When we take taxes into account, MM's 1958 Proposition could no longer hold, and the capital structure can be essential because of:____________.
a. higher operating income from lower dividends.
b. interest tax shield.
c. higher tax rates on retained earnings than on debt.
d. lower tax rates on dividends than on debt.

Answers

Answer 1

Answer:

MM's 1958 Proposition

When we take taxes into account, MM's 1958 Proposition could no longer hold, and the capital structure can be essential because of:

b. interest tax shield.

Explanation:

The propositions of Miller and Modigliani are that a firm's market value does not depend on the capital structure and the cost of equity increases as the percentage of debt increases.

But, when taxes are accounted for, MM's Propositions are no longer tenable, because debts provide interest tax shield and the market value of a firm is impacted by debts' interests and the tax shield that interests provide.  Tax burden is reduced with interests on debts.  This increases the Earnings per share, an important element in the valuation of a firm's market value.

Answer 2

The cause due to which capital structure is significant as per MM's 1958 proposition would be:

B). Interest tax shield.

MM's 1958 Proposition

The propositions made by MM i.e. Miller and Modigliani state that the value of a specific firm must not rely upon the capital structure it possesses.

They rather laid emphasis on calculating the worth by deducting that the tax shield is being displayed due to the interests received on the debts owned by the company.

This leads the firms to release their burden of taxes by shielding it through debts and as a result, the income increases. Therefore, this element must be involved while calculating the value of the firm.

Thus, option B is the correct answer.

Learn more about "Income Tax" here:

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Related Questions

Does anyone know how to start your own business as a teen? I am trying to start my own beauty business, with face products etc. Also I need name ideas one of that I was thinking of was Natural Beauty. Since I am going to be selling all natural products

Answers

Answer:

i'm no expert but, i think first start out with ideas of the business u wanna do and keep adding on to those ideas you already have and find a business idea you know you can invest in and stick to that business so you can make money you want and supply the products people want and need so, that your making money to help yourself out in life and their getting supplies that are good and don't have harsh chemicals so, it doesn't result in you losing money. Also Natural Beauty is a good name but, i think you might like these three name ideas but, if not its okay go with the name you want since it's your business. Here are the name ideas Natural Essentials, Clear Beauty, or Organic Beauty Essentials.

Answer:

Many small business owners decide to set up an LLC for the liability protection it provides. An LLC, or limited liability company, exists separately from its owners (known as members), and the owners are therefore not personally responsible for business debts.Most states don’t allow two different business entities to have the same name. So you can’t, for example, have “Joe’s Donuts, LLC” and “Joe’s Donuts, Inc.,” even if they’re located in different cities. Many states also restrict companies from using certain words in their names, such as “bank.” If the LLC name you’ve selected is available, but you aren’t going to be filing your LLC documents right away, you may want to reserve the name. Nearly every state allows you to reserve a name by filing a form and paying a name reservation fee. The length of the reservation period, filing fees, and renewal policies vary from state to state.Almost every state requires its LLCs to name a registered agent (also sometimes called a statutory agent). A registered agent is a person who agrees to receive lawsuits, subpoenas and other official documents on behalf of the LLC and to pass them along to the appropriate person at the LLC.An LLC operating agreement is the roadmap that describes how your LLC will be run. It specifies such things as the ownership interests and voting rights of the members, how profits and losses will be allocated, how meetings will be held, how the business will be governed, the rights of the members if one of them dies or leaves the business, and the way the company will be dissolved if it goes out of business.Each state has its own form and procedure for establishing an LLC. In general, you must file articles of organization that list.After the LLC’s formation documents are filed and approved, the state will issue a certificate or other document that confirms that your LLC formally exists. Once you’ve received the certificate, you can take care of business matters like obtaining a tax ID number and business licenses and setting up a business bank account. Explanation:If your LLC does business in more than one state, you may need to register to do business in other states. To do this, you’ll need to fill out and submit paperwork that’s similar to the paperwork you filed when you formed your LLC. You’ll also need a registered agent in each state where you are authorized to do business.

