The most basic layer of a product is the core product which consists of all the benefits the product will provide for consumers or business customers.
<h3>What are core products?</h3>
Core products or services are company products/services that are close to the company's core competencies. It describes the satisfaction that a consumer gets from consuming a product.
Core product involves the benefits the product will provide for consumers.
The three layers of products are :
Hence, the most basic layer of a product is the core product which consists of all the benefits the product will provide for consumers or business customers.
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Answer:
First in, first out (FIFO)
Explanation:
In FIFO, the assets produced or acquired first are sold, used or disposed of first and may be used by an individual or a corporation. So , since the newer costs are more relevant , the oldest cost won't affect the ending valuation.
Answer:
d. One defect of the IRR method versus the NPV is that the IRR does not take proper account of differences in the sizes of projects.
CORRECT As the project yields over time can differ. This generates that projects with a lower IRR can achieve a higher NPV at lower rates.
There is a crossover point after which a projects NPV are equal and from there the one with higher IRR obtains better NPV
Explanation:
a. One defect of the IRR method versus the NPV is that the IRR does not take account of the time value of money.
FALSE both method consider time value of money
b. One defect of the IRR method versus the NPV is that the IRR does not take account of the cost of capital
FALSE The IRR can be compared against the cost of capital to indicate wether or not a project should be preferable
.c. One defect of the IRR method versus the NPV is that the IRR values a dollar received today the same as a dollar that will not be received until sometime in the future.
FALSE IRR considers the time value of money
e. One defect of the IRR method versus the NPV is that the IRR does not take account of cash flows over a project's full life.
FALSE it considers all the cash flows over the project's full life.
Answer:
The company has current ratio almost half than the industry average. This is an indication that the company has lesser current assets than industry average. The ability of the company to meet its short term obligations is not suitable as the other companies in the industry are maintaining double current ratio. The ratio should never go below 1 as if it does the company may face its operational financing and working capital management issues.
The debt to equity ratio is significantly higher than the other companies of the same industry. The industry average is 4 whereas the company has ratio 20. This is significantly higher which indicates that there is heavy burden of debt on the company. High debt/ equity ratio indicates high risks. Investors avoid investing in such companies which have high debt/ equity ratio.
Explanation:
The company can go for equity financing as it will also help reduce its debt / equity ratio. The company will become less riskier and financing will be divided in debt and equity. The debt burden on assets will be reduced. There can be reduction in certain debt covenants. The company can use equity financing to fund its operations as well as purchase of non current assets to increase production and ultimately profitability of the company could rise.
