The problem a company that has a cash shortage may face is that it may be...
The problem a company that has a cash shortage may face is that it may be forced to sell its assets at exceptionally low prices, which would reduce its net worth. (true or false)
Homework Answers
True.
To overcome cash shortage certain assets may be sold at a low price , leading to reduction of net worth, since they are sold at loss.
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The problem a company that has a cash shortage may face is that
it may be...
In general, the term “par value,” also called face value or nominal value, is the...
In general, the term “par value,” also called face value or nominal value, is the lowest legal price for which a corporation may sell its shares. It has nothing to do with how much a corporation’s shares are actually worth or are sold for. Group of answer choices In general, the term “par value,” also called face value or nominal value, is the lowest legal price for which a corporation may sell its shares. It has nothing to do...
thanks 20. A company has negative cash flow, a low times interest earned ratio, market capitalization...
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20. A company has negative cash flow, a low times interest earned ratio, market capitalization of $16M, total liabilities of $9M, capital shares of $19M, retained earnings of $24M, and dividend yield of 3%. What is your assessment of the company? a) This company's stock is over-valued. b) This company may be worth more by stopping its operations and selling off the assets. c) This company can be profitable if it can reduce its leverage. d) This company's stock...
1- Consider a monopolistic market where the government has decided to implement lump-sum tax. Which of...
1- Consider a monopolistic market where the government has decided to implement lump-sum tax. Which of the following are true? Select all that apply. The monopolist loses profit. The government gains revenue. The monopolist is forced to reduce their prices. The monopolist is forced to sell less products. 2-Consider a monopolistic market where the government has decided to implement lump-sum tax. Which of the following are true? Select all that apply. The monopolist loses profit. The government gains revenue. The...
PROBLEM 4: Cost Volume Profit In the Face of Uncertainty A niche server manufacturer (the Company)...
PROBLEM 4: Cost Volume Profit In the Face of Uncertainty A niche server manufacturer (the Company) is exploring changing its manufacturing practice. Its current product, DX38 is priced at $100. If demand picks up, it can raiso prices, but competition may cap its ability of how much. Sales are expected to be 150,000 units for next year. Currently, the Company leases plant from IIP using some of their equipment. The Company manufactures about 70% of the parts of this circuit...
Sandhill Electronics reported the following information at its annual meetings: The company had cash and marketable...
Sandhill Electronics reported the following information at its annual meetings: The company had cash and marketable securities worth $1,235,455, accounts payables worth $4,159,357, inventory of $7,134,300, accounts receivables of $3,454,000, short-term notes payable worth $1,122,400, and other current assets of $121,455. What is the company's net working capital? Excel Template (Note: This template includes the problem statement as it appears in your textbook. The problem assigned to you here may have different values. When using this template, copy the problem...
Arya’s Alchemy produces mineral based face masks. The company has the following financial information: The company’s...
Arya’s Alchemy produces mineral based face masks. The company has the following financial information: The company’s sales price is $20 per unit. The variable costs of producing masks is $6 per unit. The company expects to have fixed costs of $10,000 next year. The company expects to sell 1,000 masks. Assume no taxes. Calculate the breakeven point in units: ____ units need to be sold. Calculate the breakeven point in dollars: ___ worth of product need to be sold. How...
A company which complains that although their income is quite satisfactory, cash is not available for...
A company which complains that although their income is quite satisfactory, cash is not available for dividends because of the high cost of replacing fixed assets is operating in an economic environment where: inflation is non-existent. the balance sheet value of long-lived assets is more than their replacement value. O the prices of long-lived assets have been decreasing over an extended period of time. expenditures required to replace long-lived assets are greater than depreciation expense. Question 4 2 pts Which...
Problem 1-1A Sunland Company was started on May 1. A summary of May transactions is presented below Stockholders inves...
Problem 1-1A Sunland Company was started on May 1. A summary of May transactions is presented below Stockholders invested $15,500 cash in the business in exchange for common stock. Purchased equipment for $6,000 cash Paid $200 cash for May office rent 1 2. 3. Paid $500 cash for supplies. 4. Incurred $150 of advertising costs in the Beacon News on account. 5. Received $5,200 in cash from customers for repair service. 6. Declared and paid a $1,600 cash dividend. 7....
A company has assets worth $366.11 million. It has debt with a total face value of...
A company has assets worth $366.11 million. It has debt with a total face value of $205.4 million. If the risk-free interest rate is 2.25% and the standard deviation of monthly returns on the company’s stock is 0.188, what is the likelihood the company will be unable to repay the debt in three years when it is due?
A food chain company is experiencing a capacity shortage problem, being very famous brand of fast...
A food chain company is experiencing a capacity shortage problem, being very famous brand of fast food. The company is planning to open a new outlet in Sohar, which would require initial investment of $ 220,000. Information on the expected revenues and costs (salaries of staff, rent and other expenses) for next years is given below: Year Expected revenue ($) Expected Annual Costs ($) 2020 64000 21000 2021 76000 24000 2022 85000 26000 2023 94000 30000 2024 108000 32000 2025...
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20. A company has negative cash flow, a low times interest earned ratio, market capitalization of $16M, total liabilities of $9M, capital shares of $19M, retained earnings of $24M, and dividend yield of 3%. What is your assessment of the company? a) This company's stock is over-valued. b) This company may be worth more by stopping its operations and selling off the assets. c) This company can be profitable if it can reduce its leverage. d) This company's stock...
PROBLEM 4: Cost Volume Profit In the Face of Uncertainty A niche server manufacturer (the Company) is exploring changing its manufacturing practice. Its current product, DX38 is priced at $100. If demand picks up, it can raiso prices, but competition may cap its ability of how much. Sales are expected to be 150,000 units for next year. Currently, the Company leases plant from IIP using some of their equipment. The Company manufactures about 70% of the parts of this circuit...
Sandhill Electronics reported the following information at its annual meetings: The company had cash and marketable securities worth $1,235,455, accounts payables worth $4,159,357, inventory of $7,134,300, accounts receivables of $3,454,000, short-term notes payable worth $1,122,400, and other current assets of $121,455. What is the company's net working capital? Excel Template (Note: This template includes the problem statement as it appears in your textbook. The problem assigned to you here may have different values. When using this template, copy the problem...
A company which complains that although their income is quite satisfactory, cash is not available for dividends because of the high cost of replacing fixed assets is operating in an economic environment where: inflation is non-existent. the balance sheet value of long-lived assets is more than their replacement value. O the prices of long-lived assets have been decreasing over an extended period of time. expenditures required to replace long-lived assets are greater than depreciation expense. Question 4 2 pts Which...
Problem 1-1A Sunland Company was started on May 1. A summary of May transactions is presented below Stockholders invested $15,500 cash in the business in exchange for common stock. Purchased equipment for $6,000 cash Paid $200 cash for May office rent 1 2. 3. Paid $500 cash for supplies. 4. Incurred $150 of advertising costs in the Beacon News on account. 5. Received $5,200 in cash from customers for repair service. 6. Declared and paid a $1,600 cash dividend. 7....
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