Full Boat Manufacturing has projected sales of $122.5 million next year. Costs are expected to be $72.8 million and net investment is expected to be $14.4 million. Each of these values is expected to grow at 12 percent the following year, with the growth rate declining by 2 percent per year until the growth rate reaches 4 percent, where it is expected to remain indefinitely. There are 6.2 million shares of stock outstanding and investors require a return of 11 percent return on the company’s stock. The corporate tax rate is 25 percent.
a. What is your estimate of the current stock price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
b. Suppose instead that you estimate the terminal value of the company using a PE multiple. The industry PE multiple is 11. What is your new estimate of the company’s stock price?
Answers
Based on the discounted cash flow model, the estimated current stock price of Full Boat Manufacturing is $14.51. If the terminal value is estimated using a PE multiple of 11, the new estimated stock price is $13.89.
To calculate the current stock price, we need to find the present value of all future cash flows (dividends and stock price at the end of the holding period) and then divide by the number of shares outstanding. Using the dividend discount model, we can calculate the present value of dividends and stock price as follows:
PV of dividends = \(\dfrac{[(\$122.5m - \$72.8m) \times (1 - 0.25)]}{(1 + 0.11)} + \dfrac{[(\$122.5m - \$72.8m) \times (1 - 0.25) \times 1.12]}{(1 + 0.11)^2} + \dfrac{[(\$122.5m - \$72.8m) \times (1 - 0.25) \times 1.12^2]}{(1 + 0.11)^3} + ... + \dfrac{[(\$122.5m - \$72.8m) \times (1 - 0.25) \times 1.04^n]}{(1 + 0.11)^n}\)
PV of stock price = \(\dfrac{[\$14.4m \times 1.12^{n-1}]}{(1 + 0.11)^n}\)
where n is the holding period in years.
Using the formula, we can calculate the present value of dividends to be $308.06 million and the present value of stock price to be $63.95 million. Adding these two values together, we get a total present value of $372.01 million. Dividing this by the number of shares outstanding (6.2 million), we get a current stock price estimate of $60.00.
If we use the PE multiple approach, we can estimate the terminal value of the company as the expected earnings at the end of the holding period multiplied by the industry PE multiple. Assuming that the company's earnings grow at the same rate as the cash flows (12% declining to 4%), we can calculate the terminal value as follows:
Terminal value = [$50.86m x (1 + 0.04)] / (0.11 - 0.04) x 11
where $50.86m is the expected earnings at the end of the holding period (calculated using the same growth rates as before). Solving this equation, we get a terminal value of $849.33 million.
Adding this to the present value of dividends and stock price from part (a), we get a total present value of $1,221.34 million. Dividing this by the number of shares outstanding, we get a new estimate of the company's stock price of $196.85.
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Related Questions
The difference between small business and entrepreneurship has nearly nothing to do with size and nearly everything to do with
O Capital
O competition
O number of employees
O characteristics
→
Answers
Answer: (1) Entrepreneurs are always looking for ways to make money while small business have the same goal but company owners also focus on maintaining their business income to pay for operating expenses.
(2) Entrepreneurs are more likely to take on debt than small business owners and typically have much higher risk tolerance. They are comfortable assuming larger uncertainties to pursue new ideas and opportunities
(3) Entrepreneurs are risk-takers while store owners are more conservative
(4) Entrepreneurs are future-oriented, while small business owners typically focus on the present.
Explanation:
The demand side of economic policy, refers to the actions undertaken by a nation's central bank to control money supply to maintain economic growth. This is an example of
Inflation
monetary policy
Debt management
Loans
Answers
Answer:
The perspective of economic policy that focuses its efforts to follow a national central bank when it wants to make sure money supply is regulated to achieve a continuous economical positive development is an example of:
monetary policy
Explanation:
The reasons behind this answer are that monetary policy is the concept used to represent the efforts of a certain monetary organization to make sure the interest rates are set in the best scenario to enable borrowers to pay their debts. Pointing to a scenario of economical and monetary stability that would support the country in times of economical distress.
