FIFO stands for First In First Out and LIFO stands for Last In First Out.
Answer: LIFO produces more favorable cash flow because LIFO PRODUCES LOWER INCOME TAX EXPENSE.
During inflation, LIFO approach is adopted for tax benefits. With the rise in prices, LIFO produces higher cost of sold amounts of goods.
Answer:
$0
Explanation:
This transaction classifies as a § 351 exchange since Mr. Bass is exchanging his asset for 100% of Corporation C's stock.
§ 351 establishes that no gain or loss must be recognized when property is transferred in exchange for stock in a corporation. In order for this exchange to classify as § 351, the new stockholder must assume immediate control of the corporation as established by § 368 (c). This means that at least 80% of the stocks must be exchanged.
Answer:
(A) The equilibrium quantity will increase.
Explanation:
An increase in demand and supply of electric cars would shift the demand and supply curves to the right.
Equilibrium quantity would increase.
Price would not change.
I hope my answer helps you
Answer:
The fair price of stock today is $48.425 and that is the most one should be willing to pay today.
Explanation:
The company's dividend will grow at a constant rate of 4.3% which means that the constant growth model of Dividend Discount Model will be used to calculate the price of a stock today.
The formula for Constant growth model is,
P0 = D0 (1 + g) / r - g
Where,
- D0 is dividend today
- r is the required rate of return
- g is the growth rate in dividend
P0 = 1.95 * (1+0.043) / 0.085 - 0.043
P0 = $48.425