Ashley is an attorney and also an excellent typist. She can type 120 words per minute, but she charges attorney fees at $100 per hour. Benjamin would like some typing work but can only type 60 words per minute. According to the law of comparative advantage, Ashley should hire Benjamin to do her typing if and only if his wage rate is less than:__________

Answers

Answer:

$50 / hr

Explanation:

The law of comparative advantage states that an entity should be able to produce its goods and services at a lower opportunity cost compared others in the same line of business so as to have an edge in the market.

Looking at the scenario ,if Ashley can type 120 words in a minute and also earn $100 / hr as an attorney , the opportunity cost of settling for the attorney work is the income earned through typing.

The law states that goods and services should be produced at a cost lower to the opportunity cost. To Ashley , the cost of hiring Benjamin should not be more than half of her hourly income as Benjamin production rate is half of hers.

Seymore named his wife, Penelope, the beneficiary of a $100,000 insurance policy on his life. The policy provided that, upon his death, the proceeds would be paid at a rate of $4,000 per year plus interest over a 25-year period. Seymore died June 25 of last year, and in the current year Penelope received a payment of $5,200 from the insurance company. What amount should she include in her gross income for the current year

Answers

Answer:

$1,200

Explanation:

The reason is that out of $5,200, $4,000 is the amount that Penelope receives as capital asset proceeds as this $4,000 reduces the insurance policy worth by $4,000. Hence it is insurance policy proceeds and is exempt from tax. The remainder $1,200 is interest earnings per year which must be included in the gross income for current year as it is taxable income.

Why are GNP figures generally lower than the GDP figures in
South Africa?

Answers

Answer:

GDP stands for gross domestic product and includes the market value of all the finished and legal goods and services produced within a country during one year. While the GNP refers to gross national product and it measures the total market value of all the finished and legal goods produced by the citizens (including individuals and businesses) of a country.

Generally in developing countries, like South Africa, there are a lot of foreign multinational corporations that operate there. Their operations are included in the GDP, but since they are American, European or Asian multinational corporations, their operations are included in the GNP of their respective countries, not South African GNP.

Select the balance sheet category where the items given would typically
Items Balance Sheet Category
1. Cash equivalents Current assets
2. Bond investment to be held through maturity in five years Long-term investments
3. Land not currently used in operations Plant assets
4. Equipment Plant assets
5. Trademarks Intangible assets
6. Wages Payable Current liabilities
7. Bonds payable Long-term liabilities
8. Short-term note payable Current liabilities

Answers

Answer and Explanation:

The balance category is shown below:-

Current assets are those assets that are converted into cash within one year for example inventory, accounts receivable, etc.

Fixed assets are those assets that are to be considered as to be long term that is 3 years, 5 years, etc. For example land, building, machinery, etc.

1. Cash equivalents                                        Current assets

2. Bond Investment                                           Investment

3. Land not currently used in operations        Fixed assets

4. Equipment                                                   Plant assets

5. Trade marks                            ( Other assets) Intangible assets

6. Wages payable                                     Current liabilities                                         7. Bonds payable                                         Long term liabilities                      

Short - term note payable                       Current liabilities

Suppose Asarta Inc. is polluting yucko and they have been tasked with cleaning up some of their waste. The company decides to clean up Q tons of yucko—are they cleaning up enough?

Answers

Answer: The answer is No, because the MB > MC

Explanation:

They are not cleaning up enough because the MB>MC. Therefore, all other options which cut across - Yes, because the MC > MB,

No, because the MB > MC,

Yes, because the MB > MC and

No, because the MC > MB are wrong.

Clarion Township was approved for a grant from the federal government. The grant provides for reimbursement up to $200,000 for expenditures incurred to weatherize homes for low-income persons. Upon notification that the grant had been approved, but before weatherization activities have begun, Clarion Township should:

Answers

Answer:

Make no journal entry

Explanation:

A journal entry is defined as a record of a financial transaction by an entity. Economic and non economic transactions are recorded in the accounting journal to show debits and credits of the business.

In this scenario Clarion Township was approved for a grant from the federal government.

However upon notification of the approval no journal entry is to be recorded because weatherization has not started, so no expense has been incurred.

