Even though the acid-test ratio is less than 1 which rates in the lower third quartile in the industry of 1.6, 0.9 to 0.6, it indicates a concern with repaying current liabilities. This could be due to quick expansion of inventory with the intention of increasing sales. While this is currently considered a weakness and is concerning, a rise in the ratio should be seen by 2013 due to the increase of suggested sales. 3. I calculated an “inventory turnover ratio” which measures the number of times a company sells its inventory during a year.
Productivity, as measured by the output per hour by the business sector, grew at a lower rate during the Reagan years than the 7 years prior. The growth rate of 1.3% during Reagan’s tenure was .2% higher than the 6 years afterwards, but .3% lower than the years preceding (Niskanen & Moore 1996). Inflation is an increase in the average price level and is not a positive occurrence. When Reagan took office, the REAGAN-SIDE ECONOMICS consumer price index (CPI) was at a high 13.5%, by the end of his terms, the CPI had been decreased to 4.1% (Niskanen & Moore 1996). Those who are critical of Reagan’s policy speak of the explosion of the United States’ budget deficit during the 1980s.
ACCT 557 Quiz 2 Purchase here http://chosecourses.com/ACCT%20557/acct-557-quiz-2 Product Description 1. (TCO B) As a result of differences between depreciation for financial reporting purposes and tax purposes, the financial reporting basis of Noor Co.'s sole depreciable asset, acquired in Year 1, exceeded its tax basis by $250,000 at December 31, Year 1. This difference will reverse in future years. The enacted tax rate is 30% for Year 1, and 40% for future years. Noor has no other temporary differences.
Suppose further that if the Federal Reserve changes the discount rate by 1 percentage point, banks change their reserves by 300. To increase the money supply by 2700 the Federal Reserve should A. reduce the discount rate by 3 percentage points B. reduce the discount rate by 10 percentage points C. raise the discount rate by 3 percentage points D. raise the discount rate by 10 percentage points 6. In the short run, a trade deficit allows more consumption, but in the long run, a trade deficit is a problem because A. the country eventually will consume more and produce less B. the country eventually will
The real wage and rental price of capital also increase by 10 percent. Question 4 (15 marks) a) Public saving equals T-G. An increase in government spending, G, reduces public saving. b) Private saving equals Y-T-C. An increase in government spending does not affect private saving. c) National saving equals Y-C-G. An increase in government spending reduces national saving by an amount equal to the increase in government spending. d) The equilibrium interest rate increases to bring desired investment into equilibrium with the reduced quantity of national saving.
This action will help the company down the road as fewer liabilities will result in less cash outflow, and place the company in a position to manage through the construction downturn. Another upside in the balance sheet was that The Home Depot has reported a $63 million dollar increase in stock holder´s equity. This information will be used by potential lenders or investors to determine if this company is worth the investment. In this case, it appears that The Home Depot would be a good credit risk, based on the latest
Liquidity Ratio Calculations: Current Ratio = Current Assets / Current Liabilities $147,800 / $90,283 = $1.637:1 Acid-Test Ratio = (Cash + Short-Term Investments + Net Receivables) / Current Liabilities $89,664 + $0 + $51,869 / $90,283 = $1.567:1 Receivables Turnover = Net Credit Sales / Average Receivables ($1,109,295 - $89,664) / [($51,869 + $81,557) / 2] = 15.283 *Average Collection Period = 365 / 15.283 = 23.883 Days When evaluating Huffman Trucking’s ability to pay off short-term debt and maturing obligations, it’s imperative to analyze the company’s liquidity. Utilizing the current ratio to analyze liquidity, which compares all current assets to current liabilities,
X2 = Number of EXCELLENT model produced during 8 hour shift. Max 42X1 + 87X2 ST X1 + X2 ≤ 480 3X1 + 6X2 ≤ 480 4X1 + 2X2 ≤ 480 X1 ≥ X2 3X1 + 6X2 ≤ 4X1 + 2X2 + 30 3X1 + 6X2 ≤ 4X1 + 2X2 – 30 X1, X2 ≥ 0 If the management limits the difference between Line 1 and Line 2 up to 30 minutes, it is recommended to produce about 96.667 (or 97) units of SUPER and 31.667 (or 32) units of EXCELLENT in order to maximize the total profit. Even it gives $65 reduction on initial profit, there will be more efficient balance on workload where time for Line 1 is fully utilized and on Line 2 there is only 30 minutes of unused time. (See attached print-out, table № 6) Question 6 Let X1 = Number of SUPER model produced during 8 hour shift. X2 = Number of EXCELLENT model produced during 8 hour shift.
As a sale manager you can retrieve the first profit by other mean, including decreasing cost in administration (redundancy). Admin cost = 25000 Drop profit = 1285.8787 New admin cost = 23714.1213 That means the administration cost will be reduce at about 5.14 %. Task6 Consider the effects of the following deviations upon the Master Budget: 1. A 2.5% increase in materials costs 2. A 6% increase in Electricity costs.
The elimination of short-term debt shows that Home Depot, Incorporated is not using such debt to meet short-term cash requirements. The cause of the elimination of short term debt may be caused by the improved cash position and the economy. Home Depot, Incorporated’s financial position and ratios look good. In fiscal year 2008, the long-term debt-to-equity ratio was 54.4% compared to fiscal year 2007’s 64.3%. In fiscal year 2008, the return on invested capital of continuing operations was 9.5% compared to fiscal year 2007’s 13.9%.