Answer:
the long-run framework.
Explanation:
In Economics, Growth can be defined as an increase or rise in the level of output and production of goods and services over a specific period of time by a business entity.
Issues of growth are generally considered by economists in the long-run framework because growth itself is a long-run phenomenon in economics.
A long-run growth refers to the continuous and sustained increase in the level of output of goods and services or quantity of production that a business is able to achieve.
Hence, all of the four factors of production affects the level of growth that is being experienced by an individual or organization. These factors are;
1. Capital.
2. Labor.
3. Land.
4. Entrepreneur.
In a nutshell, business owners and economist usually consider the growth of a business as a long-run phenomenon rather than as a short-run phenomenon.
Answer:
the long-run framework.
Explanation:
For each of the following depreciable assets, determine the missing amount. Abbreviations for depreciation methods are SL for straight-line and DDB for double-declining-balance.
Asset Cost Residual Service Life Depreciation Depreciation
Value (Years) Method (Year 2)
A 31,000 5 DDB $30,000
B 30,000 8 SYD 35,00
C 87,000 6,000 SL 9,000
D 252,000 21,000 10 23,100
E 211,000 3,100 8 150%DB
Answer:
Asset Cost Residual Service Life Depreciation Depreciation
Value (Years) Method (Year 2)
A $125,000 $31,000 5 DDB $30,000
B $30,000 $12,000 8 SYD $3,500
C $87,000 $6,000 9 SL $9,000
D $252,000 $21,000 10 straight line $23,100
E $211,000 $3,100 8 150%DB $32,144.53
A) double declining balance:
2 x 1/5 x 0.6cost = $30,000
0.6cost = $30,000 / 0.4 = $75,000
cost = $75,000 / 0.6 = $125,000
B) 8 + 7 + 6 + 5 +4 + 3 + 2 + 1 = 36
depreciation year 2 = 7/36 x ($30,000 - residual value) = $3,500
$30,000 - residual value = $3,500 x 36/7 = $18,000
residual value = $30,000 - $18,000 = $12,000
C) straight line depreciation per year = net depreciable value / useful life
$81,000 / useful life = $9,000
useful life = $81,000 / $9,000 = 9
D) straight line since depreciation per year x useful life = net depreciable value
$23,100 x 10 = $231,000
E) 150% double declining
year 1 = 1.5 x 1/8 x $211,000 = $39,562.50
year 2 = 1.5 x 1/8 x $171,437.50 = $32,144.53
The Wet Dog Surf Company borrows $22,000 for 5 months and will pay $825.00 interest . Calculate Wet Dog's Annual Percentage Interest Rate (APR) (rounded to two decimal places).
Answer:
The answer is 9%
Explanation:
Solution
Given that:
Wet Dog Surf Company borrows= $22,000 for 5 months
Interest =$825.000
Now we have to find Wet Dog's Annual Percentage Interest Rate (APR)
Thus
The interest rate for 5 months is given by:
$825.00/$22,000
=0.0375% or 3.75%
So, APR becomes:
3.75% * 12/5
= 45/5
= 9%
Therefore the Annual Percentage Interest Rate (APR) for We Dog's is 9%
Assume that Stillwater Designs produces two automotive subwoofers:
S12L7 S12L5.
First quarter 2014 800 1300
Second quarter 2014 2200 1400
Third quarter 2014 5600 5300
Fourth quarter 2014 4600 3900
First quarter 2015 900 1200
The vice president of sales believes that the projected sales are realistic and can be achieved by the company.
Required:
Prepare a sales budget for each quarter of 2014 and for the year in total. Show sales by product and in total for each time period. Do not include a multiplication symbol as part of your answer.
Answer:
Stillwater Designs
Sales Budget 2014
Year 2014
Product First Second Third Fourth Total
quarter quarter quarter quarter
S12L7 800 2,200 5,600 4,600 13,200
S12L5 1,300 1,400 5,300 3,900 11,900
A sales budget gives us an estimate of how many units (and $) the company will sell in the following months, quarters or even years.
