Answer:
A) according to the affordability formula Joe-Bob can take out another loan because his DTI is 36%
B) He should follow the affordability formula when he wants to take out loans
C) He should not follow DTI if he isn't taking out loans
D) Taking out a loan will negatively impact his other priorities if his DTI is very high or greater than 100%
Explanation:
using the affordability formula
The debt to income ratio = [tex]\frac{total debt}{gross income}[/tex]
total debt = mortgage payment + loan repayment = $900 + $350
= $1250
gross income = $3500
hence debt to income ratio = 1250 / 3500 = 0.3571 = 35.7%
A) according to the affordability formula Joe-Bob can take out another loan because his DTI is 36%
B) He should follow the affordability formula when he wants to take out loans
C) He should not follow DTI if he isn't taking out loans
D) Taking out a loan will negatively impact his other priorities if his DTI is very high or greater than 100%
a. According to the affordability formulas, Joe-Bob cannot afford to take out a car loan. His current DTI without the auto loan is almost 36%.
b. Joe-Bob should follow the affordability formulas to guide his decisions in taking a new loan.
c. Joe-Bob does not need to follow the affordability formulas when his debt to income ratio (DTI) is far below 36%. He can also avoid the affordability formulas when he has the prospect of increasing his monthly income.
d. If Joe-Bob takes out the car loan despite his poor rating on the affordability formulas, he may not afford to pay his bills for necessities.
Thus, Joe-Bob should not take on more loans now until he improves his income. An automobile will require routine maintenance and some repairs, including fuelling.
Data and Calculations:
Current monthly income = $3,500
Monthly mortgage payment = $900
Monthly student loan payment = $350
Total current debts = $1,250 ($900 + $350)
The Affordability Formula (Current Debt Payment to Income Ratio) =
35.7% ($1,250/$3,500 x 100)
The Affordability Rule states that Joe-Bob should not spend more than 36% of his monthly income repaying loans.
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The revenue is $94,000, the cost of goods sold is $51,000, other expenses (from selling and administration) are $21,000, and depreciation is $12,000. What is the EBIT?
Answer:
$10,000
Explanation:
EBIT is earnings before interest and tax
EBIT = Revenue - cost of goods sold - other expenses - depreciation
$94,000 - $51,000 - $21,000 - $12,000 = $10,000
David Ortiz Motors has a target capital structure of 45% debt and 55% equity. The yield to maturity on the company's outstanding bonds is 12%, and the company's tax rate is 40%. Ortiz's CFO has calculated the company's WACC as 11.35%. What is the company's cost of equity capital
Answer:
the company's cost of equity capital is 14.75 %.
Explanation:
WACC = ke × (E/V) + kd × (D/V)
Where,
ke = cost of equity
= this is unknown
E/V = Weight of Equity
= 55%
kd = cost of debt
= Interest × ( 1 - tax rate)
= 12% × ( 1 - 0.40)
= 7.20 %
D/V = Weight of Debt
= 45%
Therefore,
WACC = ke × (E/V) + kd × (D/V)
11.35% = 55%ke + 7.20 % × 45%
11.35% = 55%ke + 3.24 %
55%ke = 8.11 %
ke = 14.75 %
Horse and Buggy Inc. is in a declining industry. Sales, earnings, and dividends are all shrinking at a rate of 10% per year. a. If r = 15% and DIV1 = $3, what is the value of a share?
Answer:
$12
Explanation:
The computation of the value of the share is shown below:
Value of the share is
= Dividend ÷ (Required rate of return - shrinking rate)
where,
The Dividend is $3
The Required rate of return is 15%
And the shrinking rate is 10%
Now placing these values to the above formula
= $3 ÷ (15% - (-10%)
= $3 ÷ 25%
= $12
John is considering purchasing a commercial building. His accountant is working with him to determine the property’s value to John. The initial cost of an investment property plus the cost of any additional improvements less qualified deductions represents the:
Answer:
Adjusted basis
Explanation:
Adjusted basis in accounting is used to calculate the net value of an asset. This is done by reducing depreciation deductions from the original value and adding capital expenses like cost of improvement.
This method is best used when there is need to get accurate gain and loss records, and for tax purposes.
