Jaxon Markets currently has credit terms of net 30, an average collection period of 29 days, and average receivables of $211,410. The firm estimates that if it offered terms of 2/10, net 30 that 45 percent of its customers would pay on day 10 with the remainder paying on average in 32 days. How much cash could the company free up from its accounts receivables if it switched its credit policy? Group of answer choices $38,762 $65,009 $58,336 $64,219 $50,301
Answers
Answer: $50,301
Explanation:
If they offered the new terms of 2/10, net 30 then 45 percent of their customers would pay on day 10 with the remainder paying on average in 32 days.
The collection period would therefore be;
= 0.45 * 10 + 0.55 * 32
= 22.1 days
Currently the Average Daily sales are;
= Average Receivables/ Average collection period
= 211,410/29
= $7,290
With the new collection period their Average receivables would be;
= 7,290 * 22.1
= $161,109
Potential cash to be freed up = Current Receivables - New receivables
= 211,410 - 161,109
= $50,301
Related Questions
Which of the following features define human needs:
Answers
Human needs are fundamental requirements that must be met in order for individuals to survive and thrive. Some features that define human needs include:
Physical needs: These are basic needs that are essential for human survival, such as food, water, shelter, and clothing.Psychological needs: These are needs that are related to mental and emotional well-being, including the need for love, belonging, and self-esteem.Social needs: These are needs related to social interaction and connection with others, including the need for friendship, companionship, and community.Cultural needs: These are needs related to an individual's cultural identity, such as the need to express and preserve one's cultural traditions and values.Personal development needs: These are needs related to an individual's growth and development, including the need for education, self-improvement, and personal fulfillment.Overall, human needs are diverse and complex and may vary depending on an individual's specific circumstances and cultural context.
Harvey quit his job at State University, where he earned $62,000 a year. He figures his entrepreneurial talent or forgone entrepreneurial income to be $4,000 a year. To start the business, he cashed in $50,000 in bonds that earned 10 percent interest annually to buy a software company, Extreme Gaming. In the first year, the firm sold 10,000 units of software at $72 for each unit. Of the $72 per unit, $60 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. The accounting profit of Harvey's firm in the first year was: _________
Answers
Answer:
Accounting profit = 120,000
Explanation:
Accounting profit = total revenue - explicit costs
Accounting profit = 72*10,000 - 60*10,000
= 720,000 - 600,000 = 120,000
Service Cost Flows Number the following activities from 1 to 3 in the order corresponding to the typical flow of cost in a CPA firm. Order Activity Answer Record the time worked on a client project by professional staff. Answer Record the completion of a client project. Answer Record the application of office overhead.
Answers
Answer:
following are the answer to this question:
Explanation:
Following are the flows to this question:
It records the consumer project for completion. It records the time, which the professional staff had operated on such a client project. It is the document for the office, which overheads the submission.It's the conventional flow, which operates after the research, that was ended, and the number of human hours and its cost for the individual customer was established.
3. Why do you think people have so many problems making choices?
Answers
Answer: Most of the time it can be due to lack of sincerity and they don’t really know if that choice Will affect them in a way they might not like. It doesn’t always necessarily mean they have many problems making choices, but it can be that they have too much to risk to they take their time in picking a choice. It’s better to let the person have time so that way they don’t feel rushed, because at the end of the day the choice they choose will affect them in either a good way or in a bad way.
You are the senior auditor in charge of the audit of Potholders Ltd, a retailer of garden pots and gnomes. Your audit firm has been auditor for the last four years. Historically, the firm has had a competent and qualified internal audit team upon whose work you have placed significant reliance. Management is well respected and is viewed to have high integrity, although there was some friction last year when the auditor discovered sales cut-off errors, which reduced profit and had an adverse impact on management bonuses under the new bonus scheme. While the company has been very profitable, drought and water restrictions have placed pressure on management to maintain profitability. In planning the audit you become aware of the following facts:
1. There is a cash shortage caused by recent business expansions and falls in cash inflow.
2. The accounts payable balance has increased by 30 per cent on last year.
3. Days in debtors has increased from 45 days to 63 days.
4. Due to the difficulty of maintaining sales levels, credit checks are not always carried out.
5. Internal audit department staff levels have been halved.
6. After a recent series of thefts, control over inventory has been tightened. When goods are received they are counted and inspected and, after a pre-numbered goods received advice is prepared, the goods are moved to an enclosed storage area with adequate security, including closed-circuit TV. Goods are released from the store only upon receipt of a properly authorised requisition form.
