Answer:
$339
Explanation:
Computation of the given data are as follows:
Income before tax in FIFO = $15,730
Tax rate = 30%
So, the Tax amount for FIFO = $15,730 × 30%
= $4,719
And, Income before tax in LIFO = $14,600
Tax rate = 30%
So, the Tax amount for LIFO = $14,600 × 30%
= $4,380
So, the difference in tax amount = Tax amount for FIFO - Tax amount for LIFO
= $4,719 - $4,380
= $339
Answer:
Option (b) is correct.
Explanation:
Interest refers to the amount of money that a lender can earn on giving the loans to the borrowers. Borrower is a person who is liable to pay the interest on the borrowing amount.
Normally, a person is borrowing money or funds from the lender for making investment in a certain types of capital goods.
Interest rate refers to the rate at which lender lends its loanable funds to the borrowers.
Answer:
Fewer
Explanation:
A side effect of high gas prices is that discretionary spending of consumers goes down as they spend relatively more of their income on gasoline. Higher prices also mean that shoppers will tend to drive less - including to places like to mall or shopping center.
Answer:
Multiple IRRs:
Said another way, Multiple IRRs occur when a project has more than one <em>internal rate of return.</em> The problem arises where a project has non-normal cash flow (non-conventional cash flow pattern).
Internal rate of return (IRR) is one of the most commonly used capital budgeting tools. Investors make decisions by comparing the IRR of the project under consideration with the <em>hurdle rate</em>. If the IRR is greater than the hurdle rate, the project is accepted, otherwise it is rejected. When there are more than two IRRs, it is not exactly clear which IRR to compare with the hurdle rate.
Hurdle rate is the minimum required rate of return which businesses use as a benchmark to decide whether to invest in a project or not.
<em>So a typical situation which can generate negative cashflows which can in turn lead to multiple IRRs towards the end of the project is where the conditions of investment become adverse towards the end of the project.</em>
Imagine that toward the end of the lifecycle of a project, a forecasted increase external costs such as Interest Rate, influenced by government policies translates to an erosion of the bottom line generated by the business in that year.
Period 0 1 3 3 4 5
Unconventional cash flows ($)-19,000 16,000 16,000 6,000 6,000 -52,000
The series is non-conventional cash-flow pattern, which has two sign changes. This is the range in which the net present value of the non-conventional cash flow series is positive. The multiple IRR problem poses a series problem to analysts because the decision is not obvious.
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