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3 years ago

Lloyd Inc. had sales of $200,000, a net income of //415,000, and the following balance sheet:

Business

1 answer:

Tju [1.3M]3 years ago

4 0

Answer:

The firm's new quick ratio is 2.9

Explanation:

The current ratio is calculated as

Current ratio = Current assets / Current liabilities

2.5 times = (Cash + receivables + Inventories ) / (Accounts payable + Other current liabilities)

2.5 = ($10,000 + $50,000 + Inventories) / $50,000

$60,000 + inventories = $125,000

Inventories = $65,000

Therefore, $85,000 worth of inventories were sold off.

If the funds generated are used to reduce the common equity that is by repurchasing the equity at book value.

Hence, the common equity amounts to $115,000

Calculating the ROE before the inventory is sold off:

ROE = Net income / Stockholder's equity

= $15,000 / $200,000

= 0.075 or 7.5%

Calculating the ROE after selling off the inventory:

ROE = $15,000 / $115,000

= 0.13 or 13%

The firm's new quick ratio is

Quick ratio = (Current assets - Inventories) / Current liabilities

= ($210,000 - $65,000) / $50,000

= 2.9

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uranmaximum [27]

The statements are:

Because Dazzle is not a separate tax entity, all the owners declare revenue earned through the company on their personal federal tax returns.

The $5 million dollar villa is protected from business liabilities unless the liability is incurred through wrongful acts.

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3 years ago

Green design, sustainable packaging, waste management, and energy efficiency are aspects of the _________

Nastasia [14]

Green design, sustainable packaging, waste management, and energy efficiency are aspects of the technological segment of the general environment.

<h3>What is technological segment of the general environment?</h3>

The practice of creating physical items, the built environment, and services in accordance with ecological sustainability principles is known as "green design."

The creation and use of packaging that improves sustainability is referred to as sustainable packing. This entails a greater reliance on life cycle assessment (LCA) and life cycle inventory (LCI) to assist direct the use of packaging that has a smaller negative impact on the environment.

These elements are a part of the physical segment of the general environment that businesses have sought to address with environmental sustainability initiatives, along with energy efficiency (using alternative energy sources like solar, avoiding the use of oil to produce energy, and reducing the air footprint).

The technological area is focused on enhancing the goods and services offered by science. The rate at which new products are developed, the level of automation, and improvements in service industry delivery are a few examples of pertinent variables

The diversity of external elements that have an impact on an organization's performance and operation is known as the general environment, or macro-environment. These outside factors can decide whether a company encounters market opportunities or failures.

Hence, Green design, sustainable packaging, waste management, and energy efficiency are aspects of the technological segment of the general environment.

To learn more about General environment refer to:

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5 0

1 year ago

Ruston Company had Net Income for 2020 of $6,200,000. The firm invested $4,000,000 in manufacturing equipment during 2020. The e

Aloiza [94]

Answer:

$3,000,000

Explanation:

Calculation to determine the Net Cash Flow in 2020

STATEMENT OF CASH FLOW

For the Year 2020

Cash flow from operating Activities:

Net Income $6,200,000

Add Depreciation Expense $ 800,000

Net Cash provided by operating activities $7,000,000

($6,200,000+$800,000)

Cash flow from Investing activities:

Investment in Equipment ($4,000,000)

Net Cash used in Investing activities ($4,000,000)

Net Cash flow in 2020 $3,000,000

Depreciation under Straight Line method = (Cost - Salvage Value)/Useful Life

Depreciation under Straight Line method= (4000000-0)/5

Depreciation under Straight Line method= 800,000

Therefore the Net Cash Flow in 2020 is $3,000,000

4 0

3 years ago

The section of his business plan in which Jones sets forth the purpose of his cabinet-making business-its reason for existing-is

lorasvet [3.4K]

Answer:

The correct answer is letter "C": "Mission Statement".

Explanation:

A company's mission statement represents the objective that the firm must set. That objective must last and should be adaptable to the changes it could be exposed to. It clearly states the purpose of the company and why it exists and operates. The mission statement also identifies by whom the entity is formed and their respective functions.

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3 years ago

What do individual shareholders gain when they buy shares of a companies stock?

baherus [9]

Share Ownership by Individuals.
Did you know owning shares means tax advantage. Your tax situation can benefit from using the tax advantage that come with fully franked dividends.owning shares also means you are a company owner. When you are buying shares you are buying the company`s asset and its profits. All that told there many advantages that come along with purchase of shares by an individual who wishes to invest his capital in shares.
Benefits of Owning Shares.

1. Stock Owners Take Advantage of a Growing Economy.
As the economy grows so do cooperates earning that is because economic growth creates income this will create a consumer demand that will automatically drive more revenue into companies register an lead to rise company`s share value.
2. Easy to Buy.
The stock market has made it easy to by shares from companies. They can be purchased through a broker, financial planner or online. Once you have set up an account you can stock at any minute. The stock market runs 24 hours, five days a week making the market reliable and sufficient.
3.They are the Best Way to Stay Ahead of Inflation.
Historically stocks have averaged an annual return of 10%. That is better than the annual inflation of 3.2%. It means you have a longer time horizon. That way a stock owner is limited to the risks aligned with the stock market.
4. They are easy to sell.
The stock market allows you to sell your shares at anytime. That will surely help if you really need the cash in a hurry. One disadvantages related to this is that the prices are really volatile so the shareholder runs the risk to make losses when the make haste decisions.
5. You make money in two ways.
Many investors tend to by shares when they have low prices and sell when they are high. They invest in companies that appreciate in value at at either a fast rate or moderate rate. This attracts both day traders and buy-hold investors and this bridges the gap in making money in to ways.

Summery.
A well defined portfolio will provide most benefits and fewer risk arising to stock ownership. to exchange you shares at a limited risk and get to earn more experts advice apart from stock ownership alone have a mix of stock bonds and commodities. This has proven to be the best way to make highest returns at lower risk. It is important to note that shareholders in stock market contribute close to 80% of the revenue in the market.

6 0

3 years ago