Working capital is defined as:
A. Total assets minus total liabilities.
B. Current assets less current liabilities.
C. Current assets divided by current liabilities.
D. Current liabilities divided by total liabilities.
Answer: B
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Answer the following statements true (T) or false (F)
1. Bad planning is usually a result of top managers' inability to gather enough information. 2. Planning is usually a straightjacket for new ideas, since it effectively blocks peripheral vision in favor of a predetermined course. 3. A sustainable competitive advantage is the ability of an organization to produce goods or services more effectively than its competitors and outperform them. 4. Ford's Sync in-dash communications platform, despite its high level of technology, has been unable to provide the company with a distinct competitive advantage.
Exhibit 20-3 On January 1, 2016, Quinn Company enters into a five-year sales-type lease with Andy Company. The lease requires Andy to make five annual payments at the beginning of the year, with the first payment due January 1, 2016. The lease includes a bargain purchase price of $10,000. Quinn requires a 10% rate of return. The cost to Quinn of the property is $100,000, and it has a fair value
of $150,000. Present value factors for a 10% interest rate are as follows: Present value of $1 for n = 1 0.909091 Present value of $1 for n = 5 0.620921 Present value of an ordinary annuity for n = 5 3.790787 Present value of an annuity due for n = 5 4.169865 ? Refer to Exhibit 20-3. What is the amount of the annual lease payment Quinn would require (round the answer to the nearest dollar)? A) $35,972 B) $39,570 C) $34,483 D) $37,931
If one automobile firm merges with another automobile firm, it is called a ________ merger.
A. conglomerate B. push down C. vertical D. horizontal
According to the text, how does tax avoidance differ from tax evasion?
a. Tax avoidance makes a company more competitive; tax avoidance damages a company’s profitability. b. Tax avoidance is always ethical; tax evasion is never ethical. c. Tax avoidance occurs domestically; tax evasion involves foreign entities. d. Tax avoidance is legal; tax evasion is illegal.