question 64
Multiple Choice
Mt. Prevost Machine Corp.
Income Statement (2001)
Sales Cost of goods sold Gross profit Selling and administrative expenses Operating profit Interest expense Income before tax Tax expense Net income $4,000,0003,040,000960,000430,000530,000160,000370,000148,000$222,000
Balance Sheet Cash Aceounts receivable Inventory Total current assets Fixed assets Total assets Aceounts payable Bank loan Total current liabilities Bonds payable Total liabilities Common stock (25,000 shares) Retained earnings Total liabilities & equity 2001$60,000550,000690,0001,300,0001,300,0002,600,000270,000580,000850,000900,0001,750,000250,000600,0002000$50,000500,000620,0001,170,0001,230,0002,400,000250,000500,000750,0001,000,0001,750,000250,000400,000
-Refer to the financial statements of Mt.Prevost Machine Corp.The firm's fixed asset turnover ratio for 2001 is ____.
Definitions:
Discount Rate
Used to calculate the present value of future cash flows, reflecting the opportunity cost of capital investment.
Cost Savings
The reduction in expenses achieved by employing more efficient methods or making favorable decisions.
Salvage Value
An asset's anticipated market value upon concluding its period of utility.
Acceptable Project
Refers to a project considered feasible or desirable based on certain criteria such as return on investment, risk level, or alignment with strategic goals.