Which of the Following Statements Is True

question 44

Multiple Choice

Which of the following statements is true?

• A)Incredibly, nepotism tends to be in shareholders' best interest.
• B)If a firm is enjoying a period of profitability and its profits is are being expropriated by its employees, management's best course of action may be to sell off the firm's assets and
• Return the funds to its investors.
• C)The management of dying companies should focus on selling off the firm's assets and returning the funds to its investors; the management of healthy companies should focus on
• Growing bigger.
• D)Managers who wish to increase shareholder wealth will seek to grow, or at least prevent shrinking, their firm's business.

Estimate the impact of tax-deferred savings and flexible spending accounts on tax savings.

Calculate Tax Freedom Day to understand the proportion of income paid towards taxes.

Evaluate the effect of tax-deferred retirement contributions and flexible spending accounts on federal taxes.

Determine tax savings through itemized deductions using the tax rate schedule.

---

Definitions:

Terms of Sale

The conditions under which a seller will complete a sale, typically outlining payment terms, delivery times, and quality expectations.

Prompt Payment Discount

A discount offered by sellers to buyers for paying their invoices early.

Liable

Legally responsible or obligated.

Compensating Balance

A compensating balance is a minimum account balance that a borrower must maintain with a lender as part of the loan agreement.