Answer: A. 101
Explanation:
Amortization is done on the premium of the bond if elected to be done by the owner.
Bonds at par are worth 100 so a 102 bond has a premium of 2.
If amortized, this premium will have to be amortized over the period till maturity which in this case is 4 years.
Amortization per year = 2 points / 4 years
= 0.5
In 2 years the amortization would therefore be 1 point.
Cost basis of Bond = 102 - 1
= 101
Answer:
The answer is b) The use of a cost benefit analysis for alternative actions is undertaken.
Explanation:
The concept or idea behind the utilitarian model of ethics is that what is right should be separated from what is wrong by using the outcome of action as basis of judgement. The aim of the act should be the greatest good for the greatest number of people. In options A and C, the outcome benefits only a specified or particular group of people whereas option B, the use of cost-benefit analysis, which is one of the main areas that applies utilitarianism is businesses, best suits this ideology.
Answer:
1.
<u>Net income increases</u><em>. - </em>Ability to pay Dividends increases.
Dividends are paid from Retained Earnings which are derived from Net Income. If Net income increases therefore, so does the ability to pay Dividends.
<u>More profitable investment opportunities are available</u> - Decreases Ability to pay Dividends.
If there are more profitable opportunities for investment available, the business will invest in those opportunities. By doing so they will reduce the amount of cash that they have which is cash that could have been paid as dividends.
<u>The firm increases its debt ratio</u>. - Ability to pay Dividends Increase
As a result of the company borrowing more money, there will be more money left to pay out dividends so more dividends will be paid.
2. A. Despite the fact that Dernham Burnham Inc.'s earnings tend to fluctuate from year to year, the company most likely pays a predictable, stable dividend each year.
Companies like Dernham that aim to please investors usually adopt a predictable, stable dividend policy every year so that the investors will have more faith in them and be sure of earnings every year. This will give them a higher rating with the investors.
Answer:
(a) Issued $50,000 par value common stock for cash = Financing Activities
b) Purchased a machine for $30,000, giving a long-term note in exchange. Financing Activities = Non-cash Investing and Financing Activity
(c) Issued $200,000 par value common stock upon conversion of bonds having a face value of $200,000 = Non-cash Investing and Financing Activities
(d) Declared and paid a cash dividend of $18,000 = Financing Activities
(e) Sold a long-term investment with a cost of $15,000 for $15,000 cash = Investing Activities
(f) Collected $16,000 from sale of goods = Operating Activities
Explanation:
The Cash flows related to raising of capital is known as Cash flow from Financing Activities.
The Cash flows related to growing and selling of Assets of the business is known as Cash flow from Investing Activities.
The Cash flow related to trade in Ordinary course business of the Company is known as Cash flow from Operating Activities.
Answer: Deciding
Explanation:
The normative decision model is one of the type of theory that helps in explain the various types of optimal decisions that specifically helps calculating the accuracy of the given decision outcome.
It basically provide the various types of prescriptive function and also the various types of rules that helps in maximizing the total outcome of the decision making concept.
According to the given question, the Kevin is basically demonstrating the deciding process based on the normative decision model as he announces that the 25% of the employees salaries is basically depending upon their specific performance in an organization.
Therefore, Deciding is the correct answer.
