Consider the formula Value=PV(FCF,Wacc). Describe how bankrupt costs are included in the expression

Q: Which of the following is NOT one of the ratios in Profitability group? Select one: a. Quick ratio…

A: Profitability ratios are those ratios which helps in measuring and determining the profitability of…

Q: Which of the following ratios is always the lowest? a. The net profit margin b. The gross profit…

A: Profit margin is a financial metric that measures profitability of a business or a specific product…

Q: When we reduce Total expenses from Revenue , the result is called as ........... a. Cost b. Revenues…

A: Revenues is the total receipts of the business irrespective of the cost incurred. Expenses are the…

Q: The lessor’s initial direct costs often are substantial. What are initial direct costs?

A: The costs which are associated directly with originating a lease and are essential to acquire the…

Q: Which of the following costs is a nonlease component for the lessee? Group of answer choices taxes…

A: The objective of the question is to identify which of the given costs is considered a nonlease…

Q: EBITDA removes which of the following from the operating income number? a. Significant variable and…

A: Earnings Before Interest, Taxes, Depreciation, and Amortization is referred to as EBITDA. It is a…

Q: The difference between contribution margin and income from operations is ________. a. net income b.…

A: The contribution margin is the excess revenue over the value of variable cost and the operating…

Q: C-V-P

A: Cost-volume-profit or CVP analysis is a cost accounting method that looks at the effects that…

Q: Explain two reasons why uncontrollable costs are included in the income statement

A: Introduction:- Uncontrollable costs are cannot be avoided. Which are necessary for production of…

Q: Discuss the following components of break-even analysis: fixed costs, variable and semi-variable…

A: Break-even point: It is the point at which the contribution margin earned on sales is equal to fixed…

Q: Contrast the income statement effect of LIFO versus FIFO(on Cost of Goods Sold and Gross Profit)…

A: Last-in-First-Out (LIFO): In this method, items purchased recently are sold first. So, the value of…

Q: How the system of cost accounting has overcome the limitations of financial accounting. Explain it…

A: Cost Accounting -: Cost accounting is a procedure of administrative accounting that aims to…

Q: 3. How would you classify restructuring costs in a multi-step income statement?

A: Restructuring costs:   Restructuring costs is a onetime cost incurred and paid by the company, for…

Q: Before you look at the profit which is the last number on the income statement which number would be…

A: An income statement, also known as a profit and loss statement or P&L statement, is a financial…

Q: Total profit is defined as total revenue, R(x), minus total cost, C(x), and is given by the function…

A: Profit Function: Profit is the result from deducting the cost or the expenses to the revenue. It…

Q: Vhile computing the cost of equity using the formula, r = D1 +g, we do not make PO ny adjustment to…

A: Equity is ownership of the company and debt is external to company.

Q: In your own words explain the meaning of: a. differential revenue, b. differential cost, and c.…

A: In accounting, Differential means the difference between the two alternatives or two output levels,…

Q: Which of the following is not a correct definition of the breakeven point? A.the point where total…

A: At Breakeven Point, Total Profits are equal to zero, Contribution Margin equal to Total Fixed…

Q: If net present value for a project is negative, then____. a. IRR is equal to Cost of capital b. IRR…

A: Net present value is the difference between the present value of cashflows discounted at the cost of…

Q: ***

A: Marginal profit is profit on additional units units. Profit can be calculated by deductions of cost…

Q: When agency and bankruptcy costs are considered, the optimal capital structure has a debt level…

A: Capital structure is the distribution of finances of the company in debt and equity.

Q: Gross margin is included on the income statement under which format(s)? A) B) C) D) Contribution…

A: Gross Margin is included on the income statement under traditional approach.  Gross Margin = Sales -…

Q: What is a stand-alone principle and discuss the relevancy of financing cost under this principle.

A: In capital budgeting, the project evaluation and assessment is based on the criteria of project's…

Q: What is the varable cost for A? $0.10

A: Variable cost is the cost that changes with the change in production levels. It is directly…

Q: Mark up can be calculated by the formula; a. Markup = Cost + Expenses b. Markup = Cost + Profit c.…

A: Markup refers to the difference between the selling price of a good or service and its cost

Q: Complete comparative income statements for the month of January for Laker Company for the four…

A: The inventory can be valued using various methods such as LIFO, FIFO, weighted average, and specific…

Q: Describe the components of the profit equation.

A: Profit refers to the earnings of an entity over a specific period of time.

Q: When the profitability index is equal to zero, the benefits equal the costs. True False

A: Profitability Index is defined as the ratio between the present value of cash inflow to the present…

Q: Which option does NOT form part of measurement bases in terms of IAS1? Select one: O a. Prime cost O…

A: In summary, IAS 1 does not specifically mention "prime cost" as a measurement basis, but it does…

Q: Label each of the following statements as either true (“T”) or false (“F”). A sunk cost will change…

A: Sunk cost: It can be defined as an expense that has already been paid for and cannot be recovered in…

Q: How do you find the maximum profit and loss percentage using these graphs? Long put Payoff Kluss st…

A: A put option is a financial instrument in which the holder is granted the ability, but not the…

Q: What is the difference between 'working capital' and the 'current ratio'?

A: Current assets are assets in the form of cash or can be converted into cash within a year.Current…

Q: Based on the above, what is the following: (e)   Gross profit rate      %

A: Gross Profit is the profit after deducting direct costs from the sales.Net profit is calculated by…

Q: The difference, (Total Revenue - Total Cost) or [(Unit Price x Quantity Sold) - (Fixed Variable…

A: Income statement is a financial statement that shows profitability, total revenue and total…

Q: Kindly just let me know following formulas are correct or not? If the given formulas are not…

A: 1. It should be Net Proceeds (NP) = Price - Flotation CostBut if flotation rate is given instead of…

Q: explain the impact on financial statement using FIFO, weighted avverage and LIFO. When would the…

A: Inventory management system is the system where the inventory are maintained in books of accounts…

Q: With respect to the CVP analysis, which one of the following formulas is correct? a) px=vx+fc+Profit…

A: Following are the components of the equation: Profit= Sales- variable cost Fixed cost is the…