Journal entry is only made when cost is incurred or revenue is earned.

The CEO of peripheral company QuickDrive uses a leadership style that encourages employees to discuss management issues with the CEO and to work together to resolve those issues in a democratic manner. Which of the following statements would the CEO of QuickDrive most likely make?
A) The key to QuickDrive staying on top in a high-tech industry is not wasting time checking out what other firms do, but to act immediately on my directives.
B) In a high-tech business, it is more important to invest in technology than to invest in people.
C) The key to keeping talented employees loyal to QuickDrive is to use a participative management style and treat them with respect, value their ideas, give them the resources they need, and expect great things from them.
D) Spending a lot of money to buy out competitors for their technology is likely to backfire, because QuickDrive is a leader in technology development.

Answers

Answer:

C) The key to keeping talented employees loyal to QuickDrive is to use a participative management style and treat them with respect, value their ideas, give them the resources they need, and expect great things from them.

Explanation:

As for the statement in the question, we can see that the CEO of QuickDrive believes that the ky to success is to engange employees in an active manner.

Employees, instead of being people who only go to work and perform certain tasks, become collaborative with management, taking up the role of management often.

This lack of rigidity and free flow of ideas from top of the company to botton will likely result in a business enviroment that promotes sense of belonging, and rapid adaptation to change.

Aria’s, Inc. has 1,000 shares of 5%, $100 par value cumulative preferred stock and 10,000 shares of $1 par value common stock outstanding. The company has not paid dividends in two years. In its third year, it paid the common shareholders a $2 per-share dividend, plus the amount owed to preferred shareholders. What is the total amount of dividends paid?

Answers

Answer:

The total amount of dividends paid by Aria’s, Inc. is $30,000.

Explanation:

The total amount of dividends paid by Aria’s, Inc. can be obtained by adding the dividends paid to common shareholders and preferred stockholders as follows:

Annual dividend paid to cumulative preferred stockholders = Number of cumulative preferred shares * Par value of the share * Dividend rate = 1,000 * $100 * 5% = $5,000

Since Aria’s, Inc. has has not paid dividends in two years, the total dividend paid to cumulative preferred stockholders is as follows:

Total dividend paid to cumulative preferred stockholders = Annual dividend paid to cumulative preferred stockholders * 2 = $5,000 * 2 = $10,000

Dividend paid to common stockholders = Number of common shares * Common shares dividend per share = 10,000 * $2 = $20,000

Therefore, we have:

Total amount of dividends paid = Total dividend paid to cumulative preferred stockholders + Dividend paid to common stockholders = $10,000 + $20,000 = $30,000

Therefore,  the total amount of dividends paid by Aria’s, Inc. is $30,000.

Which identification number is the most important component of your personal identity?
A.
debit card PIN
B.
credit card PIN
C. employee ID of the company
D.
social security number
E.
bank account number

Answers

D, social security number

Answer:

D.

social security number

Explanation:

This is because that number allows the government to keep track of your lifetime earnings and years you have worked

Springfield Company offers a bonus plan to its employees and the amount of the employee bonuses for the current year is estimated to be $32,500 to be paid during January of the following year. The journal entry on December 31 to record the bonuses is:________.
A) Debit Estimated Bonus Payable $32,500; credit Cash $32,500.
B) Debit Employee Bonus Expense $32,500; credit Bonus Payable $32,500.
C) No entry since the bonuses are not paid until January.
D) Debit Employee Bonus Expense $32,500; credit Prepaid Employee Bonus $32,500.
E) Debit Unearned Bonuses $32,500; credit Bonus Payable $32,500.

Answers

Answer:

Springfield Company

The unpaid Employee Bonuses will have a journal entry as follows:

B) Debit Employee Bonus Expense $32,500; credit Bonus Payable $32,500.

Explanation:

Springfield Company had already incurred the bonus for the accounting period.  It must be recognized as an expense in the year in accordance with the accrual concept and the matching principle of generally accepted accounting principles.  These require that expenses must be recognized not on cash basis but on accrual basis and that any expense relating to an accounting period must be matched to revenue of that period.