Indicate whether the scenarios would result in an increase, a decrease, or no change in the long-run aggregate supply (LRAS) curve for a hypothetical economy. Each label may be used more than once.
The mandatory retirement age is abolished.
The economy's main export is candy.
Candy from this country increases in popularity around the world.
Since candy has become an international sensation, factories double the number of candy-making machines.
The top candy companies choose to relocate their means of production to other countries around the world.
Answer:
The mandatory retirement age is abolished.
This will result in an Increase in the long-run aggregate supply (LRAS) curve because it means that companies in the economy now have a larger workforce to choose from. This will reduce the cost of labor and lead to more goods being supplied.The economy's main export is candy. Candy from this country increases in popularity around the world.
No effect on long-run aggregate supply (LRAS) curve because this deals with demand.Since candy has become an international sensation, factories double the number of candy-making machines.
Factories are now producing more candy due to having more candy-making machines. This will result in an Increase in the long-run aggregate supply (LRAS) curve.The top candy companies choose to relocate their means of production to other countries around the world.
The companies are still supplying candy to the world, however they are doing it from other countries. This supply coming from the hypothetical economy will therefore reduce. This will result in a Decrease in the long-run aggregate supply (LRAS) curve.A rich aunt has promised you $ 5 comma 000 one year from today. In addition, each year after that, she has promised you a payment (on the anniversary of the last payment) that is 3 % larger than the last payment. She will continue to show this generosity for 20 years, giving a total of 20 payments. If the interest rate is 6 %, what is her promise worth today?
Answer:
PV= $45,642.73
Explanation:
Giving the following information:
Cash flow= 5,000
Number of years= 20
Interest rate= 6%
Growth rate= 3%
First, we need to calculate the future value of the aunts' generosity. We will incorporate the growth rate to the interest rate.
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
FV= {5,000*[(1.09^20) - 1]} / 0.09
FV= $255,800.60
Now, the present value:
PV= FV/(1+i)^n
PV= 255,800.6/1.09^20
PV= $45,642.73
At Mattel, a marketing information system stores data on regional sales activities, promotional costs, and international inventory levels. These data are examples of external sources.
Answer:
It is false.
Explanation:
At Mattel, a marketing information system stores data on regional sales activities, promotional costs, and international inventory levels. These data are not examples of external sources but are internal sources.
Internal sources of market information are informations that are gotten from within the company such as regional sales activities, promotional costs, and international inventory.
However, the external sources of information are informations that are gotten outside of the company such as survey from customers, competitors etc.
Strategic business units that have a relatively low market share but have the potential to grow are best categorized under _____ in the Boston Consulting Group (BCG) growth-share matrix.
Answer:
The answer is question marks
Explanation:
Boston Consulting Group (BCG) growth-share matrix are grouped into four:
Star
Question mark
Cash cows
Dogs.
Question mark, which is of interest to us in this question requires much closer consideration. They are growing rapidly and as a result consume large amounts of money.They have low market shares but have potential to gain market share and become stars and eventually cash cows when market growth slows At that stage(question marks), they do not generate much cash.
They are a starting point for most businesses.
The real rate is 4.1 percent and the inflation rate is 5.7 percent. What rate would you expect to see on a Treasury bill
Answer:
10%
Explanation:
The rate on a treasury bill is usually the nominal rate.
1 + Nominal rate = (1 + real rate ) x (1 + inflation rate)
(1.041) x (1.057) = 1.10
1.10 - 1 = 0.10 = 10%
Nominal rate = 10%
I hope my answer helps you
When Mayo Clinic conducted its analysis during the 1980s, what two segments of the general environment did it initially focus on?
a. Demographic and economic
b. Sociocultural and demographic
c. Economic and legal
d. Legal and technologicel
e. Technological and sociocultural
Answer:
a. Demographic and Economic .
