concern for issues of control or ability to generalize, instead choosing focus on providing rich descriptions would be following the interpretive approach.
In an interpretive approach to research, researchers are mainly focused on deciphering detailed meaning or rich descriptions so they can have a better understanding of the subject matter.
Under interpretive study, it is assumed that the meaning associated with matters are subjective and inter-subjective depending on their perception, thus researchers attempt to understand matters through the meanings attached by individuals in the sampling population.
Hence, interpretive researchers assume that issues are not singular or objective but depends on various human experiences.
A. Suppose the wages of computer-factory workers rises. This will cause (the supply / the demand) of tablet computers to (shift in / shift out) , causing tablet computer price to (rise / fall) and quantity to (rise / fall) .
B. Suppose the price of notebook computers (a substitute for tablets) falls. This will cause (the supply / the demand) of tablet computers to (shift in / shift out) , causing price of tablet computers to (rise / fall) and quantity to (rise / fall) .
C. Suppose the number of tablet computer manufacturers rises. This will cause (the supply / the demand) the supply the demand of tablet computers to (shift in / shift out) , causing price to (rise / fall) and quantity to ( (rise / fall) .
D. Suppose an exciting new game is released that is only available on tablet computers. This will cause the supply / the demand the supply the demand for tablet computers to (shift in / shift out) , causing tablet computer price to (rise / fall) and quantity to (rise / fall) .
E. Suppose the prices for popular apps (complements to tablet computers) rise. This will cause (the supply / the demand) the supply the demand of tablet computers to (shift in / shift out) , causing tablet computer price to (rise / fall) and quantity to (rise / fall) .
Answer:
Supply, shift in , rise fall
the demand, shift in, fall ,fall
supply , shift out fall, rise
the demand , shift out rise rise
the demand shift in fall fall
Explanation:
If the wages of factory worker increases, it becomes more expensive to hire workers, the cost of production increases and the demand for labour would fall. as a result, production would fall and the supply of tablets would fall. a decrease in supply leads to an inward shift of the supply curve. as a result of the fall in supply, quantity would fall and there would be a rise in price.
Substitute goods are goods that can be used in place of another good. If the price of notebooks falls, it becomes cheaper to purchase notebooks, so the quantity demanded of notebooks would rise and the demand for tablets would fall since it is cheaper to buy a tablet. the demand curve for tablets would shift in as a result of the fall in demand. As a result, price and quantity of tablets would fall.
Increase in the number of manufactures would lead to an increase in supply. this would cause a rise in the supply of tablets. when there is a rise in supply, the supply curve shifts out, prices fall and quantity increases.
the new game would increase demand for tablets because people would be interested in playing the game. as a result of the rise in demand, the demand curve would shift out, the quantity would rise and prices would rise
A complement is a good that is consumed together with another good. if the price of apps rise, it would become more expensive to buy apps as result the demand for tablets would fall. the demand curve would shift in and price and quantity would fall
When the wages of factory worker increases, it becomes more expensive to hire workers, also the cost of production increases, and also the demand for labor would fall. as a result, when the production would fall also the supply of tablets would fall. when a decrease in supply leads to an inward shift of the supply curve. Although as a result of the fall in supply, the quantity would fall, and also there would be a price rise.
When Substitute goods are goods that can be used in place of another good. also If the price of notebooks falls, it becomes cheaper to purchase notebooks, so the quantity demanded of notebooks would rise, and also the demand for tablets would fall since it is cheaper to buy a tablet. the demand curve for tablets would shift in as a result of the fall in demand. So As a result, the price and also the number of tablets would fall.
When Increase in the number of manufacturers would lead to an increase in supply. this would cause a rise in the supply of tablets. when there are a rise in supply, the supply curve shifts out, prices fall, and also quantity increases.
When the new game would increase demand for tablets because people would be interested in playing the game. So as a result of the rise in demand, the demand curve would shift out, the quantity would rise and also prices would rise
Thus A complement is a good that is consumed together with another good. if the price of apps rises, it would become more expensive to buy apps as a result the demand for tablets would fall. Then the demand curve would shift in and price and also quantity would fall
Find out more information about Demand and supply here:
https://brainly.com/question/12252562
An organization is required to know, track, and record the location of all hazardous materials that it owns, controls, or generates. Group of answer choices True False
Answer: True
Explanation:
An organization is required to know, track, and record the location of all hazardous materials that it owns, controls, or generates.
It is important for the organizations to track, know and record the location of every hazardous materials it uses in order to keep the individuals in the society safe and also keep the company active.
The trial balance for Skysong, Inc. appears as follows: Skysong, Inc. Trial Balance December 31, 2022 Cash $280 Accounts Receivable 480 Prepaid Insurance 75 Supplies 166 Equipment 3680 Accumulated Depreciation, Equipment $550 Accounts Payable 353 Common Stock 1100 Retained Earnings 1290 Service Revenue 2768 Salaries and Wages Expense 920 Rent Expense 460 $6061 $6061 If, on December 31, 2022, the insurance still unexpired amounted to $18, the adjusting entry would contain a:
Answer:
Debit Insurance expenses for $57
Credit Prepaid insurance for $57
Explanation:
From the Trial Balance, Prepaid Insurance is $75. Since on December 31, 2022, the insurance still unexpired amounted to $18, the insurance expenses for the year can therefore be calculated as follows:
Insurance expenses = $75 - $18 = $57
The adjusting entries will therefore be as follows:
Particulars Dr ($) Cr ($)
Insurance expenses 57
Prepaid insurance 57
(To record insurance expenses for the year.)