7. In the past, all purchases were made centrally at head office. However, store managers are now asked/allowed to purchase direct from local suppliers in order to obtain inventory at lower prices and avoid transport costs. Some store managers in North Queensland are importing from Indonesia.
Required:
1. Identify each component of audit engagement.
2. Outline the facts that increase inherent risks and the facts that increase or decrease control risk
Answers
The components of audit engagement from the question are:
Cost-benefitCircumvention designsapplication of controlscontrol environment The factors that increase inherent risksThe integrity of the people that are in managerial positions. The experience and the effectiveness of managers.Pressures faced by management.The type of business.Factors that affect control risks:Presence of Novel situationsThe use of Outdated controlsImproper separation of dutiesRead more on inherent risks here: https://brainly.com/question/14538724
The operating budget provides a roadmap for financial plans for a short-term, future period. What is a typical “future period” for an operating budget?
Answers
An operating budget is a financial statement that outlines the organization's expenditures and revenues for a specific period.
The operating budget is typically for a fiscal year, which is usually twelve months. The future period for an operating budget is usually a fiscal year or less than a year. The operating budget is critical because it establishes guidelines for financial activities and operations in an organization. It provides a roadmap for financial plans for a short-term, future period, which typically begins on January 1st and ends on December 31st.
An organization creates an operating budget to aid in the allocation of resources and expenditures to achieve its objectives for a given period. A typical operating budget is for a fiscal year. A fiscal year is the period when an organization prepares its financial statements. It is usually 12 months, but it may be shorter or longer depending on the organization. An operating budget typically covers one fiscal year; however, it may be longer or shorter based on the organization's preferences.
The future period for an operating budget is frequently updated to reflect the company's current situation and financial standing. It takes into account the actual results of the previous period and the estimated expenditures and revenues for the upcoming year to develop the operating budget for a future period.
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Where are 2 places you can search for apps that work with QuickBooks Online?
Answers
The places that the user can search for the applications include the QuickBooks Apps or access them from the applications menu within the QBO account.
QuickBooks is simply an accounting software package that's useful for businesses.
It should be noted that from QuickBooks applications, one can select the specific category under the categories section. Then one clicks the get application now button.
Also, the person can search for the applications by accessing them from the applications menu within the QBO account.
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payment continues to represent a barrier to widespread adoption of the sharing economy, since many consumers feel uncomfortable exchanging cash or financial information with strangers.
a. True
b. False
Answers
payment continues to represent a barrier to widespread adoption of the sharing economy, since many consumers feel uncomfortable exchanging cash or financial information with strangers is false.
A community-based online platform is frequently used to facilitate peer-to-peer (P2P) based activities of acquiring, providing, or sharing access to goods and services, which are defined as part of the sharing economy.
For thousands of years, people in communities shared resources, but with the development of the Internet and its application of big data, it has become simpler for asset owners and those looking to use those resources to connect with one another. The term "shareconomy" or "collaborative economy" can also be used to describe this type of dynamic.
People and organizations can profit from underutilized assets in sharing economies.
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Which of these describes what can happen with an adjustable-rate mortgage?
A. The annual fees decrease each year as the loan gets closer to being paid off.
B. The percentage paid on property goes up or down from year to year.
C. The amount of principal owed on the mortgage changes as the housing market changes.
D. The monthly mortgage payments go up or down from year to year.
Answers
Answer:
The monthly mortgage payments go up or down from year to year.
Explanation:
In the adjustable-rate mortgage, monthly mortgage payments go up or down from year to year.
What is mortgage?A mortgage is often known as a mortgage loan. It is a contract between the borrower and a mortgage lender that permits the borrower to buy or refinance a home without having to pay the entire amount upfront.
Monthly mortgage payments on an adjustable-rate mortgage fluctuate from year to year according to the payment of installments of the mortgage.
Therefore, option D is correct.
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what is the background of the unilever company?
Answers
Answer:
Ueliever somthing i forgot
Explanation:
can someone help me!
1. The following table shows sales of a shoe company during years 2020 and 2021. Forecast the next four points, i.e., Spring, Summer, Fall, and Winter of 2022.