Explanation:
the analysis looked at the age, gender and occupation of people studied. this is a demographic segment
it also examined the income distribution of those studied. this is an economic segment.
A company owes employee salaries of $16,000 at the end of the year. These salaries will be paid in the following year. What adjusting entry, if any, does the company need to record at the end of the year
Answer:
Wages and Salaries $16,000 (debit)
Wages and Salaries Payable $16,000 (credit)
Explanation:
At the end of the year, the Company has to recognize an Expense : Wages and Salaries and a Liability : Wages and Salaries Payable.
You deposit $500 in an account earning 5% interest compounded annually. How much will you have in the account in 10 years?
Answer:
Future Value= $814.45
Explanation:
Giving the following information:
Initial investment= $500
Interest rate= 5% interest compounded annually.
Number of years= 10
To calculate the future value, we need to use the following formula:
FV= PV*(1+i)^n
FV= 500*(1.05^10)
Future Value= $814.45
Consider the case of cell phone service. In England, there are 20 providers of cell phone service. On the other hand, in Cambodia, cell phone service is largely regulated by the government with only one firm as the sole provider of this service. Under these circumstances, it is expected that Choose one: A. England will have higher growth potential than Cambodia. B. England and Cambodia will have similar growth potential. C. England will have lower growth potential than Cambodia.
The information presented here represents selected data from the December 31, 2016, balance sheets and income statements for the year then ended for three firms:
Firm A Firm B Firm C
Total assets, 12/31/16 $417,000 $536,000 $316,000
Total liabilities, 12/31/16 216,000 144,000 _____
Paid-in capital, 12/31/16 75,000 _____ 37,000
Retained earnings, 12/31/16 _____ 307,000 _____
Net income for 2016 _____ 85,000 117,000
Dividends declared and paid during 2016 44,000 9,000 66,000
Retained earnings, 1/1/16 76,000 _____ 44,000
Required:
Calculate the missing amounts for each firm.
Answer:
Firm A Firm B Firm C
Total assets, 12/31/16 $417,000 $536,000 $316,000
Total liabilities, 12/31/16 216,000 144,000 $184,000
Paid-in capital, 12/31/16 75,000 $85,000 37,000
Retained earnings, 12/31/16 $126,000 307,000 $95,000
Net income for 2016 $94,000 85,000 117,000
Dividends declared and 44,000 9,000 66,000
paid during 2016
Retained earnings, 1/1/16 76,000 $231,000 44,000
Explanation:
Firm A Firm B Firm C
Total assets, 12/31/16 $417,000 $536,000 $316,000
Total liabilities, 12/31/16 216,000 144,000 _____
Paid-in capital, 12/31/16 75,000 _____ 37,000
Retained earnings, 12/31/16 _____ 307,000 _____
Net income for 2016 _____ 85,000 117,000
Dividends declared and 44,000 9,000 66,000
paid during 2016
Retained earnings, 1/1/16 76,000 _____ 44,000
we can use the following two basic formulas to determine the missing amounts:
ending balance retained earnings = beginning balance + net income - dividends paid
paid in capital = assets - liabilities - retained earnings
firm A:
417,000 - 216,000 - 75,000 = 126,000
126,000 + 44,000 - 76,000 = 94,000
firm B:
536,000 - 144,000 - 307,000 = 85,000
307,000 - 85,000 + 9,000 = 231,000
firm C:
44,000 + 117,000 - 66,000 = 95,000
316,000 - 37,000 - 95,000 = 184,000
43) An annuity is set up that will pay $1500 per year for ten years. What is the present value (PV) of this annuity given that the discount rate is 9%? A) $5776 B) $9626 C) $11,551 D) $13,476
Answer:
PV= $9,626.49
Explanation:
Giving the following information:
Cash flow= $1,500
Interest rate= 9%
Number of years= 10
First, we will determine the future value, using the following formulas:
FV= {A*[(1+i)^n-1]}/i
A= cash flow
FV= {1,500*[(1.09^10) - 1]} / 0.09
FV= $22,789.395
Now, the present value:
PV=FV/(1+i)^n
PV= 22,789.395/(1.09^10)
PV= $9,626.49
The risk-free rate of return is 5 percent and the market risk premium is 12 percent. What is the expected rate of return on a stock with a beta of 1.4
Answer:
Expected rate of return= 21.8 %
Explanation:
The capital asset pricing model is a risk-based model for estimating the return on a stock.. Here, the return on equity is dependent on the level of reaction of the the equity to changes in the return on a market portfolio. These changes are captured as systematic risk. Systematic risks are those which affect all economic actors in the market, they include factors like changes in interest rate, inflation, etc. The magnitude by which a stock is affected by systematic risk is measured by beta.
