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Simora [160]
4 years ago
8

The AFN equation assumes that the ratios of assets and liabilities to sales remain constant over time. However, this assumption

can be relaxed when we use the forecasted financial statement method. Three conditions where constant ratios cannot be assumed are economies of scale, lumpy assets, and excess capacity.A. TrueB. False
Business
1 answer:
Vera_Pavlovna [14]4 years ago
8 0

Answer:

The answer is A True

Explanation:

AFN which is "additional funds needed" is a concept used commonly in business looking to expand operations and influence. Since a business that seeks to increase its sales level will require more assets to meet that stated goal, some provision must be made to accommodate the change in assets. AFN is a way of calculating how much of new funds will be needed, so that the firm can realistically look at whatever or not they will be able to generate the additional funds and therefore be able to achieve the higher sales level.

Economies of scale are cost advantage reaped by companies when production becomes efficient. Firms can achieve economies of scale by increasing production and lowering cost. This does not involve calculating of new funds needed for a realistic expansion of the firm.

Lumpy assets are assets that cannot be acquired in small increments but must be obtained in large, discrete units.

Excess Capacity indicates to a situation in which the demand for a company's goods and services is less than its production capacity. This situation can arise in any firm during  the low point in a seasonal industry, where capacity is maintained to match the peak part of the season.

A constant ration can not be meet in this condition of economies of scale, lumpy assets, and excess capacity as these conditions  can not be used in raising funds or additional funds that are needed by the industry in its expansion.

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Bonnie and Ernie file a joint return. Bonnie works and receives income during the year but Ernie does not. If the couple files a
Dafna11 [192]

Answer:

Statement is true

Explanation:

One is liable to pay comparatively lesser tax if filed jointly with the spouse. Filing jointly is advantageous. IRS does not force married couples to file joint returns. They have the option to file separately but filing jointly provides ta relief.

If couples decide to file jointly, spouse is responsible to pay taxes or any resultant penalties, if the other half is unable to do so. In this case, Ernie is liable to pay taxes if Bonnie to unable to pay even though she does not have any eared income but they chose to file returns jointly.

3 0
3 years ago
____________ involves a review of the sales, costs, and profit projections for a new product to find out whether they satisfy th
serg [7]

Answer:

Business analysis

Explanation:

A product can be defined as any physical object or material that typically satisfy and meets the demands, needs or wants of customers. Some examples of a product are mobile phones, television, microphone, microwave oven, bread, pencil, freezer, beverages, soft drinks, etc.

Business analysis refers to a strategic process that typically involves a review of the sales, costs, and profit projections for a new product in order to find out whether the product is in tandem with the objectives of the company.

This ultimately implies that, many organizations and business owners use business analysis to measure the level of satisfaction with respect to the company's objectives and its customers through the process of analyzing or reviewing the sales, costs and profits projection of its new products before pushing them out into the market.

Similarly, cost-volume-profit analysis is also known as the break even analysis, it is an important tool in predicting the volume of activity, the costs to be incurred, the sales to be made, and the profit to be earned is. It is used to determine how changes in differing levels of activities such as costs and volume affect a company's operating income and net income.

5 0
3 years ago
Steven Diaz just took a job with Harley Davidson. As part of his employment agreement, Harley Davidson required Steven to sign a
il63 [147K]

Answer:

Non-compete

Explanation:

A non-compete agreement is when an emoloyee agrees not to enter into or start a similar profession in competition against her employer.

Majority of agreements stipulated the length of time an employee isn't allowed to enter into or start a similar profession in competition against her employer.

I hope my answer helps you

5 0
4 years ago
ConAgra Foods is a global manufacturer of processed and packaged foods with revenues of $11 billion annually. It recently acquir
mojhsa [17]

Answer:

wholly owned subsidiary

Explanation:

A wholly-owned subsidiary is a form of subsidiary arrangement, between two companies, whereby a company is completely owned or its whole stock is bought by another company often referred to as Parent Company after the arrangement or the agreement of the acquisition.

It is also characterized by having control over its resources and specific mission, also operates independently.

Hence, in this case, the right answer is a wholly owned subsidiary

6 0
3 years ago
If a company reorganizes its operation to gain efficiency, the cost associated with this reorganization is classified as
ivanzaharov [21]

Answer: Restructuring cost

Explanation:

Restructuring cost could be described as making expenses on rejuvenating or reviving or rebranding the company through spendings, which affects most of it's mode of operations, brings a change and innovation and ways to improve existing methods. This is capital intensive due to the work and changes required during the process.

8 0
3 years ago
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