A principle offers broad goals while leaving human beings in charge. True False Which of the following is an example of saving? Putting money into a savings account Putting money into a checking account Money that you use to pay your taxes All of the above. Which sector is the most stable sector in the economy? Consumption. Business. Government. Foreign. Which of the following is a false statement? Austrian economists criticize the Full Employment and Balanced Growth Act of 1978 The Employment Act of 1946 empowered the federal govemment to pursue mocimum employment, production, and purchasing power Expansions and recessions occur at irregular intervals and last for varyigg lengths of time. Austrian cconomists believe that we can climinate the business cycle.
Answers
The statement "A principle offers broad goals while leaving human beings in charge" is True.Savings refers to a fund which is kept aside by an individual for later use. An example of saving is putting money into a savings account.The government sector is the most stable sector in the economy.
A principle is a broad, and general statement that offers a direction for an organization or an individual, it leaves the individual or an organization to determine the exact way to achieve the principle by themselves. Thus, it is true that a principle offers broad goals while leaving human beings in charge. Savings are typically funds that are kept aside for future use, rather than immediate use. Putting money into a savings account is an example of saving.
This is because the government has the power to raise taxes or borrow money in order to pay for its expenses, unlike individuals and businesses. In addition, government employees are typically paid a fixed salary, regardless of the state of the economy. Austrian economists believe that it is impossible to eliminate the business cycle. This is a false statement.
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Dotty's is a high fashion boutique, owned by entrepreneur Daisy Smith. The
business has been open a year, and specialises in designer outfits for women.
Daisy made the decision to set up the business after working in a high street
chain for five years.
Which of the following does NOT analyse how entrepreneurial skills will enable
Daisy's business to be more financially successful?
Answers
Answer: By being organized, Daisy will be abke to ensure that her business runs more smoothly and that she has stock in the shop when is is needed and the suppliers are paid on time. This could lower the levels of stress experienced by Daisy and lead to her enjoying a better work life balance.
Explanation:
The option that doesn't analyse how entrepreneurial skills will enable
Daisy's business to be more financially successful is that "By being organized, Daisy will be abke to ensure that her business runs more smoothly and that she has stock in the shop when is is needed and the suppliers are paid on time. This could lower the levels of stress experienced by Daisy and lead to her enjoying a better work life balance".
We should note that while other options shows that there will be an increase in customer, increase in sales and lead her to be more financially successful, this particular option only relates to her work-life balance and not have an impact on her financial stability.
You can edit contents of a cell by:
Changing font type, size
Adding a fill color
Adding borders
All of the above
Answers
Answer:
All of the above
Explanation:
I took the k12 test
sharpshooter productions needs help checking the accuracy of their balance sheet. the firm reports the following: entry value entry value cash and marketable securities $207,880.00 goodwill and other assets $85,410.00 accounts payable $81,760.00 net fixed assets $469,590.00 common stock $100,000.00 notes payable $66,010.00 retained earnings $514,490.00 long-term debt ????? accounts receivable $287,050.00 inventory $122,770.00 what is the long-term debt for sharpshooter for the financials to be correct?
Answers
The long-term debt for Sharpshooter is $373,610 so the financials are correct.
Long-term debt is defined as having a maturity date of more than a year, and it is typically treated differently from short-term debt. Long-term debt is an asset for the holders of the debt but an obligation for the issuer to repay.
Cash and marketable securities = $ 205,150.00
Net fixed assets = $ 454,350.00
Goodwill and other assets = $ 81,050.00
Inventory= $ 125,760.00
Accounts Receivable = $ 278,615.00
Total assets = $ 1,144,925.00
Common stock = $ 100,000.00
Retained Earnings = $ 523,000.00
Stockholders' equity = $ 623,000.00
Total liabilities = Total assets – Stockholders’ equity
= $1,144,925 - $623,000 = $521,925
Long-term debt = Total liabilities – Accounts payable – Notes payable
Long-term debt = $521,925 - $82,815 - $65,500
= $373,610
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How can the value of an environmental performance bond be
determined? Should the safe minimum standard approach be used to
set environmental pollution standards? If so, how could it be
accomplished?
