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2 years ago

The most rigorous test of a firm's ability to pay its short-term obligations is its?

1 answer:

6 0

The working capital ratio is a measurement of a company's short-term capability of paying its financial obligations.

The working capital turnover ratio measures how efficaciously a business makes use of its operating capital to supply sales. A better ratio indicates greater efficiency. In preferred, an excessive ratio can assist your employer's operations to run greater easily and limit the want for added funding.

The working ratio measures a corporation's potential to recover running expenses from annual sales. It's miles calculated by taking general annual fees, aside from depreciation and debt-related charges, and dividing it by the yearly gross income.

The current ratio, also known as the working capital ratio, gives a short view of an enterprise's financial health. You could calculate the current ratio by taking contemporary assets and dividing that discern by means of current liabilities. A ratio above 1 way current belongings exceed liabilities.

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Preferred stock is often considered a more conservative (less aggressive) investment than common stock because: a. its holders h

Aneli [31]

Answer:

b. it is less volatile and more like a bond

Explanation:

Preferred stocks pay a fixed dividend and has the potential to appreciate in price.

Preferred share holders have no voting right but they are paid first before common shareholders.

I hope my answer helps you

6 0

3 years ago

“formal evaluation could include testing the predictive capabilities of the models on observed data to see how effective and eff

Neporo4naja [7]

This is known as in-sample forecast. It estimated the model using all available data and then comparing it to the model's fixed values to the actual realizations. But, this method is known to attract an overly positive picture of the model's forecasting ability since common fitting algorithms tend to take pains to avoid big prediction errors and are also inclined to overfitting (mistaking noise for signal in the data).

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3 years ago

Steven puts aside some of his money for future use. He is a _____ .

gavmur [86]

The answer is A, a saver.

He is putting money aside for later instead of spending it on anything else

4 0

3 years ago

Read 2 more answers

The regular selling price for the product is $80. The annual quantity of units produced and sold is 40,000 units (the costs abov

Ne4ueva [31]

Answer:

The correct option is d. Increase by $19,500.

Explanation:

Note: This question is not complete. The complete question is therefore provided before answering the question as follows:

Pluto Incorporated provided the following information regarding its single product:

Direct materials used = $240,000

Direct labor incurred = $420,000

Variable manufacturing overhead = $160,000

Fixed manufacturing overhead = $100,000

Variable selling and administrative expenses = $60,000

Fixed selling and administrative expenses = $20,000

The regular selling price for the product is $80. The annual quantity of units produced and sold is 40,000 units (the costs above relate to the 40,000 units production level). The company has excess capacity and regular sales will not be affected by this special order. There was no beginning inventory.

What would be the effect on operating income of accepting a special order for 1,000 units at a sale price of $40 per product? Note: The special order units would not require any variable selling and administrative expenses.

a. Decrease by $19,500

b. Decrease by $18,000

c. Increase by $18,000

d. Increase by $19,500

The explanation of the answer is now provided as follows:

We first calculate the expected total relevant cost of the special order as follows:

Direct materials cost per unit = Direct materials used / Annual units = $240,000 / 40,000 = $6.00

Direct labor cost per unit = Direct labor incurred / Annual units = $420,000 / 40,000 = $10.50

Variable manufacturing overhead per unit = Variable manufacturing overhead / Annual units = $160,000 / 40,000 = $4.00

Expected special order total relevant cost = (Direct materials cost per unit + Direct labor cost per unit + Variable manufacturing overhead per unit) * Special order units = ($6.00 + $10.50 + $4.00) * 1,000 = $20.50 * 1,000 = $20,500

Expected revenue from the special order = Special order units * Special order selling price per unit = 1,000 * $40 = $40,000

Expected profit from the special order = Expected revenue from the special order - Expected special order total relevant cost = $40,000 - $20,500 = $19,500

Since the expected profit from the special order is $19,500, it therefore implies that accepting it would increase operating income by $19,500.

Therefore, the correct option is d. Increase by $19,500.

6 0

3 years ago

You have the following information for Waterway Industries for the month ended October 31, 2022. Waterway uses a periodic method

Sidana [21]

Answer:

Waterway Industries

A) The weighted-average cost is $28.527

B) Ending Inventory, cost of goods sold, gross profit:

(1) LIFO (2) FIFO (3) Average-cost

Ending Inventory: $2,660 $3,060 $2,853

Cost of goods sold: $7,895 $7,495 $7,702

Gross profit: $3,780 $4,180 $3,973

Explanation:

a) Data and Calculations:

Date Description Units Unit Cost Selling Price Total

Oct. 1 Beginning inventory 70 $26 $1,820

Oct. 9 Purchase 125 28 3,500

Oct. 11 Sale (95) 40 $3,800

Oct. 17 Purchase 95 29 2,755

Oct. 22 Sale (70) 45 3,150

Oct. 25 Purchase 80 31 2,480

Oct. 29 Sale (105) 45 4,725

Oct. 31 Ending inventory 100

Total: Goods available 370 $10,555

Goods sold 270 $11,675

Weighted-average cost = Cost of goods available/Units available

= $10,555/370 = $28.527 per unit

Periodic method:

LIFO:

Ending inventory:

Oct. 1 Beginning inventory 70 $26 $1,820

Oct. 9 Purchase 30 28 840

Total Ending inventory = 100 $2,660

Cost of goods sold = Cost of goods available - Ending inventory

= $10,555 - $2,660 = $7,895

Sales Revenue $11,675

Cost of goods sold 7,895

Gross profit $3,780

FIFO:

Ending inventory:

Oct. 17 Purchase 20 29 $580

Oct. 25 Purchase 80 31 2,480

Total Ending inventory = 100 $3,060

Cost of goods sold = Cost of goods available - Ending inventory

= $10,555 - $3,060 = $7,495

Sales Revenue $11,675

Cost of goods sold 7,495

Gross profit $4,180

Average-cost:

Ending Inventory = $2,853 ($28.527 * 100)

Cost of goods sold = Cost of goods available - Ending inventory

= $10,555 - $2,853 = $7,702

Sales Revenue $11,675

Cost of goods sold 7,702

Gross profit $3,973

7 0

2 years ago