Date # of shoes sold
Spring 2020
Summer 2020 12000 D2
9000 D1
Fall 2020
Winter 2020 4000 D4
Winter 2021
2. Use the same table in the question one and this time use the moving average method to forecast F5, F6, F7, F8.
8000 D3
Spring 2021
Summer 2021 13000 D6 Fall 2021 7500 D7
8500 D5 3300 D8
Answers
Using the moving average method, F5, F6, F7, and F8 are as follows:
F5 = 8,250 (33,000/4)
F6 = 8,125 (32,500/4)
F7 = 8,375 (33,500/4)
F8 = 8,250 (33,000/4).
What is the moving average method?The moving average method is a technique that creates a series of averages.
To compute a moving average, add up all the data points during a specific period and divide the sum by the number of periods.
Data and Calculations:Date Number of shoes sold
Spring 2020 9000 D1
Summer 2020 12000 D2
Fall 2020 8000 D3
Winter 2020 4000 D4
Spring 2021 8500 D5
Summer 2021 13000 D6
Fall 2021 7500 D7
Winter 2021 3300 D8
Using the moving average method to forecast F5, F6, F7, and F8 are as follows:
Date Number of shoes sold
Spring 2020 9000 D1
Summer 2020 12000 D2
Fall 2020 8000 D3
Winter 2020 4000 D4
Spring 2021 8500 D5 F5 = 8,250 (33,000/4)
Summer 2021 13000 D6 F6 = 8,125(32,500/4)
Fall 2021 7500 D7 F7 = 8,375 (33,500/4)
Winter 2021 3300 D8 F8 = 8,250 (33,000/4)
Thus, using the moving average method, F5, F6, F7, and F8 are as follows:
F5 = 8,250 (9,000 + 12,000 +8,000 + 4,000/4)
F6 = 8,125 (32,500/4)
F7 = 8,375 (33,500/4)
F8 = 8,250 (33,000/4).
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Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $2,422,431. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $1,950,026 in annual sales, with costs of $1,675,501. If the tax rate is 0.36 , what is the OCF for this project?
Answers
The Operating Cash Flow(OCF) is $466,387.72 for this project.
Why is operating activity most important?Due to its direct connection to the company's core business activities, such as sales, distribution, production, and so forth, operating activities account for the majority of the company's cash flows. These activities also determine the profitability of the company, and items falling under this heading are the main types of cash flows.
Given,
Fixed Asset = $2,422.31
Sales = $1,950,026
Cost = $1,675,501
Tax-rate = 0.36
Required to Calculate Operating Cash Flow(OCF) = (Sale - Cost - Deprecaition) x (1-tax) + Deprecaition
OCF = ($1,950,026 - $1,675,501 - $2,422,431/3) x (1 - 0.36) + $807,477
OCF = $466,387.72
Thus, All of the money that is made by a company's primary business operations is considered operating cash flow. All capital asset acquisitions and investments in other business endeavors are included in investing cash flow. The company's payments as well as all proceeds from the issuance of debt and stock are included in the financing cash flow. The Operating Cash Flow(OCF) is $466,387.72 for this project.
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A company has budgeted total overhead at actual units produced of $10,400. The company has actual total overhead of $12,000. The controllable variance is:
Answers
Based on the information given the controllable variance is:$1,600.
Controllable varianceUsing this formula
Controllable variance=Actual total overhead -Budgeted total overhead at actual units produced
Let plug in the formula
Controllable variance=$12,000-$10,400
Controllable variance=$1,600
Inconclusion the controllable variance is:$1,600.
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What is the equation?
Answers
Two expressions joined by an equal sign form a mathematical statement known as an equation.
What is the use of equations in real life?It can be applied to address issues related to aging. It is used to figure out how fast, how far, and how long something is moving. Problems involving geometry can be resolved. It is employed to solve problems involving money and percentages.
Mathematical equations with two expressions on either side of the "equal to" sign are referred to as simple equations. This type of equation consists of a variable, which is typically represented by x or y. Rearranging is frequently necessary to solve simple equations.
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Which of these do EPA regulations typically aim to reduce? A. Trade B. Laws C. Carbon footprints D. Debt
Answers
EPA regulations typically aim to reduce Carbon footprints . Thus the correct option is C.
What is EPA?The Word EPA stands for Environmental Protection Agency which is an organization that aims to protect the health and the environment in which human beings and animals are living by eliminating hazardous substances.
Carbon footprint refers to a substance that is released as greenhouse gases and disturbs the natural balance of the environment through transportation and other energy sources.
This brings a rise in temperature which brings climate changes and increased pollution which causes toxic elements in the environment and disturbs the quality of the air we breathe.
