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Nadya [2.5K]
3 years ago
7

Financial risk applies to both the additional variability in earnings available to common shareholders and the additional chance

of insolvency caused by the use of financial leverage.
A) True
B) False
Business
1 answer:
MAXImum [283]3 years ago
4 0
A, This is true for Financial risk
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If I was 5 foot how tall would I be in centimeters
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4 years ago
Which of the following may either increase or decrease retained earnings? a. Prior period adjustments. b. Disposals of treasury
Dmitry_Shevchenko [17]

Answer:

a. Prior period adjustments.

Explanation:

"Retained earnings is the cumulative total of earnings that have yet to be paid to shareholders. These funds are also held in reserve to reinvest back into the company through purchases of fixed assets or to pay down debt."

Prior period adjustments in the beginning balance are key to calculate the retained earnings at the end of the period:

Retained Earnings = RE Beginning Balance + Net Income (or loss) – Dividends.

Therefore, prior period adjustments may either increase or decrease RE.

Reference: Morah, Chizoba. “Which Transactions Affect Retained Earnings?” Investopedia, Investopedia, 11 July 2019

4 0
3 years ago
Byron is a wealthy tycoon who makes his money buying and selling stocks. This is an example of _____ income.
Orlov [11]
A. we know it is not c or d cuz they would not fit but a and b are our options the answer would be B IF he was a worker but in this case he makes his money from a profit and pays the workers (they earned it) so it is A
8 0
3 years ago
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If a business entity entered into certain related party transactions, it would be required to disclose all of the following info
Nitella [24]

Answer:

A. the nature of any future transactions planned between the parties and the terms involved

Explanation:

If a business entity entered into certain related party transactions, it would be required to disclose details such as the dollar amount of the transactions for each of the periods for which an income statement is presented,amounts due from or to related parties as of the date of each balance sheet presented,nature of the relationship between the parties to the transactions.

These options are related with the current transactions involved between the two parties.

It will however be wrong and unethical to disclose the nature of any future transactions planned between the parties and the terms involved.

7 0
4 years ago
Using the high-low method, what is the variable cost? $2 per direct labor-hour $2.31 per direct labor-hour $.30 per direct labor
d1i1m1o1n [39]

Answer:

$0.30 per direct labor-hour

Explanation:

The computation of the variable cost per direct labor is shown below:

Variable cost per direct  hour = (High maintenance cost incurred - low maintenance cost incurred) ÷ (High direct labor hours - low direct labor hours)

= ($4,000 - $1,900) ÷ (9,000 hours - 2,000 hours)

= $2,100 ÷ 7,000 hours

= $0.30 per direct labor-hour

3 0
3 years ago
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