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Helen [10]
3 years ago
11

One advantage of a sole proprietorship is:

Business
1 answer:
viva [34]3 years ago
8 0

Answer:

option a

Explanation:

owner keeps all the profits

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A favorable cost variance occurs when actual costs are more than standard costs standard costs are more than actual costs standa
Orlov [11]
A favorable cost variance occurs when: <span>Standard costs are more than actual costs
Standard cost refers to the cost that projected to happen when acquiring an asset. Meanwhile, actual cost refers to the total cost that actually happens when acquiring that asset.

</span>
6 0
2 years ago
When the current price of an item is greater than the item's market clearing price:_________.
irina1246 [14]

Answer:

<u>C) quantity supplied is greater than the quantity demanded.</u>

<u>Explanation:</u>

We need not be confused, <em>the market-clearing price is referring to the equilibrium price. </em>Thus, if the current price is above the market-clearing price (that is, the price at which quantity demanded equals quantity supplied), it means the <u>quantity supplied</u> is <em>greater</em> than the<u> quantity demanded</u> of the item.

For example, at a price of $1 per orange, there's an equal amount in quantity demanded and quantity supplied of orange. However, the price increases to $2 per orange; which makes the current price of an orange greater than the market-clearing price of $1.

4 0
3 years ago
Fast Turnstiles Co. is evaluating the extension of credit to a new group of customers. Although these customers will provide $41
k0ka [10]

Answer:

Follows are the solution to this question:

Explanation:

In point A-1:

Calculating the value of Incremental sales after tax:  

Further revenues= $414,000  

Recognize(Less)=Costs

Debt worth =$33,120  

Set Exp. = $17,400    

Production and commercialization cost= $314,640  

Pre-sales tax =$48,840.  

Lower: 35%   tax = $17,094  

Incremental tax income =$31,746

In point A-2:

Determine profits for extra expenditure  

Extra spending on debts = \frac{ \$ 414,000}{\$ 5}

                                         = \$ 82,800.

Return on the Expenditure = \frac{\$ 31746}{ \$ 82800}

                                             = 38.34 \%

In point A-3:

Yeah, For the Fast Turnstiles company must provide certain consumers with loans.

In point B-1:

Incremental taxes after-tax calculation:  

Further sales = $ 414,000    

Return: Costs  

gross debt= $45,540    

Set Exp = $17,400  

Cost for production and marketing = $314,640  

Net profits=$ 36,420  

Without tax 35% = $12,747  

Incremental tax revenue= $23,673    

In point B-2:    

Determine profits for extra expenditure  

Extra investment in debts = \frac{ \$ 414,000 }{ \$ 5}

                                             = \$ 82,800

Incremental return on that investment = \frac{\$ 23673}{\$ 82800}

                                                                   = 28.59 \%  

In point B-3:      

Yeah, The Fast Turnstiles company must provide to certain consumers to credit.

In point C-1:    

The incremental tax revenue estimate  

$414,000 = excess revenue  

Remember Costs

Debt worth= $ 33,120  

set Exp = $17,400    

Production and commercialization cost=  $314,640  

Pre- sales  tax = $48,840.  

Less: 35% Tax = $17,094  

Incremental tax income=  $31,746  

Calculate profits for extra expenditure  

Extra Accounting Investment = \frac{\$ 414000}{1.6}

                                                 = \$ 258750

Incremental Return= \frac{\$ 31,746} {\$ 258,750}

                                = 12.27 \%

In point C-2:

Yeah, its credit should be granted to all these consumers through Fast Turnstiles company limited.

3 0
2 years ago
The common stock of the C.A.L.L. Corporation has been trading in a narrow range around $125 per share for months, and you believ
Bezzdna [24]

Answer:

The price of a 6-month call option on C.A.L.L. stock is $13.52

Explanation:

According to the given data we have the following:

P = Price of 6-months put option=$10.50.

So = Current price=$125

X = Exrecise price=$125

r = Risk free interest rate= 5%

T = Time 6 months = 1/2

In order to calculate the price of a 6-month call option on C.A.L.L. stock at an exercise price of $125 if it is at the money, we would have to use the formula of put-call parity as follows:

C=P+So- (<u>   X   )</u>

              ( 1+r)∧T

C=$10.50+$125-(<u>$125   )</u>

                            (1+0.05)∧1/2

C=$135.5-121.98

C=$13.52

The price of a 6-month call option on C.A.L.L. stock is $13.52

3 0
3 years ago
Turnbull Co. is considering a project that requires an initial investment of $270,000. The firm will raise the $270,000 in capit
svp [43]

Answer:

WACC = 11.45 %

Explanation:

Weighted average cost of capital is the average cost of all of the long-term types of finance used by a company weighted according to the that amount of finance used in relation to the total pool of fund

WACC = (Wd×Kd) + (We×Ke) + (Wp × Kp)

After-tax cost of debt = Before tax cost of debt× (1-tax rate)

Kd-After-tax cost of debt = 11.1%(1-0.4) =6.66%

Ke-Cost of equity = 14.7%

Kp= Cost of preferred stock = 12.2%

Wd-Weight of debt =100/270=0.370

We-Weight of equity = 140/270=0.518

Wp= weight of preferred stock = 30/270=0.111

WACC = (0.518× 14.7%) + (0.370 × 6.7%) + (0.111×12.2) =  11.447%

WACC = 11.45 %

6 0
2 years ago
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