Which of the following is true of risk?
A) Risk and return are inversely proportionate to each other.
B) Higher the risk associated with a security the lower is its return.
C) Risk is a measure of the uncertainty surrounding the return that an investment will earn.
D) Riskier investments tend to have lower returns as compared to T-bills which are risk free.
C
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Calculate the average number of days that inventory was held by Kelley Company during 2018. (Assume 365 days in a year. Round your intermediate calculations and final answer to two decimal places.)
Kelley Company provided the following account balances for 2018:
A) 194.15 days
B) 98.38 days
C) 95.55 days
D) 96.82 days
Indicate whether each of the following statements about accounting information is true or false. ________ a) Financial accounting is primarily intended to satisfy the information needs of internal stakeholders.________ b) Managerial accounting information includes financial and nonfinancial information.________ c) The accounting information intended to satisfy the needs of a company's employees is managerial accounting information.________ d) GAAP requires that companies adhere to financial accounting standards.________ e) Managerial accounting information is usually less detailed than financial accounting information.
What will be an ideal response?
Sara Sou is "bearish" and is of the opinion that the price of Muggle Company stock will drop within a few weeks; Stefan Gordon is "bullish" and thinks the price will go up. Sara sells her 1,000 shares of Muggle Co stock to Stefan for $100 a share. If, within a few weeks, the price of a share of Muggle Co stock
a. does not change, both Sara and Stefan can legally rescind because of their mutual mistake as to the value of the stock. b. drops sharply to $1, Stefan alone can rescind because of Sara's fraud. c. rises sharply to $200 a share, Stefan can rescind because of his unilateral mistake d. None of the above is correct. Different expectations of the future value of a good (e.g., the Muggle Co. stock) do not affect the validity of a contract for its sale.
Randolph is a 30 percent partner in the RD Partnership. On January 1, RD distributes $26,000 cash to Randolph in complete liquidation of his interest. RD has only capital assets and no liabilities at the date of the distribution. Randolph's basis in his RD Partnership interest is $37,000. What is the amount and character of Randolph's gain or loss on the distribution?
A. $11,000 capital gain. B. $11,000 capital loss. C. $0 gain or loss. D. $11,000 ordinary income.