Computing and using the CM Ratio (LO6-3) Last month when Holiday Creations, Incorporated, sold 41,000 units, total sales were $164,000, total variable expenses were $134,480, and fixed expenses were $38,800. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating Income if it can increase sales volume by 450 units and total sales by $1,800? (Do not round intermediate calculations.) 1. Contribution margin ratio 2. Estimated change in net operating income %
Answers
1.The company's contribution margin (CM) ratio is approximately 18.00%. 2. The estimated change in net operating income is approximately -$4.37% (a decrease of 4.37%).
1.Contribution Margin (CM) Ratio:
The contribution margin ratio is calculated by dividing the contribution margin (sales minus variable expenses) by the total sales.
Contribution Margin = Total Sales - Total Variable Expenses
Contribution Margin Ratio = (Contribution Margin / Total Sales) * 100
Contribution Margin = $164,000 - $134,480 = $29,520
Contribution Margin Ratio = ($29,520 / $164,000) * 100 ≈ 18.00%
2. Estimated Change in Net Operating Income:
To calculate the estimated change in net operating income, we need to determine the increase in sales volume and the corresponding increase in total sales. Then, we can use the contribution margin ratio to calculate the change in net operating income.
Change in Net Operating Income = (Increase in Sales Volume * Contribution Margin Ratio) + (Increase in Total Sales * Contribution Margin Ratio)
Change in Net Operating Income = (450 * 18.00%) + ($1,800 * 18.00%)
Change in Net Operating Income = $81 + $324
Change in Net Operating Income = $405
The estimated change in the company's net operating income is $405.
In percentage terms, the estimated change in net operating income is calculated as (Change in Net Operating Income / Previous Net Operating Income) * 100.
Previous Net Operating Income = Total Sales - Total Variable Expenses - Fixed Expenses
Previous Net Operating Income = $164,000 - $134,480 - $38,800
Previous Net Operating Income = $164,000 - $173,280
Previous Net Operating Income = -$9,280
Estimated change in net operating income % = ($405 / -$9,280) * 100 ≈ -4.37%
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Related Questions
Brian manages his company's Google Search Ads campaign. He regularly reviews the optimization score to make his Google Search campaign as effective as possible. What is Brian's optimization score based upon?
Answers
Answer: Key aspects of his accounts, including statistics, settings, and industry trends.
Explanation:
The options to the question are:
a. Testing and reporting on the speed of Brian’s websites
b. Key aspects of his accounts, including statistics, settings, and industry trends.
c. Judging ad popularity on social media
d. Comparing Brian’s sales with ad serving data.
Optimization score simply runs from 0% to 100% and it is simply an estimate that'll tell am individual or firm how well their Google Ads account will perform. Having 100% means that the account will be able to perform at full potential.
Based on the information given in the question, Brian's optimization score is based upon Key aspects of his accounts, including statistics, settings, and industry trends.
There are several disadvantages for an organization that allows employees to work from home. One such disadvantage is
Answers
One of the disadvantage for an organization that allows employees to work from home is : It makes job performance appraisal more difficult for managers.
What is performance appraisal?A performance appraisal is a formal procedure used to survey a representative's adequacy and efficiency and fills both regulatory and formative needs.
Officially, it helps manage basic leadership with respect to business activities, work force arranging and preparing and advancement.
Hence, a disadvantage for an organization that allows employees to work from home is, It makes job performance appraisal more difficult for managers.
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a fitness electronics company is a first-mover in wearable fitness trackers. its innovative everyday activity and exercise bracelet has created a monopoly for its product. executives are apprehensive about the company's ability to maintain its competitive advantage because they know that rival companies have competent research and development skills and access to marketing, sales knowhow, and manufacturing capabilities. these rivals are considered:
Answers
The rivals that have competent research and development skills and access to marketing, sales know-how, and manufacturing capabilities will be considered as d. capable competitors.
In the field of business, capable competitors can be described as competitors that have the potential in them to do better and produce more outcomes.
In the scenario above, the fitness electronic company has an idea that its competitors in the market are capable competitors because they have competent research and development skills, access to marketing, and knowledge about sales and manufacturing. Hence, the fitness electronic company works hard to innovate everyday activities to have a competitive advantage as the first mover in wearable fitness trackers so that it can remain better than the capable competitors.