In the given scenario John's accountant is using the adjusted basis when he calculates initial cost of an investment property plus the cost of any additional improvements less qualified deductions
Preference decisions compare potential projects that meet screening decision criteria and will be ranked in their preference order to differentiate between alternatives with respect to all of the following characteristics except:________a. importanceb. desirabilityc. feasibilityd. political prominence
Answer:
D
Explanation:
Political prominence inst determined in any of the capital budgeting methods. Also, political prominence shouldn't be a deciding factor when making an investment. a project might be politically prominent but it is unprofitable or doesn't align to the goals of the company.
Palmer Corp. owned 20,000 shares of Dixon Corp. purchased in 2006 for $240,000. On December 15, 2009, Palmer declared a property dividend of all of its Dixon Corp. shares on the basis of one share of Dixon for every 10 shares of Palmer common stock held by its stockholders. The property dividend was distributed on January 15, 2010. On the declaration date, the aggregate market price of the Dixon shares held by Palmer was $400,000. The entry to record the declaration of the dividend would include a debit to Retained Earnings of
Answer:
Debit to Retained Earnings of $400,000
Explanation:
Based on the information given we were told that on the declaration date, the market price or the market value of the Dixon Corp shares that was been held by Palmer Corp was the amount of $400,000 which means that the entry to record the declaration of the dividend would include a debit to Retained Earnings of the amount of $400,000 which is the market value.
The entry to record the declaration of the dividend would include a debit to Retained Earnings of $400,000.
The following information should be considered:
Since the aggregate market price of the Eaten shares on the declaration date is $400,000.Therefore, at the time of recording the declaration of the dividend it should debited to the retained earning for $400,000Learn more: https://brainly.com/question/3617478?referrer=searchResults
Gladiator USA, a tire manufacturer, guarantees its tires against defects for five years or 60,000 miles, whichever comes first. Suppose USA can expect warranty costs during the five-year period to add up to of sales. Assume that a USA dealer in Denver, Colorado, made sales of during 2018. Gladiator USA received cash for % of the sales and took notes receivable for the remainder. Payments to satisfy customer warranty claims totaled during 2018. Record the sales, warranty expense, and warranty payments for Gladiator USA.
Answer:
DR Cash............................................$96,450
DR Notes receivable........................$546,550
CR Sales revenue...................................................$643,000
(To record sales)
DR Warranty expense .............................$32,150
CR Warranty liability.................................................$32,150
(To record Warranty Expense)
DR Warranty liability.................................$20,000
CR Cash......................................................................$20,000
(To record Warranty Claim Payments)
Explanation:
Cash = 15% * $643,000
= $96,450
Notes Receivable = 643,000 - 96,450
= $546,550
Warranty Expense = 5% x $643,000
= $32,150
what happens to aggregate output if both taxes and government spending are lowered by $300 billion and mpc
Answer:
The answer is:
1. consumers' expenditure increases by $150 billion
2. output will decrease by $600 billion
Explanation:
Tax impact:
$300 billion x 0.5
= $150 billion.
If taxes are lowered by $300 billion, consumers' expenditure increases by $150 billion because with lower tax, there is money money to be spent because their disposable income has increased.
Government spending impact:
$300/(1-0.5)
$300/0.5
=$600 billion.
Due to government spending that has increased by this amount, output will decrease by this amount too because government has directly competed with firms that should have used this money to increase the total output.
Therefore, net effect on total output is $300billion($600 - $300)
Paige Company estimates that unit sales will be 10,800 in quarter 1, 12,700 in quarter 2, 14,800 in quarter 3, and 18,500 in quarter 4. Using a sales price of $85 per unit. Prepare the sales budget by quarters for the year ending December 31, 2017.
Answer:
Results are below.
Explanation:
Giving the following information:
Paige Company estimates that unit sales will be 10,800 in quarter 1, 12,700 in quarter 2, 14,800 in quarter 3, and 18,500 in quarter 4. Using a sales price of $85 per unit.
Sales Budget:
Q1:
Sales= 10,800*85= $918,000
Q2:
Sales= 12,700*85= $1,079,500
Q3:
Sales= 14,800*85= $1,258,000
Q4:
Sales= 18,500*85= $1,572,500
On November 1, Orpheum Company accepted a $10,900, 90-day, 12% note from a customer to settle an account. What entry should be made on the November 1 to record the note acceptance
Answer:
Note Receivable $10,900 (debit)
Sales Revenue $10,900 (credit)
Explanation:
Recognize the Asset : Note Receivable and Sales Revenue to the amount of the value of the note of $10,900.
Subsequently, the Interest will accrue on the note capitalized at the rate of 12%.
To determine cash payments for operating expenses for the statement of cash flows using the direct method, a decrease in accrued expenses is added to operating expenses other than depreciation.
a. True
b. False
Answer:
True
Explanation:
To determine cash payments under direct method the decrease in accrued expenses is added to the operating expenses payable . Accrued expense mean expenses incurred but not yet paid. A decrease in accrued expenses would suggest that accrued expenses have been paid therefore there has been an outflow of cash which will be added to cash paid for operating expenses.
Occupational fraud comes in many shapes and sizes. The fraud at Rite Aid is one such case. On February 10, 2015, the U.S. Attorney's Office for the Middle District of Pennsylvania announced that a former Rite Aid vice president, Jay Findling, pleaded guilty to charges in connection with a $29.1 million dollar surplus inventory sales/kickback scheme. Another former vice president, Timothy P. Foster, pleaded guilty to the same charges and making false statements to the authorities. Both charges are punishable by up to five years' imprisonment and a $250,000 fine.
The charges relate to a nine-year conspiracy to defraud Rite Aid by lying to the company about the sale of surplus inventory to a company owned by Findling when it was sold to third parties for greater amounts. Findling would then kick back a portion of his profits to Foster.
Findling admitted he established a bank account under the name "Rite Aid Salvage Liquidation" and used it to collect the payments from the real buyers of the surplus Rite Aid inventory. After the payments were received, Findling would send lesser amounts dictated by Foster to Rite Aid for the goods, thus inducing Rite Aid to believe the inventory had been purchased by J. Finn Industries, not the real buyers. The government alleged Findling received at least $127.7 million from the real buyers of the surplus inventory but, with Foster's help, only provided $98.6 million of that amount to Rite Aid, leaving Findling approximately $29.1 million in profits from the scheme. The government also alleged that Findling kicked back approximately $5.7 million of the $29.1 million to Foster.
Foster admitted his role during the guilty plea stage of the trial. He voluntarily surrendered $2.9 million in cash he had received from Findling over the life of the conspiracy. Foster had stored the cash in three 5-gallon paint containers in his Phoenix, Arizona, garage.
Assume you are the director of internal auditing at Rite Aid and discover the surplus inventory scheme. You know that Rite Aid has a comprehensive corporate governance system that complies with the requirements of Sarbanes-Oxley and the company has a strong ethics foundation. Moreover, the internal controls are consistent with the COSO framework.
1. To encourage various groups to come forward and report fraud, Dodd-Frank extended whistle-blowing privileges and rewards to which of the following?
A. Internal auditors.
B. External auditors.
C. The CEO.
D. All of these are correct.
2. Whistleblowers who meet the criteria are eligible to receive an award based on what was collected as a result of the monetary sanctions. This can vary from_________.
a. 1 to 10 percent.
b. 10 to 30 percent.
c. 15 to 35 percent.
d. 1 to 50 percent, depending on the magnitude of the fraud.
Answer:
1. To encourage various groups to come forward and report fraud, Dodd-Frank extended whistle-blowing privileges and rewards to which of the following?
D. All of these are correct.
2. Whistleblowers who meet the criteria are eligible to receive an award based on what was collected as a result of the monetary sanctions. This can vary from_________.
a. 1 to 10 percent.
Explanation:
In whistleblowing against a fraud in a company or an organization, the maximum amount which the whistleblower can receive is 10% of the money recovered (or involved) while the least amount would be 1% of the said recovered money
When Marine Midland Bank sent market researchers with surveys door-to-door in the neighborhoods of their branch banks to ask people with savings accounts why they did not also have checking accounts and credit cards with Marine Midland, they were gathering __________ data.
Answer:
questionnaire
Explanation:
In the scenario being described, the researchers were gathering questionnaire data. A questionnaire is a research instrument that consists of a set of questions that are asked to the individual with hopes of collecting that respondent's information regarding the subject. Which in this scenario, the subject in question is why the individual does not have checking accounts and credit cards with the company. These answers are usually used by the company in order to better their services and provide a better customer experience.
In its first year, a project is expected to generate earnings before interest and taxes of $237,884 and its depreciation expense is expected to be $87,882. If the company’s tax rate is 35%, what is the project’s expected net operating profit after taxes for the year?
Answer:
Net operating income= $242,506.6
Explanation:
Giving the following information:
Earnings before interest and taxes= $237,884
Depreciation expense= $87,882.
Tax rate= 35%
To calculate the net operating profit, we need to use the following structure:
EBIT= 237,884
Tax= (237,884*0.35)= (83,259.4)
Depreciation= 87,882
Net operating income= 242,506.6
On January 1, Parson Freight Company issues 9.0%, 10-year bonds with a par value of $3,400,000. The bonds pay interest semiannually. The market rate of interest is 10.0% and the bond selling price was $3,168,967. The bond issuance should be recorded as:
Answer:
January 1
Cash $3168967 Dr
Discount on Bonds Payable $231033
Bonds Payable $3400000 Cr
Explanation:
The issuance of bond on January 1 is at a discount as the coupon rate paid by the bond is less than the market interest rate. In such case the bond is issued at a lower value than its par/face value. The discount on bonds payable is the difference between the face value and the cash received on issuance.
The entry to record the issues include a debit to cash account as cash is received, a debit to the discount on bonds payable account for the amount of discount and a credit to bonds payable account as liability is created as a result of the issuance of the bonds.
Discount = 3400000 - 3168967 = 231033
A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. Variable manufacturing overhead standards are based on machine-hours. Standard hours per unit of output 4.50 machine-hours Standard variable overhead rate $11.52 per machine-hour
The following data pertain to operations for the last month:
Actual hours 8,900 machine-hours Actual total variable manufacturing overhead cost $95,920 Actual output 1,800 units
What is the variable overhead rate variance for the month?
Answer:
Variable manufacturing overhead rate variance= $7,209 favorable
Explanation:
Giving the following information:
Standard variable overhead rate $11.52 per machine-hour
Actual hours 8,900 machine-hours
Actual total variable manufacturing overhead cost $95,920
To calculate the variable overhead rate variance, we need to use the following formula:
Variable manufacturing overhead rate variance= (standard rate - actual rate)* actual quantity
Standard rate= 95,290/8,900= 10.71
Variable manufacturing overhead rate variance= (11.52 - 10.71)*8,900
Variable manufacturing overhead rate variance= $7,209 favorable
Consider a $1,000-par-value 20-year zero-coupon bond issued at a yield to maturity of 10%. If you buy that bond when it is issued and continue to hold the bond as yields decline to 9%, the imputed interest income for the first year of that bond is
Answer:
$14.87
Explanation:
Computation the imputed interest income for the first year of the bond
First step
Using this formula
Imputed interest income= Par value/(1+yield to maturity)^Numbers of years
Let plug in the formula
Imputed interest income$1,000/(1.10)^20
Imputed interest income= $1,000/6.72749
Imputed interest income=$148.64
Second step
Imputed interest income=$1,000/(1.10)^19= Imputed interest income=$1,000/6.11590
Imputed interest income=$163.51
Hence,
Imputed interest income=$163.51 - $148.64
Imputed interest income= $14.87
Therefore the imputed interest income for the first year of the bond will be $14.87
Denise contracts with Long Life Insurance Co., agreeing to pay premiums in return for which the company agrees to pay $500,000 to Denise's husband Barn when Denise dies. Barn is a(n):
Answer:
Donee Beneficiary
Explanation:
In the scenario being described, it can be said that Barn is a Donee Beneficiary. This is a third-party beneficiary that occurs when the second party in the contract does not owe anything to the third party but wants to provide them with the benefit of the performance of the first party. Which since in this scenario, Denise wants to provide Barn with all the benefits of the contract even though she does not owe him anything, then it technically makes Barn a Donee Beneficiary to the Long Life Insurance Contract.
Which one of the following statements is correct concerning the concept of materiality?
a. Materiality is determined by reference to guidelines established by the AICPA.
b. Materiality depends only on the dollar amount of an item relative to other items in the financial statements.
c. Materiality depends on the nature of an item rather than the dollar amount.
d. Materiality is a matter of professional judgement.
Answer:
D) Materiality is a matter of professional judgement
Explanation:
The _________ price is the price at which a dealer is willing to sell a security. A. bid B. ask C. clearing D. settlement
Answer: B. ask
Explanation:
The ask also known as the offer price is the price at which seller is willing to sell a security after which the buyer must have stated a bid price of how much he or she wants to pay for the security. The bid price is known to be always lower than the ask price , of which the difference between both prices is called a bid-ask spread.
