Answer:
The correct answer is letter "A": results in termination of the agent.
Explanation:
Principal-agent relationships are based on a fiduciary duty or, in other words, trust. Principal-agent problems typically arise because principals tend to delegate agents the execution of activities that benefit the principals but not the entity the agent represents. Thus, <em>if the trust between them is broken, principals, as owners of the entity, terminate the agent's contract.</em>
Answer: C) Frank is an outside director on Lofloy's board of directors.
Explanation:
As Frank has a full time employment position as a senior manager at Spinson Locomotives, he is most likely an outside director on Lofloy's board of directors.
Outside directors are those members of the board in a company that are not employed by the company which Frank isn't.
Outside directors like Frank are thought to be more impartial in decision making and for this reason companies are usually required to have a certain number of them sitting on the board.
Answer:
Explanation:
Base on the scenario been described in the question we can calculate the following
1. Calculation of Employee’s FICA withholding for social security tax rate is 6.20%. Attachment 1 below
2.Calculation of Employee’s FICA withh... Attachment 2 below
Answer:
The correct answer is C. Common fixed costs.
Explanation:
A fixed cost is an expense that the company must incur, even if the company operates at medium speed, or does not, which is why they are so important in the financial structure of any company.
This is the case, for example, of payments such as leasing, since this, if nothing is sold, must be paid. It also happens with almost all labor payments, public services, insurance, etc.
Perhaps the main component of fixed costs is labor, therefore, it is not surprising that companies struggle every day for greater labor flexibility that allows them to convert those fixed costs into variables.
Answer:
B. Income Tax Expenses
Explanation:
The Purpose of the Income Statement in Financial Statement Preparation is to ascertain the profit or loss of a business entity for a particular year. Usually, the format is as follows:
1. Gross Profit= Sales- Cost of Goods sold(Opening Inventory + Purchases- Closing Inventory)
2. Net Profit/ Net Loss = Gross Profit + Other Revenues and Gains - Expenses for the period.
However, income tax expense is only calculated when the net profit has been ascertained. It is usally referred to as net income before tax. It is based on this figure, that the income tax expense is then calculated based on prevailing income tax percentage.
Every other part of the income statement covers a section, but all sections should be calculated and concluded before the income tax expense can be calculated and then subtracted to arrive at the final income tax.
