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3 years ago

Which of the following statements is always true? A. Workers being paid based on commission...

Business

1 answer:

shusha [124]3 years ago

4 0

Answer:

The statement that is always true is the b. Workers being paid on commission get paid based solely on their performance.

Explanation:

That is because the pay on commission is proportional to the results: the more you sell the more you earn. So, the earnings are reflection of the results that the employee reaches, i.e. his/her performance. Take into account that option c. "workers being paid on commission are stressed over the amount of earnings they will have" is true only some times, because if the employee has a comfortable finance position he/she will not necessarily be under stress.

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Problem 16-17 Firm Value [LO2] Change Corporation expects an EBIT of $25,000 every year forever. The company currently has no de

PolarNik [594]

Answer and Explanation:

The computation is shown below:

a. The current value of the company is

As it is mentioned that the company has no debt that means it is unlevered firm that is equivalent to unlevered value of the company

Unlevered value of the firm = Vu

Vu = EBIT × (1 - tax rate ) ÷ unlevered Cost of Equity

= EBIT × (1 - tax rate ) ÷ R0

= $25,000 × (1 - 0.22 ) ÷ 12%

= $162,500

b-1.

The computation of the value of the firm in the case when the value of the firm is equivalent to 50% of unlevered value

VL = Vu + Borrowing × tax rate

where,

Debt = borrowing = 50% × unlevered value of company

Debt = borrowing = 50% x Vu

So,

VL = Vu + Borrowing x tax rate

VL = $162,500 + ($162,500 × 50%) × 22%

= $162,500 + $17,875

= $180,375

b-2.

The computation of the value of the firm in the case when the value of the firm is equivalent to 100% of unlevered value

Levered value of the firm VL

VL = Vu + Borrowing × tax rate

Debt = borrowing = 100% × unlevered value of company

Debt = borrowing = 100% × Vu

So,

VL = Vu + Borrowing x tax rate

= $162,500 + ($162,500 × 100%) × 22%

= $162,500 + 35,750

= $198,250

C.1.

The computation of the value of the firm in the case when the value of the firm is equivalent to 50% of the levered value

VL = Vu + Borrowing × tax rate

= Vu + (VL × 50%) × tax rate

VL = Vu + (VL × 50%) × 22%

VL = Vu + 0.11 VL

VL - 0.11 VL = 162,500

0.89 VL = 162,500

VL= 182,584.27

C.2.

The computation of the value of the firm in the case when the value of the firm is equivalent to 100% of the levered value

Levered value of the firm VL

VL = Vu + Borrowing x tax rate

VL = Vu + (VL × 100%) × tax rate

= Vu + (VL × 100%) × 22%

= Vu + 0.22 VL

VL - 0.22 VL = 162,500

0.78 VL = 162,500

VL= $208,333.33

6 0

3 years ago

Question 10 of 36

lana66690 [7]

Answer:

Explanation:

To answer the question, we look at an extreme scenario of 0% interest rate and see the minimum repayment Jade will make on the loan taken

Therefore,

Interest Rate = 0%

This means that the loan to be paid will be calculated as follows

Monthly payments x 12 Months x 14 Years

= $195 x 12 months x 14 years = $32, 760

The meaning of this outcome is that the lower the interest rate to be paid, the higher the size of the loan, because at 2.9% the loan= $26,898.98 and at 0% rate the loan= $32, 760.

The conclusion therefore is a 2.7% interest rate which is lower than 2.9% but not as low as the extreme 0% will cause the loan amount to be higher than $26,898.98. This affirms option A.

Options B and C are wrong because 2.5% and 2.3% are lower than 2.9%, therefore, the loan amount will be higher. Option D is also wrong because a 3.1% interest rate is higher than 2.9%, therefore, the amount should be lower not higher than $26,898.98

7 0

2 years ago

Techniques in identifying customers' needs and wants

Rainbow [258]

Good customer research is a very important part of the business, because knowing what the customers want and why they want that will help in better sale.Some of the techniques of <span>identifying customers' needs and wants are:
- Interviewing customers
- Conducting voice and customer surveys
- Analyzing your competition
- Interviewing stakeholders and obtaining the data they have

</span>

4 0

3 years ago

On April 15, 2012, Andy purchased some furniture and fixtures (7-year property) for $10,000 to be used in his business. He did n

jenyasd209 [6]

Answer:

$874.50

Explanation:

Calculation to determine the cost recovery deduction for 2020

2020 cost recovery deduction = $10,000 × 17.49% × ½

2020 cost recovery deduction = $874.50

Therefore the cost recovery deduction for 2020 is $874.50

8 0

3 years ago

Based on the following data, what is the amount of current assets? Accounts payable……………………………………………………….. $62,000 Accounts rece

Vlad1618 [11]

Answer:

The amount of current assets are $252,000

Explanation:

Current assets: The current assets are those assets who are converted into cash within one year. Like - accounts receivable, cash, inventory, prepaid insurance, etc.

The total amount of the current assets are shown below:

= Accounts receivable + Cash + Inventory + Short-term investments + Prepaid insurance

= $100,000 + $70,000 + $80,000 + $2,000

= $252,000

The other items represent current liabilities, long term liabilities, intangible assets, and the fixed assets so, we do not consider them in the computation part.

4 0

3 years ago