Item 28Item 28According to the _________ concept, a firm must (1) find out what customers want and provide it, (2) make sure everyone in the organization has customer satisfaction as an objective, and (3) provide goods and services that will earn a profit.

Answers

Answer:

Marketing concept.

Explanation:

The marketing concept can be defined as a concept which suggests a firm to examine the needs of customers, satisfy their needs, and work to earn profit. The concept of marketing emerged after the World War 2 when customers had a choice to buy a certain product that meet their changing needs.

There are five types of marketing concepts.

The Production ConceptThe Product ConceptThe Selling ConceptThe Marketing ConceptThe Societal Marketing Concept

So, the correct answer is that it is the marketing concept that performs the stated functions.

Cliff Company traded in an old truck for a new one. The old truck had a cost of $75,000 and accumulated depreciation of $60,000. The new truck had an invoice price of $125,000. Huffington was given a $12,000 trade-in allowance on the old truck, which meant they paid $113,000 in addition to the old truck to acquire the new truck. If this transaction has commercial substance, what is the recorded value of the new truck

Answers

Answer: $125,000

Explanation:

If the above transaction in the question has commercial substance, the recorded value of the new truck will be the trade in allowance of $12,000 on the old truck in addition to the $113,000 that was paid to get the new truck.

Mathematically expressed, this will be:

= $113,000 + $12,000

= $125,000

Uniway Technologies Inc. has based its manufacturing units in the country of Lanthania. The country's stable economic and political environment has helped the firm gain competitive advantage by lowering its production costs and improving product quality. Other things being equal, the benefits realized from such a strategy can be typically referred to as _____.

Answers

Answer:

location economies

Explanation:

Location economics refers to the economics in which the firm is able to find the location for their goods and services. It reflects the utilization setting for company goods. Also the production of goods using the optimum setting brings the extra advantage over the rivals.

Therefore according to the given situation, if it gained competitive advantage via improving the quality of products at less production cost keeping other things constant, the benefit gained from this strategy refers to the location economics

According to Michael Porter, businesses can compete successfully by doing which of the following? A. being the cheapest producer B. making unique products valued by consumers C. applying their expertise in a narrow market segment to meet that segment’s particular product or service needs D. any of these

Answers

Answer:

D. any of these

Explanation:

Competitive strategy means intentionally selecting a distinct set of tasks to produce a compelling value proposition.  Michael Porter focused on the topic of international competition. He consulted international governments on their economic strategies and led the U.S. Presidential Commission. Porter's strategies explain how a business upholds competitive advantages across the whole concerned market context.

The pharmaceutical industry argues that because new drugs will not be developed unless heavy development costs can be recouped in later sales, the current 20 years of protection provided by patents should be extended in the case of newly developed drugs. However, in other industries new-product development continues despite high development costs, a fact that indicates that the extension is unnecessary.
Which of the following, if true, most strongly supports the pharmaceutical industry’s argument against the challenge made above?
(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection.
(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete.
(C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry.
(D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug.
(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective.

Answers

Answer:

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete.

Explanation:

This option supports the pharmaceutical industry's claim because the research and development time of a new drug can be as long as half its patent life. Generally R&D on other industries takes a much shorter time, or at least not as much as half the patent's life.

Personally I would agree with the pharmaceutical industry if in exchange they would sell their drugs in the US at the same price as they are sold in Canada or Europe, or any other country in the world. The patent extension would benefit them and reduce the price of drugs by 80-90% in the US. I'm certain that the later would never happen, because the US is by far the largest cow milk for pharmaceutical companies because it is the only countries where the price of legal drugs is not regulated.

