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GarryVolchara [31]
3 years ago
13

Fairfax Pizza borrowed 745,000 dollars to build a new restaurant for 745,000 dollars. The decision to spend 745,000 dollars on t

he restaurant is best classified as an example of what type of decision?
O Capital budgeting decision
O Financing decision
O stakeholder decision
O Agency decision
Business
1 answer:
EastWind [94]3 years ago
8 0

Answer:

Financing decision

Explanation:

Financing decision is concerned with borrowing and allocating funds for investments.

As such, the decision to borrowed 745,000 dollars and use the fund to build a new restaurant for 745,000 dollars is a financing decision.

Capital Budgeting decision-making process involves plans around any long term capital expenditures whose returns (cash inflows and outflow) are expected to be earned in more than a year.

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A small office building is purchased for $1,200,000 with a balloon mortgage that is due at the end of year 10. Payments are base
anygoal [31]

Answer:

$12,000 during the first year or $1,200 per year during 10 years  

Explanation:

The IRS considers mortgage points as interest paid in advance, and generally individuals and small businesses will deduct them entirely during the current year. But the taxpayer can choose to deduct that amount ratably over the life of the loan (in this case 10 years). Of course most people chooses to deduct them completely during the first year because the IRS doesn't recognize any interest.

7 0
3 years ago
A firm is selling two products, chairs and bar stools, each at $50 per unit. Chairs have a variable cost of $25, and bar stools
marishachu [46]

Answer:

Break-even point in dollars= $36,364

Explanation:

Giving the following information:

A firm is selling two products, chairs and bar stools, each at $50 per unit. Chairs have a variable cost of $25, and bar stools $20. The fixed cost for the firm is $20,000.

To calculate the break-even point in dollars for the firm, we need to use the following formula:

Break-even point (dollars)= Total fixed costs / [(weighted average selling price - weighted average variable expense)/ weighted average selling price]

weighted average selling price= (selling price* weighted sales participation)= $50

weighted average variable cost= (variable cost* weighted sales participation)

weighted average variable cost= (25*0.5 + 20*0.50)= $22.5

Break-even point in dollars= 20,000/ [(50 - 22.5)/ 50]= $36,364

4 0
3 years ago
When might term insurance be a better option than whole life insurance?
Vedmedyk [2.9K]
Maybe never because Term insurance isn't always there when you need it. Also you can only get term at certain points in your life. Whereas whole life is always available.  
6 0
3 years ago
Read 2 more answers
A present value of $2600 is invested in an account with an annual interest rate of 4.1% . Determine the minimum amount of time r
Olin [163]

Answer:

The minimum amount of time required is:

26.82 years.

Explanation:

Present value = $2,600

Future value = $7,800 ($2,600 * 3)

Annual interest rate = 4.1%

Monthly interest rate = 4.1%/12 = 0.342%

$2,600 will need to be invested for 321.781 (26.82 years) periods to reach the future value of $7,800.00.

FV (Future Value) $7,800.00

PV (Present Value) $2,600.00

N (Number of Periods) 321.781

I/Y (Interest Rate) 0.342%

PMT (Periodic Payment) $0.00

Starting Investment $2,600.00

Total Principal $2,600.00

Total Interest $5,200.00

5 0
2 years ago
Jack offers to sell Jill his automobile for $10,000. Jill says she must think about but that she is not rejecting his offer. Jil
wel

Answer:

The sale of the car is canceled

Explanation:

For two reasons I think this. Jack had already sent out a letter to jill stating that the car is no longer for sale. As the current owner of the vechile he has the right at any point in time to draw out of the deal up till the actual signing over of the car.  

3 0
3 years ago
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