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yKpoI14uk [10]
3 years ago
12

Knowledge Check 01 Provided below is summary income statement data for Freedom Corporation. Amount Sales $ 800,000 Cost of goods

sold 350,000 Operating expenses 180,000 Other expense 30,000 Income tax expense 20,000 Net income $ 220,000 Using vertical analysis, what percentage is applicable to Cost of Goods Sold? Multiple Choice 35.0% 43.8% 56.2% 62.9%
Business
1 answer:
jasenka [17]3 years ago
7 0

Answer:

43.8%(approx)

Explanation:

Given that,

Sales = $800,000

Cost of goods sold = 350,000

Operating expenses = 180,000

Other expense = 30,000

Income tax expense = 20,000

Net income = $ 220,000

Here, we are using vertical analysis,

Percentage is applicable to Cost of Goods Sold:

= (Cost of goods sold ÷ Sales) × 100

= ($350,000 ÷ $800,000) × 100

= 0.4375 × 100

= 43.75% or 43.8%(approx)

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Answer:

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All the options except A are expected response from the fall in price and helps in explaining why the aggregate demand curve shifted ( towards the right ) . In the option B , Tyler decided to remodel his kitchen because of fall in prices, as now he is able to spend more on consumption and investment activities. Same thing is happening in option C and D as the company's here are increasing their investment spending due to the decreased prices.

But the option A , isn't something that was expected as company's don't usually fire their workers just because they have fixed price wage contract and prices have fallen, company is trying to take advantage of fallen prices by  reducing the fixed wage workers and hiring new workers on a cheap wage , which help in reducing the company's cost.

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A company just paid a $2 dividend per share. The dividend growth rate is expected to be constant at 10% for 2 years, after which
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Answer:

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V2 = DN(1+g)/ (Ke-g )(1+k e)n                                                                                                                                                                                                                                        V2 = $2.42(1+0.03)/(0.11-0.03)(1+0.11)2      

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Moreso, the value of shares for the second phase was calculated by considering the last dividend paid(D2) and then subject it to the new growth rate. The adjusted dividend was then capitalized at the appropriate discount rate of the company.

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It is what causes them to produce more than they would given the number of work hours available.

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