Answer:
False
Explanation:
Agency cost is a term used in Administration to describe a special type of expense that arises from conflicts of interest existing in an organization.Within the context of financial management, the main agency conflicts are:
-Between shareholders and managers :Theory of the principal — agent or the problem of the principal — agent is a theoretical model of economics designed to understand management situations between unequal actors having different degrees of awareness (asymmetric information): the person giving the order (principal) is usually located in the highest hierarchical position and awaits the solution of the task in his interests; on the other hand, the person executing the order (agent: manager or economic agent) is in the lower hierarchical position, but has more information than the principal and can use this information either in the interests of the principal or in his own interests. To solve this problem, various strategies are proposed, such as trusting relationships, general information systems, or focused incentives.
In general, to alleviate agency conflicts, shareholders bear the agency cost, which includes all the relative costs to make the interests of the managers aim to meet their own interests, which is to maximize the share price from the company. However sometimes the shareholders may want management to run the company in a fashion which increases shareholder value.
- Among shareholders and creditors.
<span>In this scenario, Billy Bean is the influencer and Beanie Bean is the information gatherer. </span> An information gatherer is the one who manifest an interest and seeks more information about a particular purchase. Beanie is the one who shows interest to the toilet paper saying how great it is to his father, Billy. Meanwhile, an influencer is the one who influence the final decision after careful evaluation and criteria consideration of the product. Billy fits the definition since he was convinced with Beanie's statement, telling his wife about it and leading to the actual purchase of the toilet paper.
Answer:
A. $26,400
Explanation:
Prepaid insurance beginning balance $3,000
Add: Insurance paid during year <u>$25,800</u>
$28,800
Less: Prepaid insurance Ending balance <u>$2,400 </u>
Insurance expense <u>$26,400</u>
Answer:
Explanation:
(C) The price of potato chips would rise.
Answer:
The accrued interetst is $4860 and $3240
Explanation:
Solution
Recall that:
Mura Company borrows= $360,000
Time =90/360
rate = 9%
Face value =$360,000
The next step is to compute the accrued interest payable on December 31, 2017.
Now,
Interest = 360000*9%*90/360=8100$
year end interest accrual:
Principal =$360000
time 54/360
Interest =360000*9%*54/360 = $4860
Interest recognized on February 5
Principal =$360000
Rate= 9%
Time= 36/360
Interest 360000*9%*36/360 = $3240