A company began the year with $200,000 in cash. For the year it achieved $1,000,000 in revenue. Its variable costs are $700,000 and fixed costs (including interest) $350,000. Assume no depreciation (i.e., no equipment). It pays $50,000 in dividends. Which of the following result?
a) It suffered a net loss of $50,000 and its new book value is lower by $100,000
b) It suffered a net loss of $50,000 and its new book value is lower by $50,000.
c) It suffered a net loss of $100,000 and its new book value is lower by $50,000.
d) It suffered a net loss of $100,000 and its new book value is lower by $100,000
Ans: a) It suffered a net loss of $50,000 and its new book value is lower by $100,000
Business
You might also like to view...
A ________ compares multiple items according to a single characteristic
A) frequency polygon B) line chart C) horizontal bar chart D) histograph E) paired bar chart
Business
Options can provide a lot of price action for a limited dollar investment
Indicate whether the statement is true or false.
Business