Although a part of your question is missing you might be referring to this question:
A fitness electronics company is a first-mover in wearable fitness trackers. its innovative everyday activity and exercise bracelet has created a monopoly for its product. executives are apprehensive about the company's ability to maintain its competitive advantage because they know that rival companies have competent research and development skills and access to marketing, sales know-how, and manufacturing capabilities. these rivals are considered:
a. complementary assets.
b. barriers to imitation.
c. first-movers.
d. capable competitors.
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what are the main activities in the production and maintenance phase of system development?
Answers
The planning, construction, testing, and general design of the way an conceptual model is constructed and maintained are all included in the process.
Which tasks are carried out during the maintenance phase?
The client keeps track of the program throughout this servicing phase to make sure it keeps up with the coding requirements. The client not only keeps track on performance evaluation, but also fixes bugs and updates program as needed.
What activities take place throughout the deployment and maintenance phases?
Goal of the Deployment Phase
the development group must adhere to certain steps in the deployment process to guarantee that the program and technologies deploy properly. The stages are as follows: product deployment, property transfer, distribution planning and processes, and final implementation phase.
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Banks do not hold a lot of their assets in the form of cash mainly because of:
a. regulation.
b. the fear of being robbed.
c. the opportunity cost of holding cash, cash does not earn interest.
d. it can encourage employee theft.
Answers
Banks do not hold a lot of their assets in the form of cash mainly because of the opportunity cost of holding cash, cash does not earn interest. The correct option is C.
Opportunity costs are the possible advantages that a person, investor, or company forgoes while deciding between two options. It is necessary to weigh the advantages and disadvantages of each choice offered in order to correctly assess opportunity costs.
The interest that could have been made if the cash had been used to buy bonds instead is the opportunity cost of keeping any money balance.
Therefore, due to the opportunity cost of holding cash and cash does not earn interest banks does nor prefer to hold a lot of their assets in the form of cash .
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The ______is a financial statement detailing a firm's assets, liabilities, and owners' equity.
A. balance sheet
B. statement of cash flows
C. manufacturing statement
D. income statement
Answers
The income statement is a financial statement detailing a firm's assets, liabilities, and owner's equity. Thus, option 'D' is the correct option.
What is an income statement?One of a company's financial accounts, an income statement or profit and loss account, lists the company's revenues and costs for a specific time period. It describes the process through which revenues are converted into net income or net profit.
A period of time is represented by an income statement (as does the cash flow statement). The balance sheet, on the other hand, only depicts one point in time. There are two ways to create an income statement. The Single Step Income Statement calculates the net income by adding up all receipts and deducting all costs.
In order to get at the net income, the Multi-Step income statement makes a number of calculations, beginning with the gross profit and moving on to operational expenditure estimation. then, after taking the gross profit into account, you get income from operations.
Therefore, option 'D' (income statement) is the correct option.
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Which best describes the types of indicators that the HDI measures?
O economic and industrial indicators
O infrastructure and social indicators
O social and economic indicators
O stability and social indicators
Answers
Answer:
O social and economic indicators
Explanation:
The Human Development Index (HDI) is a statistic used to measure a country's achievements in different aspects of its social and economic welfare. The united nations developed HDI to evaluate different dimensions of human development in a country. Dimensions of human development refer to people's health, educational level, and standards of living.
The HDI makes comparisons between countries by analyzing components such as average annual income and educational achievements.
Social and economic indicators is best describes the types of indicators that the HDI measures. The HDI analyzes factors such as average annual income and educational achievements to directly compare between countries.
What is HDI ?The Human Development Index is a metric that assesses a country's progress in various areas of social and economic development.
HDI was created by the United Nations to assess many aspects of a country's human development. Human development dimensions include people's health, educational attainment, and living conditions.
Thus, option C is correct.
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Which action would a government most likely take to reduce its
unemployment rate?
A. Use tax money to hire workers for government projects
B. Cut taxes on businesses that operate with very few workers
C. Increase taxes on businesses that operate outside the country
D. Cut off loans to businesses in order to reduce the money supply
SUBMIT
Answers
The unemployment rate is the unemployed divided by the sum of employed and unemployed, in order to reduce it the government can hire workers for a new project by using tax money.
What is the unemployment rate?It is the rate of unemployment calculated by the number of people unemployed to the total number of people employed and unemployed multiplied by 100.
In order to reduce it, the government can hire workers for a new project by using tax money
Therefore, option A can help in the reduction of the unemployment rate.
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After asking coworkers to review a project plan, you receive feedback. Your coworker thinks there is a better way to display the data in the business report.You should add a
title
reference
abstract
table
Answers
Answer:
table
Explanation:
are independently owned and operated, not dominant in their field of operation, and meet certain standards of size in regard to number of employees or average annual sales.
