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Inessa05 [86]
3 years ago
5

Which of the following best describes the concept of laissez-faire?

Business
1 answer:
Nat2105 [25]3 years ago
8 0

Answer:

a.  Government should not intervene in the economy.

Explanation:

The concept of laissez-faire arose during the economic liberalism movement and promotes that the government should not intervene in the economy. According to laissez-faire, the main economic role of the government was to regulate and protect rights to private property.

Therefore, the answer is a.  Government should not intervene in the economy.

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In a new margin account, a customer buys 1,000 shares of ABC stock at $40 per share. The stock rises to $50 during the next week
Helen [10]

Answer:

C) $5,000

Explanation:

Since the price of the stocks first rose to $50, the account's equity was $50,000.

The SMA balance was = ($50,000 x 1/2) - $20,000 = $,5000

The SMA balance acts like a stabilizer and cannot be taken away even if the price of the stocks fall slightly. The price of stocks must fall 25% in order for the SMA to be withdrawn.

The investor's equity decreased = equity - margin requirement = $39,000 - $20,000 = $19,000, but the amount that the investor can borrow (SMA balance) will remain the same at $5,000.

4 0
3 years ago
The financial statements of the Pharoah Company report net sales of $372000 and accounts receivable of $56400 and $27600 at the
snow_lady [41]

Answer:

the average collection period for accounts receivables is 41.2 days

Explanation:

Average Collection Period measures the amount of time it takes to collect credit from accounts owing.

Average Collection Period = Average Accounts Receivables / (Sales/365)

                                            =(($27600+ $56400)/2) / ( $372000/365)

                                            = $42,000/1019.178082

                                            = 41.20967742

                                            = 41.2 days

                             

8 0
3 years ago
Read 2 more answers
Cullumber Company incurred research and development costs of $101000 and legal fees of $41000 to acquire a patent. The patent ha
MArishka [77]

Answer:

$14,200

Explanation:

<em>Step 1 Determine the Cost of the Patent </em>

Research and Development costs        $101000

<em>Add</em> legal fees                                         $41000

Total                                                         $142,000

<em>Step 2 Determine Amortization Expense </em>

Amortization Expense = Cost/ Useful life

                                     = $142,000/10 years

                                     = $14,200

4 0
3 years ago
Tree City reported a $1,500 net increase in fund balance for governmental funds for the current year. During the year, Tree purc
DIA [1.3K]

Answer

The correct answer is c. $ 7,500.

Explanation:

The reconciliation of the change in fund balance in governmental fund financial statements to the change in net position for governmental activities in the government-wide financials is computed using the GOES BARE mnemonic. The fact pattern only describes measurement focus (GOES) issues computed as follows:

G Change in Governmental Fund Balance     $ 1,500

O Other Financing Sources                                   0

E Expenditure - Capital Outlay                           9,000

(net of depreciation)                                         (3,000)

S Internal Service Fund Net Income                   0

Change in Net Position in government

-wide financial statements                               $ 7,500

5 0
3 years ago
Proposal #1 would extend trade credit to some customers that previously have been denied credit because they were considered poo
wolverine [178]

Answer: See explanation

Explanation:

a. Compute the incremental income after taxes that would result from these projections:

Sales increase= $200,000

Less: Uncollectible accounts:

= 7% × $200,000

= ($14,000)

Annual incremental value= $186,000

Less: Collection cost:

= 3% × $200,000

= ($6000)

Less: Production and selling cost:

= 80% × $200,000

= ($160,000)

Incremental income before tax= $20000

Tax at 30% = ($6000)

Incremental income after tax = $14000

b. Compute the incremental Return on Sales if these new credit customers are accepted If the receivable turnover ratio is expected to be 4 to 1 and no other asset buildup is needed to serve the new customer.

Incremental Return on Sales will be:

= Incremental income after taxes ÷ Increase in sales

= $14000/$200000

= 7%

c. Compute the additional investment in Accounts Receivable.

Since the receivable turnover ratio will be 4, then the additional investment in the accounts receivable will be:

= Additional credit sales/Receivable turnover ratio

= $200000 /4

= $50,000

Therefore, the additional investment in the accounts receivable will be $50,000.

d. Compute the incremental Return on New Investment.

The incremental return on new investment will be:

= Incremental income after taxes/Additional investment

= $14000/$50000

= 28%

e. If your company requires a 20% Rate of Return on Investment for all proposals, do the numbers suggest that trade credit should be extended to these new customers? Explain.

Yes, the numbers implies that trade credit should be extended to these new customers. This is because the incremental return on the new investment is 28%, and this is higher than the rate of return on investment which is 20%.

5 0
3 years ago
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