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Yakvenalex [24]
3 years ago
10

For capital budgeting and cost of capital purposes, the firm should always consider retained earnings as the first source of cap

ital (i.e., use these funds first) because retained earnings have no cost to the firm.A. True.B. False.
Business
1 answer:
zmey [24]3 years ago
8 0

Answer:

False

Explanation:

Even though the main reason why a corporation should hold retained earnings is to use them as a source of capital, it doesn't mean that retained earnings don't have any cost associated with them.

The cost of holding retained earnings is the rate of return that shareholders require on the corporation's stock.

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The following purchase transactions occurred during August for Elegance Catering Service: Aug. 4 Purchased cleaning supplies for
PtichkaEL [24]

Answer:

                                                      Debit                     Credit

Aug 4   Cleaning Supplies                79

            Accounts payable                                               79

            (Innovation Supplies)  

Aug 19   Office Equipment                 4900

             Accounts Payable                                         4900

            (Office Warehouse)

Aug 23    Cleaning Supplies               209

                Accounts Payable                                    209

                 ( Rubble Supplies)

Explanation:

3 0
3 years ago
Dog Up! Franks is looking at a new sausage system with an installed cost of $460,000. This cost will be depreciated straight-lin
Anton [14]

Answer:

The Net Present Value (NPV) of this project is <u>$93,405.59</u>.

Explanation:

Note: Find attached the excel file for the calculation of the NPV of this project.

Net present value (NPV) refers to the present value of cash inflows minus the present value of cash outflows over a specified period of time.

On its own, present value (PV) refers the value that a future sum of money or stream of cash flows has now or currently given a specified rate of return. The formula for calculating the PV is given as follows:

PV = FV / (1 + r)^n

Where,

FV = Future value

r = discount rate. This is given as 10% in this question

n = Relevant period, e.g. year

The above explanation and formula together with other stated formulae in the attached excel file is used in calculating the NPV of this project.

Download xlsx
7 0
3 years ago
Assume a division of Hewlett-Packard currently makes 12,000 circuit boards per year used in producing diagnostic electronic inst
madam [21]

Answer:

The net benefit is -$26,000

Explanation:

Given the above information,

The total cost of manufacturing 12,000 circuit boards

= 12,000 × $34

= $408,000

Total purchase price

= 12,000 × $34

= $408,000

Fixed overhead cost applied

= 12,000 × $6

= $72,000

The rental income = $46,000

Outsourcing cost

= Total purchase price + Fixed overhead cost applied - Rental income

= $408,000 + $72,000 - $46,000

= $434,000

Therefore, Net benefit

= Total cost of manufacturing - Outsourcing cost

=$408,000 - $434,000

= -$26,000

8 0
3 years ago
When a grant-application package lists eligible applicants, it is just a suggestion. This is America: all organizations are elig
Rufina [12.5K]

Answer:

false

Explanation:

The United States government do make some monies available to individuals or organisation in the form of grants, for the achievement of set purposes or goals. Not everyone or organisation can be eligible for all the available grants at any time. People are expected to look through various application processes to know if they are legally eligible to apply for any grant in order to avoid wasting their time and money during application.

6 0
3 years ago
1. consumer products such a s furniture and appliances are typically distributed using ______ distribution
GaryK [48]
1 is a and 2 is c i think
4 0
3 years ago
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