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3 years ago

When a bank's loans are written off then the bank's?

1 answer:

8 0

When a bank's loans are written off, then the bank's RESERVES SHRINK WHEREAS ITS DEBTS REMAINS THE SAME. Sometimes, due to unpleasant situations, banks are forced to write off loans which they hand lend out to borrowers and which the borrower are unable to repay. This action reduces the amount of money that the bank has in its reserve.

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EA4.

boyakko [2]

Answer:

Explanation:

There is the relation between the variable cost and the product cost & fixed cost and the period cost

The product cost is that cost which is used to make the product. It includes direct material, direct labor, and the manufacturing overhead

In mathematically,

Product cost = Direct material + direct labor + manufacturing overhead

The period cost is that cost which remain fixed and is incurred when the time passes

Period cost = Salaries of sales person + delivery trucks depreciation + Repairs to office equipment + Advertising expense + usage of office supplies expense

So, the categorization is shown below:

Lumber used to construct decks ($12.00 per square foot) = Variable cost and Product cost

Carpenter labor used to construct decks ($10 per hour) = Variable cost and Product cost

Construction supervisor salary ($45,000 per year) = Fixed cost and the period cost

Depreciation on tools and equipment ($6,000 per year) = Fixed cost and the period cost

Selling and administrative expenses ($35,000 per year) = Fixed cost and the period cost

Rent on corporate office space ($34,000 per year) = Fixed cost and the period cost

Nails, glue, and other materials required to construct deck (varies per job) =

Variable cost and Product cost

3 0

3 years ago

Lein's net income is $200,000 and its operating cash flows are $240,000. The company reports total assets of $1.6 million and $1

yarga [219]

Answer:

14.1%

Explanation:

Cash return on assets is the ratio of a company's operating cash flow to its average total assets. It shows how a company is generating cash flow from its assets and compares a company’s profitability with other companies.

Cash return on assets = operating cash flow / average total assets

Given that:

operating cash flows = $240,000

Average total assets = ($1.6 million + $1.8 million) / 2 = $1.7 million.

Therefore, Cash return on assets = $240000 / $1.7 million = 0.141 = 14.1%

6 0

2 years ago

The president of the company you work for has asked you to evaluate the proposed acquisition of a new chromatograph for the firm

Tems11 [23]

Answer:

Part A)

Year 0 net cash flow would comprise of basic price, modification cost and requirement for net working capital. The formula for cash flow in Year 0 would be:

Year 0 Net Cash Flow = -Basic Price - Modification Cost - NWC

______________

Using the values provided in the question, we get,

Year 0 Net Cash Flow = -190,000 - 47,500 - 9,500 = -$247,000

______________________

Part B:

Year 1, 2 and 3 would required adjustment for depreciation charges (under MACRS) against expected savings. The depreciation rates for 3 year class asset would be 33%, 45% and 15% for Year 1, Year 2 and Year 3 respectively.

Depreciation would be calculated on the equipment's basic price and modification cost.

The formula that can be used to calculate the net operating cash flow would be:

Net Operating Cash Flow = (Sales - Depreciation)*(1-Tax Rate) + Depreciation

______________

Using the values provided in the question, we get, the table in the attached file

Important Information:

Depreciation (Year 1) = (190,000 + 47,500)*33% = $78,375

Depreciation (Year 2) = (190,000 + 47,500)*45% = $106,875

Depreciation (Year 3) = (190,000 + 47,500)*15% = $35,625

______________________

Part C:

Additional non operating cash flow would consist of after-tax salvage value and return of net working capital. Relevant formulas are:

Additional Non Operating Cash Flow = After Tax Salvage Value + Return of Net Working Capital

After Tax Salvage Value = Sales Value +/- Tax on Loss/Gain from Sale of Asset

Loss/Gain from Sale of Asset = Sales Value - Book Value

Book Value = (Basic Price + Modification Cost)*(1-(33%+45%+15%))

______________

Using the above mentioned formulas, we get,

Book Value = (190000 + 47500)*(1-(33%+45%+15%)) = $16,625

Gain on Sale of Equipment = 66,500 - 16,625 = $49,875

Tax on Gain = $49,875*30% = $14,962.50

After Tax Salvage Value = 66,500 - 14,962.50 = $51,537.50

_____________________

Additional (Non Operating) Cash Flow = $51,537.50 + $9,500 = $61,037.50 or $61,038

Explanation:

8 0

2 years ago

A(n) _____ refers to a situation where a publicly traded company is purchased and then taken off the stock market.

dalvyx [7]

Leveraged buyout/////////////////

4 0

3 years ago

The next time you need to make a choice, your brain will use what what method?

Katarina [22]

Answer:

Imagine you have just flicked a lighter. If you don’t see the flame, you will naturally try a second time. If after the second attempt it does not strike a flame, you will repeat your action again and again until it does. Eventually, you’ll see the flame and you’ll know that your lighter works. But what if it doesn’t? How long are you going to flick the lighter until you decide to give up?

Our everyday life is full of such decision dilemmas and uncertainty. We constantly have to choose between options, whether we make the most ordinary decisions – should I continue flicking this lighter? – or life-changing choices – should I leave this relationship? We can either keep on doing what we are already used to do, or risk unexplored options that could turn out much more valuable.

Some people are naturally inclined to take more chances, while others prefer to hold on to what they know best. Yet being curious and explorative is fundamental for humans and animals to find out how best to harvest resources such as water, food or money. While looking at the Belém Tower – a symbol of Portugal’s great maritime discoveries – from my office window, I often wonder what drives people to explore the unknown and what goes on in their brains when weighing pros and cons for trying something new. To answer these questions, together with Dr. Zachary Mainen and his team of neuroscientists, we investigate how the brain deals with uncertainty when making decisions.

Explanation:

It is well known that the decision-making process results from communication between the prefrontal cortex (working memory) and hippocampus (long-term memory). However, there are other regions of the brain that play essential roles in making decisions, but their exact mechanisms of action still are unknown.

4 0

2 years ago