The _____ section of the business plan tells the reader what the organization is committed to doing.

Multiple-Choice Questions on Consolidation Overview [AICPA Adapted]

boyakko [2]

Answer: 1. D. Economic entity

2. C. Circumstances prevent the exercise of control.

3. B. Consolidation used for both Sell and Vane.

4. B. In form, the companies are separate; in substance, they are one entity

Explanation:

1. When a parent–subsidiary relationship exists, it can be infered that consolidated financial statements will be prepared in recognition of the accounting concept of economic entity.

2. Consolidated financial statements are prepared when one company has a controlling interest in another unless the circumstances prevent the exercise of control.

3. Based on the information given, in Penn’s consolidated financial statements, it should be noted that Sell and Vane should be consolidated. Therefore, the correct option is B.

4. The best theoretical justification for consolidated financial statements is that in form, the companies are separate while in substance, they are regarded as one entity.

4 0

3 years ago

Aahi worries about what will happen to her jewelry business if her business partner were to have to leave the business permanent

omeli [17]

Answer:

The correct answer is C

Explanation:

Disability buyout insurance is the term which is defined or designed in order to provide the funds that is important to buy an owner or the interest of the partner in the small business if the person become disabled.

It will help or allow the remaining owners to continue the operations by replacing a key person in terms of financially as the disability of the person prevents them from returning to the business.

5 0

3 years ago

Consider an asset that has a beta of 1.25. If the risk free rate is 3.25 and the mrket risk premium is 5.5% caculate the expecte

valina [46]

Answer:

10.125%

Explanation:

The formula to compute the expected return on the asset is shown below:

Expected return on the asset = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)

= 3.25% + 1.25 × 5.5%

= 3.25% + 6.875%

= 10.125%

The (Market rate of return - Risk-free rate of return) is also known as the market risk premium and the same is used in the computation part

4 0

3 years ago

Sal and Jen went to the store together, and each bought the same car stereo. Sal used a card to make the purchase, and the full

Dvinal [7]

Given that <span>Sal and Jen went to the store together, and each bought the same car stereo. Sal used a card to make the purchase, and the full amount was immediately withdrawn from his bank account. Jen used a card to make the purchase, and she received a bill within 15 days of the purchase. She paid $21.30 for the next 18 months until the bill was paid in full. The full payment included $58.60 in interest.

The statement that describes Sal’s purchase is "</span><span>Sal used a debit card and paid a total of $324.80 for the stereo".</span>

9 0

3 years ago

Read 2 more answers

The financial statements of Carrier Office Furniture Company include the following items: 2019 2018 Cash $42,500 $42,000 Sh

ad-work [718]

Answer:

$65,500

Explanation:

Data provided in the question:

2019 2018

Cash $42,500 $42,000

Short-term Investments 28,000 19,000

Net Accounts Receivable 102,000 98,000

Merchandise Inventory 166,000 148,000

Total Assets 527,000 547,000

Total Current Liabilities 273,000 285,000

Long-term Note Payable 64,000 60,000

Now,

Working capital = Current assets - Current liabilities

Also,

Current assets (i.e for the year 2019 )

= Cash + Short-term Investments + Net Accounts Receivable + Merchandise Inventory

= $42,500 + $28,000 + $102,000 + $166,000

= $338,500

and,

Current liabilities = $273,000

Therefore,

Working capital for 2019 = $338,500 - $273,000

= $65,500

3 0

3 years ago