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3 years ago

Happy lion is considering investing ina project whose eisj is greater than the firm's current risk level based on

1 answer:

3 0

The things that decision maker should consider in this situation is to Increase the cost of capital used to evaluate the project to reflect its higher-than-average risk.
In budgetinng process, the decision maker need to make sure the cost that potentially incurred for the company because of the higher risk.
If, after including all that the potential benefit still outweight the potential risk, then they could move forward with the investment.

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Answer each of the following questions from the standpoint of each of the three theories of justice. Each question should have t

Vlada [557]

Answer:

O WHAT IS THAT WOW WOW WOW PO

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3 years ago

Mr. and Mrs. Jones had an extensive flood in their basement. They incurred casualty losses of $20,000. Their insurance company r

andreev551 [17]

Answer:

True

Explanation:

According to the IRS tax guidelines in such a case the unreimbursed amount is deductible as an itemized deduction from tax returns.

What this implies for Mr. and Mrs. Jones is that the $12,000 unreimbursed amount would be deducted from their tax return. Thus, reducing the amount of taxes to be paid by them.

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3 years ago

On January 1, 2013, Jacob Inc. purchased a commercial truck for $48,000 and uses the straight-line depreciation method. The truc

Jlenok [28]

Answer:

The amount of gain should Jacob Inc. record on December 31, 2015 is $5,000

Explanation:

Truck Value = $48,000

Annual depreciation = ( $48,000 - $8,000) / 8 = $40,000 / 8= $5,000

First year (2013) = $40,000 - $5,000 = $35,000

Second year (2014) = $35,000 - $5,000 = $30,000

Third year (2015)= $30,000 - $5,000 = $25,000

Gain = Sale Value - Truck Value (actual) = $30,000 - $25,000 = $5,000

6 0

3 years ago

g If a firm can earn a profit stream of $50,000 per year for 10 years, that profit stream is worth:1)A)nothing today)less than $

galben [10]

Answer:

b)less than $500,000 today, but a positive amount.

Explanation:

By the virtue of the concepts of compounding and discounting, we understand that $1 today is worth more that $1 in the future.

Where Pv = Present value

Fv = Future value

r = discount rate

t = time

Fv = Pv ( 1 + r)^t

As such If a firm can earn a profit stream of $50,000 per year for 10 years, that profit stream is worth less than $500,000 today, but a positive amount.

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3 years ago

The following financial information is taken from the annual reports of the Jackson Company and the Pearce Company: Jackson Pear

zloy xaker [14]

Answer:

1. Jackson = $350,000 and Pearce = $1,020,000

2. Pearce

Explanation:

The formula to compute the free cash flow is shown below:

= EBIT × (1 -Tax Rate) + Depreciation & Amortization - Change in Net Working Capital - net capital Expenditure

But for this question, the formula would be

= Cash flow from operating activities - Cash investment in property & equipment

1. For Jackson, it would be

= $500,000 - $150,000

= $350,000

For Pearce, it would be

= $1,500,000 - $480,000

= $1,020,000

2. If we see and compare the free cash flow, the Pearce has better cash flow due to the high cash flow from operating activities

3 0

4 years ago