What would you recommend to the ceo of ibiam

Assignment Help Accounting Basics
Reference no: EM13683264

Ibiam Co.'s ROA for the most recent year was 15%. When you examine the company's long-term debt footnote, you conclude that Ibiam's current borrowing rate is about 8%. Their debt-to-equity ratio is 1-to-1. What would you recommend to the CEO of Ibiam?
a. Use any available cash to pay down debt to avoid the borrowing costs.
b. Borrow money for any investment needs; if excess cash is on hand, buy back some of your own stock.
c. Stop worrying about financing and concentrate on operations.
d. Increase debt by a factor of 10, pay out the proceeds as a big dividend, and head for a non-extradition country.

The Dozier Co. shipped products to customers in 2015, and customers agreed to pay Dozier a total $2,000 in 2016. What factor might lead Dozier to recognize less than $2,000 of revenue in its 2015 income statement?
a. Dozier shipped product to customers with low credit scores
b. Dozier allows customers a limited right of return
c. Dozier included two years of tech support with the products at no extra charge
d. All of the above
e. B & C

The Crowe Co. uses the LIFO cost flow assumption. Your boss has asked you to compare financial results of Crowe with that of another company that uses the FIFO cost flow. You dig around in Crowe's annual report and find the following ending balances: Inventory $3,120; Other Assets $5,000; Shareholders' Equity $7,206; Net Income $690. Your research also reveals that the LIFO reserve was $320 at the end of the year, and the reserve was $370 at the beginning of the year. What ending balance of assets would Crowe report if it had always used the FIFO cost flow assumption? Ignore income taxes.
a. $8,440
b. $8,490
c. $8,120
d. $7,800
e. None of the above
Refer to the question above. What net income would Crowe. Co. report for this year if it has always used the FIFO cost flow assumption?

Reference no: EM13683264

Questions Cloud

Determine the pressure increase : At the surface of a freshwater lake the pressure is 106 kPa. Determine the pressure increase in going 34.9 meter below the surface
What amount of cash does gore co. receive : Gore Co. issued $200,000 of bonds with a stated annual rate of 8% at a time when the market rate of interest is 6% per year. Interest is paid semiannually, and the bonds mature in 3 years. What amount of cash does Gore Co. receive when the bond..
Evaluate what must the pressure of the fluid in the syringe : A hypodermic syringe is attached to a needle that has an internal radius of 0.300 millimeter and a length of 3.02 centimeter. Find what must the pressure of the fluid in the syringe be in order to inject the solution at a rate of 0.253 mL/s
Determine the voltage across the copper part : A 15 meter length of wire consists of 6 meter of copper followed by 9 meter of aluminum, both of diameter 1.2 mm. Determine the voltage across the copper part
What would you recommend to the ceo of ibiam : Ibiam Co.'s ROA for the most recent year was 15%. When you examine the company's long-term debt footnote, you conclude that Ibiam's current borrowing rate is about 8%. Their debt-to-equity ratio is 1-to-1. What would you recommend to the CEO..
What is the increase in the kinetic energy of the block : A horizontal force of magnitude 37.2 N pushes a block of mass 3.85 kg across a floor where the coefficient of kinetic friction is 0.585. Through that displacement, the thermal energy of the block increases by 40.6 J. What is the increase in thermal e..
Describe how far off course the wind blows the plane : A pilot directs his plane North of East. The airspeed of the plane is 1 60.0m/s. A wind blows with a speed of 32.0m/s from East to West. Describe how far off course the wind blows the plane in 2.00 hours.
Adjusting entry for warranties : The Schrock Co. needs help preparing its adjusting entry for warranties. At the end of the year, 1,000 units remain under warranty. Schrock expects 2% will be returned and each return will cost it $30 to repair or replace. Prior to making th..
Summarize the life cycle of a product : Summarize the life cycle of a product (Introduction, Growth, Maturity, Decline) and explain how the stage of the life cycle impacts price. Provide two examples of products where you have seen this occur.

Reviews

Write a Review

 

Accounting Basics Questions & Answers

  The following data are taken from the balance sheet at the

the following data are taken from the balance sheet at the end of the current year. determine the a working capital b

  A company has inventory of 28 units at a cost of 145 each

a company has inventory of 28 units at a cost of 14.5 each on june 1. on june 3 they purchased 38 units at 16.5 each.

  Along with expenses of rent 10700 supplies 5200

1. a and b are married are both age 50 and have two dependent children c aged 18 and d aged 20 and live in

  What is the variable cost per unit

Average cost per unit is $1.425 at the 16000 unit level of activity and $1.38 at the 20000 unit level of activity. What is the variable cost per unit? The total fixed cost per unit?

  How has public criticism of the public accounting

1.while congress believed that sarbanes-oxley would improve corporate corruption and prevent future corporate scandals

  J-mart and buy-lo are two companies that sell identical

j-mart and buy-lo are two companies that sell identical products. they are located in different parts of the same city.

  Inventories of raw materials and finished goods

Aborkian Co. is forecasting sales of 75,000 units of product for November. To make one unit of finished product, seven pounds of raw materials are required. Actual beginning and desired ending inventories of raw materials and finished goods are:

  Journal entry to record the change in accounting principle

Wertz Corporation decided at the beginning of 2010 to change from the completed-contract method to the percentage-of-completion method for financial reporting purposes.

  Determine the amount of payroll cost

A review of the accounting records of Rayford Manufacturing indicated that the company incurred the following payroll costs during the month of August.

  Calculate the unit manufacturing cost of the us and eu

wedig diagnostics manufactures two laser photometers that are used in preparing dna tests. the u.s. model is designed

  The bootsie holding company has sales exceeding 10 billion

the bootsie holding company has sales exceeding 10 billion and each of its three wholly-owned subsidiaries has sales

  What is the percentage change from 2011 to 2012 what is the

what is the percentage change from 2011 to 2012? what is the percentage change from 2012 to 2013? be sure to indicate

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd