Which of these is not a benefit to using prototype stores?
a. The stores use custom buildings for each city and town.
b. The stores enable a retailer to take advantage of quantity discounts in purchases.
c. The stores ease the employee interchange among branches.
d. These stores help portray a uniform image among franchise and chain store units.
a
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In determining the dollar amount to use for operating assets in the return on investment (ROI) calculation, companies will generally use either net book value or gross cost of the assets. Which of the following is not an argument for the use of net book value rather than gross cost?
A. It eliminates the depreciation method as a factor in ROI calculations. B. It will result in a decrease of ROI each year. C. It is consistent with how assets are reported on the balance sheet. D. It encourages the replacement of old, worn-out equipment.
The static budget, at the beginning of the month, for Wadsworth Company follows:
Static budget: Sales volume: 2000 units; Sales price: $50.00 per unit Variable costs: $14.00 per unit; Fixed costs: $25,100 per month Operating income: $46,900 Actual results, at the end of the month, follows: Actual results: Sales volume: 1900 units; Sales price: $58.00 per unit Variable costs: $16.5 per unit; Fixed costs: $34,000 per month Operating income: $44,850 Calculate the flexible budget variance for operating income. A) $3600 U B) $3600 F C) $1550 F D) $15,200 F
The return on assets and the asset turnover ratios are used to analyze
A) leverage. B) long-term solvency. C) profitability. D) liquidity.
Trade receivables occur when two companies trade or exchange notes receivables
Indicate whether the statement is true or false