Answer:
False
Explanation:
Agency cost is a term used in Administration to describe a special type of expense that arises from conflicts of interest existing in an organization.Within the context of financial management, the main agency conflicts are:
-Between shareholders and managers :Theory of the principal — agent or the problem of the principal — agent is a theoretical model of economics designed to understand management situations between unequal actors having different degrees of awareness (asymmetric information): the person giving the order (principal) is usually located in the highest hierarchical position and awaits the solution of the task in his interests; on the other hand, the person executing the order (agent: manager or economic agent) is in the lower hierarchical position, but has more information than the principal and can use this information either in the interests of the principal or in his own interests. To solve this problem, various strategies are proposed, such as trusting relationships, general information systems, or focused incentives.
In general, to alleviate agency conflicts, shareholders bear the agency cost, which includes all the relative costs to make the interests of the managers aim to meet their own interests, which is to maximize the share price from the company. However sometimes the shareholders may want management to run the company in a fashion which increases shareholder value.
- Among shareholders and creditors.
Answer:
The answer is false.
Explanation:
Agency costs involve costs that are incurred from managers pursuing their own interests at the expense of shareholder value, AND ALSO
the costs that are incurred by shareholders to make sure that managers pursue shareholder value.
Examples of agency cost on the part of managers are pursuing policies that will increase their remuneration, buying expensive status car and sometimes manipulating financial statements to make it look good to the shareholders and the public.
An example of agency cost on the part of shareholders is hiring external auditor to check the financial statement and make an opinion on its true and fairness.
B. The second advisor because the total first-year cost is $5,000.
C. The first advisor because the total first-year cost is $5,000.
D. Because the cost is approximately the same, either advisor could be selected.
Answer:
The answer is A.
Explanation:
According to the details given in the question on the two financial advisor's approach, the first advisor does not request a payment but a commission on the funds purchased with the inheritance money. The second advisor does request payment for the job and also a share on the assets managed with the inheritance money.
If Kirby wants to minimize the upfront expenses which can be described as the sum that is paid before a service or a job is done, then the first advisor is the better option. So the answer is A.
I hope this answer helps.
B) Choice B
C) Both of the choices would produce the same return
D) We can’t tell.
Answer:
the answer is (C) both of the choices would produce the same return
Answer:
Faeber Textile Company frequently factors its accounts receivable. During 2019, Faeber made credit sales of $100,000 to customers, under terms of 2/10, n/30. Faeber records its credit sales using gross price.
Dr Accounts receivable 100,000
Cr Sales revenue 100,000
In 2019, Faeber sold $70,000 of these receivables to a factor. The factor remitted 90% of the accounts receivable factored and charged a 12% commission on the gross amount of the factored receivables.
Dr Cash 54,600
Dr Factoring expense 8,400 (= $70,000 x 12%)
Dr Factoring receivables 7,000
Cr Accounts receivable 70,000
The factoring agreement also requires Faeber to be responsible for any cash discounts taken by customers upon payment of the factored receivables. Faeber is charged for these cash discounts upon reimbursement by the factor. During 2019, the factor collected the remaining amount of the factored receivables, minus the 2% discount on 94% of the collected receivables, and returned the balance owed to Faeber.
Dr Cash 5,684 (=$7,000 - $1,316)
Dr Sales discounts 1,316 (= $70,000 x 94% x 2%)
Cr Factoring receivables 7,000
Faeber collected the remaining amount of the unfactored accounts receivable, minus the 2% discount on 96% of the collected receivables.
Dr Cash 29,424 (= $30,000 - $576)
Dr Sales discounts 576 (= $30,000 x 96% x 2%)
Cr Accounts receivable 30,000
4% of the accounts receivable were collected at 100%, and 96% were collected at 98%.
b. A credit to Cash Over and Short for $4.00.
c. A debit to Petty Cash for $392.50.
d. A credit to Cash for $396.50.
e. A debit to Cash for $396.50.
Answer:
The correct answer would be:
A credit to cash of $385. However, this is not an option indicated. But, according to the figures provided, the answer i recommend is correct.
Explanation:
Debit: Various expenses $382
Debit: Cash shortage ($450 - $382 - $65) $3
Credit: Cash: 385
To record entry to replenish the petty cash fund.
The entry to replenish the petty cashfund will include a debit to Cash for $396.50. The correct option is e.
The custodian must record a debit to the Petty Cash account to raise it back to the starting balance of $450 in order to replenish the petty cash fund. $382 + $65 = $447 in total receipts and cash on hand (coins and currency).
The custodian is short by $2.50 because the initial fund amount is $450. A debit of $396.50 ($450 - $2.50) will be issued from Cash to reflect the amount owed to the custodian in order to return the Petty Cash account to $450.
Thus, the correct option is e.
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Answer:
The formula to calculate the Budget Balance is
Government Income - Government Expenditure
in this case
$1.05 billion - $1.06 billion = - 0.01 billion or - $100 million
Explanation:
A budget balance is reached when a government expenditures are equal to it's income.
In this case, since the country's only source of income it is slightly less than than what is required to run the government, it has a budget deficient.
Since the country does not export or trade with outside countries, the government will need to take out a loan to make up for this deficient.
Answer:
False negative
Explanation:
A false negative may be defined as the outcome where the outcome of the binary classification process the model incorrectly determines or predicts the negative class.
In the context, though the employee have access to open the door as a part of his job, the employee could not open the door by scanning his badge. So this may be considered as a false negative as the employee could not open the door inspite of having access to the door.