Question

The statement of cash flows for Baldwin Company shows what happens in the Cash account during the year. It can be seen as a summary of the sources and uses of cash (sources of cash are added, uses of cash are subtracted). Please answer which of the following is true if Baldwin makes plant improvements:

It is a source of cash and will be shown in the financing section as an addition.

It is a use of cash, and will be shown in the financing section as a subtraction.

It is a source of cash, and will be shown in the investing section as an addition.

It is a use of cash, and will be shown in the investing section as a subtraction.

On the income statement, which of the following would be classified as a Period cost?

Direct Material Expense

Inventory Carry Expense

Direct Labor Expense

Depreciation Expense

It is January 2nd and senior management of Chester meets to determine their investment plan for the year. They decide to fully fund a plant and equipment purchase by issuing $10,000,000 in bonds. Assume the bonds are issued at face value and leverage changes to 2.7. Which of the following statements are true? Select all that apply.

Select: 3

Total liabilities will be $136,284,929

Chester’s long-term debt will rise by $10,000,000

Total Assets will rise to $218,578,172

The total investment for Chester will be $13,613,828

Working capital will remain the same at $14,177,936

Next year Baldwin plans to include an additional performance bonus of 0.5% in its compensation plan. This incentive will be provided in addition to the annual raise, if productivity goals are reached. Assuming the goals are reached, how much will Baldwin pay its employees per hour?

$28.15

$31.04

$29.70

$28.29

Suppose the Baldwin company begins to compete through good designs, high awareness and easy accessibility for their existing products, what strategy would they be implementing?

Niche cost leader

Niche differentiation

Broad differentiation

Broad cost leader

his year Andrews achieved an ROE of 5.4%. Suppose the Board of Directors of Andrews mandates that management take measures to increase financial Leverage (=Assets/Equity) next year. Assuming Sales, Profits, and Assets remain the same next year, what effect would you expect this new Leverage policy will have on Andrews ROE?

Andrews ROE will increase.

Andrews ROE will remain the same.

Andrews ROE will decrease.

Andrews Corp. ended the year carrying $73,440,000 worth of inventory. Had they sold their entire inventory at their current prices, how much more revenue would it have brought to Andrews Corp.?

$73,440,000

$103,919,000

$134,055,510

$12,416,000

The Chester's workforce complement will grow by 10% (rounded to the nearest person) next year. Ignoring downsizing from automating, what would their total recruiting cost be? Assume Chester spends the same amount extra above the $1,000 recruiting base as they did last year.

$3,498,000

$265,000

$2,915,000

$318,000

Answer 1

A) It is a use of cash, and will be shown in the investing section as a subtraction.

B) Depreciation Expense

C) Chester’s long-term debt will rise by $10,000,000

D) Broad differentiation

E) Andrews ROE will increase.

Step-by-step explanation:

A) As the company will do a cash dibursement will be considered cash use and because is investing on it to increase future cash flow

B) A period cost is a cost which cannot be capitalized into an asset. As cost which occur as the time passes over the years Which is the case for depreciation expense

C) bonds payable for 10,000,000 will be recorded

the leverage is a ratio to analize the firm it does not influence the accounting

D) The company differenciate his products from the rest of their competitors in a great variety of products rather than a single buyer segment.

E) ROE will increase as the leverage makes the debt weight increase while the equity weight (proportion of the company owned by the stockholders)

For the rest ofthe options the information provided is insufficient please do another question with the information