For example, if an investor wants to buy a security, he or she will first determine how much the seller is willing to sell it for, which is the ask price--- least price the seller is willing to sell the security for. However on the other hand, the seller in order to sell his or her security will first determine the highest price at which a buyer would be willing to pay for the security.
If an investor purchases a bond when its current yield is higher than the coupon rate, then the bond's price will be expected to
Answer:
The answer is: The bond price is expected to Increase over time, reaching par value at maturity
Explanation:
If an investor purchased a bond when the bond current yield-to-maturity is higher than the bond's price, the bond is said to be bought at discount (its price is less than the face value at maturity). With this, the bond price will be expected to Increase over time, reaching par value at maturity.
And when the opposite happens i.e coupon rate higher than the current yield-to-maturity, the bond is said to be bought at premium.
Coffer Co. is analyzing two projects for the future. Assume that only one project can be selected. Project X Project Y Cost of machine $ 77,000 $ 55,000 Net cash flow: Year 1 28,000 2,000 Year 2 28,000 25,000 Year 3 28,000 25,000 Year 4 0 20,000 If the company is using the payback period method and it requires a payback of three years or less, which project should be selected?
Answer: Project X
Explanation:
Payback period is a method of capital budgeting that judges a project's viability based on when it will be able to pay back the initial investment.
Payback period Project X
Cost of machines is $77,000
= Year 1 + Year 2 + Year 3
= 28,000 + 28,000 + 28,000
= $84,000
Means it paid back within 3 years.
= Year + Year 2
= 28,000 + 28,000
= $56,000
At year 2 how much was left;
= 77,000 - 56,000
= 21,000
= Amount left/ amount paid in year
= 21,000/28,000
= 0.75
= 2 years + 0.75 years
It took 2.75 years to pay off the Project X
Payback period Project Y
Cost of machines is $55,000
= Year 1 + Year 2 + Year 3
= 2,000 + 25,000 + 25,000
= $52,000
Means it did not payback within 3 years.
In 4th year
= 55,000 - 52,000
= $3,000
= 3,000/20,000
= 0.15
It took 3 years + 0.15 year = 3.15 years to pay off.
Project X should be selected as it pays back within 3 years.
Problem 14-13 Calculating the WACC [LO3] Dinklage Corp. has 4 million shares of common stock outstanding. The current share price is $70, and the book value per share is $9. The company also has two bond issues outstanding. The first bond issue has a face value of $75 million, a coupon rate of 7 percent, and sells for 95 percent of par. The second issue has a face value of $60 million, a coupon rate of 6 percent, and sells for 107 percent of par. The first issue matures in 25 years, the second in 8 years. Suppose the most recent dividend was $4.30 and the dividend growth rate is 4.5 percent. Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues. Both bonds make semiannual payments. The tax rate is 21 percent. What is the company’s WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Answer:
WACC = 8.97%
Explanation:
total value of equity = $70 x 4,000,000 = $280,000,000
cost of equity:
$70 = $4.4935 / (Re - 4.5%)
Re - 4.5% = 6.42%
Re = 10.92%
total value of debt:
$75 million x 0.95 = $71,250,000
YTM = {70 + [(1,000 - 950)/25]} / [(1,000 + 950)/2] = 72 / 975 = 7.3846%
$60 million x 1.07 = $64,200,000
YTM = {60 + [(1,000 - 1,070)/8]} / [(1,000 + 1,070)/2] = 51.25 / 1,035 = 4.9517%
weighted cost of debt = ($71,250,000 / $135,450,000 x 7.3846%) + ($64,200,000 / $135,450,000 x 4.9517%) = 3.8845% + 2.347% = 6.2315%
total value of the firm = $280,000,000 + $135,450,000 = $415,450,000
equity weight = $280,000,000 / $415,450,000 = 0.674
debt weight = 1 - 0.674 = 0.326
WACC = (0.674 x 10.92%) + (0.326 x 6.2315% x 0.79) = 7.36% + 1.605% = 8.965% = 8.97%
A company developed the following per-unit standards for its product: 2 gallons of direct materials at $8 per gallon. Last month, 2200 gallons of direct materials were purchased for $16720. The direct materials price variance for last month was
Answer:
$880 favorable
Explanation:
The computation of direct materials price variance for last month is shown below:-
Direct material price variance = Actual quantity × (Standard price - Actual price)
= 2,200 × ($8 - ($16,720 ÷ 2,200)
= 2,200 × ($8 - 7.6)
= 2,200 × $0.4
= $880 Favorable
Therefore for computing the direct materials price variance for last month we simply applied the above formula.
