Lucky wants to attach a goal coast of her life goal. What might she do this

In accounting for a contingent liability, if the likelihood of the obligation is probable but the amount cannot be estimated, a

Tems11 [23]

Answer: d. provide disclosure in the footnotes to the financial statements.

Explanation:

A contingent liability is an obligation that a company might owe in future depending on the outcome of an event such as a law suit.

To record a contingent liability in the books, two conditions must be satisfied;

Loss must be probable
Amount must be estimable

If these two conditions are not satisfied then the contingent liability may simply be disclosed as a footnote in the financial statement. The amount here is not estimable so can be disclosed as a footnote.

6 0

3 years ago

Montross Lumber processes wood to be shipped to construction companies. In order to keep its products uniform, Montross conducts

tiny-mole [99]

Answer:

$450

Explanation:

Activity based costing is the process by which a business allocates cost on the basis of the number of times an activity is carried out.

For example if different departments use a photocopier to copy 3,000, 5,000, and 2,000 sheets. The total cost will be allocated based on amount of activity per department.

In this instance

Total number of boards= 36,000

Inspections= 5% of the total

Inspection cost= $15 per hour

Percentage that will be inspected= 0.05 * 36,000 = $1,800

It takes one minute to inspect each board, there are 60 minutes in one hour. So 60 boards are inspected in one hour.

Number of inspection hours= 1,800 ÷ 60= 30 hours

Total cost of inspection= Cost per hour * Number of hours

Total cost of inspection= 15 * 30= $450

7 0

3 years ago

The S&P 500 Index is one of the most commonly used benchmark indices for the U.S. equity markets. Consisting of 500 companie

seropon [69]

Answer:

1. Based on my understanding of P/E ratios, in which of the following situations would the average trailing P/E ratio (current price divided by earnings per share over the previous 12 months) of the S&P 500 Index be higher?

Th e correct option is (b). The outlook for the economy and the markets is for improvement.

2. You invest $100,000 in 40 stocks, 20 bonds, and a certificate of deposit (CD). What kind of risk will you primarily be exposed to?

Th e correct option is (b). Portfolio risk

3. Generally, investors would prefer to invest in assets that have:

a. A higher-than-average expected rate of return given the perceived risk

Explanation:

1. Based on my understanding of P/E ratios, in which of the following situations would the average trailing P/E ratio (current price divided by earnings per share over the previous 12 months) of the S&P 500 Index be higher?

Th e correct option is (b). The outlook for the economy and the markets is for improvement. If the outlook of the economy and the market prospects of the stocks are for improvements, it then means that the Price Per Earning of the stock will be increasing, which is a positive economic trend.

Moreover, since we are talking about the average P/E it can be inferred that in the very long run, average of the S&P 500 Price to Earnings (PE) ratio (since 1900) is approximately 15.8, and the ratio since 1946 (the post-World War II period) is 17.3, so, it is fair to call a "normal" PE ratio about 16.5, which is relatively stable over the years.

2. You invest $100,000 in 40 stocks, 20 bonds, and a certificate of deposit (CD). What kind of risk will you primarily be exposed to?

Th e correct option is (b). Portfolio risk is the chance that the combination of assets or units, within the investments that you own, fail to meet financial objectives. Each investment within a portfolio carries its own risk, with higher potential return typically meaning higher risk. It can be computed as the risk of the two-securities portfolio, first take the square of the weight of 40 Stocks ($100,000.00) and multiply it by square of standard deviation of the 40 stocks. Repeat the calculation for 20 Bonds and a Certificate of Deposit.

3. Generally, investors would prefer to invest in assets that have:

a. A higher-than-average expected rate of return given the perceived risk Yes they will because a higher -than average expected rate of return will inform the investor the type of strategies to adopt to guarantee the expected earnings containing the risk.

5 0

3 years ago

Your brother announces at Thanksgiving Dinner that he is thinking of becoming a day trader. What questions might you ask him to

Travka [436]

1) Has he diversified his portfolio within the 11 sectors?

2) Does he go for capital appreciation stocks or dividend stocks?

3) How much time does he spend studying a company's financials (10K form) and charts?

4) Who is his favorite investor? Warren Buffet for picking great stocks and holding for many many years or someone like Bill Ackman who is a bit deceptive on his trading tactics (over the summer he said 'Hell is coming' a signal thought by many as "panic sell" whilst he was buying heavily)

5) What is the number he is seeking to retire? There's usually a number ranging from $1M and $200M.

6) Maybe ask him if he is seeking to get licensed as a CMT (reading chart patterns)?

Hope this helps, either way best of luck to him!

4 0

3 years ago

If a family spends its entire budget in a given time frame, the family can afford either 90 cans of soup or 60 frozen dinners. A

g100num [7]

Answer:

0.67

Explanation:

Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives.

If the family buys one can of soup, the opportunity cost is the frozen food forgone.

Opportunity cost of one can of soup = 60 / 90 = 0.67

I hope my answer helps you

8 0

3 years ago