X company always aim a steady net income, but the company this year had high sales resulted in extremely high net income, so the president told the controller to increase the yearly allowance for doubtful account from 4% to 6% of net credit sales because he is nervous the stockholders might expect the company to always be able to sustain such a high net income. Q/ what actions the controller should take and why ?

X company always aim a steady net income, but the company this year had high sales resulted in extremely high net income, so the president told the controller to increase the yearly allowance for doubtful account from 4% to 6% of net credit sales because he is nervous the stockholders might expect the company to always be able to sustain such a high net income. Q/ what actions the controller should take and why ?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question 3 Esellance, a sale training company manager, believes that the economic state for the next year will be strong, normal, or weak and that the company’s returns will have the probability distribution presented below: State of economy. Probability of the state of economy. Rate of return Strong. 0,50 45% Normal 0,40 15% Weak 0,10 5% What is the coefficient of variation of the estimated returns? 1. 0,560 2. 0,584 3. 0,600 4. 0,620
Pfizer Pharmaceuticals, Inc. is facing difficulties due to longer average collection period as many of its customers are having liquidity issues and they are delaying payments well beyond the due dates. Furthermore, the bad debt ratio of the company is on the rise as lots of pharmaceutical companies have gone bankrupt or having financial difficulties. In order to address these issues, company is thinking to adopt stringent credit policy in order to reduce bad debt and average collection period. The Management has decided that it will not grant additional credit to any customer beyond 15 days past due on payments. However, such a change of policy has consequences, and it is expected that firm will reduce it current sales to $6.5 million (20% reduction from current level of sale). However, the policy will also help in reduction of bad debts losses by 4% (from 8% to 4%) and average collection period by 35 days (from 110 days to 75 days). The expected decrease in sales will result in…
On November 14, Thorogood Enterprises announced that the public and acrimonious battle with its current CEO had been resolved. Under the terms of the deal, the CEO would step down from his position immediately. In exchange, he was given a generous severance package. Given the information below, calculate the cumulative abnormal return (CAR) around this announcement. Assume the company has an expected return equal to the market return. Note: A negative value should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Round your answers to 1 decimal place. Market Return (%) Company Return (%) Date November 7 1.3 0.9 November 8 1.1 0.9 November 9 -1.0 -0.4 November 10 -0.6 -0.6 November 11 2.1 1.0 November 14 -0.9 2.6 November 15 0.1 0.1 November 16 0.9 1.5 November 17 1.0 0.4 November 18 -1.0 0.0 November 21 1.1 0.2 Days from Announcement Daily Abnormal Cumulative Abnormal Return Return -5 -0.4 -0.4 -4…
i need ans of surface revenue and deffered revenue
please help with practice problems
Which of the following decreases the cash holding A.The rising commodity prices increases the value of law material inventoriesby 10% B.A manufacturer decreases production in anticipation of a decrease in demand C.THe frim repurchases its own stocks D.THe corporation has decided to give their customer less time in paying their purchases
[Question text] If D-Mart Bhd recently replaced its management team which use a flexible financing policy. Due to this policy changes, the company should_ Select one: O A. buy their inventory with cash O B. finance all company's assets with long-term debt C. use short-term financing in the seasonal peaks D. finance only long-term assets with long-term debt
11.3 Hau Lee Furniture, Inc., described in Example 1 of this chapter, finds its current profit of $10,000 inadequate. The bank is insisting on an improved profit picture prior to approval of a loan for some new equipment. Hau would like to improve the profit line to $25,000 so he can obtain the bank’s approval for the loan. a) What percentage improvement is needed in the supply chain strategy for profit to improve to $25,000? What is the cost of material with a $25,000 profit? b) What percentage improvement is needed in the sales strategy for profit to improve to $25,000? What must sales be for profit to improve to $25,000? Please provide steps so that I can better understand how the answer is found.
Suppose a company’s current credit terms are 1/10,net 30, but management is considering changingits terms to 2/10, net 40, relaxing its credit standards, and putting less pressure on slow-payingcustomers. How would you expect these changesto affect (a) sales, (b) the percentage of customerswho take discounts, (c) the percentage of customers who pay late, and (d) the percentage of customers who end up as bad debts?
23-Easa Saleh Al Gurg Group Careers company collecting and storing all kinds of information for future planning and decision making. Because of present Covid-19 pandemic situation, they found the decrease in sales revenue of the company and to take necessary actions, the management of the company collected information on percentage of product rejections, number of customer complaints. The category of information the company focusing on is termed as: O a. Financial Quantitative information O b. Financial Qualitative information O c. Non-Financial Qualitative information O d. Non-Financial Quantitative information
Assume an Australian company with the following characteristics: volatile earnings high insurance cost most company tax paid outside Australia assess the appropriate level of dividends for this company, explain reasoning if the company wants to pay dividends which type of payout policy would you recommend it to use and why
c. Which of the following correctly identifies a risk facing SSC that might adversely affect sales during the coming years? Multiple Choice A general slowdown in the economy. Sales to many smaller customers other than Wingo Corporation. Increased attention to developing new products. A board of directors dominated by management. pdf Untitled docume....pdf *led d ocume

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