Which of the following statements is true if the income statement credit column exceeds the income statement debit column on a worksheet?
A) The company made a net profit.
B) The company incurred a net loss.
C) The retained earnings account decreased during the period.
D) An error was made.
A
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Which of the following statements is not true?
a. Routine payroll processing begins with the submission of time cards. b. Payroll clerks must verify the hours reported on the time cards. c. Payroll reconciles personnel action forms with time cards and prepares paychecks. d. Cash disbursements signs paychecks and forwards them to the paymaster for distribution.
A company has $817,000 in bonds payable with an unamortized premium of $20,000 . If one-fourth of the bonds are converted to common stock, the entry that would record the conversion is:
a. Bonds Payable 204,250 Common Stock 204,250 b. Bonds Payable 224,250 Common Stock 224,250 c. Common Stock 199,250 Bonds Payable 199,250 d. Bonds Payable 204,250 Unamortized Bond Premium 5,000 Common Stock 209,250
The Rule in Shelley's Case is applied in all states
Indicate whether the statement is true or false
Julia Saunders is your boss and the treasurer of Foster Carter Enterprises (FCE). She asked you to help her estimate the intrinsic value of the company's stock. FCE just paid a dividend of $1.00, and the stock now sells for $15.00 per share. Julia asked a number of security analysts what they believe FCE's future dividends will be, based on their analysis of the company. The consensus is that the dividend will be increased by 10% during Years 1 to 3, and it will be increased at a rate of 5% per year in Year 4 and thereafter. Julia asked you to use that information to estimate the required rate of return on the stock, rs, and she provided you with the following template for use in the analysis: src="https://sciemce.com/media/4/ppg__cognero__Chapter_07_Corporate_Valuation_and_Stock_Valuation__media__023af613-fc81-43d8-83ad-05e66f7d6d99.PNG" style="vertical-align: 0px;" width="573px" height="161px" />Julia told you that the growth rates in the template were just put in as a trial, and that you must replace them with the analysts' forecasted rates to get the correct forecasted dividends and then the estimated TV. She also notes that the estimated value for rs, at the top of the template, is also just a guess, and you must replace it with a value that will cause the Calculated Price shown at the bottom to equal the Actual Market Price. She suggests that, after you have put in the correct dividends, you can manually calculate the price, using a series of guesses as to the Estimated rs. The value of rs that causes the calculated price to equal the actual price is the correct one. She notes, though, that this trial-and-error process would be quite tedious, and that the correct rs could be found much faster with a simple Excel model, especially if you use Goal Seek. What is the value of rs?
A. 11.84%
B. 12.21%
C. 12.58%
D. 12.97%
E. 13.36%