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2 years ago

The discounted payback period Blank _____ account for the time value of money, and the payback period Blank

Business

1 answer:

kondor19780726 [428]2 years ago

8 0

The discounted payback period does account for the time value of money, and the payback period does not.

<h3>What is discounted payback period?</h3>

A method of capital budgeting used for determining a project's profitability is known as discounted payback period. This will be done by recognizing the time value of money and by discounting cash flows of the future.

The payback period is the amount of time it takes for an asset's net cash flows to pay back the amount invested in it. It's a quick and easy technique to assess the risk of a given project.

The advantage of this method is utilized in selecting the projects as this method helps to determine the profitability of any project by identifying measures to reach the break-even point in any project.

Learn more about discounted payback, here

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On September 1, 2021, American Metals Distribution (AMD) has an inventory of 10,000 pounds of copper that it plans to sell on th

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Answer and Explanation:

a. The Journal entry is shown below:-

1. Hedge charges Dr, $150

To Cash Account $150

(Being bank charges is recorded)

2. Hedge Instrument - Financial Asset Dr, $600

To Profit and Loss A/c $600

(Being financial assets is recorded)

3. Profit and Loss A/c Dr, $600

To Inventory Account - Copper $600

(Being profit and loss account is recorded)

4. Bank A/c Dr, $22,400

To Sales $22,400

(Being bank account is recorded)

2. The computation of the gross margin and locked with the put option and actual reported gross margin is shown below:-

Particulars Rate Pounds Amount Gross Margin Gross Margin

Cost Price $2.15 10,000 $21,500

Strike Price $2.3 10,000 $23,000 $1,500 6.98%

Cost after hedge

loss of $0.6 2.09 10,000 $20,900

Selling Rate $2.24 10,000 $22,400 $1,500 7.18%

Gross margin locked with the put option: 6.98%

Actual reported gross margin: 7.18%

The two amounts are different, since the carrying value of the inventory has changed and the same has been reduced. As a result the total gross margin of 1,500 yielded another percentage as the base value (inventory carrying value) was adjusted.

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3 years ago

22. Preferred stockholders hold a claim on assets that has priority over the claims of A) both common stockholders and bondholde

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Answer:

C) common stockholders, but after that of bondholders.

Explanation:

Preferred stockholders hold a claim on assets that has priority over the claims of common stockholders but after that of bondholders.

The preferred shareholder is given preference for the distribution of dividends, which is higher than the common stock. It is paid as per the discretion of the company´s directors. Instead, they have limited right and they do not vote for corporate governance like a common stockholder. In the case of the dissolution of the company, the preferred shareholders will still receive payment due to them in terms of dividends. They have a feature of both bonds and equity stockholders.

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3 years ago

Smaller companies are moreLikely than larger companies to divide up tasks using a strategy

Natali [406]

Bigger companies are more known and have less space to mess up, as a smaller company not as known, are more likely to give up part of the company to other sharrers and i not played smart, could lose the company altogether.

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3 years ago

Read 2 more answers

Small businesses that are just getting off the ground often have problems with the difference between cash coming into the busin

faust18 [17]

Answer:

d) <u>cash flow</u>

Explanation:

Small businesses are characterized by limited scale of operations and small quantum of revenues. Thus, small businesses in their initial stages have to deal with the common problem of shortage of funds owing to delay in receipts from debtors owing to relaxed credit terms.

The receipts are not received on time while the expenses accumulate which leads to a situation of cash crunch wherein it gets difficult to meet expenses and liabilities.

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3 years ago

Consider the following events: a. A fruitworm infestation ruins a large number of apple orchards in the state of Washington. Thi

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Answer:

Both statements are true

Explanation:

Due to the worm infestation, there would be a fall in supply of apples, this would lead to a shift of the supply curve to the left

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Only a change in price of a good leads to a movement along the supply curve for the good, other factors lead to a shift of the supply curve

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3 years ago