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mariarad [96]
3 years ago
6

Crater HVAC Systems is preparing its statement of cash flows ​(indirect​ method) for the year ended March​ 31, 2018. To​ follow,

in no particular​ order, is a list of items that will be used in preparing the​ company's statement of cash flows. Identify each item as an operating activity addition to net​ income; an operating activity subtraction from net​ income; an investing​ activity; a financing​ activity; or an activity that is not used to prepare the cash flows statement. a. Increase in inventory b. Issuance of common stock c. Decrease in accrued liabilities d. Net income e. Decrease in prepaid expense
Business
1 answer:
Ymorist [56]3 years ago
8 0

Answer:

a. Increase in inventory - <u>an operating activity subtraction from net​ income</u>

This is an operating activity as it has to do with the day to day business of the company and its operations. It is a subtraction from Net income because an increase in inventory means that more cash was spent to buy the inventory.

b. Issuance of common stock - <u>a financing​ activity</u>

Financing activities are those that have to do with raising capital for the business so when stock is issued and Equity is raised, it is a financing activity.

c. Decrease in accrued liabilities - <u>an operating activity subtraction from net​ income</u>

Liabilities are also in relation to the firm's operations so they are operating activities. This will be a subtraction from Net income because cash was used to pay off liabilities which is what reduced them.

d. Net income - <u>operating activity addition to net​ income</u>

Net income is derived from the operations of the business so is an Operating activity. It will increase net income evidently.

e. Decrease in prepaid expense - <u>operating activity addition to net​ income</u>

Prepaid expense is in relation to expenses which is an operating activity. It will be an addition to net income because as an asset, it reducing means that cash was not paid to acquire it.

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sergey [27]

Answer:

77.27% or

(17/22)%

The loan will accepted

Explanation:

property value 550,000

haircut 125,000

550,000 - 125,00 = 425,000 mortage value

425,000/550,000 = 77.27% = (17/22)%

The ratio is below the cutoff, so it is within the boundaries the lender expect. The loan will be given.

8 0
3 years ago
Suppose the real risk-free rate is 3.00%, the average expected future inflation rate is 5.90%, and a maturity risk premium of 0.
never [62]

Answer:

the rate of return that expected on one year treasury security is 9.00%

Explanation:

The computation of the rate of return that expected on one year treasury security is as followS

= Risk free rate + average expected future inflation rate + maturity risk premium

= 3.00% + 5.90% + 0.10%

= 9.00%

Hence, the rate of return that expected on one year treasury security is 9.00%

Therefore the correct option is d.

And, the rest of the options are wrong

5 0
3 years ago
The five-dollar Burger Joint gift card that your friend gave you for your birthday expires today. You can either use the gift ca
Radda [10]

Answer:

Opportunity cost is the benefit that is foregone for an individual by choosing one alternative over other alternatives available to him.

If the opportunity cost is lower for an individual then this will benefit him whereas if the opportunity cost is higher then this will not benefit the individuals.

We know that if a person stay at home and eat delicious home-cooked then he must use some ingredients to cook food.

Therefore, the opportunity cost of eating the home-cooked meal is five-dollar Burger Joint gift card and the value of ingredients that are use in the home-cooked food.

4 0
3 years ago
Cold Ice has a profit margin of 8.3 percent and a payout ratio of 42 percent. The firm has annual sales of $386,400, current lia
erastova [34]

Answer:

The internal growth rate is 4.36%

Explanation:

net income = 8.3%*386,400

                   = $32,071.20

net working capital = current assets – current liabilities

current assets – 37200 = 16700

                                        = $53,900

total assets = current assets + net fixed assets

                   = 53,900 + 391,500    

                   = 445,400

Then:

ROA = 53,900/445400

        = 0.072005

b = 1 - 48% = 0.52

internal growth rate = 0.072005*0.52/1 - (0.072005*0.52)

                                 = 0.041763/0.958237

                                 = 4.36%

Therefore, The internal growth rate is 4.36%

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