Answer:
<u><em>accrual; no cash payment; do not</em></u>
<u><em>Explanation:</em></u>
Indeed, accrual accounting uses adjusting entries to reflect economic reality, that is, it tells the actual financial position of the company such that even when there is no cash payment involved in the transaction.
Thus, profits may not necessarily equal cash over a period.
Answer:
work out a plan with its financial intermediaries
Explanation:
Based on the information provided within the question it can be said that in this situation the company should work out a plan with its financial intermediaries
. By doing so they would be able to clearly point out the problem and focus on it to be able to come up with a solution on how to obtain the credit that they need.
Answer:
The correct answer is: the additional product generated by additional units of an input will eventually diminish.
Explanation:
The law of diminishing marginal returns states that with each additional unit of input employed the marginal product of each additional input will go on declining.
This is why the total product will increase at first but after reaching a certain point it will start declining. The total product will be maximum at the point where the marginal product is zero. When marginal product becomes negative the total product will decline.
Answer:
Explanation:
What is given:
The price of a new fabricating machine - 60
The price of a one-year-old machine - 51
The real interest rate is 10% per year
Marginal product of fabricating machines 165-2K (K - desired number machines)
If calculate the depreciation, (60-51)/51 = 15%
a) Find user cost of capital
User cost of capital is the sum of interest rate and depreciation cost multiplied by the price of new machine
= 60*(0.10+0.15) = 15 units
b) Determine the number of machines that will allow Missing Link to maximize its profit
165-2K=15
2K = 150
K = 75 machines
c)
Suppose that Missing Link must pay a tax equal to 40% of its gross revenue. What is the optimal number of machines for the company?
165-2K = 15/(1-0.4)
165-2K=14/0.6
165-2K=25
2K=140
K=70 macines
Answer:
The answer is "Option D".
Explanation:
Using the formula for calculating present value:
that's why "Option D" is correct.
