Answer: a. Residual income, like ROI, can encourage a short run orientation
Explanation:
Residual incomes presents the same problem as ROI measurement, The problem of myopic behaviour or short run orientation
The manager may cut expenses like advertising expenses, maintenance expenses , training expenses when being evaluated under residual income or ROI to reflect a favourable residual income or return on investments, The problem Managers being short run orientated is not eliminated or minimized by change methods between ROI and Residual income.
<span>Choice (d) is the most correct. When an auditor looks at the risks involved with possible misstatements (control risk and inherent risk), it helps him or her understand the detection risk that could stem from using the wrong procedures or making the wrong decisions during the audit.</span>
Answer:
Margin of safety Amount by which sales can decrease before a loss is incurred.
Answer:
480 inches (40 feet)
Explanation:
Studs are boards placed on walls so as to support the walls. Studs are used in framing the wall and they are vertical.
Studs are usually spaced on walls with wall framing at either 16 inches on center, 19 inches on center or 24 inches on centers.
Given that on center spacing = 16 inches, number of studs = 31
The length of the wall is given by the formula:
number of studs = (length of wall in inches / on center spacing in inches) + 1
Length of wall (inches) = (number of studs - 1) * on center spacing
hence:
Length of wall (inches) = (31 - 1) * 16 inches = 480 inches
Length of wall = 480 inches = 40 feet
Answer: Bad Debt Expense 28,000 Allowance for Doubtful Accounts 28,000
Explanation:
Account receivable = 300,000
Percentage uncollectible = 10%
Current balance = 2000
Adjustment to allowance for uncollectible accounts is given by :
(Account receivable ×percentage uncollectible) - current balance
(300,000 × 10%) - 2000
(300,000 × 0.1) × 2000
30,000 - 2000 = 28,000
Therefore, adjustment should be :
bad debt expense debit 28,000
allowance for doubful account credit 28,000