Answers
Environmental performance bond is a financial guarantee from a company or industry, indicating that they are compliant with the environmental protection laws in the area. The bond is refunded upon the compliance of the company or industry or after an agreed-upon duration has passed.
The value of an environmental performance bond can be determined based on the following factors:Environmental impact of the company or industry – The bond should be large enough to cover the cost of any environmental damage caused by the company or industry. If the environmental impact is high, the bond should be high too.
The size of the company or industry – Larger companies or industries may require a larger bond than smaller companies. The bond should be large enough to deter the company from committing any environmental damage.Financial capacity of the company or industry – The bond should be enough to be significant to the company. The value of the bond should not be too high to make it difficult for the company to operate.
The safe minimum standard approach should be used to set environmental pollution standards. It is a risk-based approach that considers the likelihood of harm to human health or the environment. This approach can be accomplished by:The establishment of baseline data – This data can be used to compare the environmental pollution before and after the implementation of the environmental pollution standards.
Establishment of an environmental management system – This system can help companies or industries to manage their environmental impact. The system should be regularly audited to ensure compliance. Review of the environmental pollution standards – The standards should be reviewed regularly to ensure that they are still effective. The review should take into account new scientific findings and technological advancements.
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Scenario 3: Buying a cell phone plan It’s time to buy a new cell phone plan, and you will be paying for this one yourself. The providers offer a lot of options, and your budget is limited. What financial information do you need? What financial decision-making strategies can you use? (Cost comparison, cost-benefit analysis, calculating future expenses, or budgeting?)
Answers
Answer:
hi bestie
cost comparison
Explanation:
The portion of bonds or notes payable that is due within one year is reported as a(n):____.
Answers
Current obligations are recorded for the portion of bonds or notes payable that are due within one year.
A company's short-term financial commitments that are due in a year or within a typical operational cycle are known as Current obligations . An organization's operational cycle, also known as the cash conversion cycle, is the period of time it takes to buy inventory and turn that inventory into cash through sales. The sums owing to suppliers in the form of accounts payable are an illustration of a current liability .Current obligations are a company's short-term financial obligations that are due within a year or during a typical operational cycle.
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The buried verb phrase conduct research on can be revised to research, conduct or order. .
Overuse of intensifiers sounds unprofessional. Which one of the following sentences best controls exuberance?
The team was thoroughly disappointed that the proposal was totally rejected.
Answers
Overuse of intensifiers sounds unprofessional. The one sentence that best controls exuberance is "The team was disappointed that the proposal was rejected."Intensifiers are used to emphasize the meaning of a word or phrase. The term 'totally' is an intensifier that shows emphasis on the word 'rejected' in the given sentence, but it makes the sentence sound exaggerated.
Moreover, using two intensifiers in one sentence is not recommended, as it sounds unprofessional, and it may affect the reader's perception of the writer's credibility. Using moderate words in a sentence while keeping the main essence of the sentence intact can make a piece of writing sound more professional. So, the best sentence that controls exuberance is "The team was disappointed that the proposal was rejected." This sentence expresses the same meaning as the original sentence, but without using an intensifier.
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JohnBoy Industries has a cash balance of $54,000, accounts payable of $134,000, inventory of $184,000, accounts receivable of $219,000, notes payable of $129,000, and accrued wages and taxes of $41,500. How much net working capital does the firm need to fund?
Answers
Answer:Net working capital = $152,500
Explanation:
Net working capital = CA– CL
Where CA= Current Assets = Cash + Inventory + Accounts Receivable
and CL= Current Liabilities= Account payable + Notes payable + accrued wages and taxes
CA=$54, 000 + $184,000 + $ 219,000 =$457,000
Current liabilities = Account payable + Notes payable + accrued wages and taxes
CL = $134,000 + $129,000 + $41,500 = $304,500
Net working capital = Current assets – Current liabilities
Net working capital = $457,000 – $304,500= $152,500
Net working capital = $152,500
commenced business with the balance at bank 125,000 (journal entry)
Answers
bank a/c Dr
to capital a/c
An early theory that helped factories become more efficient by studying worker movements is called _____ .
administrative management
scientific management
behavioral management
theory X
Answers
Answer:
Scientific management theory
Explanation:
The scientific management theory seeks to improve the productivity of every employee in the organization. The theory applies scientific techniques of analysis, observation, synthesis, rationality, and logic to improve individual and industry efficiency.
Fredrick Taylor developed the scientific management theory in the early 20th century. The theory focused on the technical aspects of efficiency rather than the broader perspectives of human behavior in the organization.
Some of its principles include
Separation of planning function from doingHiring the right person for each job and train to improve performanceScientific determination of the fair amount of work per employeeMonitor and evaluate work performanceWhy miscommunication and misunderstanding happen
Answers
Answer:
misunderstanding happens due to the distance . misunderstanding happen due to lack of time to solve problem . misunderstanding happens due to third person between two persons . misunderstanding happens due to the virtual world .
The number of separate businesses a firm operates and the degree of ___________ of those businesses increase a firm's level of diversification.
A) diversity
B) economy of scale
C) relatedness
D) management
Answer: C) relatedness
Answers
The number of separate businesses a firm operates and the degree of relatedness of those businesses increase a firm's level of diversification.
What is Diversification?
By introducing or acquiring new items, businesses can increase their market share or access new markets (perhaps through licensing, merger, or acquisition). It enables a business to develop by raising its market share in an already-existing market or by establishing a presence in that market. Innovation and market disruption are fundamental components of diversification.
In an effort to lower portfolio risk, the concept of diversification combines a wide range of investments. Investing in several asset classes, such as stocks, bonds, real estate, or cryptocurrencies, is the most common way to diversify one's portfolio.
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how to make a business title
Answers
Answer:
In this article, we'll give you eighteen tips for coming up with a great business name.
Use acronyms.
Create mash-ups.
Get inspiration from mythology and literature.
Use foreign words.
Use your own name.
Take a look at a map.
Mix things up.
Partner with another company.
Answer:
try to make it catchy, but relevant to your subject. its easy to remember, not hard to spell, and remember it doesn't have to really really cool, as long as it makes sense, and is easy to remember
Explanation:
What does indigenous technology mean?
Answers
Answer: I hope this is helpful mark brainlist if right then no if wrong
Explanation:
Indigenous technology is used by the native inhabitants of a country or region and it constitutes an important part of its cultural heritage. Characteristically, indigenous technologies: Are recognized as animate, imbued with the breath of life and they live in form and function.Technologies employed by the native inhabitants of a country and which constitute an important part of its cultural heritage and should therefore be protected against exploitation by industrialized countries; the problem of indigenous knowledge has been discussed during the Rio Conference but it does not receive much ...Types of indigenous technology in India are; (i) Generic Drugs. (ii) Thorium based Nuclear Reactors. (iii) Plastic RoadsIndigenous Technology is created within a sensory environment that builds on our sense of relationship, meaning, balance, feeling, memory and place as well as sight, sound, smell, taste and touchIndigenization is the process by which Indigenous ways of knowing, being, doing and relating are incorporated into educational, organizational, cultural and social structures of the institution.One example of Indigenous Technologies in action today can be witnessed in differential approaches to medicine. Medical technologies in the Western Scientific sense of the term might conjure images of biomedical research labs, electromagnetic monitors or imaging systems such as CT or MRI scans.Indigenous technology is used by the native inhabitants of a country or region and it constitutes an important part of its cultural heritage. Characteristically, indigenous technologies: Are recognized as animate, imbued with the breath of life and they live in form and function.
9. If you found that you were in financial trouble because of credit and had great difficulty paying your monthly bills, what would you do?
Answers
Answer:
You would have to cut down on some luxuries, like lots of foods, amusement parks, shopping trips, etc. If you have have extra hours, work more hours, quite possibly take another job.
Explanation:
If you could franchise a business - what business would you choose? (2-3 sentences)
Answers
Answer:
I would choose the Franchise Dunkin Donuts since many people get hungry in the morning. And since plenty of people work in the day times. It would be a mastermind full proof plan of sweet success.
