What would the effect of the failure in the ratio measurement?

Q: How do the Internal-Rate-of-Return Criterion relate to the PW Analysis?

A: Capital budgeting:   It is the process in which the business uses to determine which proposed fixed…

Q: Describe how the FIFO method is different from the weighted-average method.

A: FIFO and weighted average method are the accounting tool for the inventory valuation. Under FIFO,…

Q: What limitations do ratio analysis have?

A: Ratio Analysis: It is a technique used in the financial analysis field. Ratio analysis helps to use…

Q: What

A: Introduction:- The following one of the conditions is required to satisfied for segment reporting as…

Q: What is the Tolerable Error Rate?

A:

Q: Why is it crucial to estimate the MARR correctly?

A: It is the minimum return rate on the project which an entity computes prior to the staring of the…

Q: What is the difference between margin and markup?

A: Margin and Markup are two terms used for calculation of selling price of the product. Margin is also…

Q: What’s the primary difference between the MIRR and the regular IRR?

A: It refers to the rate of return that is computed by the company to make a decision of selection of a…

Q: What are the shortcomings of the internal rate of return criterion?

A: Solution- Internal Rate of Return (IRR)-      The Internal Rate of return (IRR) is that the discount…

Q: How should one establish performance measurements? And how can they be aggregated?

A: Business Sustainability: Business sustainability is increasing the business worth for a long term,…

Q: Why is the variance (or standard deviation) used as a measure of risk? What are the advantages and…

A: Reasons of utilizing variance as a risk measure: While consider a lesser risk in investment, fewer…

Q: What can be understood by abnormal return?

A: Note firstly we understand what is meaning of abnormal return. Basic meaning of abnormal return is…

Q: uncertainty?

A: Answer - Option D Relevance is where the information is useful and appropriate , predictive or…

Q: What are the steps in computing the cost of a prediction error when using the EOQ decision model?

A: Economic Order Quantity (EOQ): Economic order quantity is the quantity of order that is purchased…

Q: is profile measurement and analysis? What are the limitations of this approach?

A:

Q: What is the purpose of a Limit Test?

A: Definition:   Limit test: It checks the data by evaluating it with the predetermined upper and…

Q: What is the difference between between beta and standard deviatio

A: In the world of finance in general and investing in particular we often use the concepts of beta as…

Q: What is the meaning of margin of safety?

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Q: What are the considerations in imputing an appropriateinterest rate?

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Q: advantages and disadvantages of the scattergram method as compared to the high-low method?

A: Solution High-low method takes high level activity and low level activity and measure the total cost…

Q: What are the Differences in Maturities?

A: Maturities in the context of the bond mean that bonds are issued for a specific period of time. It…

Q: Which of the following is incorrect regarding measurement period?

A: Business combinations are the result of acquisitions or mergers. Here, one party acquires the other…

Q: What is a break-even point and how is it calculated?

A: Break-even point: Break-even point is defined as a situation where a firm’s expenses and revenues…

Q: Illustrate the calculation of the standard deviation of returns?

A: Standard deviation refers to a measure of variation or dispersion of a set of values. We can…

Q: What caused a decrease in the current ratio?

A: The current ratio is the ratio that is used to calculate the ability of the company to pay off its…

Q: When completing a differential analysis, when are the differences shown as positive amounts? As…

A: In differential analysis , two alternatives are compared by taking first alternative as base and…

Q: What type of testing are ratios?

A: Ratio:   It is a number expressed in terms of another to establish a relationship among them.

Q: What is the difference between arithmetic and geometric mean returns?

A: The difference between arithmetic mean return and geometric mean return is mainly in two aspects…

Q: Is a negative Sharpe ratio good or bad?  EXPLAIN

A: What sharpe ratio measure? It measure the excess return earn by portfolio over risk free rate at…

Q: How is the standard deviation of returns calculated?

A: Standard deviation is ascertained as follows: The mean worth is dictated by including all the…

Q: What is the tainting percentage? How is it calculated?

A:

Q: Present the internal rate of return criterion and its strengths and weaknesses.

A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only…

Q: What is the major disadvantage of the high-low method?

A: High-low method: High-low method is a method of calculating the variable cost and the fixed cost of…

Q: What do you mean by roll-forward procedure and rollover method? Difference between roll-forward…

A: Roll Forward Procedure The roll-forward process means checks that will be carried out in the…

Q: Explain Measures of Variance and Risk?

A: Variance tests normal or normal variability. Variability is volatility for investors, and volatility…

Q: What is the difference in a data and findings?

A: Data is the combination of raw facts which is used for providing information and conclusions to the…

Q: what is the break-even point and margin of safety ?

A: Break-even point In accounting language Break-even point means the total turnover of the company is…

Q: Explain the limitations of ratio analysis

A: Limitations of ratio analysis:Ratios are mostly computed based on historical costs as a result;…

Q: What is meant by the current ratio?

A: The current ratio is liquidity which measures the ability of the enterprise to pay its short-term…

Q: What does the acid test ratio state? Meaning what do the results mean?

A: Acid test ratio is also known as liquid ratio or quc ratio. This is calculated by dividing liquid…

Q: What is the difference between the current ratio and the quick ratio?

A: Ratio analysis is a method of measuring the financial position of the organization with different…

Q: How is the tainting percentage calculated?

A: Tainting percentage can be computed individually for each sampled item. In PPS sampling, the amount…