Even Better Products has come out with a new and improved product. As a result, the firm projects an ROE of 20%, and it will maintain a plowback ratio of 0.30. Its projected earnings are $2 per share. Investors expect a 14% rate of return on the stock.

a.
At what price and P/E ratio would you expect the firm to sell? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Price $
P/E ratio
b.
What is the present value of growth opportunities? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

PVGO $
c.
What would be the P/E ratio and the present value of growth opportunities if the firm planned to reinvest only 20% of its earnings? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

P/E ratio
PVGO $

Answers

Answer and Explanation:

The computation is shown below:

a. The price and P/E ratio is

Price = Current year dividend ÷ (Required rate of return - growth rate)

where,

Growth rate is

= ROE × plowback ratio

= 20% × 0.30

= 6%

And, the current year dividend is ×

= $2 × (1 - 0.30)

= $1.4

So, the price is

= $1.4 ÷ (0.14 - 0.06)

= $17.50

Now the P/E ratio is

= $17.50  ÷ 2

= 8.75

b)  For the present value of growth opportunities, the formula and the computation is

= Price of the stock - earnings ÷ required rate of return

= $17.50 - $2 ÷ 0.14

= 3.21

c)  The P/E ratio and the present value of growth opportunities is

But before that we need to find out the price which is

Price = Current year dividend ÷ (Required rate of return - growth rate)

where,

Growth rate is

= ROE × plowback ratio

= 20% × 0.20

= 4%

And, the current year dividend is

= $2 × (1 - 0.20)

= $1.6

So, the price is

= $1.6 ÷ (0.14 - 0.04)

= $16

Now the P/E ratio is

= $16  ÷ 2

= 8

And, the growth opportunities is

= Price of the stock - earnings ÷ required rate of return

= $16 - $2 ÷ 0.14

= 1.72

Assume that Matt, Joe, and Teresa are the only citizens in a community. A proposed public good has a total cost of $1,000. All three citizens will share an equal portion of this cost in taxes. The benefit of the public good is $500 for Matt, $280 for Joe, and $260 for Teresa. In a majority vote, this proposal will most likely be

Answers

Answer: Defeated; two against and one in favor

Explanation:

The options to the question are:

a. Accepted; two in favor and one against

b. Defeated; two against and one in favor

c. Accepted; three in favor and none against

d. Defeated; none in favor and three against

A majority vote is a voting system whereby the person who wins is the person that has more than fifty percent of the vote.

In this question, we are told that Matt, Joe, and Teresa will share an equal portion of this cost in taxes and that the benefit of the public good is $500 for Matt, $280 for Joe, and $260 for Teresa.

In a majority vote, this proposal will most likely be defeated as there will be two against and one in favor. Joe and Teresa will be against it ane only Matt will be in support as he will receive more in benefit than the others.

Brokerage relationships must be disclosed in writing prior to : Eliciting or accepting confidential information from a buyer concerning buyer's real estate needs, motivation, or financial qualifications

Answers

Answer:

Correct

Explanation:

Brokerage relationships must involve both parties signing an agrerment to the relationship. This means that there must be a written agreement signed by both parties that the agent(broker) will represent the other party exclusively in the transaction. This agreement should be available and should be disclosed in writing before the broker can go ahead to represent the buyer on-call transactions that will involve buyers confidential information

Determining firm performance is a complex interaction of firm effects and industry effects, with other factors also considered. Based on historical analysis, what do we know about firm and industry effects

Answers

Answer and Explanation:

As per the historical analysis the explanation is shown below:-

a. Management decisions have a major role to play in firm results, rather than firm impact.

b. The influence of macro-environmental effects like recession is greater than that of either firm or industrial effects.

c. The firm effects have a greater impact on results than on the effects on industry.

d. The effects of the industry get more effect on results than firm effects.

________________ focuses on explaining the differences between planned and actual contribution margins. a.Contribution margin analysis b.The unit cost factor c.The quantity factor d.The unit price factor

Answers

Answer: A.) Contribution Margin analysis

Explanation: The contribution margin analysis could be explained as an analytical tool in accounting which helps managers in observing variation or differences in the budgeted and actual contribution margin of a product. The contribution margin is used to determine the revenue made on a product after deducting the fixed cost incurred in it's production. It is also used to evaluate the performance of individual product derived from the amount of residual profit after deducting necessary production cost.

The selection of levels of activity to depict a flexible budget:__________.
1. will be within the relevant range.
2. is largely a matter of expediency.
3. is governed by generally accepted accounting principles.

