Answer: Decrease in fixed costs
Explanation:
When using the tax-shield approach, the relevant method of calculating operating cashflow is;
= (Sales - Cash Costs) * (1 - tax rate ) + (Depreciation * tax)
Looking at the formula it can be inferred that if fixed costs (part of cash costs) were to decrease, the cash from sales would be higher and would therefore result in an increased operating cashflow for the company.
Answer: Adding safety stock
Explanation:
A stockout is when the orders of the customer for a particular product is more than the amount of inventory that is kept on hand and this leads to lost sales, and a negative impact on the long-term relationship with the customer.
Since the demand is not uniform and constant, then stockout risks can be controlled by adding safety stock. The safety stock is asimply the additional quantity of an item which is held in the inventory in order to help to reduce stockout risk.
<span>Marketing Myopia is the term for when a company does business in terms of goods and services instead of focusing on the benefits consumers are looking for. These companies are focused on the bottom line. It is considered a short-sighted view by most experts and often causes the companies in question to be unable to quickly adjust when there are changes in their particular markets.</span>
Answer:
Account Titles Debit Credit
Cash $144,500
Discount on Bonds Payable $53,941
Bonds Payable $184,000
Paid-in Capital Stock Warrants $ 14,441
Working:
Discount on bonds payable = Bonds payable + Paid in capital stock warrant - cash
= 184,000 + 14,441 - 144,500
= $53,941
Value of bonds with warrants:
= 144,900 + 16,100
= $161,100
Value of warrants is therefore:
= Cash received / Value of bond with warrants * value of warrants
= 144,500 / 161,100 * 16,100
= $14,441
