Answer:
A) Company A is the one that is financially leveraged.
Where there is the presence of debt in the capital structure of a firm, that firm is said to be Financially leveraged.
B) A is true.
A company's return on equity or expected returns increases because the use of leverage increases stock volatility. Volatility increases its level of risk which in turn increases returns. This happens only if the company is operating an ideal level of financial leverage.
On the other hand, however, but excessive debt can increase the risk of default and can lead to low returns or even bankruptcy.
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Answer:
B) $1,187.50
Explanation:
The computation of the total profit or loss on this investment is given below:
Expiration price = 1061'4 = 1061 + 4 ÷ 8 = 1061.50
Quoted price = 1056'6 = 1056 + 6 ÷ 8 = 1056.75
Now the profit is
= (1061.50 - 1056.75) × 5000 × 5
= $1,187.50
Hence, the profit on this investment is $1,187.50
Answer:
C.earning college credits in high school.
Explanation:
The other answers are all negative and in the question it says ''a benefit''.
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Answer:
$88,450 should be included in the current assets section of Janson’s December 31, 2021, balance sheet
Explanation:
Current Assets: The current assets are those assets which are converted into cash within one year.
Examples - Accounts receivable, inventory, prepaid insurance, cash, etc.
The computation of the total current assets is shown below:
= Accounts receivable + Inventory + Prepaid insurance + Short term investment
= $14,000 + $40,000 + $3,650 + $30,800
= $88,450
The amount of prepaid insurance which is given in the question is for two years. We have to compute for one year so we divide the total amount by number of years
= $7,300 ÷ 2 years
= $3,650
