3. Corporations [ LO3 ] What is the primary disadvantage of the corporate form of organization? Name at least two advantages of corporate organization.
11. Goal of the Firm [ LO2 ] Evaluate the following statement: Managers should not focus on the current stock value because doing so will lead to an overemphasis on short-term profits at the expense of long-term profits.
Ch. 2: Questions 4 & 9( Questions and Problems section): Microsoft ® Excel ® template provided for Problem 4.
Building an Income Statement [ LO1 ] Billy’ s Exterminators, Inc., has sales of $ 817,000, costs of $ 343,000, depreciation expense of $ 51,000, interest expense of $ 38,000, and a tax rate of 35 percent. What is the net income for this firm?
3. Dividends and Retained Earnings [ LO1 ] Suppose the firm in Problem 2 paid out $ 95,000 in cash dividends. What is the addition to retained earnings?
4. Per-Share Earnings and Dividends [ LO1 ] Suppose the firm in Problem 3 had 90,000 shares of common stock outstanding. What is the earnings per share, or EPS, figure? What is the dividends per share figure?
9. Calculating Additions to NWC [ LO4 ] The 2014 balance sheet of Steelo, Inc., showed current assets of $ 4,630 and