It is least likely that a production budget revision would cause a revision in the
a. capital budget.
b. cash budget.
c. purchases budget.
d. pro forma balance sheet.
A
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Gerhardt is the president of the Pacer Bicycle Company. He also serves as a director of the Flexible Tire Company. It occurs to Gerhardt that both companies could benefit from a contract in which Flexible agrees to supply Pacer with tires for its bicycles. If Gerhardt wishes to negotiate a contract between Pacer and Flexible, which of the following is correct?
a. The contract will be void as a conflict of interest. b. Under the RMBCA, the contract is permitted if it is fair and reasonable to both corporations, or Gerhardt fully discloses all information relating to the transaction and the contract is approved by either the board of disinterested directors or the shareholders. c. The contract is a clear conflict of interest and will be avoidable by either company even with disclosure. d. Both the contract will be void as a conflict of interest and the contract is a clear conflict of interest and will be avoidable by either company even with disclosure.
For different people, the same product might be a convenience product, a shopping product, or a specialty product.
Answer the following statement true (T) or false (F)
Marvel Bank & Trust operates in a very competitive marketplace, using a traditional labor-hour-based system to determine the cost of processing its mortgage loans. Recently, the firm explored a switch to activity-based costing to determine the wisdom of its previous ways. The following information is available:ActivityCostDriveDriver UnitsApplication processing $900,000 Applications4,000Loan underwriting 800,000 Underwriting hours16,000Loan closure 880,000 Legal hours8,000Total$2,580,000??Two loan applications, among many others, were originated and closed during the year. No. 7439 consumed 3.5 hours in loan underwriting and 1.5 hours in loan closure, for a total of 5.0 hours. No. 7809 also required 5.0 hours of time, subdivided as follows: 2.0 hours in loan
underwriting and 3.0 hours in loan closure.Required: A. Use an activity-based-costing system and determine the cost of processing, underwriting, and closing the two loan applications.B. Determine the cost of processing the two loans if Marvel uses the traditional labor-hour-based system. Conversations with management found that, on average, each application took nine labor hours of processing time, excluding underwriting and closure.C. Is Marvel making a mistake by continuing to use a traditional system that is based on an average labor cost per hour? Why? What will be an ideal response?
List and describe three strategies for investing in bonds
What will be an ideal response?