Answer:
The correct answer is 2.29
Explanation:
The debt-to-capital ratio (D/E) is a measurement of a company's financial leverage.
D/E=Total debt/Total equity
Total debt=(notes payable (10.5) + current maturities of long-term debt (39.9) + long-term debt (239.7) = 290.1
Total Equity = 126.6
D/E= 290.1/126.6=2.29
Thus, the debt to equity ratio for Luther in 2018 is closest to 2.29
Answer:
A) I can calculate by what percentage mydeco's revenues grew from 2012 to 2016.
total revenue 2012 = $402.5 million
total revenue 2016 = $606.4 million
change in revenue = ($606.4 - $402.5) / $402.5 = $203.9 / $402.5 = 50.66%
B) net income grew by:
net income 2012 = $18.1 million
net income 2016 = $27.4 million
change in net income = ($27.4 - $18.1) / $18.1 = $9.3 / $18.1 = 51.38%
C) For the years 2012 and 2016 the net income was very similar to total revenue, but that didn't happen during 2014 and 2015 since revenues increased, but net income decreased. The problem that mydeco faced during those years was that their costs, both COGS and sales and marketing costs increased by a much larger proportion than revenue. This is specially true for sales and marketing costs that increased almost 50% (between 2012 -2015) while revenues increased only 25%. Probably the company had to invest a lot of resources to rebound their sales since they plummeted in 2013.
Answer:
The Blowing's sand net income will increase by $45,000 by saving of direct fixed costs.
Explanation:
Fixed costs are costs which remains unchanged irrespective of the level of activity produced by Blowing Sand's, means the Blowing Sand's will have to bear that cost whether it eliminate the Drafty product line or not. example factory rent, building depreciation etc.
Direct Fixed costs are those which only incurred when the units are produced so that will only incur costs when production is made.
So the elimination of Drafty product line will save $45,000 of direct fixed costs and the remaining $78,000 will be redistributed to other remaining product lines which will not impact the net income.
Answer:
He would need to make up for missing today's training session because it is going to be a very important session that will help him a lot to improve his skills.
He would be mad about missing it because he would lose that valuable opportunity to improve his skills, as well as because he would have to make up for missing it.
He would regret missing the session for the same reason.
He tried missing today's session because he had other things on mind, more pressing tasks, the session is valuable but boring, etc.
Answer:
1. Gain of $12,000 on sale of some equipment from one of the gas stations that Bakko still owns at 12/31/Year 4. - <u>Part of income from continuing operations.</u>
The gas station is still owned by Bakko so the gain received will form part of income from continuing operation.
2. Bakko receives $5,000 for a fuel contract that will begin in Year 5. - <u>Not part of net income for Year 4</u>
As per the Revenue Recognition principle of Accounting, revenue is only to be recorded when earned which means that this revenue will be in the Year 5 income.
3. Bakko has $100,000 gain on the sale of the gas stations on May 1, Year 4. - <u>As a discontinued operation.</u>
The gas station has been sold and so is a discontinued operation.
4. Operating results through April 30,Year 4 for the gas stations that were sold. -<u> As a discontinued operation.</u>
The gas station has been sold and so is a discontinued operation. Will be reported in the Income statement as such.
5. Bakko has a $20,000 loss on the sale of the donut stores on October 1. - <u>As a discontinued operation. </u>
The donut store was sold and is no longer a part of Bakko so is a discontinued operation.