Answers

Answer:

1 and 2

Explanation:

A flexible budget is a budget in which there is a change in the volume or the change in activity so that it becomes so sophisticated

While on the other hand under the static budget the values would remain the same

So at the time of selection for activity levels, it should be within relevant change and expediency matter H

Hence, the first two statements are correct

The Credit Alliance v. Arthur Andersen & Co. case established three tests that must be satisfied for holding auditors liable for negligence to third parties. All of the following are tests described except :________.
a) Knowledge by the accountant that the financial statements are to be used for a particular purpose.
b) The intention of the third party to rely on those statements.
c) Some action by the accountant linking hi or her to the third party than provides evidence of the accountant's understanding of intented reliance.
d) The identity of the third party must be directly known to the auditor.

Answers

Answer:

D.

Explanation:

The Credit Alliance v. Arthur Andersen & Co. is a case that questions if an accountant should be held liable to the third party on whom it is reliable to his detriment absent privity of contract.

The Court of Appeals of New York, on July 2, 1985, affirmed that an auditor should not be held liable if they fulfill the following three requirements.

The auditor should have knowledge that the financial statements will be used for a particular purpose.The intention of the third party to rely on those statements. Some action should have been there by the acccountant that links him or her to the third party which will clarify the auditor to understand why third party is relying in the statement.

So, from the options stated in the question, one that is not included in this case is the fourth one. Thus the correct answer is option D.

Sandra Stone, Vice President of International Operations for Global Apparel Corporation, was working with her subordinate, Pete Thompson, to plan for his upcoming 18-month overseas assignment to the firm's new office in Rome. Based upon her experience with previous failed overseas assignments, she was taking steps to avoid another failure. Therefore, one of the key features of Sandra's plan for Pete was to

Answers

Answer: develop a reentry plan for Pete prior to the completion of the overseas assignment.

Explanation:

The options to the question are:

A. develop a reentry plan for Pete prior to the completion of the overseas assignment.

B. limit communication to every-other-month status phone calls so as to not micromanage Pete.

C. save costs by avoiding a "look-see" trip for Pete and his family, given Pete's enthusiasm.

D. develop performance measures after Pete had completed his first year.

E. develop the assignment "on the fly" given the uncertainties involved.

From the question, we are informed that Sandra Stone, Vice President of International Operations for Global Apparel Corporation, was working with her subordinate, Pete Thompson, to plan for his upcoming 18-month overseas assignment to the firm's new office in Rome.

We are further told that based upon her experience with previous failed overseas assignments, she was taking steps to avoid another failure. Therefore, one of the key features of Sandra's plan for Pete was to develop a reentry plan for Pete prior to the completion of the overseas assignment. This will help to prevent another failed overseas assignment.

Hector Aguerra is interested in making a lot of money. He is a very good salesperson. People tell him he could sell sand in Saudi Arabia! He is also a very hard worker, and is willing to work a lot of hours to make the kind of money he wants. Hector should most likely look for the kind of job that is paid:_________
A. on salary with overtime.
B. by commission.
C. with a high hourly rate.
D. in a situation with team-based compensation.

Answers

Answer:

B

Explanation:

Hector is best suited to work as as a sales or advertising agent due to his high selling skills. Sales agents are usually paid in commissions. He would also be able to earn the type of money he wants by choosing the number of hours he chooses to work

In a perpetual average cost system:_________
a) A new weighted-average unit cost is calculated each time additional units are purchased.
b) The cost allocated to ending inventory is generally the same as it would be in a periodic inventory system.
c) The moving-average unit cost is determined following each sale.
d) The average is determined by dividing the total number of units sold by the cost of units purchased during the period.

Answers

Answer:

a) A new weighted-average unit cost is calculated each time additional units are purchased

Explanation:

Perpetual Inventory system is the method of recalculating the value of goods held after each transaction.

In Weighted Average Cost Method, the average cost of goods held is recalculated each time a new delivery of goods is received. Issues are then priced at this weighted average cost.

