Answer: Option B
Explanation: In simple words, flexible budget variance refers to the difference between the results that were predicted by the flexible budget model and the actual results.
Flexible budgets are not rigid and are made on some assumptions the difference arises due to variance in the level of variable expenses that were incorrectly predicted by the model.
Hence the correct option is B.
Answer:
See below
Explanation:
It is to be noted that under IFR, inventories are carried at a lower of cost or net realizable value, which is $550,000 in this scenario.
Also, under the United states GAAP, inventories are carried at a lower of cost or market . Here, the replacement cost of $525,000 would be used because it is below NRV and its equal to the difference between NRV and normal profit margin.
Answer: 7.43%
Explanation:
The yield to maturity simply refers to the total return that is expected on a bond as long as the bond is held till it matures.
In this case, since the investor is indifferent between this municipal bond and an otherwise identical taxable corporate bond, the yield to maturity of the corporate bond will be:
4.83% = Corporate bond YTM × ( 1- 35%)
4.83% = Corporate bond YTM × 65%
Corporate bond YTM = 4.83% / 65%
Corporate bond YTM = 0.0483/0.65
Corporate bond YTM = 7.43%
The yield to maturity of the corporate bond is 7.43%
Answer:
Capital Gains Yield = 10.45%
Explanation:
The capitals gain yield represents the percentage appreciation or increase in the value of an investment. It is simply calculated by calculating the increase in the value of an investment or stock/bond and divide it by its initial cost.
The formula for CG Yield is,
CG Yield = (P1 - P0) / P0
Where,
P1 is current price
P0 is initial price paid
Thus CG Yield = (54.01 - 48.9) / 48.9 = 0.10449 pr 10.449%
