Answer:
Explanation:
..
In most situations, asset values do not equal the amount of money that could be realized if the assets were sold.
a. True
b. False
Answer:
True
Explanation:
The answer to this question is true. The recording of assets is usually done at cost. This is equivalent to the value that was exchanged when the asset was sold. In a country like the United States for example, if an asset such as a land or machine gets to appreciate in value after a period of time, it is not usually revalued. Therefore the answer to this question is true.
Zero Calories Company has 16,000 shares of cumulative preferred 1% stock, $40 par and 80,000 shares of $150 par common stock. The following amounts were distributed as dividends:
Year 1 $21,600
Year 2 4,000
Year 3 100,800
Determine the dividends per share for preferred and common stock for each year.
Assume a market for a normal good is currently in equilibrium. If the government increases the taxes that firms must pay, then:
Answer:
The supply will decrease.
Explanation:
The supply will decrease because the application of taxes will make selling costly. Thus, when cost increases then producers supply less. Therefore, less quantity will be supplied in the market when tax is imposed and this will increase the prices of products.
With so many workers habituated to using mobile devices for so much of their work, should company management develop apps for influencing subordinates? Explain your reasoning.
Answer:
This is not a yes or no answer.
The action of leadership/management would depend on their assessment of the impact of the habit on the results being delivered by the workers.
The questions to ask are:
Does the use of the mobile phone for their work reduce or increase productivity?Does what are the advantages? are there disadvantages?What would developing an app achieve for management?Explanation:
In trying to influence workers who are already habituated or accustomed to a particular way of doing things, it is best practice to study the culture and establish what its advantages are. This can then be compared to its demerits. If the demerits clearly and consistently present risks that make of no relevance the advantages, the leader(s) must move to correct such a risk.
So assuming that using mobile phones makes ICT risks (such as loss of company data, loss of company data, risk of unauthorised access etc) even more pronounced, whether or not the app is the best solution will depend on the total cost of that solution to the company weighed against other options.
Other options could simply be
- looking for an already existing app
- banning the using of mobile phone for office work using etc
- re-establishing the use of laptops as the preferred work tool
In any of the above scenarios, the leadership will succeed in influencing its workers positively if it:
plays its part well as a cultural shift role modelbecomes an arbiter of the policies modifying changes affecting work styleencourages the new workstyle by rewarding those that embrace it openly manage change by ensuring that there is a training platform that helps ease the transition into the new work style.Cheers
Select a commercial or Public Service Announcement (PSA) that uses an emotional appeal/Pathos.
Identify the organization along with the topic/issue presented in the PSA or commercial.
Using the information in this section, how would you characterize the way it persuades listeners with emotion?
Is it effective in persuading you as a listener? Why or why not?
Include a Reference page citing the source in APA format.
Write your response in a letter form.
Answer:
An announcement that applies an emotional appeal attempts to urge an emotional reaction from the general public so on suits the message contained within the announcement.
Select a commercial or public service announcement that uses an emotional appeal.
A public service announcement that shows the aftermath of environmental pollution
Using the information in this section, how would you characterize the way it persuades listeners with emotion?
When the general public feels guilty about not having the ability to try to do something about environmental degradation, there'll be a change from the utilization of inorganic to the use of organic materials. When companies that pollute the environment are charged or closed down, and when the people resort to planting more trees.
Is it effective in persuading you as a listener?
Yes.
Why or why not?
It is very effective in persuading because the listeners put themselves in the situation and feel the effect of not taking care of the environment.
Discuss your findings with your classmates.
When people feel guilty for not taking care of the environment, they're going to take social action aimed toward correcting things. The people imagine how the planet is going to be like 50 years from now and picture how their children and grandchildren will survive. they're therefore compelled to try to do something so on contribute to environmental protection and to support the ecology.
Depreciation, in accounting, is a process that results in: Multiple Choice an accurate measurement of the economic usefulness of an asset. depreciable assets being reported in the balance sheet at their fair value. accumulating cash for the replacement of the asset.
Answer:
spreading the cost of an asset over its useful life to the entity.
Explanation:
The depreciation is a non-cash expense that should be charged over the fixed assets i.e. land, buidling, car, etc
It is an expense so the same should be shown on the debit side of the income statement
Also the cost of an asset minus the salvage value divided by the useful life could be spreaded as the depredciation expense by using straight-line method
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $270,000 including installation. The company estimates that the equipment will have a residual value of $24,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 1 3,100 2 1,100 3 1,200 4 2,800 5 2,600 6 1,200 2. Prepare a depreciation schedule for six years using the double-declining-balance method.
