Vinson Manufacturing requires all capital investment projects to have a payback period of 5 years or less. Vinson is currently considering an equipment purchase that has an initial cost of $90,000. The equipment is expected to have a ten year life and a salvage value of $5,000. Assuming cash flows are equal, what does the annual cash flow generated by the equipment need to be in order to meet the
payback period requirements?
A) $18,000
B) $19,000
C) $17,000
D) $9,000
A
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Answer the following statements true (T) or false (F)
1.Concerning U.S. tariff policy, the offshore assembly provision (OAP) provides unfavorable treatment to products assembled abroad from U.S. made components. 2.Tariff avoidance is the legal utilization of the tariff system to one's own advantage in order to reduce the amount of tariff that is payable by means that are within the law. 3.Tariff evasion occurs when individuals or firms escape tariffs by illegal means such as smuggling imported goods into a country. 4.A foreign-trade zone (FTZ) is an area within the United States where business can operate without the responsibility of paying customs duties on imported products or materials for as long as they remain within this area and do not enter the U.S. marketplace. 5.Empirical studies show that virtually all U.S. import tariffs are "progressive" in that they disproportionately negatively impact upper income groups rather than lower income groups.
Critics point to which of the following factors when they accuse marketing of harming consumers through high prices?
A) quotas B) nontrade tariffs C) excessive markups D) government taxes E) changes in currency values
Firms with tangible long-term assets and less predictable cash flows, such as auto manufacturers and steel companies, whose sales vary with changes in economic conditions, tend to use
a. a more nearly equal mix of long-term debt and shareholders' equity financing. b. a greater amount of long-term debt [80%] than shareholders' equity financing [20%]. c. a smaller amount of long-term debt [20%] than shareholders' equity financing [80%]. d. a greater amount of long-term debt [80%] than assets [20%]. e. a greater amount of shareholders' equity [80%] than assets [20%].
Which of the following is not true regarding SFAS 158?
a. It brought the overfunded and underfunded status of defined benefit plan to the footnotes of the balance sheet. b. It required certain costs be charged to other comprehensive income. c. It requires a credit to other pension income for amortized prior service costs. d. An overfunded or underfunded amount for OPEBs must be shown as an asset or liability on the balance sheet.