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WARRIOR [948]
3 years ago
10

Discuss the corporate control of your business. Explain why your business in Mexico is exposed to agency problems

Business
1 answer:
Wittaler [7]3 years ago
5 0

Answer:

Corporate Control and Agency Problems

For  instance, Mr. Jones has a business in Mexico and hires professional managers, but he cannot be there to control their actions always.  There are lots of agency problems because of the conflict of interests that is prevalent and the inexistence of goal congruence.

His corporate managers are his agents, as the stockholder.  However, most times, these managers do not run the businesses they are entrusted with fiduciary duties in the best interests of  Mr. Jones or the principals who appointed them to the positions.  They carry out their own agendas and try to satisfy their selfish interests.

Explanation:

Is there any wonder Mr. Jones' business in Mexico is exposed to agency problems?  The managers who are your agents will never, at all times, protect your interests in the business.  They try as much as possible to satisfy their own interests.  Where there is no goal congruence, managers will always expose their principals to agency problems.  To curtail these problems, Mr. Jones and the other stockholders must devise means to align the interests of the managers with those of the stockholders.  One of the ways of achieving this is through stock compensation and the limitation of compensation in cash.

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Differential Analysis for a Lease or Buy Decision Sloan Corporation is considering new equipment. The equipment can be purchased
Arlecino [84]

Answer:

Alternative 2 (purchase equipment) should be selected because it reduces costs by $10,400.

Explanation:

Alternative 1 (lease):

less price per year $30,000 x 5 years = $150,000

Alternative 2 (purchase):

initial investment = $125,500 + $1,600 = $127,100

maintenance cost per year = $2,500 x 5 years = $12,500

<h2>                   Differential Analysis</h2>

                                              alternative 1      alternative 2     differential

                                              lease                 purchase          effect

Revenues                             $0                      $0                    $0

Costs:    

Purchase price                     $0                -$125,500         -$125,000

Freight and installation      $0                    -$1,600              -$1,600  

Repair and maintenance          $0                   -$12,500           -$12,500

(5 years)    

Lease                                    -$150,000                 $0              $150,000

(5 years)    

Income / loss                       -$150,000           -$139,600           <u>$10,400</u>

Alternative 2 (purchase equipment) should be selected because it reduces costs by $10,400.

4 0
3 years ago
What are some of the strategies that you currently use to make consumer
horsena [70]

<u>Answer:</u>

Consumer behavior considers numerous reasons why individual, situational, mental, and social individuals look for items, purchase, use, and afterward discard them.

Evaluative criteria are positive qualities that are imperative to you, for example, the cost of the knapsack, the size, the number of compartments, and shading. A portion of these attributes are valued highly as compared to others. For instance, the size of the rucksack and the cost may be more imperative to you than the shading except if, state, the shading is hot pink, and you despise pink.

8 0
3 years ago
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Jim would like to learn more about what it's like to be a in college.without having to take college classes or difficult exams.
MAVERICK [17]
B Advanced Placement
5 0
2 years ago
Shore Company reports the following information regarding its production cost. Units produced 36,000 units Direct labor $ 31 per
Sedaia [141]

Answer:

$73.86 per unit

Explanation:

The computation of the cost per unit under the absorption costing is as follows

= Direct material per unit + Direct labor per unit + variable overhead per unit + fixed overhead per unit

where,

Variable overhead cost per unit

= $288,000 ÷ 36,000 units

= $8 per unit

And, the fixed overhead cost per unit is

= $102,920 ÷ 36,000 units

= $2.86 per unit

So the cost per unit is

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3 0
3 years ago
Which of the following statements is true regarding the Unrealized Loss on Investments account
max2010maxim [7]

Answer:

B) It is reported on the income statement when it pertains to short term investments

Explanation:

Unrealised loss is defined as a reduction in the value of an asset that is held by an investor rather than selling it and realising a loss.

Unrealised loss is also called paper loss. This loss is not realised until the asset is sold.

Unrealised losses are not usually recorded on the income statement unless they intend to be sold in a short time.

When a security is to be sold in the short run it is called a trading security. Trading securities are represented in the income statement as they can increase or reduce income

8 0
3 years ago
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