Which of the following is considered an advantage of home ownership?

Andrei [34K]

Answer: B)May seek removal of a person from a registered firm.

Explanation: PCAOB( Protecting Investors through Audit Oversight ) is the person assigned with the duty of the inspection of the audit reports, interest of investors, public organization's auditors etc.

They do their job/duty by the help of the components such as enforcement, setting of the specific standards,overseeing etc. They also get have the authority of removing of any person from organization on the basis of their duty. Thus the correct option is option (B)

5 0

2 years ago

The explicit forecast period must be long enough for the company to reach a steady state the point at which we calculate the con

Mamont248 [21]

Answer: E) The company expects a constant weighted average cost of capital.

Explanation: The explicit forecast period in most organisations are usually made between five to about fifteen years,this is to ensure that enough timeline is given to effectively capture all the necessary information to do proper forecast.

The only option that is not a desirable feature of the steady state is that. The company expects a constant weighted average cost of capital. All other options are desirable feature because they have positive impact on the business and will make a good forcast.

8 0

2 years ago

McMurphy Corporation produces a part that is used in the manufacture of one of its products. The costs associated with the produ

larisa [96]

Answer:

Opportunity cost ($481,000) is greater than the total production cost ($356,000). McMurphy corporation should produce the products by itself instead of buying from Conners Company since the production costs are lower than purchase cost

Explanation:

Determine the total cost associated with the production of the units as follows;

T=M+L+V+F

where;

T=total costs

M=direct materials cost

L=direct labor costs

V=variable factory overhead costs

F=fixed factory overhead costs

In our case;

M=$88,000

L=$127,000

V=$59,000

F=$137,000

replacing;

T=(88,000+127,000+59,000+137,000)=$411,000

Total costs=$411,000

Assuming the McMurphy avoids 55,000 fixed factory overhead cost;

Total costs=411,000-55,000=$356,000

The opportunity cost if McMurphy Corporation decides to purchase the units from Conners Company instead of producing them will be;

Opportunity cost=cost per unit×number of units

cost per unit=$37

number of units=13,000 units

Opportunity cost=37×13,000=$481,000

Opportunity cost ($481,000) is greater than the total production cost ($356,000). McMurphy corporation should produce the products by itself instead of buying from Conners Company since the production costs are lower than purchase cost

5 0

3 years ago

Place the components of the M2 money supply in order, from smallest to largest

dimulka [17.4K]

Answer:

Small time deposits, money market mutual funds, currency, checkable deposits, savings deposits.

Explanation:

8 0

2 years ago

An investor has two bonds in his portfolio that have a face value of $1,000 and pay a 9% annual coupon. Bond L matures in 15 yea

aksik [14]

Answer:

Price of L bond at 5 percent required rate of return = $1,415.16

Price of L bond at 7 percent required rate of return = $1,182.16

Price of L bond at 10 percent required rate of return = $923.94

The price of the long term bonds change more with a change in interest rate because the long term bonds have a greater interest rate risk as compared to the short term bonds

Explanation:

L bond has a coupon rate of 9 percent, a face value of $1,000 and matures in 15 years. The coupon payments are made on annual basis. At the time of maturity the bondholder gets the face value.

We can find the present value of the coupon payments using the present value of annuity formula and the present value of the face value to be received after fifteen years using the present value formula. Sum of the present value of annuity of coupon payments and present value of the face value should equal the fair value (price) of the bond.

If the required rate of return is 5 percent, the price of the bond can be computed as under

Price = PMT [[(1+i)^n] -1]/[ix(1+i)^n] + FV/(1+i)^n

where PMT = 1,000 x 9% = $90

n = 15 years, i = 5% and FV = $1,000

Plugging the values in the formula we get

Price = 90[{(1+0.05)^15} - 1]/ [0.05 x (1+0.05)^15] + 1,000/(1+0.05)^15

Price = 90[{(1.05)^15} - 1]/ [0.05 x (1.05)^15] + 1,000/(1.05)^15

Price = 90[2.07893 - 1]/ [0.05 x 2.07893] + 1,000/2.07893

Price = 90[1.07893]/ [0.10395] + 1,000/2.07893

Price = 934.14 + 481.02 = 1,415.16

If the required rate of return increases to 7 percent, the price is computed as under

Price = 90[{(1+0.07)^15} - 1]/ [0.07 x (1+0.07)^15] + 1,000/(1+0.07)^15

Price = 90[{(1.07)^15} - 1]/ [0.07 x (1.07)^15] + 1,000/(1.07)^15

Price = 90[2.759 - 1]/ [0.07 x 2.759] + 1,000/2.759

Price = 90[1.759]/ [0.19313] + 1,000/2.759

Price = 819.71+ 362.45 = 1,182.16

If the required rate of return increases to 10 percent, the price is computed as under

Price = 90[{(1+0.1)^15} - 1]/ [0.1 x (1+0.1)^15] + 1,000/(1+0.1)^15

Price = 90[{(1.1)^15} - 1]/ [0.1 x (1.1)^15] + 1,000/(1.1)^15

Price = 90[4.1772 - 1]/ [0.1 x 4.1772] + 1,000/4.1772

Price = 90[3.1772]/ [0.41772] + 1,000/4.1772

Price = 684.55+ 239.39 = 923.94

The price of the long term bonds change more with a change in interest rate because the long term bonds have a greater interest rate risk as compared to the short term bonds

3 0

2 years ago