Answer:
Year Depreciation expenses
1 $90,000
2 $60,000
3 $40,000
4 $26,667
5 $17,778
6 $11,556
Explanation:
Note: See the attached excel file for the depreciation schedule for six years using the double-declining-balance method.
The double-declining-balance method is a depreciation approach in which the rate of depreciation for an asset is twice the rate of depreciation for the straight line method.
In the attached excel, the double-declining-balance depreciation rate is therefore calculated as follows:
Straight line depreciation rate = 1 / Number of expected useful years = 1 / 6 = 0.166666666666667 = 16.6666666666667%
Double-declining depreciation rate = Straight line depreciation rate * 2 = 16.6666666666667% *2 = 33.3333333333334%
Also note the following in the attached excel file:
Beginning depreciable amount in Year 1 = Cost of the new machine = $270,000
The depreciation expenses for Year 6 is calculated by deducting the residual value of $24,000 from Year 6 Beginning depreciable amount. That is:
Depreciation expenses for Year 6 = $35,556 - $24,000 = $11,556
The residual value of $24,000 therefore represents the book value at the end of Year 6.
From the attached excel file, we therefore have:
Year Depreciation expenses
1 $90,000
2 $60,000
3 $40,000
4 $26,667
5 $17,778
6 $11,556
According to the liquidity preference model, the equilibrium interest rate is determined by the: International Monetary Fund. supply of and demand for money. supply of and demand for loanable funds. level of investment spending and saving.
Answer:
Supply of and demand for money.
Explanation:
The equilibrium interest rate is determined by the demand and supply of the money. The interest rate is represented by the verticle axis of the graph and supply and demand for money is represented by the horizontal axis. Thus, the point of intersection between supply curve and demand curve determines the equilibrium interest rate.
Assume that the current price of a stock is $100. A call option on that stock with an exercise price of $97 costs $7. A call option on the stock with the same expiration and an exercise price of $103 costs $3. Using these options what is the expiration profit of a bear call spread if the stock price is equal to $110
Answer:
-2
Explanation:
The specific actions to be taken in implementing a strategy.
The correct answer to this open question is the following.
Although there are no options attached we can say the following.
In general terms, the specific actions to be taken in implementing a strategy are the following.
First of all, the manager has to clearly define the strategic plan and its content.
Then, define the general goal, and specific goals. It is highly recommended to use the SMART formula. Goals have to be specific, measurable, attainable, realistic, and time-bound.
Then, define the Key Performing Indicators or KPI's. These will serve to define the results the company expects to accomplish with the plan.
Create a series of programs and specific actions to reach the goals.
Then, to implement the tactics or specific programs.
Monitoring the programs and then evaluate the results to provide feedback.
An FI purchases at par value a $100,000 Treasury bond paying 10 percent interest with a 7.5 year duration. If interest rates rise by 4 percent, calculate the bond's new value. Recall that Treasury bonds pay interest semiannually. Use the modified duration valuation equation.
Answer:
The bond's new value is $70,000
Explanation:
First calculate the percentage change in the value of the bond
Duration = Percentage change in price / Percentage change in yield
Percentage change in price = Duration x Percentage change in yield
where
Duration = 7.5 years
Percentage change in yield = 4%
Percentage change in price = ?
Placing value sin the formula
Percentage change in price = 7.5 x 4%
Percentage change in price = 0.30
Percentage change in price = 30%
As we know that the value of the bond and the yield rate are inversely proportional to each other, If the yield rate increases the value of the bond decreases due to the discounting factor used in the valuation o the bond.
Hence, the value of the bond is calculated as follow
Value of the bond = Par value of the bond x ( 1 - per centage of change in the price of the bond
Value of the bond = $100,000 x ( 1 - 30% )
Value of the bond = $100,000 x 0.70
Value of the bond = $70,000
When the pressure for local responsiveness is strong and the pressure for coordination is weak for multinational corporations in an industry, the industry will tend to become:___________
A) global
B) consolidated
C) multidomestic
D) risky
E) indigenous
Suppose you invest equal amounts in a risky asset with an expected return of 16% and a standard deviation of returns of 18% and a risk-free asset with an interest rate of 4%. Calculate the standard deviation of the returns on the resulting portfolio.
Answer:
The answer is "[tex]10\%[/tex]".
Explanation:
You are equivalent investors in 16 percent of a portfolio and 4 percent of a risk-free asset. A weighted mean of these two will become the predicted return.
[tex]= \text{(Portfolio weight} \times \text{Return portfolio)} + \text{(Portfolio weight}\times \text{risk-free)}\\\\[/tex]
[tex]= (0.5 \times 16\%) + (0.5 \times 4\%)\\\\= (0.5 \times \frac{16}{100}) + (0.5 \times \frac{4}{100})\\\\= \frac{8}{100} + \frac{2}{100}\\\\= \frac{8+2}{100}\\\\= \frac{10}{100}\\\\= \frac{1}{10}\\\\= \frac{1}{10} \times 100\\\\=10\%[/tex]
Redbud Company uses a certain part in its manufacturing process that it buys from an outside supplier for $44 per part plus another $6 for shipping and other purchasing-related costs. The company will need 10,000 of these parts in the next year and is considering making the part internally. After performing a capacity analysis, Redbud determined that it has sufficient unused capacity to manufacture the 10,000 parts but would need to hire a manager at an annual salary of $40,000 to oversee this production activity. Estimated production costs are determined to be:
Direct material $ 28
Direct labor 12
Variable overhead 6
Fixed overhead (includes manager at $4 per unit) 10
Total unit cost $ 56
A) Identify the relevant costs to make this part internally. (Select all that apply)
A) Historical cost
B) Direct labor
C) Direct material
D) Variable overhead
E) Fixed overhead
F) New manager's salary
B) Should Redbud produce the part or continue to buy it from the outside supplier? (Select the right answer)
A) Redbud should produce the part.
B) Redbud is indifferent about the decision.
C) Redbud should continue to buy it from the outside supplier.
C.What are the other factors that Redbud Company should consider in deciding to make the part internally? (Select all that apply.)
A) Total sales quantity.
B) The potential for improved control over the availability of the parts by having it when needed and the potential for improved quality of the parts.
C) Since Redbud Company is considering the use of currently available capacity, it should evaluate any relevant opportunity costs of using this capacity for more profitable activities.
Answer:
Redbud Company
A) Relevant costs:
B) Direct labor
C) Direct material
D) Variable overhead
F) New manager's salary
B) B) Redbud is indifferent about the decision.
C. Other factors to consider:
B) The potential for improved control over the availability of the parts by having it when needed and the potential for improved quality of the parts.
C) Since Redbud Company is considering the use of currently available capacity, it should evaluate any relevant opportunity costs of using this capacity for more profitable activities.
Explanation:
a) Data and Calculations:
Cost of buying parts from outside supplier = $50 per part
Units required in the next year = 10,000
Costs required to produce internally:
Supervisor's salaries $40,000
Direct material $ 28
Direct labor 12
Variable overhead 6
Fixed overhead (includes
manager at $4 per unit) 10
Total unit cost $ 56
Relevant costs:
Direct material $ 28
Direct labor 12
Variable overhead 6
Fixed overhead (includes
manager at $4 per unit) 4
Total unit cost $50
You are calculating the volume quantity needed for material that will compact to 95% of its original undisturbed volume. You know that you will need to fill a void with a volume of 1,487 cubic yards. What is the volume of material needed from the borrow pit to equal this amount when fully compacted
Answer:
Volume = 1565.56 cubic yards
Explanation:
The computation of the volume of material required is shown below:
95% × volume = 1,487 cubic yards
Volume = 1565.56 cubic yards
Basically 95% of volume is equivalent to the 1487 cubic yards
So according to this we determined the volume
Hence, the same should be considered
Ayayai Corp. uses a periodic inventory system. Its records show the following for the month of May, in which 69 units were sold.
Date Explanation Units Unit Cost Total Cost
May 1 Inventory 32 $8 $256
15 Purchase 25 9 225
24 Purchase 41 10 410
Total 98 $891
Calculate the weighted-average unit cost. (Round answer to 3 decimal places, e.g. 5.125.)
Weighted-average unit cost $____
Calculate the ending inventory at May 31 using the FIFO, LIFO and average-cost methods. (Round answers to 0 decimal places, e.g. 125.)
FIFO LIFO Average Cost
$____ $____ $_______
Answer:
a. Weighted-average unit cost = $9.092
b. We have:
Ending inventory at May 31 using the FIFO method = $290
Ending inventory at May 31 using the LIFO method = $232
Ending inventory at May 31 using the average-cost method = $264
Explanation:
a. Calculate the weighted-average unit cost. (Round answer to 3 decimal places, e.g. 5.125.)
