There is a new shoe company called "Tim's Shoes" that sells via online including an app. Just put in your size, see the selectio
1 answer:
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Answer:
(C) The Firm's stock is overvalued and one should consider selling the stock
Explanation:
Price Earnings Ratio is a measure of market price of stock in relation to it's earnings. It shows how well a company's stock is valued in the market.
Price Earnings Ratio =
A high price earnings ratio would lead investors to believe that the firm's stock prices are higher than it's earnings which means the stock prices are overvalued.
This further means, the market price of those stocks is greater than their fair value and it would be beneficial to investors to sell such stocks as it would result into a gain.
Thus, a higher price earnings ratio will lead investors to infer that the firm's stock is overvalued and one should consider selling the stock.
Answer:
<h2> Whispering Winds Corp.</h2>Statement of Cash Flows (Indirect Method) 2017
Cash flow from operating activities:
net income $161,100
Adjustments to reconcile net income:
+ depreciation expense $40,160
+ loss on sale of equipment $2,020
Change in current assets:
- increase in accounts receivable ($40,050)
- increase in inventory ($44,310)
+ increase in prepaid expenses $1,980
Change in current liabilities:
+ increase in accounts payable $2,580
- decrease in accrued exp. payable ($10,070)
Net cash provided by operating activities $113,410
Cash flow from investing activities:
purchase of new equipment ($164,450)
sale of old equipment $33,650
Net cash provided by investing activities ($130,800)
Cash flow from financing activities:
Proceeds from issue of new stocks $171,150
- redemption of bonds ($49,180)
- dividends paid ($85,680)
Net cash provided by financing activities $36,290
<u>Net increase in cash $18,900</u>