Under CAPM,
E(r)= Rf + β×(Rm-Rf)
E(r)- expected return- ?
Rf-risk-free rate- 5%
β= Beta - 1.4
(Rm-Rf) - 12
E(r) = 5% + 1.4× (12%)= 21.8 %
Expected rate of return= 21.8 %
Brett Thiesen wants to make a political case for regional economic integration to his electorate. Which valid statement can he make in his regard?A) Those seeking a united europe have always had a desire to make another way in europe imminentB) Linking neighboring economies increases the potential for violent conflictC) making neighboring economies increasingly dependent on each other fails to create incentives for political cooperationD) Countries can enhance their political weight in the world by grouping their economiesE) free trade stimulates economic growth, which creates dynamic gains from trade
Answer:
If Brett Thiesen wants to make a political case for regional economic integration to his electorate, the valid statement he can make in this regard is
E) free trade stimulates economic growth, which creates dynamic gains from trade.
Explanation:
Free trade among regional countries is the only sure way to "stimulate economic growth and create dynamic gains from trade." According to wikipedia.com, "Free trade is a trade policy that does not restrict imports or exports. It can also be understood as the free market idea applied to international trade." It is free trade system that created the European economy, enabling them to replace their national currencies with the Euro. Regional free trade also encourages the movement of not only goods, but also persons and services, and cultures.
Cellar Wines has a debt-equity ratio of 0.54, sales of $728,700, net income of $94,900, and total debt of $382,000. What is the return on equity
Answer:
13.42%
Explanation:
Here is an solution to the question below.
Debt equity ratio = 0.54
Sales = $728700
Net income = $94900
Total debt = $382000
Total equity ratio = net income / (total debt/ debt equity ratio)
total debt/ debt equity ratio = 382000/0.54 = 707,407.4
Total equity ratio = 94900/707,407.4
= 0.1342 x 100
= 13.42%
This is the return on equity.
Coronado Corporation purchased a new machine for its assembly process on August 1, 2017. The cost of this machine was $162,702. The company estimated that the machine would have a salvage value of $17,802 at the end of its service life. Its life is estimated at 5 years, and its working hours are estimated at 21,000 hours. Year-end is December 31.
Compute the depreciation expense under the following methods. Each of the following should be considered unrelated
a. Straight Line Method for 2017
b. Sum-of-the-years'-digits for 2018
c. Double-declining-balance for 2018
Answer:
a. Straight Line Method for 2017
depreciation expense per year = ($162,702 - $17,802) / 5 years = $28,980
depreciation expense (August to December 2017) = $28,980 x 5/12 = $12,075
b. Sum-of-the-years'-digits for 2018
depreciation expense year 1 = 5/15 x $144,900 = $60,375 / 12 months = $5,031.25 per month
depreciation expense year 2 = 4/15 x $144,900 = $48,300 / 12 months = $4,025
depreciation expense January 2018 - July 2018 = $5,031.25 x 7 = $35,218.75
depreciation expense August 2018 - December 2012 = $4,025 x 5 = $20,125
depreciation expense 2018 = $35,218.75 + $20,125 = $55,343.75
c. Double-declining-balance for 2018
depreciation expense year 1 = 2 x 1/5 x $162,702 = $65,080.80 / 12 months = $5,423.40 per month
depreciation expense year 2 = 2 x 1/5 x $97,621.20 = $39,048.48 / 12 months = $3,254.04
depreciation expense January 2018 - July 2018 = $5,423.40 x 7 = $37,963.80
depreciation expense August 2018 - December 2012 = $3,254.04 x 5 = $16,270.20
depreciation expense 2018 = $37,963.80 + $16,270.20 = $54,234
7. A fast-food chain plans to expand by opening several new restaurants. The chain operates two types of
restaurants, drive-through and full-service. A drive-through restaurant costs RM 100.000 to construct,
requires 5 employees, and has an expected annual revenue of RM 200.000. A full service restaurant
costs RM 150.000 to construct, requires 15 employees, and has an expected annual revenue of RM
500,000. The chain has RM 2,400,000 in capital available for expansion. Labor contracts require that
they hire no more than 210 employees, and licensing restrictions require that they open no more than
20 new restaurants.
