Answer:
Answer is explained and solved in the explanation section below.
Explanation:
Data Given:
First we need to clearly extract the data from the question.
Sales of the year = 5000000
Increase in Sales (%) = 20%
Profit Margin = 4%
Retention Ratio = 100%
Dividend Payout = 0
1. Increase in Assets necessary to support increase in Sales = Increase in Sales x total Assets = 20% x 3000000 = 600000
2. Increase in Liabilities necessary to support increase in Sales = Increase in Sales x Total Liabilities Accounts payable + Accrued Liabilities + other payables = 20% x 500000 = 100000
3. Net Income = 5000000 x (1 + 0.20) x 4% = 240,000
So Addition of Retained Earnings = 100% = 240,000
4. AFN = Increase in Assets - Increase in Liabilities - Increase in Retained Earnings = 600000 - 100000 - 240000 = 260000
Under this scenario, the company would have higher level of retained earnings which would reduce the amount of additional funds needed.
Answer:
The NPV of the project is $974.
Explanation:
The net present value is the today's value of a stream of cash flows. The net present value will be the sum of all the expected future cash flows from a project less the initial investment required for the project and it is used to evaluate the investment decisions.
The net present value of an investment project will be:
NPV = CF1 / (1+r) + CF2 / (1+r)^2 + ... + CFn / (1+r)^n - Initial investment
or
If the cash flows are constant or of same amount through out, occur after the same interval of time and are for a defined period of time, they become an annuity and the NPV of such a project can be calculated by,
NPV = (Cash flow per period * Present value of Annuity factor) - Initial cost
The NPV of this project will be = (2000 * 2.4869) - 4000 = 973.8 rounded off to $974
Answer:
<u>d. Is it possible to make decisions without collecting data?</u>
<u>Explanation:</u>
There is <em>no need</em> for such a question since you are already requested to begin developing a data collection plan.
However, questions related to who will be responsible for collecting the data are important as they enable you to properly plan. Also, knowing the source of the data and the reason for collecting the data are important questions.
Answer:
The answer is given below;
Explanation:
1. Bank (1,500*12) Dr.$18,000
Capital (1,500*4) Cr.$ 6,000
Paid in capital in excess of par (1500*(12-4)) Cr.$12,000
2. Bank Dr.$7,500
Capital (1,500*5) Cr.7,500
Answer:
merchandise inventory on the balance sheet 6,540 option B
Explanation:
we should eevaluate between cost or market price, the lowest.
Product C
cost: 6
market: 5
we will use $5 so 420 units x 5 dollars = $ 2,100
Product D
cost: 12
market: 14
we will use $12 so 370 units x 12 dollars = $ 4,440
Total merchandise: product C 4,440 + product D 2,100 = 6,540