Explanation: In Russia dog does not eat your homework, I do.
How can choosing the right institution help you manage money effectively?
Answers
Answer:
You may get a better job, or it may make you more responsible. The money is the main thing, you will get paid better, so you wont have to worry abt money i guess.
Explanation:
How are SI units supportive to traders?
Answers
Some common SI units
Mass=KgTemperature=KLuminous intensity=CandelaCurrent=AmperePressure=PaOwen retired at the age of 62 years. A monthly rental income of R25 000 accrued to him each month for the entire 2022 year of assessment. The rented property was part of his residential property. In additional to the rent he incurred maintenance costs of R 60 000 of which 40% was for the commercial aspect of the property. Employees’ tax of R48 265 was deducted from this pension during the 2022 year of assessment. On 31 July 2021 he sold his shares in Margarine Ltd (an unlisted company). Owen provides the following information regarding his shareholding in Margarine Ltd:
• He bought 10 000 shares in Margarine Ltd on 2 January 2002 at R15 each for investment purposes (not for speculation).
• He sold his shares to Margie on 31 July 2021 for R400 000.
In addition to this sale Owen also sold one of his residential properties which he had purchased for R2 500 000.
The sale resulted in income of R3 000 000 REQUIRED:
Calculate the total taxable income for Owen for the 2022 year of assessment
Answers
To calculate the total taxable income for Owen for the 2022 year of assessment, we need to consider the various sources of income and deductions provided in the given information.
Let's break it down:
Rental Income: Owen received a monthly rental income of R25,000 for the entire 2022 year of assessment. Therefore, his total rental income for the year would be R25,000 x 12 = R300,000.
Maintenance Costs: Owen incurred maintenance costs of R60,000 for the property. Since 40% of the costs were for the commercial aspect, the deductible portion would be 40% of R60,000, which is R24,000.
Employees' Tax: Owen had employees' tax deducted from his pension during the year, amounting to R48,265.
Sale of Shares: Owen sold his shares in Margarine Ltd for R400,000. Since these shares were held for investment purposes, the capital gain or loss needs to be calculated. The cost of the shares was R15 x 10,000 = R150,000. Therefore, the capital gain would be R400,000 - R150,000 = R250,000.
Sale of Residential Property: Owen sold his residential property for R3,000,000. This sale would result in a capital gain or loss, depending on the purchase price. However, the purchase price of the property is not provided in the given information.
To calculate the total taxable income, we need to deduct the allowable deductions from the total income. In this case, the deductible expenses would be the maintenance costs (R24,000). The taxable income would be the total income (R300,000 + R250,000 + R3,000,000) minus the deductions (R24,000). However, since the purchase price of the residential property is not given, we cannot provide an exact calculation of the total taxable income.
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sellers will tend to be most concerned with customer satisfaction when a. it is difficult for the customer to evaluate product quality. b. they depend on repeat customers for most of their business. c. they sell primarily to tourists. d. they are a monopoly protected from competition by government licensing.
Answers
b. They depend on repeat customers for most of their business. Because most of their revenue comes from recurring clients, merchants tend to be most concerned with customer satisfaction.
Customers' pleasure is likely to be the top priority for sellers whose primary source of revenue is repeat business. This is because they are aware that happy clients are more likely to become loyal ones, which eventually translates into more revenues. Customers are more likely to go elsewhere if they are not pleased with their experience, on the other hand. The alternative choices, such selling largely to tourists or operating as a monopoly protected by government licence, would not always result in a strong emphasis on customer satisfaction since these sellers might not rely on repeat business as much.
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Why is creative thinking important to generate business ideas?
Answers
Answer: Creative thinking is necessary for business problem-solving.
Explanation: The skill of creative thinking is a helpful skill because it teaches workers/business owners to find opportunities and ways to improve something even if the situation is challenging. This also lets the person face a problem or situations by a different view. I hope this helped!
A lower real rate of interest shifts the aggregate demand curve to the ________ because it ________ borrowing costs and induces households and business to spend ________. (Hint: Fill in the blanks before reading the possible answers.)
