Financial economists prefer to use market values rather than book values when measuring debt ratios because market values are a better reflection of current value than historical value. the correct answer is option(b).
Market capitalization is frequently used to refer to market value, which is the price an asset commands on the market. Because they depend on a variety of variables, including the physical working environment, the overall state of the economy, and the dynamics of supply and demand, market values are dynamic in nature.
An asset's book value is determined by the balance in its balance sheet account. Asset values are determined by subtracting any depreciation, amortization, or impairment expenses from the asset's initial cost.
Since market value includes profitability, intangibles, and potential for future growth, it typically exceeds book value for a company. The net asset value investors receive when they purchase shares is measured using book value per share.
The complete question is:
Financial economists prefer to use market values when measuring debt ratios because:
- market values are more stable than book values.
- market values are a better reflection of current value than historical value.
- market values are readily available and do not have to be calculated like book values.
- market values are more difficult to calculate which makes financial economists more valuable
- None of these.
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The country of origin effect happens when the place a product was manufactured influences how consumers perceive the product.
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What is a country of origin effect?</h3>
- COO stands for Country of Origin.
- The practice of marketers and consumers identifying brands with countries and basing purchasing decisions on the country of origin of the product is referred to as effect.
- The country of origin effect occurs when the location of a product changes how consumers perceive the product.
- Consumers assume product features based on country stereotypes and previous encounters with products from that country.
- As a result, a COO cue has become an essential information cue for customers who are more exposed than ever before to internationalized product selection and multinational marketing.
Therefore, the country of origin effect happens when the place a product was manufactured influences how consumers perceive the product.
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Answer:
C) $1,200 capital gain.
Explanation:
David's basis on the land was $24,000
liability assumed by other partners = $30,000 x (1 - 10%) = $27,000
liability assumed by David on the partnership's other liabilities = $18,000 x 10% = $1,800
David's gain = liability assumed by other partners ($27,000) - land basis ($24,000) - additional liability assumed by David ($1,800) = $1,200 gain
When a partner contributes property to a partnership, his/her gain or loss must be determined using the asset's basis, not the fair market value.
Answer:
The journal entry is as follows:
Cash A/c Dr. $18,000
Equipment (Fair value) A/c Dr. $9,000
To N's capital $27,000
(To record the investment bought by Nichols)
Workings:
Cash contributed by Nichols = $18,000
Equipment's Book value = $6,300
Fair value of equipment = $9000
Nichols capital = $18,000 + $9,000
= $27,000
Answer:
BEP units 205,882 pounds
BEP dollars $102,941.17
Explanation:
0.50 - 0.33 = 0.17 contribution per pound
This means each pound generates 0.17 of contribution.
Now, we can calculate the pounds needed to afford the fixed cost.
35,000/0.17 = 205,882.35 pounds
for the BEP we will multiply by the sales price:
205,882.35 pounds x $0.5 = $102,941.17
