Benchmarking requires the comparison of your firm to other organizations; it is not appropriate to benchmark by comparing one of your divisions to another of your divisions
Indicate whether the statement is true or false
FALSE
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All of the following statements accurately describe the debt ratio except.
A. A relatively low ratio signifies lower risk. B. It is of use to both internal and external users of accounting information. C. Higher financial leverage means greater risk. D. The ratio is computed by dividing total equity by total liabilities. E. The ratio is computed by dividing total liabilities by total assets.
A ________ income statement format shows net sales and reports subtotals for various types of items such as gross profit, income for operations, and net income.
Fill in the blank(s) with the appropriate word(s).
A substituted contract substitutes a new party for one of the original contracting parties
Indicate whether the statement is true or false
Fire Corp. is considering the purchase of a new piece of equipment. The equipment costs $50,000 and will have a salvage value of $5,000 after nine years. Using the new piece of equipment will increase Fire's annual cash flows by $6,000.a. What is the payback period for the new piece of equipment?b. Suppose that the increase in cash flows was $10,000 in the first year, then decreased by $1,000 each year over the life of the equipment. What is the payback period for the equipment?
What will be an ideal response?