All categories

3 years ago

Common-size statements: Multiple Choice

Business

1 answer:

77julia77 [94]3 years ago

7 0

Answer:

Reveal changes in the relative importance of each financial statement item to a base amount.

Explanation:

In the common-size statements, the items would be displayed in the percentage form that is based on the base value rather than the absolute values.

The preparation of this statement is to do the proper analyses of each item with period to period of the similar company so that proper decisions should be taken. In addition, it would also create its importance with respect to the item mentioned in the financial statement

You might be interested in

Compare transnet with a perfect competitor in terms of price and output and profit

Sholpan [36]

Transnet SOC Ltd is a rail, port, and pipeline company in Johannesburg.

Price: This company is a price maker, therefore, in terms of price, Transnet perfect compitetor is a price taker.

Output: Transnet has the ability to decide the quantity of their output and they have many competitors on this one.

<span>Profit: Transnet might be able to increase their profit but in a competition it would be hard because customers might switch to the competitor. </span>

5 0

3 years ago

Cook Co. determined that the net value of its accounts receivable at December 31, 20X4, based on an aging of the receivables, wa

Ksenya-84 [330]

Answer:

$9,000

Explanation:

Bad Debts Written off $22,000

Uncollectible accounts-recovered $(8,000)

Allowance for doubtful accounts reversed

(opening-closing $40,000-$35,000*) ($5,000)

Bad Debt Expense for the year $9,000

*270,000-235,000 =35,000

7 0

3 years ago

For each of the following scenarios, determine whether the situation described can be attributed to the real-balances effect, th

aksik [14]

Answer:

A)Interest-rate effect

B)Real-balances effect

Explanation:

✓The interest rate effect can be regarded as change in borrowing as well as spending behaviors as a consequence or result of adjustment of interest rate. As a general rule, interest are been set by central bank of the nation, then consumer banks will then extend similar interest rates across their customers. For instance

As a result of an increase in the price level, the cost of borrowing increases, which causes people to buy fewer cars.

✓ In economics, real balance effect can be regarded as "Pigou effect" which can be regarded as stimulation of output as well as employment which is been caused as a result of increased consumption through a rise in real balances of wealth, especially during time of deflation. Instance of this is

When the price level decreases, restaurants become busier as more people purchase restaurant meals.

3 0

3 years ago

Lancaster bakery has net fixed assets of $329,700, current assets of $87,200, a price-earnings ratio of 12.8, a debt-equity rati

Verizon [17]

Market to book ratio is the ration of market price per share divided by the book value per share, it can be mathematically expressed as below:

Market to Book Value= $\frac{Market Value Per Share}{Book Value Per Share}$

In this problem the first step is to find Market Value per share

PE Ratio is given by the following formula:

PE Ratio= $\frac{Market Price Per Share }{Earning Per Share}$

12.8= $\frac{Market Price Per Share }{1.97}$

Market Price Per Share=$25.216

We now find Book Value Per Share, Book Value is nothing but the Equity Value of the Organization, In the given problem, we don't have this information, but we have total assets, which amounts to $416900($329700+$87200). Using Debt Ratio we can find book value per share as below:

Lets assume Shareholders Equity is x, Thus total liability will be Total Assets-x

Debt Equity Ratio is given as below:

Debt Equity Ratio= $\frac{Total Liabilities}{Equity}$

0.42= $\frac{416900-x}{x}$

x=$293592

Book Value per share=$293592/36000

Book Value per Share=8.155

Market to book value=25.216/8.15533

Market to book value ratio= 3.09

8 0

3 years ago

What would happen to the economy if the president disbanded the board

PIT_PIT [208]

Monarchy, and downfall. Peoples voice over the official boards. There would be a better market in a way, but it would also be more cut, and strict.

5 0

3 years ago