Answer:
ROE would have changed by 8.52%
Explanation:
First we calculate the current ROE using Dupont Equation which gives ROE as,
ROE = Net Income/Sales * Sales/Total Assets * Total Assets/Equity
or
ROE = Net Profit Margin * Total Assets Turnover * Equity Multiplier
- Current ROE = 10600/295000 * 1.4 * 1.75 = 0.0880 or 8.8%
The condition says that the net income could have increased to 20850 but other factors will remain constant. Thus, to calculate new ROE, we will calculate the new Net Profit margin but the total assets turnover and the equity multiplier will remain constant as sales assets and capital structure is not changing.
- New ROE = 20850/295000 * 1.4 * 1.75 = 0.17316 or 17.32%
- The ROE would have changed by 17.32 - 8.80 = 8.52%
Usually, it's over a monthly period.
Everybody's Credit is different, because people have different Credit Scores
Hope this helps!!
Answer:
Is better to continue the production of the component as currently is taking allocated overhead from other department. Buying will inccur in a financial disadvangate of 25,000
Explanation:
<u>Make</u>
Direct cost:
DM 120,000
DL 25,000
VMO <u> 45,000 </u>
Total Variable: 185,000
Tracable fixed cost: 5,000
Total cost: 190,000
<u>Buy option:</u>
purchase 190,000
unavoidable cost: (30,000 - 5,000) = 25,000
Total cost: 215,000
Answer:
A. positive cash flow of $ 20 comma 900 from investing activities
Explanation:
book value - sales price = loss on sale
30,900 - sales price = 10,000
30,900 - 10,000 = sales price
sales price = 20,900
Assumming the purchase was on cash, it will be disclosure as cash generated from investing activities for 20,900
The reason is that cashflow do not focus on the gain or loss from the sale. It focus on the cash movements and this sale involve a cashinflow of 20,900
Answer:
The correct answer is A. True.
Explanation:
Risk management models are a great tool to anticipate and prevent possible losses that could occur when investing a certain capital, implementing appropriate precautionary measures; Therefore, organizations and investors that have a culture of risk, create a competitive advantage over others, by assuming assessed risks, gain experience in risk management, anticipate adverse changes, protect or cover their investments in advance and obtain higher profits by taking greater risks.