Therefore, option C is appropriate.
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U.S. Treasury issues three types of Treasury securities: Treasury bills (T-bills), Treasury notes (T-notes), and Treasury bonds (T-bonds). The time to maturity (TTM) of T-bills is 12-month or less than 12-month. The TTM of T-notes is between 1 year and 10 years. The TTM of T-bonds is longer than 10 years. Which one(s) (T-bills, T-notes, or T-bonds) belong to the money market instrument(s)? Which one(s) belong to the capital market instrument(s)? If you would like to buy Treasury securities, which one(s) would you purchase? Explain why?
Answers
Answer:
Treasury bills (T-bills) are short-term money market instruments issued by the government to raise short-term funds. They are issued for terms of less than a year and are sold at a discount from their face value. T-bills have maturities of 4, 8, 13, 26, and 52 weeks. Therefore, T-bills belong to the money market instrument(s).
Treasury notes (T-notes) are issued with maturities from two to 10 years and pay interest semi-annually. Therefore, T-notes belong to the capital market instrument(s).
Treasury bonds (T-bonds) are long-term investments that have maturities of 10 to 30 years and also pay interest semi-annually. Therefore, T-bonds belong to the capital market instrument(s).
If you would like to buy Treasury securities, it depends on your investment goals. If you want a short-term investment with low risk and low return, you can consider buying T-bills. If you want a medium-term investment with moderate risk and moderate return, you can consider buying T-notes. If you want a long-term investment with high risk and high return, you can consider buying T-bonds.
Explanation:
I hope this helps
A sports car traveled a distance of 312 miles in 6 hours. Traveling at the same speed, what distance would this sports car travel in 8 hours? (5 points)
a
234 miles
b
360 miles
c
416 miles
d
474 miles
Answers
A sports car traveled a distance of 312 miles in 6 hours. Traveling at the same speed, distance that this sports car would travel in 8 hours will be 416 miles
It is calculated as below:
Calculation of miles per hour= total distance/total hours taken
=312/6
= 52 miles per hour
Calculation of total distance= Distance travelled in one hour* No. of hours
= 52 x 8 = 416 miles
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Vinny and Sandra have just had their first baby, and need to make a decision about how to handle work and child‑care responsibilities. Vinny earns $1000 per week working full time, and Sandra's full‑time salary is $1200 per week. They each can work part time and earn half their full‑time wage. Calculate the change in GDP for each situation, relative to when they both worked full time and had no child‑care responsibilities. If GDP falls, include a negative sign in your answer. a. Both Vinny and Sandra return to work full time and pay a child‑care provider $600 per week to care for their child. $ b. Both Vinny and Sandra will return to work full time, while Sandra’s mother takes care of their child without financial compensation. $ c. Both Vinny and Sandra will return to work full time, while Vinny's brother takes care of their baby. They'll pay him $600 a week to care for their child, but neither they nor Vinny’s brother will report those payments to the IRS, or on any government surveys. $ d. Vinny and Sandra will each return to work part time, and split child‑care responsibilities. $ e. Vinny will stay home to care for the baby, while Sandra returns to work full time. $
Answers
Answer:
A. 600
B. 0
C. 0
D. -1100
E. -1000
Explanation:
For part A you are asked to find the change in GDP with the addition of paying a babysitter $600. The GDP beforehand was the total income from both Vinny and Sandra which is $1200 + $1000 = $2200. For these questions, you are being asked to find a change in GDP which would simply be the addition of $600. Similiary, for part B there is no change in GDP because they do not pay Sandra's mother, so the change in GDP is 0. For part C, since the payments are not reported, there is no change in GDP. Part C can be thought of as a reference to the shadow market and GDP from the shadow market is not recorded. Part D has a negative 1100 because they each go back to work part-time, Vinnie earning $500 per week and Sandra earning $600. The change in GDP would be negative because they are losing 1100 in order to care for a new child. For part E, Vinnie gives up all his income which would normally amount to $1000 per week. The change in GDP is therefore negative.
