Holiday DeCor Company is insured by a commercial general liability policy (CGL). Holiday DeCor rented a storage facility for one month to store some excess inventory
While visiting the storage facility, a Holiday DeCor employee discarded a cigarette. The resulting fire severely damaged the storage facility. Which statement is true regarding coverage of this damage under the CGL?
A) There is no coverage as the damage occurred at a rented premises.
B) There is no coverage because property damage liability is excluded.
C) The damage is covered under the fire legal liability coverage.
D) There is no coverage because an employee of Holiday DeCor caused the loss.
Answer: C
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Anderson Corporation is considering an investment opportunity with the following expected net cash inflows: Year 1, $250,000; Year 2, $350,000; Year 3, $395,000. At the end of Year 3, the residual value of the investment would be $50,000. The company uses a discount rate of 12%, and the initial investment is $400,000. Calculate the NPV of the investment.
Which of the following is true of the acid-test ratio?
a) It measures a company's ability to meet its short-term obligations with cash and cash equivalents b) It indicates how much cash could be realized by selling the inventory c) It measures a company's ability to pay its current liabilities d) It measures the ability of the company to earn net income
Rosewood Company made a loan of $8600 to one of the company's employees on April 1, Year 1. The one-year note carried a 6% rate of interest. What is the amount of interest revenue that Rosewood would report in Year 1 and Year 2, respectively?
A. $0 in Year 1 and $516 in Year 2 B. $129 in Year 1 and $387 in Year 2 C. $387 in Year 1 and $129 in Year 2 D. $516 in Year 1 and $0 in Year 2
What steps could an entrepreneur take to improve their chances of success when forming a strategic alliance?
What will be an ideal response?