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kolezko [41]
3 years ago
9

Analysis of a company's financial statements: Below are simplified versions of the balance sheet and income statement for Toys b

y Tom, Inc. Use this information to answer the following question.
Income Statement

Sales $100,000
COGS $41,700
Variable Sales and Admin $10,000
Fixed Sales and Admin $5,000
Net Income $43,300
Balance Sheet

Assets
Cash $10,000
Acconts Receivable $5,000
Inventory $10,000
Liabilities
Accounts Payable $5,000
Notes Payable $5,000
Shareholder's Equity
Common Stock $5,000
Retained Earnings $10,000
A 15% increase in inventory turns for Toys by Tom, Inc. would bring this ratio to _____, suggesting _____ in _____.

109 days; a deterioration; profitability

3.9 days; a deterioration; profitability

4.8 times; an improvement; efficiency

3.9 times; an improvement; efficiency
Business
1 answer:
il63 [147K]3 years ago
6 0

Answer:

The answer is:

A 15% increase in inventory turns for Toys by Tom, Inc. would bring this ratio to 4.8 times, suggesting improvement in efficiency.

Explanation:

We have the current Inventory turnover = COGS / Inventory = 41,700/10,000 = 4.17 times

=> An 15% increase in the Inventory turnover will bring the Inventory turnover ratio to: 4.17 x 1.15 = 4.8 times;

Increasing in inventory turnover may be the result of higher sales ( thus higher COGS) or low level of inventory holding - thus limiting the resources spending on idle inventory. So, higher level of inventory turnover in someways suggesting improvement in efficiency.

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kati45 [8]

Answer:

yes, there is no separation between the administration and ownership in a partnership.

the partnership contract stipulates which partners have the decision making ability and which partners don't. We cannot say specifically that limited partners have no say in decision making.

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Explanation:

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3 years ago
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tamaranim1 [39]

Answer:

The marginal propensity to save is 0.4

Explanation:

The marginal propensity to save is 1 - marginal propensity to consume.

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The marginal propensity to consume (MPC) = Change in consumption / change in income

The MPC = (2100 - 1500) / (3000 - 2000)  =  0.6

Thus, the marginal propensity to save is 1 - 0.6 = 0.4

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3 years ago
If a payment cap is applied and the required payment does not cover the interest expense, the unpaid interest is added to the lo
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The condition when a payment cap is applied and the required payment does not cover the interest expense, the unpaid interest is added to the loan thereby increasing the loan balance even though the required payment is being made, is known as a negative amortization.

<h3>What is negative amortization?</h3>

A condition where the amount owed by an individual keeps adding even after the repayments are done is known as negative amortization.

Such condition of a negative amortization arises as the amount being repaid does not fully or partly cover the interest amount.

Hence, the significance of negative amortization is aforementioned.

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fight for the same benefit or gain

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For example, they may differentiate their products or give discounts in order to attract customers and so increase profits

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Answer:

True

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