Answers
How would price fixing and collusion help producers
Answers
Answer:
Price fixing provides firms with the ability to deter away from market competition.
Explanation:
It is easier and more profitable for producers to collude and set prices together rather than compete in a competitive environment. It puts less pressure on firms to keep prices competitive and victimizes customers.
Price fixing and collusion can help producers by allowing them to manipulate market conditions and maintain artificially high prices, maximizing their profits.
Price fixing refers to an illegal practice where competing companies within an industry conspire to set prices at a certain level, eliminating competition and artificially inflating prices to maximize profits.
Collusion is a cooperative agreement between competing companies to restrict competition and gain an unfair advantage. It involves secret agreements to coordinate business practices, such as fixing prices, sharing sensitive information, or dividing markets, to manipulate the market in their favor.
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Most probably, your complete question is this:
How would price fixing and collusion help producers?
Exercise 3-20A Record transactions and prepare adjusting entries, adjusted trial balance, financial statements, and closing entries (LO3-3, 3-4, 3-5, 3-6, 3-7) (GL)
On January 1, 2021, Red Flash Photography had the following balances: Cash, $20,000; Supplies, $8,800; Land, $68,000; Deferred Revenue, $5,800; Common Stock $58,000; and Retained Earnings, $33,000. During 2021, the company had the following transactions:
1. February 15 Issue additional shares of common stock, $28,000.
2. May 20 Provide services to customers for cash, $43,000, and on account, $38,000.
3. August 31 Pay salaries to employees for work in 2021, $31,000.
4. October 1 Purchase rental space for one year, $20,000.
5. November 17 Purchase supplies on account, $30,000.
6. December 30 Pay dividends, $2,800.
The following information is available on December 31, 2021:
Employees are owed an additional $4,800 in salaries.
Three months of the rental space has expired.
Supplies of $5,800 remain on hand.
All of the services associated with the beginning deferred revenue have been performed.
Requirement
General Journal
General Ledger
Trial Balance
Income Statement
Statement of SE
Balance Sheet
1. Record each of the transactions listed above in the 'General Journal' tab. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.
2. Record the adjusting entries in the 'General Journal' tab.
3. Review the adjusted 'Trial Balance' as of December 31, 2021.
4. Prepare an income statement for the year ended December 31, 2021, in the 'Income Statement' tab.
5. Prepare the statement of Stockholder's Equity for the year ended December 31, 2021, in the 'Income Statement' tab.
6. Prepare a classified balance sheet as of December 31, 2021 in the 'Balance Sheet' tab.
7. Record the closing entries in the 'General Journal' tab.
Answers
Answer:
Red Flash Photography
1. General Journal
January 1, 2021:
Debit Cash, $20,000
Supplies, $8,800
Land, $68,000
Credit: Deferred Revenue, $5,800
Common Stock $58,000
Retained Earnings, $33,000
To record opening balances.
Feb. 15 Debit Cash $28,000
Credit Common Stock $28,000
To record additional shares issued.
May 20 Debit Cash, $43,000,
Debit Accounts receivable $38,000
Credit Service revenue $81,000
To record provision of services for cash and on account.
August 31 Debit Salaries Expense $31,000
Credit Cash $31,000
To record payment of salaries.
October 1 Debit Prepaid Rent $20,000
Credit Cash $20,000
To record prepayment of rent for one year.
November 17 Debit Supplies $30,000
Credit Accounts payable $30,000
To record the purchase of supplies on account.
December 30 Debit Dividends $2,800
Credit Cash $2,800
To record payment of cash dividends.
Analysis of Adjustments at December 31, 2021:
1. Debit Salaries Expense $4,800
Credit Salaries Payable $4,800
To accrue salaries.
2. Debit Rent Expense $5,000
Credit Prepaid Rent $5,000
To record rent expense for the year.
3. Debit Supplies Expense $33,800
Credit Supplies $33,800
To record supplies expense.
4. Debit Deferred Revenue $5,800
Credit Service Revenue $5,800
To record services performed.
