Answer: True
Explanation:
The agency problem is when there is a conflict of interest between the management of a company and the stockholders that exists in the company.
In order to help reduce the potential agency conflicts that at occur during the course of a business, a few of the institutional investors often bring in the pressure of the direct shareholder on the management of a firm. They believe by involving the shareholders, the management will try not to have any differences with the shareholders and thereby reducing agency problem.
Answer:
Under the accrual basis, it should recognize $1,000,000 as property tax revenue for the year 2019. The remaining $45,000 that it does not collect in year 2019 will be accounted for as Property Tax Receivable while the $5,000 will be recorded as Uncollectible Expense in 2019.
Explanation:
The accrual concept or basis of accounting requires that all revenues and expenses relating to a fiscal year be recognized in that accounting year. It is not only the actual cash receipts and payments that should be recognized. This means that any revenue that is due but not yet received will be accounted for in the year that the revenue arises. And all the related expenses for raising the revenue will also be accounted for in the same year.
Answer:
a. Regulatory compliance costs - Fixed cost
b. Salaries of top management and key personnel - Fixed cost
c. Cost of metal used in manufacturing - Variable cost
d. Cost of wood used in manufacturing - Variable cost
e. Mortgage payments - Fixed cost
f. Industrial equipment costs - Fixed cost
g. Interest on debt - Fixed cost
h. Postage and packaging costs - Variable cost
Explanation:
The cost which is affected by the production of units is known as variable cost. The cost which does not vary with the units produced is fixed cost. Fixed cost does not change from period to period irrespective of level of output and is usually same for a certain period. It is easy to budget for fixed costs instead of variable cost. Variable cost changes every period and is based on company's output.
Answer:
vertical integration strategy
Explanation:
In supply chain management, vertical integration refers to expanding the company's operations to either include some of its vendors, distributors and retailers, or both. This way, the company will be able to control the upstream of the supply chain management (vendors) and/or the downstream (distributors and retailers).
In this case, Beatrice is advocating for a vertical integration strategy in order for the company to expand into dairy farms. This way they company will control the supply of raw milk.
Answer:
25%
Explanation:
the margin of safety is the percent of sales which the company is above the break even point.
We solve for the break even point:
BEP = 150,000
We solve for the margin of safety:
$ 200,000 - $ 150,000 = $ 50,000
Now we compare against our sales:
$ 50,000 / $ 200,000 = 0.25