The change in GDP for each situation will be:
(a) 600(b) 0(c) 0(d) -1100(e) -1000According to the question,
Whenever both work full time and had no child care then the b will be:
= \(1000+1200\)
= \(2200\)
(a)
New GDP,
= \(1000+1200+600\)
= \(2800\)
Change will be:
= \(2800-2200\)
= \(600\)
(b)
→ When mother doing child care isn't part of GDP then,
New GDP,
= \(1000+1200\)
= \(2200\)
Change will be:
= \(2200-2200\)
= \(0\)
(c)
→ Private non-reported transaction isn't a part of GDP then
New GDP,
= \(1000+1200\)
= \(2200\)
Change will be:
= \(2200-2200\)
= \(0\)
(d)
→ Working part time so will earn half of wages then,
New GDP,
= \(500+600\)
= \(1100\)
Change in GDP,
= \(1100-2200\)
= \(-1100\)
(e)
Only Sandra works then,
New GDP,
= \(1200\)
Change in GDP,
= \(1200-2200\)
= \(-1000\)
Thus the above answers are correct.
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Dividends Per Share
Sandpiper Company has 30,000 shares of cumulative preferred 1% stock, $100 par and 50,000 shares of $25 par common stock. The following amounts were distributed as dividends:
20Y1 $75,000
20Y2 24,000
20Y3 90,000
Determine the dividends per share for preferred and common stock for each year. Round all answers to two decimal places. If an answer is zero, enter '0'.
Answers
The dividends per share for preferred stock for years 20Y1, 20Y2, and 20Y3 are $2.50, $0.80, and $3.00, respectively. The dividends per share for common stock for the same years are $1.50, $0.48, and $1.80, respectively.
To determine the dividends per share for preferred and common stock for each year, we need to divide the total dividend amount by the number of shares for each type of stock.
Preferred Stock:
The preferred stock has a 1% dividend rate and a par value of $100 per share. There are 30,000 shares of cumulative preferred stock.
Year 20Y1:
Dividend per share for preferred stock = Dividend amount / Number of preferred shares
Dividend per share for preferred stock = $75,000 / 30,000
Dividend per share for preferred stock = $2.50
Year 20Y2:
Dividend per share for preferred stock = $24,000 / 30,000
Dividend per share for preferred stock = $0.80
Year 20Y3:
Dividend per share for preferred stock = $90,000 / 30,000
Dividend per share for preferred stock = $3.00
Common Stock:
The common stock has a par value of $25 per share. There are 50,000 shares of common stock.
Year 20Y1:
Dividend per share for common stock = Dividend amount / Number of common shares
Dividend per share for common stock = $75,000 / 50,000
Dividend per share for common stock = $1.50
Year 20Y2:
Dividend per share for common stock = $24,000 / 50,000
Dividend per share for common stock = $0.48
Year 20Y3:
Dividend per share for common stock = $90,000 / 50,000
Dividend per share for common stock = $1.80
In summary, the dividends per share for preferred stock for years 20Y1, 20Y2, and 20Y3 are $2.50, $0.80, and $3.00, respectively. The dividends per share for common stock for the same years are $1.50, $0.48, and $1.80, respectively.
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QUESTION ONE
ABC Ltd wishes to expand its business. On 31 Dec 2021, the company had
the following existing and proposed capital structures to support the
expansion programme.
1. The existing 8% debt capital has a book value of Ksh 50 000 000 and
matures in 10 years. The market value of debt at the close of business on
31 Dec 2021 was Ksh 40 000 000
2. A ten year loan of Ksh 300 000 000 is to be raised at an interest of 10
percent p.a. A cost of Ksh 20 000 000 will be incurred in raising this loan
3. A 12% preference stock capital stands in the books at Ksh 100 000 000
( 1 000 000 shares) and has a total market value of Ksh 150 000 000.
4. There are 40 000 000 ordinary shares with a current market price of Ksh
1500 each. The firm’s expected earnings per share (EPS) stand at Ksh
200, its growth rate is 6% and has a dividend payout of 60%.
5. The company plans to issue 10 000 000 ordinary shares at a market price
of Ksh 1 500 per share. The cost of floating the shares is estimated at Ksh
10 000 000.
Required:
i) Firm’s current weighted average cost of capital (10 marks)
ii) Firm’s expected weighted average cost of capital after the expansion
programme (i.e. marginal cost of capital) (5 marks)
QUESTION TWO
An investor intends to place Ksh 112,000,000 in the 91 days Treasury bill at a quoted rate/yield of 7.65%
p.a.
