Answer:
B. The payback is approximately three years
Explanation:
The computation of payback period for this equipment purchase is shown below:-
<u>Year Cash flow Cumulative cash flow</u>
0 -$600,000 -$600,000
1 $250,000 -$350,000
2 $200,000 -$150,000
($250,000 - $50,000)
3 $150,000 0
($200,000 - $50,000)
4 $100,000 $100,000
($150,000 - $50,000)
5 $50,000 $150,000
($100,000 - $50,000)
Here, Cumulative cash flow in the year o is -$600,000 and as we can see that cumulative cash flow in year 3 is 0.
Therefore the payback period lies in 3 years.
Answer:
$844,000
Explanation:
Given that,
Accounts Receivable = $900,000
Credit balance of Allowance for Doubtful Accounts per books before adjustment = $50,000
Expected amount of uncollectible = $56,000
Bad debt expense at the end of the period is determined by subtracting the credit balance of allowance for doubtful accounts from the expected amount of uncollectible.
Bad debt expense:
= Expected amount of uncollectible - Credit balance
= $56,000 - $50,000
= $6,000
At the end of the period, the allowance for doubtful accounts has a balance of $56,000 that are to be uncollectible.
The cash realizable value of the accounts receivable at December 31, after adjustment, is determined by simply subtracting the Allowance for doubtful accounts from the accounts receivable. It is calculated as follows:
= Accounts Receivable - Allowance for doubtful accounts
= $900,000 - $56,000
= $844,000
Answer:
21%
Explanation:
We can calculate the expected return of a firm by add dividend yield and growth rate but in this question, the growth rate is not given therefore we will find growth rate first with the available data
DATA
Payout ratio = 0.4
Return on equity = 25%
Dividend yield = 6%
Solution
Growth rate = Return on equity x retention ratio
Growth rate = Return on equity x (1 - payout ratio)
Growth rate = 25% x (1-0.4)
Growth rate = 25% x 0.6
Growth rate = 15%
Expected return = Dividend yield + growth rate
Expected return = 6% + 15%
Expected return = 21%
Answer:
A production combination outside of the PPF is unattainable by the economy with the given resources and technology.
This represents the Concept of scarcity in economics.
If the economy wishes to achieve the production point outside the frontier, they will have to enhance the production possibility capacity by introducing new technology or finding new resources.
Explanation:
Answer:c. 12.0%
Explanation:Return on Investment (ROI) is a measure used by firms in order to determine how effective an investment is in terms of gains from its proceeds when compared to the amount invested .
Given
Yellowday Energy margin as 3%
turnover= 4.0 and sales as $50million,
we can calculate the ROI,Return on Investment , as the Profit margin multiplied by turnover
ROI = Profit Margin x Turnover
= 3% x 4.0
= 0.03 x 4.0
=0.12
0.12 x 100
= 12.0%