3. Adjusted Trial Balance as of December 31, 2021
Account Titles Debit Credit
Cash $37,200
Accounts receivable 38,000
Supplies 5,000
Prepaid Rent 15,000
Land 68,000
Accounts Payable $30,000
Salaries Payable 4,800
Common Stock 86,000
Retained Earnings 33,000
Dividends 2,800
Service Revenue 86,800
Salaries Expense 35,800
Rent Expense 5,000
Supplies Expense 33,800
Totals $240,600 $240,600
4. Income Statement for the year ended December 31, 2021
Service Revenue $86,800
Salaries Expense 35,800
Rent Expense 5,000
Supplies Expense 33,800 $74,600
Net Income $12,200
5. Statement of Stockholders Equity for the year ended December 31, 2021
Retained Earnings $33,000
Net Income 12,200
Dividends (2,800)
Retained earnings, Dec. 31, 2021 $42,400
Common stock 86,000
Total equity $128,400
6. Classified Balance Sheet as of December 31, 2021
Assets
Current Assets:
Cash $37,200
Accounts receivable 38,000
Supplies 5,000
Prepaid Rent 15,000 $95,200
Long-term assets:
Land $68,000
Total assets $163,200
Liabilities and Equity:
Accounts Payable $30,000
Salaries Payable 4,800
Total liabilities $34,800
Equity:
Common Stock 86,000
Retained Earnings 42,400
Total equity $128,400
Total liabilities and equity $163,200
7. General Journal
Debit Service Revenue $86,800
Credit Income Summary $86,800
To close revenue income summary.
Debit Income Summary $74,600
Credit Salaries Expense $35,800
Credit Rent Expense $5,000
Credit Supplies Expense $33,800
To close expenses to income summary
Debit Income Summary $12,200
Credit Retained Earnings $12,200
To close income summary to retained earnings.
Debit Retained Earnings $2,800
Credit Dividends $2,800
To close dividends to retained earnings.
Explanation:
a) Data and Analysis:
January 1, 2021 balances:
Cash, $20,000
Supplies, $8,800
Land, $68,000
Deferred Revenue, $5,800
Common Stock $58,000
Retained Earnings, $33,000
Transactions:
Feb. 15 Cash $28,000 Common Stock $28,000
May 20 Cash, $43,000, Accounts receivable $38,000 Service revenue $81,000
August 31 Salaries Expense $31,000 Cash $31,000
October 1 Prepaid Rent $20,000 Cash $20,000
November 17 Supplies $30,000 Accounts payable $30,000
December 30 Dividends $2,800 Cash $2,800
Analysis of Adjustments at December 31, 2021:
1. Salaries Expense $4,800 Salaries Payable $4,800
2. Rent Expense $5,000 Prepaid Rent $5,000
3. Supplies Expense $33,800 Supplies $33,800
4. Deferred Revenue $5,800 Service Revenue $5,800
Please help. Atleast the top 2
Answers
Answer:
Number 1 is Pure Market. Number two is socialist, I'm pretty sure.
Explanation:
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Explain the concept of inter cropping in brief . (5) note: it should be of 5 marks
Answers
Answer:
Inter cropping is a type of multi cropping where the farmer cultivates two or more crops in a field simultaneously. Inter croping is a sustainable practice that can improve resource-use efficiency, such as nutrients and water, allowing low input agricultural practices.
Explanation:
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What phrase describes businesses who develop a positive relationship to
society
Answers
Suppose an unregulated natural monopoly becomes regulated using marginal cost pricing. As a result, the firm's profits would Group of answer choices increase substantially. decrease substantially, but remain positive. be brought down to zero. become negative.
Answers
Answer:
you queastioncove its better
Explanation:
At a local grocery store, they sell a Visa card that has a prepaid amount on it. People can use this card anywhere, but it cannot be used for more than its prepaid value. Which type of card is this?
A.
a debit card
B.
a smart card
C.
a stored value card
D.
a retail credit card
Answers
The type of the card is a Retail Credit card. Hence the option (D) is the correct one.
What is the function of retail credit cards work?For retail credit cards, an image You can potentially obtain benefits at some retail establishments if you have a retail store credit card.
Decide if you want a card that restricts the retailers with which you may earn rewards or one that enables you to earn rewards for regular purchases. Benefits could consist of privileged access to funding, exclusive deals, discounts, and awards.
For instance, paying in whole for a motorcycle costing $10,000 would be excessive for a buyer.
Consumer will receive a $10,000 loan from retail credit institutions, which will be repaid with interest over a period of time in the form of monthly installments.
Hence the correct option is (D).
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Which are affected by the factors of production? Check all that apply.
A.) the demand of the item
B.) the availability of the item
C.) the cost of the item
D,) the quality of the item
E.) the popularity of the item
Answers
Answer:
A
C
D
Explanation:
without demand no reason to product it
The cost of a item also greatly affects it
and how well they can make it without being too expensive
dazzle fashion is a clothing retailer. during august, the company completed a series of transactions. for each of the following items, give an example of a transaction that has the described effect on dazzle's accounting equation.
