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2 years ago

Knowledge check what are the possible weaknesses of this peer approach to valuation?

Business

1 answer:

kolbaska11 [484]2 years ago

7 0

Answer:

The growth which is estimated is wrong.

Explanation:

The Prospective price to earning ratio P/E multiples are calculated using future earnings. In that way, they can be dramatically wrong. Relative valuation is quick and easy. It compares industry peer.

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Melinda signs a three year contract for employment as a legal studies lecturer. Does this type of contract fall within the scope

abruzzese [7]

Answer: Yes, because it is a contract whose terms prevent possible performance within one year

Explanation:

The Statute of Fraud mandates that certain contracts need to be written down. These contracts include the sale of land, amounts involving more than $500 and contracts that have a timeframe of over a year.

Melinda entered into a contract with terms that have to be fulfilled in more than a year. It is therefore under the Statute of Frauds.

3 0

2 years ago

Direct and Indirect Costs Kubin Company's relevant range of production is 18,000 to 22,000 units. When it produces and sells 20,

pychu [463]

Answer:

a) direct manufacturing cost $220,000

b) indirect manufacturing cost $130,000

2 a) the manufacturing department cost will be of $350,000

b) zero as direct material, labor and overhead can be determinated.

3) a) $40,000

b) $50,000 advertizement.

4) No as we can set the object cost to determinate the direct and indirect cost of the adminsitrative expenses.

Explanation:

a) The direct manufacturing cost will be the variable manufacturing cost linked to the unit cost:

Materials $7 + Labor $4 = $11 per unit

20,000 units x $11.00 = $ 220,000

b) indirect manufacturing cost will be the overhead.

20,000 x ($1.5 + $5) = 130,000

a) Materials, labor and overhead.

which totals for 350,000

2 b) all the manufacturing cost are traceable so zero.

fixed selling

20,000 x 3.5 = 70,000

less 50,000 advertizement = 20,000

variable sales:

commisions $1 x 20,000 + 20,000 = 40,000 direct cost (sales persons)

b) the indirect cost will be the advertizement as cannot be linked directly to the sales person cost.

3 0

2 years ago

Which statement best describes a significant similarity between the AICPA and IESBA codes? Both codes incorporate the conceptual

34kurt

Both codes incorporate the conceptual framework approach for evaluating threats when specific rules on a matter do not exist.

Explanation:

IFAC has enacted a Code of Ethics for Professional Accountants (IESBA Code), the International Ethics Standards Committee for Competent. The latest IESBA Code edition was upgraded and modified in July 2009 and comes into force on 1 January 2011. The adjustments clarified and considerably strengthened the independence specifications for all competent accountants.

IESBA and AICPA are more comparable than they are, but there are substantial differences. In many instances it will produce similar effects if codes are added to the same pattern of truth.

The IESBA Code deals with a number of possible independence issues which are covered by the AICPA Conceptual Structure but not AICPA. Examples include the Long Senior Human Resources Group (including Team Rotation).

Certain independence restrictions are enforced by the IESBA Code representing the "extent of public interest in certain companies" (i.e. entities listed on an accepted stock exchange for whose shares are listed), and institutions whose auditors are legally or administrative authorities required to comply with the same requirements for independence as the listings).

The IESBA splits the conditions for freedom into two regions. Section 290 offers the toughest prohibitions and includes accounting reports and audits. Section 291 generally provides less stringent requirements of freedom for all other insurance obligations. The AICPA does not change the principles of equality.

6 0

2 years ago

The Darwin Company reports the following information that occurred during the current period: Sales commissions expense $15,600

ch4aika [34]

Answer:

The Darwin Company

Calculation of Manufacturing Overhead costs:

= $17,200

Explanation:

a) Data and Calculations:

Depreciation on factory equipment $4,700

Indirect labor 5,900

Factory rent 4,200

Factory utilities 1,200

Indirect materials used 1,200

Total Manufacturing overhead costs = $17,200

b) Darwin's manufacturing overhead costs will include only the above listed costs. Sales commissions, direct materials, direct labor, and office salaries expense do not form part of the manufacturing overhead costs. The manufacturing overhead costs are neither direct materials or labor costs or selling and administration costs.

8 0

2 years ago

An important application of _________ interest involves _________. Some common types of amortized loans are automobile loans, ho

Lelechka [254]

Answer:

Compound interest; amortized loans; amortization schedule; largest; decline; smallest; increases.

Explanation:

An important application of compound interest involves amortized loans. Some common types of amortized loans are automobile loans, home mortgage loans, and business loans. Each loan payment consists of interest and repayment of principal. This breakdown is often developed in an amortization schedule. Interest is largest in the first period and declines over the life of the loan, while the principal repayment is smallest in the first period and it increases thereafter.

Amortization in accounting is used to periodically lower the book value of a loan principal or an intangible asset such as intellectual property over a set period of time.

The compound interest formula is given below;

$A = P(1 + \frac{r}{n})^{nt}$

Where;

A is the future value.

P is the principal or starting amount.

r is annual interest rate.

n is the number of times the interest is compounded in a year.

t is the number of years for the compound interest.

5 0

2 years ago