Required:
a) Compute the investor’s return, assuming that he is withholding tax-payer
b) Compute the investor’s return, assuming that he is non-withholding taxpayer (6 marks)
Answers
Answer:
rat
Explanation:
Derek is a high school student who is currently taking a course in personal
finance. He knows that he should be managing his money from his part-time job
better. He has learned about saving and budgeting, but he continues to spend all
of his money on his car and going out with friends. He knows that someday he'll
have to be more responsible, but right now he thinks he should just enjoy being a
carefree teenager. Why is it important for Derek to manage his money well now
instead of waiting until he's older?
Answers
Answer:
If he starts practicing saving money and budgeting while he is young, it will help him in the future when he is trying to save up for a house or trying to make a budget for how much he wants to spend on his future house. If he spends all of this money as a teenager, he won't have any money saved up for things that he needs.
Briefly describe the traditional organizational structure.
Answers
Answer:
The traditional organizational structure is the structure has the following characteristics:
Explanation:
Hierarchical: there is a clear hiearchical structure, between the top levels of the organization, and the bottom levels of the organization. There is a clear line of command, and workers have to respond vertically to their supervisors, who at the same time have to respond vertically to top management.
And the other characteristic is that departments within the organization are clearly defined, and each worker belongs to a specific department.
A great way to ontain hands-on training in a real work environment is to complete a(n)
Answers
Answer:
It's c, apprenticenship
Arianna is setting up an entertainment system. At this particular home, she needs to hold up a receiver while moving
wires around and reaching for tools. Arianna is using
physical strength and dexterity.
O problem-solving skills.
accuracy and attention to detail.
planning and organization skills.
оооо
Answers
Answer: Physical Strength and Dexterity
Explanation:
I just took the test
Answer:
A. physical strength and dexterity.
Explanation:
A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.5%. The probability distributions of the risky funds are:
Expected Return Standard Deviation
Stock fund (S) 16% 34%
Bond fund (B) 10% 25%
The correlation between the fund returns is 0.11.
Required:
a. What would be the investment proportions of your portfolio if you were limited to only the stock and bond funds and the portfolio has to yield an expected return of 12%?
b. Calculate the standard deviation of the portfolio which yields an expected return of 12%.
Answers
Based on the probability distributions of the funds and the correlation, the following is true:
Investment proportions would be 33% Equity and 67% debt. Standard deviation would be 21.16%. What would be the Investment proportions?The expected return can be found as:
= (Return on stock x Weight of stock) + (Return on debt x Weight of debt)
As we already have the return as 12%, we can solve the formula for weights :
12% = (16% x Weight of equity ) + (10% x Weight of debt)
12% = (16% x W of equity ) + (10% x (1 - W of equity))
12% = 0.16W + 10% - 0.1W
2% = 0.06W
W = 2% / 0.06
= 33%
Equity is 33% so Debt is 67%.
What would be the standard deviation?= √(Weight of stock ² x Standard deviation of stock ² + Weight of debt ² x Standard deviation of debt² + 2 x standard deviation of stock x standard deviation of debt x Correlation x weight of stock x weight of debt )
= √(33%² x 34% ² + 67%² x 25%² + 2 x 34% x 25% x 0.11 x 0.33 x 0.67)
= 21.16%
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Which of the following did Judge Parker NOT mention as one of the principles of ethics?
Answers
Answer:
Remain open-minded
Explanation:
Outline how a multinational food production company would process a food commodity from its rawest form in a developing
country to its finished state on store shelves in the United States or Europe.
Answers
Answer:
See below
Explanation:
A multinational company is a business organization that operates in more than one country. The company will have its headquarters in its domicile country and branches in separate countries. Businesses grow to multinationals to get closer to their target markets, avoid protection laws, and take advantage of lower production costs.
A multinational in the food industry may set up a factory in an African country where raw materials are readily available. This move will see it increase its production volumes at a lower cost. The company will establish branches in American and Europe, where its target market is located. It can operate retail stores in these regions to sells its products from the factory in Africa.
Project management differs from management of more traditional activities mainly because of: (I) its limited time frame. (II) its unique, defined set of activities. (III) the requirement for use of the appropriate resources. (IV) the need for planning and execution.
Answers
The difference that project management shows from the management of more traditional activities is that project management has:
Its limited time frame Its unique, defined set of activities.What is Project Management?Project management is the use of techniques, procedures, skills, knowledge, and expertise to accomplish specific project objectives within agreed-upon constraints. Project management contains final deliverables that must be completed within a specific timeframe and budget.
A significant distinction between project management and 'management of traditional activities' is that project management has an ultimate outcome and a fixed timeframe, whereas management is a continuous activity.