Answers
During August, Dazzle Fashion completed a series of transactions. Here is an example of a transaction for each item that has the described effect on Dazzle's accounting equation:
1. Purchase of Inventory: Dazzle Fashion purchased $10,000 worth of inventory on credit from a supplier. This transaction increases the assets (inventory) and liabilities (accounts payable) on the accounting equation.
2. Cash Sale: Dazzle Fashion made a cash sale of $5,000 to a customer. This transaction increases the assets (cash) and equity (retained earnings or revenue) on the accounting equation.
3. Borrowing from Bank: Dazzle Fashion borrowed $20,000 from a bank. This transaction increases the assets (cash) and liabilities (bank loan) on the accounting equation.
4. Payment of Expenses: Dazzle Fashion paid $2,000 for rent and utilities. This transaction decreases the assets (cash) and equity (retained earnings or expenses) on the accounting equation.
5. Equity Investment: The owner of Dazzle Fashion invested $15,000 of their personal funds into the business. This transaction increases the assets (cash) and equity (owner's capital) on the accounting equation.
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24. The company is considering two independent projects with an initial cost of $18,000 each. The cash inflows of Project A are $3,000, $7,000, and $10,000 for Years 1 to 3, respectively. The cash inflows for Project B are $3,000, $7,000, and $15,000 for Years 1 to 3, respectively. The required return is 12 percent and the cutoff discounted payback period is 3 years. Based on discounted payback, which project(s), if either, should be accepted
Answers
Answer: Project B
Explanation:
To find out the project that should be accepted based on the discount rate and the cut-off discounted payback periods, find the present value of the three year cashflows of each project. If it is larger than the initial investment then it should be accepted:
Project A
= 3,000 / (1 + 12%) + 7,000 / (1 + 10%)² + 10,000 / (1 + 12%)³
= $15,376.73
Project A's present value is less than the initial investment of $18,000 so it should not be chosen.
Project B
= 3,000 / (1 + 12%) + 7,000 / (1 + 10%)² + 15,000 / (1 + 12%)³
= $18,935.63
Project B's present value is larger than the initial investment of $18,000 so it should be chosen.
Suppose 2 athletes sign 10-year contracts for $80 million. In one case, we're told that the $80 million will be paid in 10 equal instalments. In the other case, we're told that the $80 million will be paid in 10 instalments, but the instalments will increase by 5% per year. Who got a better deal and why?
Answers
Answer:
player 2 is signing a better contract
Explanation:
the present value of an annuity (player 1) = annual payment x annuity factor
assuming that the interest rate is 10%
present value = $10 million x 6.1446 (PV annuity factor, 10%, 10 periods) = $61.446 million
player 2's contract
the present value of a growing annuity = [payment / (i - g)] x {1 - [(1 + g) / (1 + i)]ⁿ} = [$10 / (10% - 5%)] x {1 - [(1 + 5%) / (1 + 10%)]¹⁰} = $200 x 0.372 = $74.398 million
Suppose the economy is initially in long-run equilibrium. The Fed enacts a policy to . In the short-run, this expansionary monetary policy will cause:
Answers
Answer:
A shift from AD 1 to AD 2 and a movement to point B, with a higher price level and higher output.
Explanation:
The above is what the expansionary monetary policy of the Federal government will cause in a situation where a policy was introduced on a short-run.
What type of product/service management did Ray do?
Answers
The product/service management that Ray do was that He had made his design department to be able to design a furniture piece.
What was Ray doing?Product service management (PSM) is known to be a kind of a marketing function that is said to be based on making better a product or service due to market changes.
Note that involves an ongoing analysis of their features so that one can be able to improve as well as modify the items that are needed.
Ray in the above is carrying out marketing information management by gathering information from customers to use so that he can set up the theater system seats. The activities is one that entail pricing and the use of the channel management function.
Therefore, The product/service management that Ray do was that He had made his design department to be able to design a furniture piece.
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A customer's confirmation of a municipal securities transaction must include A) the highest potential yield the customer may receive and the amount of markup or markdown in a principal transaction. B) the lowest potential yield the customer may receive and information regarding the catastrophic call provision. C) the highest potential yield the customer may receive and information regarding the catastrophic call provision. D) the lowest potential yield the customer may receive and whether the bond is taxable or subject to the alternative minimum tax.
Answers
Answer:
D) the lowest potential yield the customer may receive and whether the bond is taxable or subject to the alternative minimum tax.