Answers
A lower real rate of interest shifts the aggregate demand curve to the right because it lowers borrowing costs and induces households and businesses to spend more.
A lower real interest rate means that the cost of borrowing money decreases, making it more attractive for households and businesses to take out loans.
With lower borrowing costs, households and businesses are more likely to make investments, purchase goods and services, and undertake capital projects, which in turn increases the aggregate demand for goods and services in the economy. This increase in demand for goods and services shifts the aggregate demand curve to the right.
This shift in the aggregate demand curve can lead to an increase in the output, employment, and income levels in the economy. Therefore, a lower real rate of interest can have a positive impact on economic growth and development.
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what led to the market revoluntion
Answers
The development of new transportation technologies was one of the main causes that caused this economic change.
Which three factors played the biggest roles in the Market revolution?The manufacture of things for a cash market; the use of technologies and developments to generate commodities for a mass market; and the quick advancements in transportation and communication.
At what point did the market revolution begin?A market revolution that began in the 1820s and 1830s was revolutionizing both domestic and international trade. Independent artisans were being pushed out by factories and mass production. Produce from farms was grown and shipped by cheap modes of transportation, such the Erie Canal, to distant, rather than local, markets.
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Lilly, Briah, Chloe, and Terry are the directors and equal shareholders of Fantastic Holidayz Pty Ltd, a company that runs an exclusive airline company and operates in several high-rise office buildings in Melbourne. Briah is the Managing Director and Terry is the Chief Financial Officer. Lilly and Chloe are non-executive directors. The Company has adopted a written constitution which contains the following clauses: (36) A directors' meeting may be called by a director giving reasonable notice individually to every other director (37) Quorum for directors' meetings is four directors and the quorum must be always present during the meeting (42) A resolution of the majority of directors may resolve to remove another director of the company. Business is booming, and Fantastic Holidayz has made a great deal of money over the last few years. However, the Board of Directors have rejected Lilly's proposal to declare a dividend for the last 7 years in a row - and she is getting fed up. The other directors always outvote her, arguing that it is better to keep the profits in reserve and continue to expand the business. Terry is currently investigating the possibility of opening further destinations to their itinerary In October 2017 Lilly was overseas for a family funeral and on her return to Melbourne, she discovers that the other directors have met and passed resolutions to remove her as a director of the company. Lilly did not receive any notice of the director's meeting. In another resolution, the remaining directors voted to pay themselves $500,000 in bonuses - equating to the entire year's profit. Lilly is angry that she has been removed and not paid a bonus and comes to you for your professional advice and opinion. Further, Fantastic Holidayz has a longstanding agreement with several travel agencies, and in January 2018, Fantastic's financial accounts showed that one agency owed the company $85,000, and there was no applicable security Recently, Lilly discovered that by June 2018 the debt owing to Fantastic Holidayz had blown out to $200,000. Terry had approved additional credit without the knowledge of the other directors. He did this, even though the agency had been taking a long time to pay its overdue account. Additionally, there are now rumours that are insolvent, but this cannot be proven. REQUIRED: 1. Discuss whether Lilly can bring any action to challenge the other directors' decision to deny dividends for several years and then pay themselves bonuses? (5 marks) 2. Advise Lilly about the process and potential outcomes if the travel agency is placed into voluntary administration - and any implications of this on Fantastic Holidayz. (5 marks) 3. Advise Lilly about whether Terry has breached any of his statutory duties as a director of Fantastic Holidayz. Include in your answer the consequences of a breach of duty, whether Lilly could bring an action for compensation on behalf of the company against Terry, and whether there are any defences available.
Answers
It is important for Lilly to consult with a legal professional to assess the specific circumstances and determine the most appropriate course of action. Legal advice tailored to the jurisdiction and applicable laws should be sought.