Note that the amount of $18 unexpired insurance will now be the Prepaid insurance that will appear as an asset under the Current Asset in the balance sheet, while the $57 insurance expenses will be charged as an expense in the income statement.
Solt Corporation uses a job-order costing system and has provided the following partially completed T-account summary for the past year. Finished Goods Bal. 1/1 38,000 Credits ? Debits ? Bal. 12/31 50,000 The Cost of Goods Manufactured for the year was $415,000.The unadjusted Cost of Goods Sold for the year was:
Answer:
The unadjusted Cost of Goods Sold for the year was: $403,000
Explanation:
Calculation of Cost of Goods Sold
Opening Finished Goods Inventory $38,000
Add Cost of Goods Manufactured for the year $415,000
Less Ending Finished Goods Inventory ($50,000)
Cost of Goods Sold $403,000
"A market maker enters a quote of $20.50 Bid; $21.00 Ask; with a size of "5 x 5" into the NASDAQ System. If a market order to buy is entered into the system for 1,500 shares, and this dealer's quote is matched, the market maker will be obligated to sell:"
Answer: 500 shares at $21.00
Explanation:
A market maker is one who buys and then sells security from which the stated market is made into, and using the account of the the firm. It should be noted that a market order to buy will have to be matched in sequence.
Therefore, if a market order to buy is entered into the system for 1,500 shares, and this dealer's quote is matched, the market maker will be obligated to sell 500 shares at $21.00.
A growing population encourages economic growth as it creates a larger workforce. Suppose a surge in immigration increases a country's total population and its overall economic output increases. As a result, the country's real GDP increases from $304,000 to $316,500. What is the percent change in real GDP
Answer:
4.11%
Explanation:
the percentage change in real GDP = [(new real GDP - old real GDP) / old real GDP] x 100 = [($316,500 - $304,000) / $304,000] x 100 = 4.11%
Generally a surge in immigration will result in both higher nominal and real GDP, but what should be more important is how real GDP per capita changes. If real GDP per capita increases, then the inflow was positive and made the economy grow for better. If real GDP per capita decreases, even if total real GDP increases, then the economy is not doing better.
Jacobsen Corporation prepares its financial statements applying U.S. GAAP. During its 2016 fiscal year, the company reported before-tax income of $621,000. This amount does not include the following two items, both of which are considered to be material in amount: Unusual gain $201,000 Loss on discontinued operations (301,000) The company's income tax rate is 30%. In its 2016 income statement, Jacobsen would report income from continuing operations of:
Answer:
Jacobsen Corporation
Income from continuing operations of $621,000 will be reported.
Explanation:
The income from continuing operations is the same thing as the operating income. It is the pre-tax income that is reported on Jacobsen Corporation's income statement for the year ended December 31, 2016. The tax rate of 30% is applied on this figure to obtain the income tax expense for the year. But, for Jacobsen that has other unusual items, these are taken into consideration before the income tax is imputed to obtain the after-tax income.
1. A small-scale businessman deposits money at the beginning of each year into his savings account, depending on the level of the business’ returns. He deposits $1000 in the first year, $3000 in the second year, $5000 in the third and $7000 in the fourth year and annual interest rate of 7%. What is the value of the investment at the time of his first deposit?
Answer:
The value of the investment at the time of his first deposit is $1,000.
At the end of the first year, the investment will be worth $1,070.
Explanation:
The value of a deposit investment is determined by the interest rate and time. Time affects the value of an investment by this small-scale businessman in many ways. The passage of time increases the value of his investment. However, the total increase may not be due to the interest rate, but inflation also affects asset's value. For this businessman to make a gain in the investment, the interest rate must be higher than the inflation rate. Otherwise, the investment loses money due to the effects of inflation, which reduces the real value of an asset over time.
F Mining has $6 million in sales, its ROE is 20%, and its total assets turnover is 3.2x. The company has 40% equity financed (i.e., equity multiplier is 2.5). What is its net income? (DuPont analysis)
Answer:
$0.15 million
Explanation:
The formula for ROE can be used as a stepping stone to determining the value of net income:
ROE=Profit margin*Total asset turnover*Equity multiplier
ROE is 20%
total asset turnover is 3.2
equity multiplier is 2.5
20%=profit margin*3.2*2.5
20%=profit margin*8
profit margin=20%/8=2.5%
The formula for profit margin can now be used to determine net income.
profit margin=net income/sales
2.5%=net income/$6 million
net income=$6 million*2.5%
net income=$0.15 million
Which of the following statements are true?
A. Different companies will use different charts of accounts based on individual company need.
B. The chart of accounts contains the balance of all the accounts in the ledger.
C. The general ledger contains all of the accounts that a company uses, along with detail of the balances in those accounts.
D. The general ledger and the chart of accounts can be ordered in any sequence because they are not formal financial systems.
Answer:
TRUE: A. Different companies will use different charts of accounts based on individual company need.
C. The general ledger contains all of the accounts that a company uses, along with detail of the balances in those accounts.
Explanation:
A. Different companies will use different charts of accounts based on individual company need.
A chart of accounts is the combination of all the accounts of an organization in an organized and structured model whose objective is to establish a codification so that there is a standardization of the company's financial information to assist the work of the accounting sector.
Therefore, each company will have a model chart of accounts referring to its activities and processes.
C. The general ledger contains all of the accounts that a company uses, along with detail of the balances in those accounts.
The general ledger can be defined as the set of all accounts held in the organization in detail.
Through the information in the accounts, the organization is able to correctly separate each one by type and carry out the organizational financial statement.