Explanation:
All municipal securities are exempted from registration and filing requirements of the Securities and Exchange Commission (SEC).
However, a customer's confirmation of a municipal securities transaction must include the lowest potential yield the customer may receive and whether the bond is taxable or subject to the alternative minimum tax.
You work as the sales manager for a company that sells office supplies to businesses of all sizes.Because the profit margins are razor-thin,you need to ensure that you are getting the very best prices on paper,pencils,pens,Post-It Notes,and other office supplies from the manufacturers.When reviewing the quarterly profit statement,you realize that your costs are higher than they should be,and you trace the higher costs back to an employee who has been lax about getting competitive bids to ensure the lowest prices.When you conduct your research to determine the reason for the higher costs,and take action to bring those costs back down,in which of the key management processes are you taking part?
A) planning
B) organizing
C) leading
D) controlling
E) mentoring
Answers
Answer:
E) Mentoring
Explanation:
Since they are looking into something.
Dr. Peabody recorded $6,820 in services provided to clients who make monthly payments. Which of the following statements is correct?
A. The dental revenues account is debited $6,820; accounts receivable is credited $6,820.
B. Accounts receivable is credited $6,820; the dental revenues account is credited $6,820.
C. Accounts receivable is debited $6,820; the dental revenues account is debited $6,820.
D. Accounts receivable is debited $6,820; the dental revenues account is credited $6,820.
Answers
Answer:
D. Accounts receivable is debited $6,820; the dental revenues account is credited $6,820.
Explanation:
The two accounts that are affected here are accounts receivables ( Assets) and the revenue account ( affects capital). The accounts receivable will increase as payment is expected at the end month. Since receivable are assets, an increase in receives is recorded as a debit of the account receivable account. $ 6,820 will be debited on the accounts receivables.
The services rendered increases the revenue to Dr. Peabody. Revenue is considered a capital account because it increases the owner's equity. An increase in a capital account is credited. Dr. Peabody will credit the dental revenue account with $6,820.
Inflation is assumed to be a temporary problem that does not affect financial decisions.
Answers
While it is true that inflation is often temporary, it can still have a significant impact on financial decisions.
What is financial?Financial refers to the management of money, including its investment, lending, budgeting, and saving. It is based on the principles of economics, which studies how people, businesses, and governments make decisions about money. Financial activities include the buying and selling of stocks, bonds, mutual funds, and other investments, borrowing money from lenders such as banks, and managing personal budgets. Financial planning and advice are important for individuals and businesses to make wise decisions about their finances and ensure long-term financial stability.
Inflation can affect the cost of goods and services, for example, and can reduce the purchasing power of a currency. It can also cause interest rates to rise, which affects the cost of borrowing. As such, it is important to consider the potential impact of inflation when making financial decisions.
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a project’s irr will ______if the project’s cash inflows increase, and everything else is unaffected.
stay the same
decrease
increase
Answers
A project’s Internal Rate of Return (IRR) will increase if the project’s cash inflows increase, and everything else is unaffected.
The IRR is a financial measure utilized to assess the profitability of an investment venture. It represents the discount rate at which the Net Present Value (NPV) of a project becomes zero. To put it differently, it represents the interest rate at which the current value of money coming in is equal to the current value of money going out.
If a project's cash inflows increase, while everything else remains unaffected (i.e., the cash outflows and timing of cash flows remain the same), the IRR of the project is expected to increase. This is because the increased cash inflows will result in a higher NPV, making the project more profitable and hence increasing the IRR.
It's important to note that IRR is not always the most reliable metric for evaluating investment projects, as it has some limitations and assumptions. It should be used in conjunction with other financial metrics and thorough analysis of the project's cash flows, risks, and overall financial feasibility. Nevertheless, in the given scenario, if a project's cash inflows increase and everything else remains unchanged, the IRR of the project is expected to increase as well.
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What must people taking out a mortgage agree to? Check all that apply. A loan amount plans for repairs an interest rate renovation ideas payment terms.
Answers
The things which people who are taking out a mortgage must agree to are:
A loan amount, Interest ratePayment termsAccording to the given question, we are asked to state the things which people who are taking out a mortgage must agree to and why they are essential for obtaining this loan.
As a result of this, we can see that when a person is taking out a mortgage loan, then he is expected to agee on the loan amount, the interest rate and the payment terms.
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Answer:
A loan amount,
Interest rate
Payment terms
Explanation:
Analyse why the social benefit of education exceed the private benefit
Answers
Answer:
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Explanation:
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