The Finney Company Is Reviewing the Possibility of Remodelling One

question 111

Multiple Choice

The Finney Company is reviewing the possibility of remodelling one of its showrooms and buying some new equipment to improve sales operations. The remodelling would cost $120,000 now, and the useful life of the project is ten years. Additional working capital needed immediately for this project would be $30,000; the working capital would be released for use elsewhere at the end of the ten-year period. The equipment and other materials used in the project would have a salvage value of $10,000 in ten years. Finney's discount rate is 16%. (Ignore income taxes in this problem.)
-What would be the immediate cash outflow required for this project?

• A) ($150,000).
• B) ($130,000).
• C) ($120,000).
• D) ($90,000).

Distinguish between positive, negative reinforcement, and punishment.

Recognize the significance of stimulus generalization and stimulus discrimination.

Understand the process and effects of observational learning.

Grasp the concept of higher-order conditioning.

---

Definitions:

External Financial Reporting

The process of disclosing financial information to external stakeholders, such as investors or regulators, through reports like balance sheets and income statements.

Inventory Accounting Methods

Inventory accounting methods determine the cost of goods sold and ending inventory value, including techniques like FIFO, LIFO, and weighted average cost.

LIFO Layers

In the Last-In, First-Out inventory accounting method, layers of inventory purchased at different times (and prices) which can affect the cost of goods sold and ending inventory valuation.

Inventory Liquidation

The process of selling off inventory, typically at reduced prices, to generate cash or reduce excess stock.