With this said, my final recommendation is that Custom Snowboards first try to improve their costing methods and reduce expenses before moving forward with the expansion. By choosing the no long term debt as the optimal capital structure, you can clearly see that it gives the greatest earnings per common stock share at 0.064 compared to the other options of -0.037, 0.054, and 0.015. There is also zero interest on the no long term debt compared to the other options. All options have a total debt of $1,000,000, so no difference there, as well as EBIT, which is $60,018 for all options. And also, net income is the best for the no long term debt option at $45,089, while the other options fall at -7,382, 29,901, and 4,589.
In addition, there will be the opportunity cost of not having cash available for more useful requirements i.e. supplier discounts, interest income. Therefore, Willow Company needs to hold optimum levels of inventory and increase its sales in order to improve its inventory turnover and cash
One reason for the high divorce rate in the contemporary UK is because of the changes in the law. For example the main changes took place in 1969 where the Divorce reform act was introduced (Came into effect in 1971), this allowed couples to divorce without having to prove that their relationship has broken down e.g. by showing that they are now living apart. This made it easier for couples to divorce without feeling ashamed because the court did not require a ‘guilty’ partner to be identified. From here in 1984 the law allowed couples to petition for a divorce after one year of marriage instead of three, meaning that couples no longer had to endure an empty shell marriage over a long period of time.
Going into third quarter planning, I looked at the pro forma cash flow and income statements to determine that my cash balances would not require any emergency borrowing while allowing me to expand production levels to meet or exceed my forecasted sales. I decided to be somewhat conservative in setting production capacity to try to avoid excessive inventory holding costs. As it turned out I significantly underestimated demand in Q3 and Q4 so that I sold out my
This is because as price falls consumers can afford more goods as their real incomes increase and they feel richer. Real income is the bundle of goods and services that an individual can purchase. As we move from A1 to A2 utility increases from U1 to U2 because we move to a higher indifference curve so now the individual can now consume a better bundle of goods. This backs up the non satiation assumption of consumption which states more is better thus when we increase consumption total utility increase. The four axioms of consumption: Transitivity, Non-satiation, Marginal rate of substitution in consumption and Completeness must be met in order to be able to draw
Point #2: Tariffs protect American jobs and wages. (Points: 13) I find this position to be valid. Protective tariffs are designed to raise the retail price of imported products so that domestic goods are more competitively priced (Nickels, McHugh & McHugh, 2008, p. 76). Therefore, if products are competitively priced then the consumer will be more likely to purchase domestic products instead of imports. Since consumers will be more likely to support American vendors, this will keep the American businesses running and not force them to cut costs to compete with imports.
However, when Canada increased the price tariffs, the price of the t-shirt would increase once it entered the other country. So now, the retail price of the Canadian shirt would be, for example, eighteen dollars. Now the priced has increased, no one will buy the t-shirt from Canada, Mainly because the American one is cheaper. [6] The U.S.A may have also even cut the trading and/or importing with Canada but they have learned their lesson by not including such high tariffs when trading with other countries from Middle East and
Since the Walton Work Wear line is in the production stage, its accumulated development costs should be capitalized. The Carroway Cool Top has not started it commercial production which would allow the development costs not to be amortized yet. Also interest costs on loans to generate financing for the R&D activates of a product can be capitalized rather than expensed. The capitalization of interest would allow CCL to reduce taxable income in the future when it is more profitable. I would recommend that CCL make the above changes immediately so that the financail statements are not incorrect.
Borrowers who did not meet their standards were forced to pay higher interest rates to subprime lenders, but the companies essentially persuaded investors to treat a vast number American families as if they were interchangeable. They took messy bunches of loans, with risks as variable as snowflakes, and created securities of uniform quality, easy to buy and sell. The result was one of the most popular investment products ever created. And in its absence, experts on housing finance say that fewer borrowers would qualify for the best interest
(Andrews). These are the choice we have unless Americans purchasing habits change. Globalization has an enormous effect on manufacturing in relation to jobs. When companies here in America send their products to other countries that have much cheaper labor cost, we benefit with low prices, but what about the jobs that are lost here in the United States? Just as an example, when a clothing designer creates a fall collection, they employ numerous seamstresses and pattern makers to translate their drawings into clothing.