Answer:
D) Both a and b.
- a. Revenues.
- b. Variable costs.
Explanation:
Project A Project B
Revenues: $360,000 $280,000
Variable costs: $210,000 $180,000
Fixed costs: $90,000 $90,000
When you are choosing a project, all the information the information is relevant since you must determine the cash flows. In this case, since both projects have the same fixed costs, then they are not as important when determining which project is more profitable.
We are not told how much does depreciation represent from the fixed costs, but cash flows are calculated by:
net cash flow = [(revenues - variable costs - fixed costs) x (1 - tax rate)] + depreciation
Answer: The restaurant industry
Explanation:
It would depend on supply and demand. If a company’s stock is excelling or doing presentably good then more people will buy it and this raises the prices. When stocks are presumably not doing well the prices will plummet making it cheap.
Answer:
b. proportional
a. monetary policy
c?. increase output?
Explanation:
Hesitant on #3 because it could technically be considered a as well, but c marks its primary purpose.
Answer:
A. Carmen recognizes a $2,000 Sec. 1231 gain and Marc recognizes $5,000 as ordinary income.
Explanation:
Carmen transferred land (Sec. 1231 property) that has adjusted basis $18,000 with a FMV of $20,000. This means there is a gain to be recognized on the transfer of $2,000.
In case of Marc, there is no gain or loss on the transfer of equipment. However, the value of $5,000 short term note received will be recognized as ordinary income.
A. Keeping in view the above provided information, this statement is correct.
B. The transfer does result in a gain for Carmen, therefore, this statement is incorrect.
C. As there is gain for one individual and odinary income to be recoginzed for the other, therefore, this statement is also incorrect.
D. Marc has not transferred property Sec. 1231 instead the transfer was of machinery. Hence, this statement is also incorrect.