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2 years ago

A large corporation suffers from the principal-agent problem when its:

Business

2 answers:

bija089 [108]2 years ago

8 0

Answer:

The correct answer is letter "B": board of directors ties the salaries of management exclusively to the profits of the firm.

Explanation:

Principal-agent problems arise when a principal hires an agent to perform duties that conflict with the agent's best interest. The problem typically occurs when the principal provides incentives to act in the principal's interest but not the agent, generating a conflictive agenda.

In that case, if the boards of directors tie the salaries of management according to the profits of the firm, they will be acting on their own interest but not in the interest of the managers, making option "B" to represent a typical principal-agent problem.

amm18122 years ago

7 0

<span>The correct answer is d. management does not own a large share of firm stock and pursues its own interests rather than those of shareholders.When management pursues its own interests, there is a conflict with the interest of the shareholders who hired the management in the first place.</span>

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Brown and Lowery, Inc. reported $470 million in income before income taxes for 2018, its first year of operations. Tax depreciat

damaskus [11]

Answer:

$20 Million

Explanation:

Reported Income before taxes for 2018= $470 Million

Tax Depreciation excess over Financially Reported Depreciation= $ 50 Million

Income Tax rate for 2018= 35%

Enacted Rate for Years after 2018= 40%

Calculation

The Deferred Tax Liability= Excess of Tax Depreciation over Financially Reported Depreciation × Enacted Tax Rate

= $50,000,000 × 40%

=$20,000,000

Deferred Tax Liability

This represents the tax due for a particular period but yet to be paid. A deferred tax liability is the indication that an organisation will have to pay mor tax in the future as a result of a current transaction.

In the situation of Brown and Lowery, the Deferred tax is an applied tax rate to the excess of tax depreciation over financial reporting depreciation.

Based on International Accounting Standard (IAS) 12, Deferred tax liability should be calculated using the Enacted rate for years after the current period.

Also, $50,000,000 is the excess of tax depreciationi over depreciation used for financial reporting, however, since the firm has a $20, 000,000 which is a non-tax deductible expense then it will not affect our Deferred Tax Liability Calculation.

8 0

3 years ago

Sherry knew that her established customers liked her product much better than her competitor's. She was planning to expand into

Rom4ik [11]

Answer:

d. premium pricing.

Explanation:

Premium pricing is the strategy of pricing in which the product is highly priced in comparison to that of the other similar products available in the market. This is done in order to keep the belief in customers that the product is superior than those available in the market.

Some people those who think that expensive products are always nice, prefer these kind of products.

Here in the given instance also Sherry prefers this model and her ideology also matches with this technique.

7 0

3 years ago

The company budgeted for production of 2,400 units in June, but actual production was 2,500 units. The company used 19,850 pound

horsena [70]

Answer:

d. $40 F

Explanation:

Calculation to determine what The variable overhead efficiency variance for June is

First step is to calculate the SH

SH = 2,500 units × 0.4 hour per unit

SH= 1,000 hours

Now let calculate the Variable overhead efficiency variance

Using this formula

Variable overhead efficiency variance = (AH - SH) × SR

Let plug in the formula

Variable overhead efficiency variance= (980 hours - 1,000 hours) × $2 per hour= (-20 hours) × $2 per hour

Variable overhead efficiency variance= $40 F

Therefore Variable overhead efficiency variance is $40 F

8 0

2 years ago

During 2018, Montoya (age 15) received $2,200 from a corporate bond. He also received $600 from a savings account established fo

Ann [662]

Answer:

The correct answer is option (C) $ 1,750

Explanation:

Given data:

Amount received from corporate bond = $ 2,200

Amount received from a savings account = $ 600

Thus, the total income = $ 2,200 + $ 600

The total income = $ 2800

Now,

the standard deduction for the person claimed as dependent's on another's tax return = $ 1,050

Hence, the total taxable income = Total income - standard deduction

the total taxable income = $ 2,800 - $ 1,050 = $ 1,750

Hence, the correct answer is option (C) $ 1,750

3 0

3 years ago

It takes 1 hour to travel from new york to Washington dc by air and 4 hours by train The airfare is 200 and the train fare is 85

creativ13 [48]

Answer: I think the train fare.

Explanation:

Not sure if answer is correct. Sorry if I am wrong.

7 0

1 year ago

A large corporation suffers from the​ principal-agent problem when​ its:

A large corporation suffers from the principal-agent problem when its: