Answer:
Luther Corporation
Current Ratio for 2006 is closest to:
1.1 : 1
Explanation:
a) Data and Calculations:
Total Current Assets = $144 million
Total Current Liabilities = $132 million
Current Ratio = Current Assets/Current Liabilities
= $144/$132
= 1.1 : 1
b) Luther Corporation's current ratio is a liquidity measure that shows Luther's ability to pay off short-term obligations worth $132 million or those due within one year with its current assets of $144 million. The ratio tells investors and analysts of Luther Corporation how Luther can use its current assets to pay off its current debts. Since Luther's current ratio is higher than 1, it is considered good, depending on the industry average. This means that Luther's current ratio of 1.1 : 1 should not be considered in isolation, but in comparison with other firms in the industry and its performance over a number of years.
Answer:
Void
Explanation:
Void is the term of law, which is defined as the contract is not valid currently, and the parties of the contract are not held to its terms. The void contract is the one which is generally unenforceable.
The contract could be void because of many reasons like the contract need one party to perform that act which is impossible or in that case, where one party is not mentally incompetent.
So, in this case, the contract is most likely to be void as the contract with the party who is mentally incompetent, though the party has not been adjudged through court.
Answer:
The correct answer is D. 10.00%
Explanation:
To get internal rate of return we use excel or a spreadsheet. See document attached.
Make the cash flow to solve this problem. At moment 0 we have the investment cost , in this case $1.475.668 (negative) From period 1 to period 5, we have different incomes o benefits. Salvage value is 1.615.205, we are going to get it at moment 5 (positive).
Then, we calculate the Net cash flow that is the difference between benefits and cost.
We use all the result (positive and negative) in Net cash flow to get the IRR.
Net Present Value (NPV) 768907
Internal Rate of Return (IRR) 10,00%
