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NeTakaya
4 years ago
15

Why might the current and quick ratios for the electric utility and the​ fast-food stock be so much lower than the same ratios f

or the other​ companies? ​(select all the answers that​ apply.)
a. their inventory balances are going to be very close to zero because it is impossible to stockpile electricity and burgers.


b. their accounts receivable balances are going to be much lower than for the other two companies.


c. the explanation for the lower current and quick ratios most likely rests on the fact that these two industries operate primarily on a cash basis.


d. the explanation for the lower current and quick ratios most likely relates to poor management performance?
Business
1 answer:
yulyashka [42]4 years ago
6 0

Current ratio is a comparison of current assets to current liabilities, calculated by dividing your current assets by your current liabilities.

The quick ratio compares the total amount of cash + marketable securities + accounts receivable to the amount of current liabilities.

A. Inventory would be a factor in both of these ration (assets). In both of these industries, inventory would be low. You cannot readily stockpile energy and burgers are perishable items.

B. It is true that both of these industries would have low outstanding accounts receivable because people will need their power to survive and fast food places don't offer credit.

C. These two industries deal with cash mainly. Cash doesn't have to be physical currency, but accounts that can easily be paid.

D. Low current and quick ratios are actually signs of good management not poor management.

All of the above are correct EXCEPT answer D.

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Betty operates a beauty salon as a sole proprietorship. Betty also owns and rents an apartment building. This year Betty had the
nikitadnepr [17]

Answer:

Betty's AGI $33,558

Explanation:

Betty's AGI:

Revenue from salon $88,560

Salaries paid to beauticians ($46,440)

Nail salon supplies ($23,620)

Salon's operating income $18,500

                   +

Interest income $14,665

                   +

Rental revenue from apartment building $35,180

Depreciation on apartment building ($14,400)

Real estate taxes paid on apartment building ($11,980)

Rental income $8,800

                    -

Alimony paid to her husband $7,100

                    -

Self-employment tax on salon income $1,307

                   =

Betty's AGI $33,558

Real estate taxes paid on Betty's house and charitable contributions are itemized deductions (below the line deductions).

6 0
3 years ago
Which of the following is a person who authorized an agent to act on his or her behalf ​
lina2011 [118]

Answer:

Principal

Explanation:

A power of attorney (POA) is a legal document giving one person (the agent or attorney-in-fact) the power to act for another person (the principal).

8 0
3 years ago
The process by which the use of a new product or service spreads throughout a market group is referred to as
MrRissso [65]

Answer:

Diffusion of innovation.

Explanation:

  • It's a widely studied method where the theory suggests that the rate at which the new ideas spread and develops or prophets in all the directions is seen by the early majority, late majority, and laggards and is a method of group marketing through the various communication channels.
3 0
3 years ago
Rajiv loves watching Downton Abbey on his local public TV station, but he never sends any money to support the station during it
daser333 [38]

Answer:

free rider

true

true

Explanation:

The free rider problem is a form of market failure. It occurs when people benefit from a good or service of communal nature and do not pay to enjoy these services.

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A private good is a good that is excludable and rivalrous. They are usually exchanged in the market by private sector businesses. It

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3 years ago
(Appendix 11.1) Depreciation for Financial Statements and Income Tax Purposes Dinkle Company purchased equipment for $50,000. Th
Romashka-Z-Leto [24]

Answer and Explanation:

The computation is shown below:

For year 1

According to the Company's Books Depreciation

= (Orginal Cost - Salvage value) ÷ useful Life

= ($50,000 - $5,000)  ÷ 10 years

= $4,500

According to the Income Tax Depreciation

= Cost × MACRS Rate for Year 1

= $50,000  × 20%

= $10,000

So, the difference in year 1 is

= $10,000 - $4,500

= $5,500

For year 2

According to the Company's Books Depreciation

= (Orginal Cost - Salvage value) ÷ useful Life

= ($50,000 - $5,000)  ÷ 10 years

= $4,500

According to the Income Tax Depreciation

= Cost × MACRS Rate for Year 2

= $50,000  × 32%

= $16,000

So, the difference in year 1 is

= $16,000 - $4,500

= $11,500

7 0
3 years ago
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