Store-It Owns and Operates Self-Storage Units Across the Country

question 207

Multiple Choice

Store-It owns and operates self-storage units across the country. The firm is well established and has a cost of capital of 9 %. Stop n Drive operates several stations which supply bread and milk along with gasoline, diesel, and kerosene fuels. Stop n Drive's cost of capital is 13 %. Both companies are considering opening a chain of bakeries which would supply fresh baked goods for individual consumers. The internal rate of return on these bakeries is 11.5 %. Which firm or firms, if either, should open the bakery outlets?

• A) Store-It only.
• B) Stop n Drive only.
• C) Both Store-It and Stop n Drive.
• D) Either Store-It or Stop n Drive.
• E) Cannot be determined from the information given.

Identify the correct method of recording sales and the use of the MasterCard or VISA in accounting.

Comprehend the different components of the income statement and their relationship with net income.

Understand the basic differences between merchandising and service businesses in terms of financial statements.

Comprehend how to calculate gross profit and operating income.