The mode of transportation that results in the lowest transportation cost will also lower total costs for a supply chain.
a) true
b) false
Answer: False
Explanation:
Transportation is the movement of individuals or goods from one place to another. Supply chain are the steps that are involved before a product will finally get to the consumer.
It should be noted that the mode of transportation that results in the lowest transportation cost will not necessarily lower total costs for a supply chain. This I because transportation isn't the only process involved on supply chain.
Waterway Industries's direct materials budget shows total cost of direct materials purchases for January $200000, February $220000 and March $290000. Cash payments are 60% in the month of purchase and 40% in the following month. The budgeted cash payments for March are
Answer:
Total cash disbursement= $262,000
Explanation:
Giving the following information:
Purchases:
January= $200,000
February= $220,000
March= $290,000
Cash payments are 60% in the month of purchase and 40% in the following month.
Cash disbursement March.
Purchase on cash March= 290,000*0.6= 174,000
Purchase on account from February= 220,000*0.4= 88,000
Total cash disbursement= $262,000
Prepare journal entries to record the following four separate issuances of stock.
a. A corporation issued 4,000 shares of $20 par value common stock for $96,000 cash.
b. A corporation issued 2,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $20,500. The stock has a $1 per share stated value.
c. A corporation issued 2,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $20,500. The stock has no stated value.
d. A corporation issued 1,000 shares of $50 par value preferred stock for $242,500 cash.
Answer: PLease find answers in explanation column
Explanation:
1. Being issued for common stock at $20 par value
Account Debit Credit
Cash $96,000
Common stock at $20 par value (4000 x 20) $80,000
Paid in excess capital of par Common stock $16,000
($96,000 - $80,000)
2. Being issued for stated stock at $1 to promoters
Account Debit Credit
0rganisation expenses $20,500
Common stock at $1 stated value (2000 x 1) $2,000
Paid in excess capital of par Common stock
($20,500 - $2,000 $18,500
3. Being issued to promoters at no stated value
Account Debit Credit
Organization expenses $20,500
Common stock, no-par value $20,500
4. Being issued at preferred stock of $50 par value
Account Debit Credit
Cash $242,500
Preferred stock at $50 par value (1000 x 50) $50,000
Paid in excess capital of par Preferred stock
($242,500 - $50,000) $192,500
Suppose that Dunkin Donuts reduces the price of its regular coffee from $2 to $1 per cup, and as a result, the quantity sold per day increased from 10 to 40. Over this price range, the price elasticity of demand for Dunkin Donuts’ regular coffee is:
Answer:
PED = -6
Explanation:
The PED or price elasticity of demand for a product measures the responsiveness of a product's demand to the changes in the price of the product. The PED is calculated as follows,
PED = % change in Quantity demanded / % change in price
PED = [(40 - 10) / 10] / [(1 - 2) / 2]
PED = -6
A PED of -6 represents that quantity demanded is highly price elastic and a negative sign means that it is a normal good.
A car dealership union negotiates a contract that dramatically increases the salaries of all salesmen. If one of the salesmen is thinking of changing careers to be a hardware salesman, his opportunity cost:___________.
a. Would not be affected
b. Of becoming a hardware salesman would decrease
c. Of becoming a hardware salesman would increase
d. None of the above
Answer:
c. Of becoming a hardware salesman would increase
Explanation:
Opportunity cost defines that when a person gets to benefit from another than he received. So, that person takes another benefit from where he gets more benefit or we can say that he will choose the best alternative.
According to the given situation, A car dealership association is negotiating a contract that significantly increases all salesmen 's wages. Now, the Opportunity cost when one of the salespersons feels that shifting the path to hardware is of becoming a hardware salesperson that would increase.
Hence, the right answer is C
Merchandise inventory: Multiple Choice Is a current asset. Is a long-term asset. Must be sold within one month. Is classified with investments on the balance sheet. Includes supplies the company will use in future periods.
Answer: is a current asset
Explanation:
Merchandise inventory is the product thqtbare owned by a company which the company wants to sell.
It should be noted that when preparing the balance, merchandise inventory sheet is reported as current asset.
Also, buying merchandise inventory is part of a business operating cycle.