Your firm has a beginning balance of $8,000 cash, $2,000 inventory, and $10,000 initial equity. Your firm is operating in an all-cash environment without taxes. You sold $1,000 of inventory for three times the amount you paid for it
If this is your only transaction, your resulting balance sheet should most closely resemble which of the following choices?
A) Cash = $8,000, accounts receivable = $3,000, inventory = $1,000, initial equity = $10,000, and retained earnings = $2,000
B) Cash = $11,000, inventory = $1,000. initial equity = $10,000, and retained earnings = $2,000
C) Cash $11,000, inventory = $2,000, initial equity $10,000, and retained earnings $3,000
D) Cash $11,000, inventory = $2,000, and initial equity = $13,000
B
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One source of life and health insurance underwriting information is an organization that life and health insurance companies can join
As a member, life and health insurance companies report health impairments of applicants, and this information is shared with member companies. Although the information is shared, the underwriting decision of the member company is not disclosed. What is this organization called? A) Fair Isaac Corporation (FICO) B) Medical Information Bureau (MIB) C) National Association of Insurance Commissioners (NAIC) D) National Association of Mutual Insurance Companies (NAMIC)
Which of the following would be best considered to be an agency conflict problem in the behavior of the following financial managers?
A) Bill chooses to pursue a risky investment for the company's funds because his compensation will substantially rise if it succeeds. B) Sue instructs her staff to skip safety inspections in one of the company's factories, knowing that it will likely fail the inspection and incur significant costs to fix. C) James ignores an opportunity for his company to invest in a new drug to fight Alzheimer's disease, judging the drug's chances of succeeding as low. D) Michael chooses to enhance his firm's reputation at some cost to its shareholders by sponsoring a team of athletes for the Olympics.