As a result, a project professional must possess a diverse set of talents, including frequently technical abilities, as well as people management abilities and commercial acumen.
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Mr. Johnnie B. Good has a furniture business which he operates as a sole proprietor. The business has been doing well for several years and now he wants to finance the expansion of his business by way of a loan and he is thinking of approaching BCN Bank accordingly. He is also planning to buy a great deal of raw material on credit from Miller’s Hardware in support of the business expansion. Mr. Good in looking at the potential risks to his personal assets and in an effort to safeguard himself from losing his personal assets if the business failed and was not able to repay the loan or pay for the material he got on credit, filed the relevant documents with the companies office and incorporated a private company, Good Furniture Ltd, with him as the sole shareholder and director and then went ahead and obtained a loan in the company’s name from the bank and bought the raw material on credit on behalf of the company. The bank in providing the loan ensured that Mr. Good signed a personal guarantee for the entire loan amount.
Shortly after receiving the loan and the material on credit, the business faced severe competition from other furniture stores who imported much cheaper furniture and so the business failed and had no business assets to cover the loan or to pay for the material taken on credit.
BCN Bank and Miller’s Hardware both sue to recover their respective amounts and each is seeking to get a court order to have Mr. Good sell his personal assets to meet the obligations of Good Furniture Ltd. Both Claimants are contending that the ‘one man’ company is merely a shield to what is in essence a sole proprietorship business.
Using case law and statute, advise Mr. Good as to the likelihood of success of:
A) Miller’s Hardware
B) BCN Bank
Answers
A) Miller's Hardware: Unless Miller's Hardware can prove fraudulent intent or abuse of the corporate form, it's unlikely to hold Mr. Good personally liable.
B) BCN Bank: Mr. Good's personal guarantee strengthens BCN Bank's chances of success in recovering the loan amount from his personal assets.
Mr. Good's situation involves the concept of piercing the corporate veil, which refers to disregarding the separate legal personality of a corporation to hold its shareholders personally liable. In this case, Miller's Hardware and BCN Bank are seeking to hold Mr. Good personally liable for the debts of Good Furniture Ltd. Let's analyze the likelihood of success for each claimant:
A) Miller's Hardware:
To determine the likelihood of success for Miller's Hardware, we need to consider the circumstances under which the court may pierce the corporate veil. The court will generally pierce the corporate veil if it can be shown that the company is merely an alter ego or a sham used to avoid legal obligations.
Factors considered include commingling of assets, inadequate capitalization, failure to follow corporate formalities, and fraud.
In this case, since Mr. Good incorporated Good Furniture Ltd as a separate legal entity, it demonstrates an intention to operate as a company rather than a sole proprietorship.
Unless Miller's Hardware can provide evidence of fraudulent intent or other factors indicating abuse of the corporate form, the court is unlikely to pierce the corporate veil. Therefore, Miller's Hardware may face challenges in holding Mr. Good personally liable.
B) BCN Bank:
BCN Bank has an advantage over Miller's Hardware because Mr. Good signed a personal guarantee for the loan, assuming personal liability. A personal guarantee is a legally binding agreement, and it can override the protection of limited liability that a corporation provides.
As long as the personal guarantee is valid and enforceable, BCN Bank has a strong chance of success in recovering the loan amount from Mr. Good's personal assets.
In summary, Miller's Hardware may face difficulties in holding Mr. Good personally liable, while BCN Bank is likely to succeed based on the personal guarantee provided by Mr. Good.
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Balboa Corporation activities for the year are summarized below:
Addition modifications $29,000
Allocated income (total) 25,000
Allocated income (State F) 3,000
Allocated income (State G) 22,000
Apportionment percentage 40%
Credits 800
Federal taxable income 90,000
Subtraction modifications 15,000
Tax rate 5%
Compute Balboa Corporation's State F taxable income and net tax liability for the year.
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Answer:
Balboa Corporation's State F taxable income and net tax liability for the year is $930
Explanation:
Balboa Corporation’s State F taxable income for the year
Federal taxable income $90,000
Addition modifications $29,000
Subtraction modifications -$15,000
Net Federal Taxable Income $104,000
Allocated income (total) -$25,000
State Taxable Income $79,000
Apportionment percentage 40%
$31,600
Allocated income (State F) $3,000
Income Allocated to State F $34,600
Tax rate 5%
$1,730
Less: Tax Credits -$800
State F taxable income for the year $930