Answer:
Both statements are False
Explanation:
<u>Statement a</u>
As with higher debt involved the expected return on investment is more on equity. But reducing debt up till a certain level is beneficial in that condition, but there is an ideal debt to equity ratio of 1 - 1.5, it varies upon the industry requirements and conditions.
Although the theory which states that reducing debt will reduce cost of equity and of debt is false as there is a tax benefit on debt which states that cost is always less of debt.
<u>Statement b</u>
Financial distress and bankruptcy has several reasons to occur, and one of them is borrowing.
It do not depend on the level of borrowings, whether moderate or high, borrowings demand compulsory payment in the terms of interest due, which leads to a burden on the company. This also increases the demand of shareholders.
Thus, the statement is false.
Answer:
$100,000
Explanation:
A triple indemnity clause attached to a life insurance policy should pay in case of accidental death three times the amount of the policy. But in order for this clause to be effective, the insured must not have any responsibility in the accident.
In this case, since the accident was caused by the insured, the triple indemnity clause doesn't apply, so the regular amount ($100,000) has to be paid to the beneficiary.
Answer:
C) $100,000,000 of assets that it invests on a discretionary basis
Explanation:
For an institutional investor to qualify as Qualified Institutional Buyer (QIB) under Rule 144A of the Securities and Exchange Commission (SEC) it must:
- manage at least $100 million worth of securities
- the securities must come from issuers that are not affiliated with the institutional investor
In case of banks or savings and loans institutions, Rule 144A requires them to have a net worth of at least $25 million.
Purchases Debit $80,000
Accounts Payable Credit $80,000
Work in process Roasting Department Debit $42,000
Purchases Credit $42,000
Production Debit $22,500
Purchases Credit $22,500
<h3>What is Inventory?</h3>
Inventory is the current asset of a company which it sells to customers and gain profits, the inventory is also known as Stock. The raw material is converted into finished goods by manufacturing companies.
The purchases are debited with payable's account being credited and then the purchases/ inventory is issued for the production of goods, and is therefore charged as the work in process.
Learn more about Inventory at brainly.com/question/27256758
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