(a) How many restaurants of each type should the chain open in order to maximize the expected
revenue? [1 point)
≤
Explanation:
Drive through Full Service
Annual revenue 200,000 500,000
Cost 100,000 150,000
Income 100,000 350,000
Employee 5 15
Income / employee 20,000 23,333.33
Using simultaneous equation ,
Let X represent the drive through service ,and Y represent the full service restaurant
Budget = 100,000x + 150,000y ≤ 2,400,000 (equation 1)
Employer = 5x + 15y ≤ 210 (equation 2)
(Divide equation 1 by 10 ,000)
10x+ 15y ≤ 240 (equation 3)
Using elimination method, multiply equation 2 by -2
10x +15y ≤240
-10x - 30y ≤-420
-15y ≤ -180
y≤ -180/-15
y = 12
substitute y = 12 in equation 3
10x + 15y≤240
10x +180 ≤240
10x≤240-180
10x≤60
x≤6
12 1,800,000 180
6 600,000 30
6 drive through services and 12 full services should be opened.
6 Drive through 12 full service 20
Cost 600,000 1,800,000 2,400,000
Employees 30 180
Net income 600,000 4,200,000
One of the fastest way to acquire knowledge is to hire individuals or purchase entire companies that have valued knowledge.
A. True
B. False
Answer:
True
Explanation:
Knowledge is something that cannot just be acquired within a day. It requires lots of reading, studying different books, rigorous amount of trainings and carrying out various research to learn something new. All this takes some period of time, maybe months or years because there is a need to perfectly master the field of study.
Therefore one of the fastest ways to acquire knowledge at a fast rate is to hire an individual who is an expert in that field or purchase an entire company that has already gained the knowledge because trying to achieve that on your own is time consuming.
This is an added advantage to the organisation as it helps to increase its growth rate and face any form of competition in the market.
Hence the statement above is true.
A share of BAC common stock has just paid a dividend of $1.00. The market return is 12% and the beta is 1.5. The three month T-bill rate is 4%. The expected long-run growth rate for this stock is 8%. What is the required return for the stock? What is the stock price?
Answer:
Required rate of return= 16%
Stock price= $13.50
Explanation:
A share of BAC common stock just made a dividend payment of $1
Market return is 12%
Beta is 1.5
Risk-free rate is 4%
Growth rate is 8%
The required rate of return for the stock can be calculated as follows
Required rate of return= Risk-free rate+beta×(market rate-risk-free rate)
= 4%+1.5(12%-4%)
= 4%+1.5×8%
= 4%+12
= 16%
The stock price can be calculated as follows
Stock price= dividend for the year/(rate of return-growth rate)
= (1×1.08)/(16/100-8/100)
= 1.08/0.16-0.08
= 1.08/0.08
= $13.50
Hence the required rate of return and the stock price is 16% and $13.50 respectively.
Turner Inc. produces two products P1 and P2. The company has provided you with the following information. Assume that the current sales volume of P1 and P2 reflects the long run sales mix of the firm.
