The single largest contributor to the probability that a firm will end up in financial distress occurs when income flows fail to meet the required spending outflows owed to outstanding obligations or needs.
Financial distress is the inability of a business or individual to generate sufficient income or income to meet or pay their financial obligations. This is typically due to high fixed costs, a high proportion of illiquid assets, or cyclical earnings.
Financial distress may therefore make it difficult for the company to obtain external funding for viable projects. Our inability to raise external funding and our predicament may both impact our trade credit policy.
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Answer:
Reduced demand and increased supply leading to reduced equilibrium and approximation rates.
And it could also lead to an unpredictable effect or impact on the equilibrium quantities of laser eye surgery.
Answer:
C) In today's dollars, Chang Lee's money is worth more than Soo Lee's
Explanation:
The present value of receipts 6 year hence of amount $20,000 discounted at 7% rate would be: Discounting factor of 1 $ for 6 years at 7 % i.e expressed as:
= 20,000 × 0.6663
= $ 13,327 approx
The present value of $20,000 receipts 9 years hence discounted at 7% rate is given by:
= 20,000 × 0.5439
= 10,879 approx.
As is evident from above, Chang Lee's present value of receipts is more than those of Soo Lee's.
The Manufacturing Overhead for the year was $18,000 overallocated.
Explanation:
- Lakeside, Inc. estimated manufacturing overhead costs for the year at $ 375 comma 000, based on 180 comma 000 estimated direct labor hours. Actual direct labor hours for the year totaled 191 comma 000. The manufacturing overhead account contains debit entries totaling $ 391 comma 000.
- The Manufacturing Overhead for the year was $18,000
- there are basically two types of business overhead which are administrative overheads and the manufacturing overheads.
- Overhead expenses includes the following examples,
- the accounting fees,
- advertising, insurance,
- interest rates,
- legal fees,
- labor work,
- rent, repairing,
- supplies, taxes,
- telephone bills,
- travelling expenses, etc.
Answer:
Option C $10,000
Explanation:
Taxable income is $8000 and the tax allowable depreciation (MACRS) is $3000. To arrive at accounting income we have to deduct Tax allowable depreciation from the taxable income and add the accounting depreciation which is $1000.
This implies:
Accounting profit = Taxable Income + Tax allowable depreciation - Tax disallowed expense + Tax disallowed income
By putting values we have:
Accounting profit = $8000 + $3000 - $1000 = $10,000