Weighted-average unit cost = Total Cost of units of inventory available for sale / Total units of units of inventory available for sale = $891 / 98 = $9.092
b. Calculate the ending inventory at May 31 using the FIFO, LIFO and average-cost methods. (Round answers to 0 decimal places, e.g. 125.)
Ending inventory in units = Total units of units of inventory available for sale – Units sold = 98 - 69 = 29
Therefore, we have:
Ending inventory at May 31 using the FIFO method = Ending inventory in units * Unit cost of purchases on May 24 = 29 * $10 = $290
Ending inventory at May 31 using the LIFO method = Ending inventory in units * Unit cost of inventory on May 1 = 29 * $8 = $232
Ending inventory at May 31 using the average-cost method = Ending inventory in units * Weighted-average unit cost = 29 * $9.092 = $264
Tracey Sales Co. has predicted the following costs for this year for 500,000 units: Manufacturing Selling and Administrative Variable $ 800,000 $250,000 Fixed 1,200,000 300,000 Total $2,000,000 $550,000 What is the markup on variable manufacturing costs needed to break even
Answer: 218.75%
Explanation:
In order to breakeven, the variable manufacturing cost would have to be the same as the fixed costs in addition to the administrative costs.
= Fixed costs + Administrative cost
= 1,200,000 + 550,000
= $1,750,000
Variable cost needs to be $1,750,000
It is currently at $800,000 so it needs to increase by:
= 1,750,000 / 800,000 * 100%
= 218.75%
On Jan 1 2020, Ethan Corporation issued 12% bonds with a face value of $4,000,000. These bonds mature in ten years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $4,498,490 to yield 10%. Ethan uses a calendar-year reporting period. Using the effective-interest method of amortization, what amount of interest expense should be reported for 2020
Answer:
Ethan Corporation
Using the effective-interest method of amortization, the amount of interest expense that should be reported for 2020 is:
= $449,096
Explanation:
a) Data and Calculations:
Face value of bonds issued = $4,000,000
Issue price of the bonds = 4,498,490
Premium on the bonds = $498,490 ($4,498,490 - $4,000,000)
Coupon interest rate = 12%
Effective interest rate = 10%
Interest payments = June 30 and December 31
June 30:
Cash payment for bond interest = $240,000 ($4,000,000 * 6%)
Interest expense = 224,925 ($4,498,490 * 5%)
Amortization of bond premium = $15,075 ($240,000 - $224,925)
Bonds value = $4,483,415 ($4,498,490 - $15,075)
December 31:
Cash payment for bond interest = $240,000 ($4,000,000 * 6%)
Interest expense = 224,171 ($4,483,415 * 5%)
Amortization of bond premium = $15,829 ($240,000 - $224,171)
Bonds value = $4,467,586 ($4,483,415 - $15,829)
Interest expense for 2020 = $449,096 ($224,925 + $224,171)
Paul, the Director of Recruitment at an insurance company, finds that the company has a disparate impact on the proportion of Hispanic employees compared to the proportion of Hispanics in the labor market. Which of the following steps should Paul take to solve the problem most efficiently?
a) He should lower the job specifications for Hispanic applicants.
b) He should continue using the current recruiting practices because only organizations with affirmative action plans are required to meet EEO guidelines.
c) He should start advertising for job openings on the local Spanish radio station.
d) He should freeze the hiring process until qualified Hispanics apply for vacant positions
Answer: c) He should start advertising for job openings on the local Spanish radio station.
Explanation:
This realization by Paul should make him want to hire more Hispanics into the company and the best way to do so would be to advertise it in such a way that Hispanics have a better chance of hearing about job openings.
Advertising on Spanish radio would ensure that Hispanics hear the advertisements because they are the main ethnicity that speaks Spanish. This will give them an edge in learning about job openings and enable Paul to hire more Hispanics.
Which of the following statements correctly describe properties of an economic model? Check all that apply.
A) An economic model requires a complex set of assumptions.
B) An economic theory can be expressed in the form “If X, then Y, all other things held constant.”
C) An economic model requires simplified assumptions.
D) The purpose of an economic model is to depict the real world as accurately as possible.
Answer:
A) An economic model requires a complex set of assumptions.
D) The purpose of an economic model is to depict the real world as accurately as possible.
Explanation:
The following statements that correctly describes properties of an economic model are:
A) An economic model requires a complex set of assumptions.
D) The purpose of an economic model is to depict the real world as accurately as possible.
An economic model requires a complex set of assumptions.The purpose of an economic model is to depict the real world as accurately as possible.
Are the properties of economic model.
