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kotegsom [21]
3 years ago
8

The Tipton Division of Dudley Company reported the following data last year: Return on investment 20 % Minimum required rate of

return 12 % Residual income $ 50,000 Tipton Division's average operating assets last year were: Multiple Choice A. $625,000 B. $250,000 C. $416,677 D. $333,333.
Business
1 answer:
pashok25 [27]3 years ago
7 0

Answer:

A. $625,000

Explanation:

We know that,

Residual income = Average operating assets × (Return on investment  - Minimum Required Rate of Return)

$50,000 = Average operating assets × (20% - 12%)

$50,000 = Average operating assets × 8%

So, the average operating assets would be

= $50,000 ÷ 8%

= $625,000

We simply apply the formula by considering all the items which are given in the question

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Bird Brain Co. reported net income of $45,000 for the year ended December 31, 2016. January 1 balances in accounts receivable an
Alika [10]

Answer:

Option (A) is correct.

Explanation:

Cash flow from Operating Activities:

=  Net income + (Beginning Accounts receivable - Ending Accounts receivable) + (Ending Accounts payable - Beginning Accounts payable)

= $45,000 + ($23,000 - $22,000) + ($28,000 - $26,000)

= $45,000 + $1,000 + $2,000

= $48,000

Therefore,  Bird Brain's cash flows from operating activities would be $48,000.

5 0
3 years ago
Lohn Corporation is expected to pay the following dividends over the next four years: $16, $12, $11, and $7.50. Afterwards, the
andreev551 [17]

Answer:

Current share price =$77.81

Explanation:

Price of the stock today = \frac{D1}{(1+ke)^1}+\frac{D2}{(1+ke)^2}+\frac{D3}{(1+ke)^3}+\frac{D4}{(1+ke)^4}+\frac{P4}{(1+ke)^4}.

where P4 = \frac{D5}{ke-g}

where D5 = D4(1+g)

Price of the stock today = \frac{16}{(1+0.16)^1}+\frac{12}{(1+0.16)^2}+\frac{11}{(1+0.16)^3}+\frac{7.50}{(1+0.16)^4}+\frac{7.50(1.06)}{(0.16-0.06)(1+0.16)^4} = $77.81

8 0
3 years ago
Process costing would be most likely used by a A. salsa company. B. soft drink manufacturer. C. cereal company. D. all of the ab
Lana71 [14]

Answer:

All of the above would use process costing.

Explanation:

Process costing can be defined as a method of assigning manufacturing costs whereby the cost of each unit produced is assumed to be the same cost for every unit.

Process costing is most commonly applied when goods are produced in large numbers and when the costs linked to individual units cannot be easily differentiated from each other.

Under process costing, costs rise over a fixed period of time, and are then assigned to all the units produced throughout that period.

4 0
3 years ago
Among the most effective ways to increase sales of an online service is to offer some form of free trial for users to experiment
Basile [38]

Answer:

Option D

Explanation:

When providing an online service, a company firstly targets to reach the maximum audience. With the increase in reach of audience the chances and feasibility of sales also increases.

But, still there are many customers who desire to have a free trial of service, in order to ensure themselves about the quality and  detailed description of service.

In case company agrees to provide free trial, those customers are also satisfied and tend to avail the online service.

Thus, although the sales is directly proportional to the number of visitors, but it would definitely increase by providing the free trial of online service, as ensures more satisfaction in customers.

Final Answer

Option D

7 0
3 years ago
Greg is the CEO of a leading company in the consumer packaged goods industry. He is trying to grow his company for personal gain
Lilit [14]

Answer: Over-diversification

Explanation:

 According to the given question, the Over-diversification is one of the concept in the business in which the an organization make a large number of investment of the different types of asset where the expectation of the marginal cost become high.

Greg is one of the leading company CEO and for the growth of the company he has decided for acquiring some small chemical firms for increase the productivity but the shareholder are not happy with this due to the over-diversification concept.

The over-diversification also increase the risk in the investment process but there is always high possibility of marginal benefit in the business. Therefore, Over-diversification is the correct answer.  

 

3 0
3 years ago
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