Benefits offered to encourage people to make a specific economic decision

Business

2 answers:

g100num [7]3 years ago

7 0

Answer:

D. Incentives

Explanation:

Incentives are benefits that help motivate others to make a specific economic decision.

Incentives will give someone unique opportunities from the specific decision that one is making.

choli [55]3 years ago

4 0

Answer:

D. incentives

Explanation:

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Cashen Co. paid $2,400,000 to acquire all of the common stock of Janex Corp. on January 1, 2017. Janex's reported earnings for 2

andrew-mc [135]

Answer:

(D) $3,588,000.

Explanation:

Consolidated net income is defined as the sum of net income of the parent company (minus income from investment in subsidiary and unrealized income from downstream sales) plus net income of subsidiaries, which results after deducting depreciation (or amortization), income from transactions with the parent company and unrealized gains in inventories.

In the example, the parent company is Cashen Co. and the subsidiary is Janex´s. Recall that a parent company is one that owns more than 50 percent of the shares of the subsidiary, in this case, it is 100%.

According to the information provided, Cashen Co's net income was $ 3,180,000 and neither income from investment in subsidiary nor unrealized income from downstream sales is reported, so it is not necessary to subtract anything.

On the other hand, we know that Janex´s reported earnings totaled $432,000. However, the amortization of allocations related to the investments ($ 24,000) must be subtracted here. Therefore, the net income of that company was $408,000 ($432.000 - $24.000).

Finally, we add the net income of both companies. That is, $ 3,180,000 + $ 408,000 = $ 3,588,000.

<em>Note: I want to point out that there is a typo in the question. It says: "What is the amount of consolidated net income for the year 2010?", instead of "What is the amount of consolidated net income for the year 2017?"</em>

8 0

3 years ago

Gere Furniture forecasts a free cash flow of $40 million in Year 3, i.e., at t = 3, and it expects FCF to grow at a constant rat

LenKa [72]

Answer:

Option (A) is correct

Explanation:

Given that,

Free cash flow in Year 3, FCF3 = $40 million

FCF to grow at a constant rate, g = 5%

Weighted average cost of capital, WACC = 10%

Cost of equity = 15%