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Question
A corporation reports the following year-end balance sheet data:
| Cash | $ 40,000 | Current liabilities | $ 64,000 |
| Accounts receivable | 35,000 | Long-term liabilities | 72,000 |
| Inventory | 60,000 | Common stock | 100,000 |
| Equipment | 150,000 | Retained earnings | 49,000 |
| Total assets | $285,000 | Total liabilities and equity | $285,000 |
Calculate the corporation's current ratio and its acid-test ratio.
Answer
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Related questions
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The _______________________________ is computed by discounting the future net cash flows from the investment at the project's required rate of return and then subtracting the initial amount invested.
Q:
The _______________________________ is computed by dividing a project's after-tax net income by the average amount invested in it.
Q:
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Q:
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A. Sell the units as scrap.
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C. It does not matter because both alternatives have the same result.
D. Neither sell nor rebuild because both alternatives produce a loss. Instead, the company should store the units permanently.
E. Throw the units away.
Q:
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Q:
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Q:
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Q:
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Q:
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Q:
Periods
12 Percent 1
8929 2
1.6901 3
2.4018 4
3.0373 Assuming all revenue is to be received at the end of each year, what are the net cash flows for this investment if net present value equals ($11,790)?
A. $78,210
B. $10,920
C. $25,750
D. $237,547
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Q:
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B. $(251.52) and Scott would be willing to pay $29,748.48 for the machine.
C. $(251.52) but the price Scott would pay cannot be determined. D. $900 and Scott would be willing to pay $30,900 to acquire the machine
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Q:
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B. It includes the time value of money.
C. It cannot be used when cash flows are not uniform.
D. It cannot be used if a company records depreciation.
E. It cannot be used to compare investments with different initial investments.
Q:
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Year 2
Year 3
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$15,000
$6,000
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i = 10% n = 2
i = 10% n = 3 .9091
.8264
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E. $0.00
Q:
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Q:
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A. To eliminate all risk.
B. To discount all future and past cash flows.
C. To earn a satisfactory return on investment.
D. To reverse past decisions.
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Q:
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Q:
What is the difference between an opportunity cost and a sunk cost?
Q:
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Q:
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Dept. R
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$7,000
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3,000
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2,500
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5,500
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B. $500 decrease
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Q:
Bandy Corporation owns a machine that manufactures lawn games. Production time for the croquet set is 10 units per hour and for the volley ball game is 8 units per hour. The machines capacity is 1,500 hours per year. Both products are sold to a single customer who has agreed to buy all of the companys output up to a maximum of 4,000 croquet sets and 10,000 volleyball games. Selling prices and variable costs per unit are shown below. Based on this information, what is Bandy Corporations most profitable sales mix? Croquet Set
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$75
$62 Variable costs per unit
42
25 A. 15,000 croquet sets.
B. 12,000 volleyball games.
C. 4,000 croquet sets and 10,000 volleyball games.
D. 4,000 croquet sets and 8,800 volleyball games.
E. 2,500 croquet sets and 10,000 volleyball games.
Q:
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76 A. Both product A and product B should be processed further.
B. Neither product A nor product B should be processed further.
C. Only product B should be processed further.
D. Only product A should be processed further.
E. A processing further decision cannot be made from the available data.
Q:
Altertech Inc. manufactures a product that contains a circuit board. The company has always purchased this circuit board from a supplier for $32 each. Altertech recently upgraded its own manufacturing capabilities and now has enough excess capacity (including trained workers) to begin manufacturing the circuit board instead of buying it. The company prepared the following per unit cost projections of making the circuit board, assuming that overhead is allocated to the part at the normal predetermined overhead rate of 110% of direct labor cost. Direct materials
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22 Total
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A. Income will decrease by $7 per unit.
B. Income will increase by $7 per unit.
C. Income will increase by $12 per unit.
D. Income will decrease by $12 per unit.
E. Income will increase by $10 per unit.
Q:
A company expects to produce and sell 7,000 units of a single product. The following additional company information is available: Variable costs (per unit) Production costs
$20 Nonproduction costs
$3 Fixed costs (in total) Overhead
$175,000 Nonproduction
$14,000 Compute this companys total cost per unit.
A. $23
B. $45
C. $27
D. $50
E. $5
Q:
Assume markup percentage equals desired profit divided by total costs. What is the correct calculation to determine the dollar amount of the markup per unit?
A. Total cost times markup percentage.
B. Total cost per unit times markup percentage per unit.
C. Total cost per unit divided by markup percentage per unit.
D. Markup percentage per unit divided by total cost per unit.
E. Markup percentage divided by total cost.
Q:
Capital budgeting decisions are generally based on:
A. Tentative predictions of future outcomes.
B. Perfect predictions of future outcomes.
C. Results from past outcomes only.
D. Results from current outcomes only.
E. Speculation of interest rates and economic performance only.
Q:
If net present values are used to evaluate two investments that have equal costs and equal total cash flows, the one with more cash flows in the early years has the higher net present value.