Finance can help the entire organization by: Selling more product while keeping overall selling costs low Keeping the average cost of capital lower rather than higher Keeping the average cost of capital higher rather than lower Maintaining good cost records for operations and marketing
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Finance can help the entire organization by:
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- A high operating margin implies that ______________ . The company is in a better position to increase its finance cost The company is in a better position to absorb the finance cost The company is in a better position to reduce its overheads The company is in a better position to increase its pricesTo compete successfully for the better stockholders and better lenders, a business would need: Good employees Increasing sales revenue A higher asset utilization A lower asset utilizationWhich of the following statements is true? Return on investment (ROI) equals margin multiplied by sales. When used in return on investment (ROI) calculations, turnover equals sales divided by average operating assets. An advantage of using ROI to evaluate performance is that it encourages the manager to reduce the investment in operating assets as well as increase net operating income.
- Which of the followings is NOT an advantage of financial institutions in consumption smoothing? A. They help to solve moral hazard and adverse selection issues. B. They help to share risks. C. They help to reduce transaction costs. D. They help to create more jobs.The trend for cost of goods sold is it is decreasing as a percentage of sales and the trend for total marketing costs as a percentage of sales is increasing. What does this suggest to the company CEO? The CEO would want to analyze the company’s cost structure – particularly the contribution margin ratio, the relevant ranges for fixed expenses and the company’s marketing and production expenses The CEO would want to analyze whether operations has done something that reduces production costs, but that has also made the product less attractive in the customers’ eyes The CEO would want to analyze the company's margin % and asset utilization The CEO would want to analyze the company's cost of capitalGive typing answer with explanation and conclusion 5. Which of the following statements is correct? A-- All the answers are correct. B-- A more direct method of calculating the DOL is to use the following equation is DOL = (Sales - Variable Costs)/EBIT. C-- Because the amount of debt is determined by managerial choice, the business risk that a firm faces is also determined by management. D-- Fixed costs are those costs that are expected to change at the same rate as the firm’s sales. E-- If a firm’s operating costs are all variable, then any variation in sales will be less than the variation in EBIT.
- A. The trend for cost of goods sold is increasing as a percentage of sales and the trend for total marketing costs as a percentage of sales is decreasing. What does this suggest to the company CEO? a. The CEO would want to analyze whether marketing is pushing production to hard (increasing expenses) to make the marketing effort easier (less expenses). b. That production is spending too much money to produce the product c. The CEO would want to analyze whether production is pushing marketing to hard to make the production effort easier and thus lower marketing expenses d. That the marketing manager is doing a good job because marketing expenses are declining as a percentage of sales B. What does the previous scenario suggest to a company CEO? Sales in units are increasing and the average price is decreasing. Net operating income is decreasing. a. The CEO should wait and hope things get better b. The CEO would want to carefully analyze the…Marketing ROI Return on Investment (ROI) is one of the most important metrics for marketers to be aware of. After all, we need to know how the effort and dollars we’re putting into our marketing campaigns is affecting our bottom line. First, however, we need to define exactly what a firm means by investment. In most cases, firms define investment as the total assets of the firm. To calculate the ROI, we need the net income found in the income statement and the total assets (or investment) found in the firm’s balance sheet. ROI is calculated as follows: For example, if you invested $100 in a share of stock and its value rises to $110 by the end of the fiscal year, the return on the investment is a healthy 10%, assuming no dividends were paid. Question 1 Let’s say you bought a brand-new office suite in downtown Grand Rapids which is valued at $750,000. Five years later, you sell the property for $1,235,000. What is your ROI for this investment? Your Answer:…Cost-volume-profit analysis is used to make many decisions, including product pricing and controlling costs. What is meant by the statement, my company has good operating leverage?
- If a firm's marginal revenue is smaller than its marginal cost, then the firm should collect additional information before taking any action. increase output to increase profit. keep output the same decrease output to increase profit.the decision making about profit sharing is a.long term financial decision msking b. Short term financial decision making c. Short term and long term financial decision making d. Is not a task of financial decision makCost Behavior - Operating leverage and profitability analysis Discuss how understanding cost behavior leads to better decision-making and increased profits. Make a recommendation as to the best formula to use to assess a company's profitability. Please provide specific examples.