B. 0.5 percent
C. 1.0 percent
D. 2.5 percent
E. 5.0 percent
Variable costs can be defined as the costs that:
A. remain constant for all time periods.
B. remain constant over the short run.
C. vary directly with sales.
D. are classified as non-cash expenses.
E. are inversely related to the number of units sold.
Tall Guys Clothing has a 45 day collection period. Sales for the next calendar year are
estimated at $2,100, $1,600, $2,500 and $2,300, respectively, by quarter, starting with
the first quarter of the year. Given this information, which one of the following
statements is correct? Assume a year has 360 days.
A. The firm will collect $800 in Quarter 2.
B. The accounts receivable balance at the beginning of Quarter 4 will be $1,150.
C. The firm will collect $2,000 in Quarter 3.
D. The firm will have an accounts receivable balance of $2,300 at the end of the year.
E. The firm will collect a total of $2,400 in Quarter 4.
Home Care Providers is paying an annual dividend of $1.10 every other year. The last
dividend was paid two years ago. The firm will continue this policy until 3 more
dividend payments have been paid. One year after the last dividend normal payment,
the company plans to pay a final liquidating dividend of $40 per share. What is the
current market value of this stock if the required return is 17 percent?