Answer:
a-1. The present value of Plan 1 = $93.08
a-2. The deal 2 which involves paying immediately adn taking the 10% discount is better.
Explanation:
a-1.
The interest rate of 5% is taken as the discount rate to convert future cash flows into the present value.
The First payment plan with installments has a present value of,
Present Value-Plan 1 = 25 + 25/1.05 + 25/1.05² + 25/1.05³ = $93.08
a-2.
The first plan will cost $93.08 in the present value.
The second plan will involve immediate payment and a discount of 10%vwhch makes the present value of plan 2 as $90 (100 - (100*0.1)).
Thus, the second deal or deal involving immediate payment and taking the discount is better.
Production budgets are used by manufacturers to determine the quantity of product units that will be produced. Based on the predicted sales, the production budget is chosen.
Regarding projected inventory levels, it is modified in accordance with the company's inventory policy. A manufacturer creates cost budgets for the direct materials, direct labour, and overhead expenses needed for manufacturing based on the production budget.
The company's inventory policy should be kept in mind while creating a production budget. The production budget is built on the sales budget, with changes made for starting and ending inventories.
The company's inventory management strategy affects the production budget as well. Depending on the company's strategic outlook, inventories may be increased or decreased.
For the given question, the production budget is prepared and attached in the form of an image.
Learn more about Production Budget here: brainly.com/question/13061264
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Answer:
False.
Explanation:
An attractive industry are not one that is characterized by high entry barriers, suppliers and buyers with strong bargaining power, low threats from substitute products, and low rivalry among firms.
An industry is defined by a group of firm that produce good and service, which are close subtitute and bargaining power of supplier are not considered as entry barrier to a firm in the open market. Industry with high fixed cost can pose high degree of rivalry among firm.
Answer:
D.
Explanation:
Firstly, we need to keep in mind when it comes to cost of capital (debt or equity) is that it have to be incremental cost. Use bond yield to maturity rather than other yield to estimate cost of debt.
Let go through each of answer option one by one:
a. is based on the current yield to maturity of the company's outstanding bonds. => include both old bonds and recently-issue bonds => not incremental cost => False
b. is equal to the coupon rate on the latest bonds issued by the company. => Coupon rate is not relevant => Fasle
c. is equivalent to the average current yield on all of a company's outstanding bonds. => Current yield is not relevant => Fasle
d. is based on the original yield to maturity on the latest bonds issued by a company. => Meet all requirement => True
Answer:
Retained earnings balance =$54,700
Explanation:
Retained earnings is the proportion of profit made by a company which is not distributed as dividend but rather re-couped to be re-invested. A payment of dividend would reduce the balance of retained earnings while further profit retained increases it.
The balance of retained earnings at the end = opening balance + profit retained for the year - dividend paid for the year
= 33,400 + 36,500 - 15,200 = $54,700
Retained earnings balance =$54,700