P1 P2
Selling price per unit $30 $60
Variable cost per unit $10 $30
Numberof units sold 9,000 6,000
Total fixed costs $240,000
Select ALL statements that are true. All numbers in the answer choices are rounded off to 2 decimals. Breakeven volume in units is rounded off to the next higher integer.
A. 40% of Turner's revenue comes from P2
B. The operating leverage for Turner now is 0.47
C. Turner makes a contribution of $0. 57 per dollar of revenue, on the average.
D. Turner will breakeven when it reaches a revenue of $420,000.
E. The breakeven volume for Turner is 9,334 units
Answer:
B. The operating leverage for Turner now is 0.47 ⇒ TRUE
operating leverage = fixed costs / total costs = $240,000 / $510,000 = 0.47
C. Turner makes a contribution of $0. 57 per dollar of revenue, on the average. ⇒ TRUE
total contribution margin = ($20 x 9,000) + ($30 x 6,000) = $180,000 + $180,000 = $360,000
total revenue = $630,000
contribution margin per $ of revenue = $360,000 / $630,000 = $0.57
D. Turner will break even when it reaches a revenue of $420,000. ⇒ TRUE
break even point in $ = (6,000 x $30) + (4,000 x $60) = $180,000 + $240,000 = $420,000
Explanation:
A. 40% of Turner's revenue comes from P2 ⇒ FALSE
total revenue = $270,000 + $360,000 = $630,000
revenue from P2 = $360,000, which represents 57.14% of total revenue
E. The breakeven volume for Turner is 9,334 units ⇒ FALSE
in order to calculate break even point, we can prepare a bundle of products = 3P1 + 2P2
contribution margin per bundle = $120
break even point = $240,000 / $120 = 2,000 bundles
6,000 P1 and 4,000 P2
In a department, 35 comma 000 units are completed and transferred out and 12 comma 400 remain in ending WIP at 85% complete. If an equivalent unit costs $ 10.00 for direct materials, what is the value of materials transferred out?
Answer:
$350,000
Explanation:
The computation of the value of material transferred out is shown below:
= Completed and transferred units × equivalent cost for direct material per unit
= 35,000 units × $10
= $350,000
Therefore by multiplying the completed & transferred units with the equivalent cost for direct material per unit we can get the value of material transferred out
A customer buys 100 shares of ABC at $30 as the initial transaction in a new margin account. Subsequently, ABC rises to $40 per share in the market. What is the account's equity after the change in market value
Answer:
Account's Equity:
Investment in ABC = $4,000 ($40 x 100)
This is made up of initial investment of $3,000 and Unrealized Gain of $1,000 ($10 x 100) for the appreciation in market value.
Explanation:
The account's equity is the share in ownership rights of the customer in the margin account. According to investopedia.com, "A margin account is a brokerage account in which the broker lends the customer cash to purchase stocks or other financial products. The loan in the account is collateralized by the securities purchased and cash, and comes with a periodic interest rate."
Bendel Inc. has an operating leverage of 4.3. If the company's sales increase by 15%, its net operating income should increase by about:
Answer:
64.5%
Explanation:
The requirements of this question is to calculate increase in net operating income.
Increase = 15 percent
Operating leverage = 4.3
increase in net operating income.
Operating leverage x sales increase
= 15 x 4.3
= 64.5%
I hope this answer is helpful.
Pharoah Company purchased equipment in 2020 for $104,000 and estimated an $8,000 salvage value at the end of the equipment's 10-year useful life. At December 31, 2021, there was $67,200 in the Accumulated Depreciation account for this equipment using the straight-line method of depreciation. On March 31, 2022, the equipment was sold for $21,000.
Prepare the appropriate journal entries to remove the equipment from the books of Pharoah Company on March 31, 2022. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Answer:
Pharoah Company
General Journal
Debit Sale of Equipment $104,000
Credit Equipment account $104,000
To close the equipment account.