Geraths Windows manufactures and sells custom storm windows for three season porches and also provides installation service for the windows. The installation process does not involve changes in the windows, so this service can be performed by other vendors. Geraths enters into the following contract on July 1, 2014, with a local homeowner. The customer purchases windows for a price of $2,690 and chooses Geraths to do the installation. Geraths charges the same price for the windows irrespective of whether it does the installation or not. The price of the installation service is estimated to have a fair value of $590. The customer pays Geraths $2,300 (which equals the fair value of the windows, which have a cost of $1,700) upon delivery and the remaining balance upon installation of the windows. The windows are delivered on September 1, 2014, Geraths completes installation on October 15, 2014, and the customer pays the balance due.
Prepare the journal entries for Geraths in 2014. (Round answers to 0 decimal places, e.g. 5,275.)

Answers

Answer:

Kindly check Explanation

Explanation:

1st of July 2014:

No journal entry Dr.

No Journal entry Cr.

1st of September 2014:

CASH 2300 Dr.

ACCOUNTS RECEIVABLE 390 Dr.

INVENTORY 1700 Cr.

SALES REVENUE (2300/2890)×2690 - - 2140.8 Cr

UNEARNED SERVICE REVENUE (590/2890)×2690 - - - 549.2 Cr.

15th October 2014 :

CASH (2690 - 2300) - - 390 Dr.

UNEARNED SERVICE REVENUE - - 549.2 Dr.

ACCOUNTS RECEIVABLE - - - 390 Cr.

SALES REVENUE - - - 549.2 Cr.

Containers, Inc., sends its standard order form to Distribution Corporation to evidence a sale of packing materials. Distribution responds with its own standard purchase order form. Additional terms in the purchase order automatically become part of the contract unless:________.

Answers

Please answer please please thank you

Suppose you own 50,000 shares of common stock in a firm with 2.5 million total shares outstanding. The firm announces a plan to sell an additional 1 million shares through a rights offering. The market value of the stock is $ 35 before the rights offering and the new shares are being offered to existing shareholders at a $ 5 discount. a.If you exercise your preemptive rights, how many of the new shares can you purchase? b.What is the market value of the firm after the rights offering? c.What is your total investment in the firm after the rights offering? How is your investment split between original shares and new shares? d.If you decide not to exercise your preemptive rights rather sell your rights, what is your investment in the firm after the rights offering? How is this split between old shares and rights?

Answers

Answer:

20,000 ; $117.5 million; $2,350,000; $1678500; $1,078,500

Explanation:

Given the following :

Number of common stock shares owned = 50,000

outstanding shares = 2.5 million

Additional shares = 1 million

Market value of stock before rights offering = $35

Net stock price for existing shareholders ($5 discount) = $(35 - 5) = $30

A.) If you exercise your preemptive rights, how many of the new shares can you purchase?

Number of stocks / (outstanding shares ÷ additional shares)

[(50,000) ÷ (2.5 ÷1)] = 50,000/2.5 = 20,000

B.) b.What is the market value of the firm after the rights offering?

(Outstanding shares * market price) + ( additional shares * discount price)

(2.5million * $35) + (1 million * $30)

$87.5 + $30 = $117.5 million

C.) What is your total investment in the firm after the rights offering?

(stock shares held before offering * market price) + ( new shares that can be purchased * discount price)

(50,000 * $35) + (20,000 * $30)

1750000 + $600,000 = $2,350,000

D.)

Number of common stock shares *new market value after Issuance

New Market value after Issuance :

Market value of firm after offering / (outstanding + additional shares)

$117,500,000 / (2.5+1)million

$117,500,000 / 3,500,000

= $33.57

50,000 * $33.57 = $1678500

11)

Revenue from right sale :

Number of right shares * discount price

20,000 * $30 = $600,000

Value of proceed :

$1678500 - $600,000 = $1,078,500

The biomedical division needs to hire the best biomedical engineers in the world to be competitive in this global industry, and competition to attract talent is stiff. Many of the most innovative engineers work for startups. What would be the most appropriate HRM approach

Answers

Answer:

Explanation:

Based on the information provided, it can be said that the most appropriate approach would be to acquire startups with talented employees and integrate these employees into the company's culture. These startup's would not only already have the talented employees that the biomedical division needs but those employees would also already have become accustomed to the team that they have been working within the startup. This would drastically increase their efficiency.

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