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topjm [15]
3 years ago
8

Why should firms with promising investment opportunities strive to maintain a conservative capital structure, i.e., limited leve

rage? Why do you think many promising small businesses apparently do not follow this recommendation and are heavily indebted?
Business
1 answer:
Crazy boy [7]3 years ago
7 0

Answer:

The answer is to assure funding for future assets.

The answer is because of lack of sufficient operating cash flow.

Explanation:

Companies with promising investments opportunity typically have valuable intangible assets whose value would decline sharply if the company would go into financial difficulty, its important for such company to maintain a financial flexibility that comes with a conservative capital structure to assure funding for future assets.

   Poor cash flow is when the income cash flow is insufficient to meet the outgoing cash flow needs of a business and this can also lead to inability to raise additional equity force.

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A series of formal, written statements in which the plaintiff and defendant both state claims for the defense regarding the matt
4vir4ik [10]
The answer is Appeal, my friend.
3 0
3 years ago
The focus vision area has ...........degrees of information.
tekilochka [14]
5-10 degrees

The focus vision has the purpose of helping in the targeting task. It is also the one that helps to establish a visual lead. Besides these, one of the most important functions of this type of vision, focus vision, is to allow the reading of street signs or any other that might be important, as well as interpreting them.
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3 years ago
Trell Corporation transferred $50,000 of accounts receivable to a local bank. The transfer was made without recourse. The local
PIT_PIT [208]

Answer:

Correct one is Option D.

<u>$6,500</u>

Explanation:

Fair value of its 20% interest in the receivables 8000  

Less: Factoring fee=50000*3% =1500

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7 0
3 years ago
Firms such as IKEA and The Home Depot are known for their use of __________ because they set reasonably low prices but still off
Maslowich

Answer:

b. value-based pricing

Explanation:

Value based pricing is a pricing strategy to set price of products based on value perceived by the purchaser. To have increased profit margin, business deduces the number of benefit the product provides to consumer. Then it establishes price which takes consideration of manufacturing cost, competitive price and consumer's willingness to pay price for the goods.

In the question  mentioned IKEA not only provide functional benefit for the product but also quality, design, and services at low prices hence it is an instance of value based pricing.

7 0
2 years ago
Read 2 more answers
Cost of Preferred Stock Marme, Inc., has preferred stock selling for 96 percent of par that pays an 11 percent annual coupon. Wh
nataly862011 [7]

Answer:

Component cost of preferred stock is 11.4583 %

Explanation:

Given Data:

Preferred stock selling=96 percent of par.

Annual Coupon =11 percent

Required:

What would be Marme’s component cost of preferred stock?

Solution:

The formula we are going to use is:

i_{stock}=\frac{D_o}{P_o}

Where:

D_o is  11 percent annual coupon

P_o preferred stock selling for 96 percent of par

If we convert the above percentage to dollar using the scale $1=1% then:

D_o=$11

P_o=$96

i_{stock}=\frac{\$11}{\$96}\\ i_{stock}=0.114583

Component cost of preferred stock is 11.4583 %

7 0
3 years ago
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