Debit Accumulated Depreciation $69,600
Credit Sale of Equipment $69,600
To close the accumulated depreciation account.
Debit Cash Account $21,000
Credit Sale of Equipment $21,000
To record the cash receipts from the sale.
Explanation:
a) Calculations:
Purchase price = $104,000
Salvage value = $8,000
Depreciable amount = $96,000
Depreciation per year = $9,600 ($96,000/10)
Accumulated Depreciation at Dec. 31, 2021 = $67,200
This shows that the equipment was bought 7 years ago (not clear from the question), because $9,600 x 7 = $67,200
b) Depreciation expense for 2022 = $2,400 ($9,600 x 3/12)
c) Total accumulated depreciation = $69,600 ($67,200 + 2,400)
d) The difference in the Sale of Equipment account is the loss on sale = $13,400 ($104,000 - 69,600 - 21,000). This shows that the equipment was sold at a loss of $13,400.
Ferkil Corporation manufacturers a single product that has a selling price of $100 per unit. Fixed expenses total $225,000 per year, and the company must sell 5,000 units to break even. If the company has a target profit of $67,500, sales in units must be:
Answer:
Break-even point in units= 6,500 units
Explanation:
Giving the following information:
Selling price per unit= $100
Fixed expenses total $225,000 per year
Break-even point= 5,000
Desired profit= $67,500
First, we need to calculate the contribution margin per unit:
Break-even point in units= fixed costs/ contribution margin per unit
5,000= 225,000 / contribution margin per unit
contribution margin per unit= 225,000/5,000
contribution margin per unit= $45
Now, we can determine the number of units to be sold:
Break-even point in units= (fixed costs + desired profit) / contribution margin per unit
Break-even point in units= (225,000 + 67,500) / 45
Break-even point in units= 6,500 units
Identify the account used by businesses to record the transfer of assets from a business to its stockholders: Multiple Choice The Common stock account. An expense account. A liability account. A revenue account. The Dividends account.
Answer:
Common stock
Explanation:
The common stock has the credit balance which is shown in the liabilities side of the balance sheet
While transferring the assets from business to it stockholders we used the common stock account as it includes the capital of the company, preferred stock, common stock, etc
Therefore the first option is correct
A corporation ran an ad which showed environmental experts praising its social initiatives. The ad encourage readers to visit its website to learn how they could help save the environment. Which copy style was used to describe the company's efforts to help preserve the environment
Answer:
institutional copy.
Explanation:
In the scenario described above, the institutional copy style was used, which can be defined as a type of advertisement whose objective is not to sell a product or service, but rather to promote the selling company through its policies, philosophies and objectives, with the objective of strengthening and creating its reputation so that customers are aware of their values and reputation, generating recognition and prestige.
This is what the company analyzed in the above question did by running an ad that shows environmental experts praising its social practices and encouraging readers to access its website and learn about its positive environmental practices
You own a house that costs $300,000 and you are considering leveraging your home. How would three houses that each have $200,000 in mortgage debt make more money than one house that is fully paid
Answer:
You will be able to get more money if you have 3 houses and owe $200,000 on each house simply because you can use the houses to earn extra income.
Imagine two situations:
Situation 1: You own one $300,000 house and earn $100,000 of ordinary income. The bank will lend you money solely based on your income.
Situation 2: You own 3 houses and obviously since you only use one, you can rent the other two. Lets suppose that you can rent the two houses at $2,500 each, and after paying all expenses and taxes, you have $2,000 left per month per house. That means that your total income will increase by $48,000 per year and we can add that to your normal salary of $100,000. In order for this situation to be more favorable, your current debt payments must be less than the additional revenue generated by the two houses (less than $48,000 per year). If your final balance is favorable = additional income ($48,000) ≥ current debt payments, that means that you will have more disposable income in order to pay back any additional loans.
Another reason why a bank might favor situation 2, is that in case something goes wrong, e.g. you get fired, it is always easier to sell one or even both extra houses in order to repay your loan.