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3 years ago

(Consider This) Which of the following statements is true about U.S. firms?

Business

1 answer:

faltersainse [42]3 years ago

4 0

Answer:

The correct answer is letter "B": Over half are bankrupt within the first five years after starting up.

Explanation:

Under the Bankruptcy Code, U.S. companies and individuals can file for bankruptcy and it is considered a legal process. In the second quarter of 2019, almost 23 000 companies filed for bankruptcy. There is an average of 44 500 firms that had to be liquidated from 1980 until 2019. According to the same tendency, most of those start-ups file for bankruptcy after the first 5 years of operations.

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A company bought new heating system for $42,000 and was given a trade-in of $2,000 on an old heating system, so the company paid

mixer [17]

35000$ for sure
thanks

7 0

3 years ago

Target Corporation prepares its financial statements according to U.S. GAAP. Target's financial statements and disclosure notes

Paraphin [41]

Answer:

Gross profit ratio = 29.5%

Inventory turnover ratio = 6.16 times

Explanation:

(a) Target uses the retail inventory method to account for the majority of it's inventory and the related cost of sales. in this method, inventory is stated at cost using the last in first out (LIFO) method as determined by applying a cost to retail ratio to each merchandise groupings ending retail value.

(b) The cost of inventory includes

1. The amount T pays to it's supplier to acquire inventory.

2. freight cost incurred in connection with the delivery of products to it's distribution centres and store.

3. Import cost reduced by vendor income and cash discounts.

= 29.5%

Inventory turnover ratio = 51997/(8601+8282)/2

= 6.16 times

6 0

3 years ago

Gail Corporation is comparing two different capital structures: an all-equity plan (Plan I) and a levered plan (Plan II). Under

denis23 [38]

Answer:

a. Under Plan I

No debt.

EPS = Earnings / Number of shares

= 650,000 / 160,000

= $4.06 per share

b. Under Plan II

Debt of $1.4 million.

Interest = 7% * 1.4 million

= $98,000

EPS = (650,000 - 98,000) / 110,000 shares

= $5.02 per share

c. Breakeven point.

What amount of Earnings will equate the two plans.

Assume earnings is e.

e / 160,000 = (e - 98,000) / 110,000

e * 110,000 = 160,000 * (e - 98,000)

110,000e = 160,000e - ‭15,680,000,000‬

160,000e - 110,000e = ‭15,680,000,000‬

e = ‭15,680,000,000‬/50,000

e = $‭313,600‬

5 0

3 years ago

During the recession of 2007-2009, the U.S. economy was experiencing a decrease in home prices and consumer wealth, a credit cri

Stels [109]

Answer:Answer The business sector (b)The policy option is the fiscal policy

Explanation:

Recession can be defined as a state of economic declines in a country which in turn lead to decline in the GDP of a country as well as increase in the rate of unemployment in the country. It is a period of slow business activities in the country which can last for period of six months or a year depending on the quick response of the handlers of the economy to quickly put the situation under control. It is a period of slow growth in the economy. In a period of recession, the business sector experience lack of credit facility which arise due to the inability of the banking sector of the economy to lend to the business sector.. during these period there is a decrease in consumer spending, in the sense that, the demand for goods and services by the households will reduced drastically as a result of the reduction in the purchasing power of the people.

However, with a view to bring the economy under control, the policy option to be adopted is the fiscal policy in which the government can increase their spending on the economy, The fiscal policy also includes the reduction of the income tax as a way of increasing the purchasing power of the people. In addition, The banking sector will also be encouraged to start lending to the business sector as a way of boosting the economy and bring back the economy to the path of growth.

3 0

4 years ago

TIGER ENTERPRISES

densk [106]

Answer:

Tiger Enterprises

Statement of Cash Flows

For Year ended December 31, 2018

Cash flow from operating activities

Net income $1,308

Adjustment to reconcile net income $110

+ depreciation $270

+ decrease in accounts receivable $95

+ increase in income tax payable $35

- increase in inventory ($55)

- increase in prepaid insurance ($45)

- decrease in accounts payable ($75)

- decrease in other expenses payable ($115)

Net cash flow from operating activities $1,418

Cash flow form investing activities

Acquisition of P, P & E ($450)

Net cash flow from investing activities ($450)

Cash flow from financial activities

Proceeds from notes payable $230

Proceeds from issuance of common stock $130

Payment of dividends ($1,198)

Net cash flow from financing activities ($838)

Total cash flow increase $130

Cash balance December 31, 2017 $230

Cash balance December 31, 2018 $360

Explanation:

cash $360 - $230 (+$130 change)

net income $1,308

depreciation $270

accounts receivable -$95 change

inventory + $55 change

Prepaid insurance + $45 change

P, P & E +$450 change

Accounts payable - $75 change

Other expenses payables -$115 change

income tax payable +$35 change

notes payable +$230 change

common stock +$130 change

retained earnings +$110 change

dividends paid = net income - change in retained earnings = $1,308 - $110 = $1,198

4 0

3 years ago