What is Economics?Economics is a social science which base on how human needs are met or satisfied through the allocation of scarce resources .
What is an Economic Model?Economic model is a theoretical processes which consist of variables and how this set of logical variables relate within them.
Therefore,
An economic model requires a complex set of assumptions.The purpose of an economic model is to depict the real world as accurately as possible.Are the properties of economic model.
Learn more on Economics from the link below.
https://brainly.com/question/17996538
Retained earnings, December 31, 2012 $ 306,800 Cost of equipment purchased during 2013 29,000 Net loss for the year ended December 31, 2013 4,000 Dividends declared and paid in 2013 14,300 Decrease in cash balance from January 1, 2013, to December 31, 2013 11,100 Decrease in long-term debt in 2013 14,000 Required: From the above data, calculate the retained earnings balance as of December 31, 2013. (Negative amounts should be indicated by a minus sign.)
Answer:
$288,500
Explanation:
Particulars Amount
Retained Earnings Dec 31, 2012 $306,800
Less: Net Loss for the Year $4,000
Less: Dividend declared and paid in 2013 $14,300
Retained Earnings Dec 31, 2013 $288,500
rt, a $0.73 per share cash dividend was declared by the board of directors for it common stock. On 12/31, the date of declaration, there were 98,000 shares authorized, 59,000 shares issued, and 8,000 Treasury shares. On the date of the dividend declaration, what amount will Walmart record into their dividend account
Answer:
$36,792
Explanation:
Missing word "At Walmart, the board of directors declared a $0.73"
Outstanding stockholder = Issued stockholder - Treasury stock
Outstanding stockholder = 59,000 shares - 8,600 shares
Outstanding stockholder = 50,400 shares
Amount of Dividend = Declared per share cash dividend * Outstanding stockholder
Amount of Dividend = 50,400 shares * $0.73
Amount of Dividend = $36,792
So therefore, on the date of the dividend declaration, $36,792 shall be recorded by Walmart into their dividend account.
You invested $5,000 in the stock market one year ago. Today, the investment is valued at $5,500. What return did you earn? What return would you suffer next year for your investment to be valued at the original $5,000?A. 10%, -9.09%, respectivelyB. -10%, +9.09%, respectivelyC. 110%, -10%, respectivelyD. 110%, -9.09%, respectively
Answer:
A
Explanation:
Rate of return in one period = (value in year 1 / initial value) - 1
(5500 / 5000) - 1 = 0.1 = 10%
(5000 / 5500) - 1 = -9.09%
Consider the market for purple potatoes below and assume that a price ceiling of $30 is imposed by the government. Calculate the deadweight loss:
Answer:
$5000
Explanation:
B. Lopez Company reports unadjusted first-year merchandise sales of 221,000 and cost of merchandise sales of $64,000. The company expects future returns and allowances equal to 5% of sales and 5% cost of sales. The year-end adjusting entry to record the cost side of sales returns and allowances is:
Answer: See explanation
Explanation:
The year-end adjusting entry to record the cost side of sales returns and allowances will be:
Dr Inventory Return estimated $3200
Cr Cost of goods sold $3200
(To record expected coat of returns)
Note that the above calculation was done as:
= $64,000 × 5%
= $64,000 × 0.05
= $3200
everyone makes mistakes sometimes. when we ask your most recent manager what types of mistakes you would be least likely to make on the job what will they say
Answer:
needs to be more spefic
Explanation:
Dan purchases a 1000 par value 10-year bond with 9% semiannual couponsfor 925. He is able to reinvest his coupon payments at a nominal rate of 7%convertible semiannually.Calculate his nom
Answer:
9.2%
Explanation:
Missing word "Calculate his nominal annual yield rate convertible semiannually over the ten-year period"
Semi annual coupon payments = 9% / 2 = 4.5%
Par value = 4.5% * 1,000 = $45
interest rate per period = r = 7% / 2 = 3.5%
Number of periods, n = 2 x 10 = 20
FV of all the coupons reinvested = 45 / r * [(1 + r)^n - 1]
FV of all the coupons reinvested = 45 / 3.5% * [(1 + 3.5%)^20 - 1]
FV of all the coupons reinvested = $1,272.59
Receipt of par value at the end of the 10 years = par value = 1,000
Total accumulated value at the end of 10 years = $1,272.59 + 1,000
Total accumulated value at the end of 10 years = $2,272.59
Invested amount = $925
i = nominal interest convertible semi annually.