1. Lilly's Challenge to Dividend Denial and Bonus Payment:
Lilly may have grounds to challenge the other directors' decision to deny dividends for several years and then pay themselves bonuses. The key considerations are as follows:
a) Breach of Fiduciary Duty: Directors owe a fiduciary duty to act in the best interests of the company. By consistently rejecting dividends despite profitable operations, the directors may be breaching this duty if their decision is not justifiable and reasonable. The decision to pay themselves bonuses without Lilly's approval further strengthens her case.
b) Unfair Prejudice: Lilly may argue that the denial of dividends and payment of bonuses unfairly prejudice her interests as an equal shareholder and director. This argument can be supported by the fact that dividends have been consistently denied for several years, and the bonuses were paid without her knowledge or consent.
c) Oppression of Minority Shareholder: If the other directors' actions substantially interfere with Lilly's rights as a shareholder and director, it could constitute oppression of a minority shareholder. Denying dividends and paying bonuses in a manner that excludes Lilly's interests may be viewed as oppressive.
Lilly can potentially bring legal action seeking remedies such as an injunction to stop the bonuses, an order for dividends to be paid, or a buyout of her shares at a fair value.
2. Travel Agency in Voluntary Administration:
If the travel agency owing $200,000 to Fantastic Holidayz is placed into voluntary administration, the process and potential outcomes can be summarized as follows:
a) Voluntary Administration: Voluntary administration is a process where an external administrator (usually a registered liquidator) takes control of the insolvent company to maximize returns for creditors. The administrator assesses the company's financial position and explores options, such as restructuring or selling the business.
b) Outcomes and Implications: During voluntary administration, the administrator may propose a Deed of Company Arrangement (DOCA) to the creditors. If approved, it could allow the travel agency to continue operating and repay the debt over an agreed period. Alternatively, if the company's financial situation is deemed irreparable, the administrator may recommend liquidation.
For Fantastic Holidayz, the outcome depends on the recovery of the debt. If the travel agency is unable to repay the owed amount, Fantastic Holidayz may have to write off the debt as a loss, potentially impacting their financial position. The impact could be significant if the debt is material to the company's operations.
3. Terry's Breach of Director's Duties:
Terry, as the Chief Financial Officer and a director of Fantastic Holidayz, may have breached his statutory duties. The key considerations are as follows:
a) Duty of Care and Diligence: Directors must exercise reasonable care, skill, and diligence in fulfilling their roles. Terry's approval of additional credit without the knowledge of other directors could be seen as a failure to exercise due care and diligence. The consequences of a breach may include personal liability for any loss suffered by the company.
b) Duty to Act in Good Faith and for Proper Purpose: Directors must act in good faith and in the best interests of the company. By approving additional credit for a customer with an outstanding overdue account, despite potential insolvency concerns, Terry may have breached this duty.
c) Consequences and Action for Compensation: If Terry is found to have breached his statutory duties, consequences may include personal liability for any loss suffered by the company due to his actions. Lilly, as a shareholder, may have standing to bring a derivative action on behalf of the company to seek compensation from Terry for any losses incurred.
d) Defenses: Terry may raise defenses such as relying on professional advice, acting in good faith, or having the belief that his actions were in the company's best interests. However, these defenses may not absolve him entirely from liability if his actions are found to be unreasonable or against the company's interests.
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What is the amount of physical goods and services that can be bought with a given amount of money?
Answers
Answer:
please Elaborate like how much money do you have or something
What is the difference between a total and a subtotal?
Answers
Explanation:
SUB-TOTAL:
The total for a part of a list of numbers being summed.
TOTAL:
An amount obtained by addition of smaller amounts.
Answer:
subtotal is all the different parts being added together from different list.
total is the all items being added together plus tax.
Explanation:
The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 49,500 $ 65,000 Work in process 11,500 23,900 Finished goods 69,500 48,600 Activities and information for May Raw materials purchases (paid with cash) 223,000 Factory payroll (paid with cash) 371,000 Factory overhead Indirect materials 28,000 Indirect labor 93,000 Other overhead costs 133,000 Sales (received in cash) 1,530,000 Predetermined overhead rate based on direct labor cost 80 % Determine whether there is over or underapplied overhead. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods So
Answers
Answer:
Your answer is given below:
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