The cost of capital can be generally defined as the rate of return expected by anyone who provides capital to a company (e.g., an investor or a bank). How can a financial statement audit reduce the cost of capital for a company?
What will be an ideal response?
An audit adds credibility to a company's financial statements. The audit reduces information risk, or the risk that information circulated by a company's management will be false or misleading. With reduced risk of poor information, anyone providing capital will have better information on which to base their capital decisions. This will lead to a lower cost to the company for obtaining capital.
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Tranquility Company manufactures ceiling fans and uses an activity-based costing system. Each ceiling fan has 20 separate parts. The direct materials cost is $75 and each ceiling fan requires 2.00 hours of machine time to manufacture. There is no direct labor. Additional information is as follows:
What is the total manufacturing cost per ceiling fan? (Round any intermediate calculations and your final answer to the nearest cent.)
A) $86.60
B) $88.20
C) $95.20
D) $98.60
Answer the following statements true (T) or false (F)
SFAS No. 112 requires that post-employment costs be handled on an actuarial basis.
Credits are always on the ____________________ side of a T-account
Fill in the blank(s) with correct word
You should consider using a ________ approach when both groups are willing to invest time and effort to reach a resolution that maximizes everyone's outcome.
A. compromising B. avoiding C. dominating D. problem-solving