$925 * (1 + i / 2)^n = 2,272.59
925 * (1 + i / 2)^20 = 2,272.59
i = 2 * [(2,272.59 / 925)^1/20 - 1]
I = 9.19%
I = 9.2%
So, his nominal annual yield rate convertible semiannually over the ten-year period is 9.2%
Camden Biotechnology began operations in September 2013. The following selected transactions relate to liabilities of the company for September 2013 through March 2014. Camden's fiscal year ends on December 31.Its financial statements are issued in April.2013a. On September 5, opened checking accounts at Second Commercial Bank and negotiated a short-term line of credit of up to $15,000,000 at the bank's prime rate (10.5% at the time). The company will pay no commitment fees.b. On October 1, borrowed $12 million cash from Second Commercial Bank under the line of credit and issued a five-month promissory note. Interest at the prime rate of 10% was payable at maturity. Management planned to issue 10-year bonds in February to repay the note.c. Received $2,600 of refundable deposits in December for reusable containers used to transport and store chemical-based products.d. For the September-December period, sales on account totaled $4,100,000. The state sales tax rate is 3% and the local sales tax rate is 3%. (This is a summary journal entry for the many individual sales transactions for the period.)e. Recorded the adjusting entry for accrued interest.2014f. In February, issued $10 million of 10-year bonds at face value and paid the bank loan on the March 1 due date.g. Half of the storage containers covered by refundable deposits were returned in March. The remaining containers are expected to be returned during the next six months.Required:1. Prepare the appropriate journal entries for these transactions.2. Prepare the current and long-term liability sections of the December 31, 2013, balance sheet. Trade accounts payable on that date were $252,000.
Answer:
Cash (Dr.) $12,000,000
Short term notes payable (Cr.) $12,000,000
Cash (Dr.) $2,600
Liability of refundable (Cr.) $2,600
Interest Expense (Dr.) $250,000
Interest Payable (Cr.) $250,000
Accounts receivable (Dr.) $4,100,000
Sales Revenue (Cr.) $3,977,000
Sales Tax Payable (Cr.) $123,000
Cash (Dr.) $10,000,000
Bond Payable (Cr.) $10,000,000
Explanation:
Liability Schedule 2013,
Accounts Payable $252,000
Current Portion of notes payable $2,000,000
Interest Payable $250,000
Sales tax Payable $123,000
Liability for refundable deposit $2,600
Total Current Liability $2,627,600
Which one is not a main question when you evaluate earnings' quality?
a. Source of revenue and persistent of revenues
b. Gross profit relationship between earnings and the market price of the common stock
c. Debt to equity ratio and total amounts of liabilities.
Answer:
Debt to equity ratio and total amounts of liabilities
Explanation:
Permanent and Temporary components of Earnings
The Permanent components of earnings may continue into future. Example is the sales revenue from regular product lines may continue in the future.
Temporary components of earnings may not continue in the future. Example is the gains or losses from the sale of equipment
Quality of Earnings
This is simply defined as any substance of earnings and their sustainability into future accounting periods.
The Quality of Earnings is influence largely by:
1. Accounting Methods: this entails all methods/means are set up/designed to match revenue and expenses.
2. Accounting estimates: this is when users of financial statement need to be aware of the impact that accounting estimates have on income.
3. One time items: this covers if and when earnings increase/decrease because of a one time items,then that portion of earnings will be sustained in the future.
Components of Earnings quality
1. Proper revenue and expense recognition
2. Declining or stable operating expenses compared to sales
3. High and persistently improving gross margin/ sales ratio etc.
The debt to equity ratio and the total amount of liabilities of a company is not important in evaluating the earnings' quality.
Which of the following statements is incorrect? Employment insurance compensation encourages longer job searches, which may lead to a better match between jobs and employees. Employment insurance compensation increases the opportunity cost of being unemployed. The typical employment insurance compensation is roughly one third of one's latest salary for up to 26 weeks. Demand and supply curves for labor are constantly shifting.
Answer:
Employment insurance compensation increases the opportunity cost of being
unemployed.
Explanation:
The Employment insurance program is the benefit that is provided temporarily to the people who do not have jobs or had lost their jobs of no fault of their own. This program helps the unemployed with financial help temporarily so that they can survive and search for another jobs.
The compensations provided from the employment insurance encourages the people for a longer job search and better match between the employees and the jobs. This financial aid is provided for up to a maximum of 26 months and for 1/3rd of one's latest salary. The demand and supply curve for te labor is shifting constantly.
Thus the incorrect statement is :
Employment insurance compensation increases the opportunity cost of being
unemployed.
