One of the major risks of pursuing a strategy of tangible assets or intangible differentiation advantage is that company may fail to detect the competitors.
What are tangible assets?Long-term physical resources that are owned by a company or organization and have some economic worth are referred to as tangible assets. Assets are typically not for sale and are acquired by the corporation in order to run its activities successfully. Examples of the same include buildings, vehicles, tools, equipment, furniture, fixtures, land, computers, and so on. Most often, these assets are at risk of being lost to theft, fire, accidents, or other natural disasters. A useful economic life exists for tangible assets, beyond which they run the risk of becoming obsolete. The most popular technique used by businesses to stretch out the cost of an asset over the course of its economic life is depreciation.
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ignoring taxes and all else held constant, on the , the market value of a stock should decrease by the amount of the dividend.
The market value of a stock should drop by the dividend amount on the dividend declaration date, with taxes and other factors held constant.
Which of the following is a defense of the company's low dividend policy?Until the gain is realized, the tax on capital gains is delayed. A low dividend tax will be preferred by the stockholders.
The constant dividend payment ratio has which of the following issues?The issue with the constant dividend payout ratio is that the dividend's monetary value changes year over year. One possible justification for dividend payments is that they indirectly lead to a closer monitoring of management's investment activity, which reduces agency costs.
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this term is used to define the provision which allows the bond issuer to settle the payments towards the bond before the maturity.
The term that defines the provision which allows the bond issuer to settle the payments towards the bond before maturity is known as the call feature.
What is a call feature?A call feature is referred to a feature in a bond agreement that allows the issuer to buy back bonds at a set price within certain future time frames. The issuer uses a call feature to hedge against interest rate risk. If interest rates decline bonds can be bought back and replaced by bonds carrying a lower interest rate.
The call feature may also limit the amount of money that a bondholder might otherwise be able to earn by holding a bond.
So when a call feature is present investors demand a higher effective interest rate.
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warren corporation is interested in a three-year, 11% annual coupon bond. a broker quotes a price of $930.35. what is the yield to maturity?multiple choice10%
The yield to maturity is equal to 14.00% in a three-year, 11% annual coupon bond that a broker quotes a price of $930.35.
What is yield to maturity?The yield to maturity (YTM), book produce, or redemption yield of a bond or other fixed-interest safety, such as gilts, is an estimate of the overall rate of return expected to be earned by an investor who buys a bond at a specific market price, holds it until maturity, and receives all interest payments and the capital redemption as scheduled. It is the (theoretical) internal rate of return (IRR, overall interest rate), which is the discount rate at which the bond's current price and the present value of all bond-related cash flows (principal and coupon payments) are equal. Although market convention is more frequently followed, the YTM is frequently expressed in terms of Annual Percentage Rate (A.P.R.).
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At the wholesale club, one can buy toothpaste at a lower unit price if one buys six tubes of toothpaste at once. This is an example of ____, which ____ producer surplus.
At the wholesale club, one can buy toothpaste at a lower unit price if one buys six tubes of toothpaste at once. This is an example of imperfect price discrimination, which increases producer surplus.
In a business, price discrimination occurs when the producer of a product decides to set his own value or price for the product as a strategy to improve output from the product.
The producer surplus can be described as the revenue that is generated by a producer after selling his product.
Imperfect price discrimination can occur if a producer decides to lower the price of a product, as the toothpaste above, on the condition that a set quantity of the product is bought by the customer. As more product will be sold by this imperfect price discrimination, the producer surplus will increase.
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which of the following are not examples of defensive industries? a. food producers. b. durable goods producers. c. pharmaceutical firms. d. public utilities. e. b and c
They are not examples of producers of durable goods in defensive industries.
What exactly are non-consumable goods?
Nondurable consumer goods have a lifespan of minutes to three years and are purchased for immediate or almost immediate consumption. Fuel, clothing, footwear, and beverages are all common examples.
What kinds of things last?
Products that can be physically handled, can be kept in inventory, and typically last at least three years.
What are three examples of durable goods for consumers?
Appliances like washers, dryers, refrigerators, and air conditioners are examples of consumer durables; tools; televisions, computers, and other electronic devices; jewelry; trucks and cars; and furniture for the house and office.
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extreme sports, a bicycle, atv, and motorbike retailer, buys its inventory on credit. before extreme pays for this merchandise in 60 days, the money owed is classified on its balance sheet as a(n)
Extreme Sports, a bicycle, ATV, and motorbike retailer, buys its inventory on credit. The money owed is classified on its balance sheet as a(n)--account payable.
What is Account Payable?The accounts payable department is responsible for the financial, administrative and clerical support of a business. They are responsible for making payments owed by the business to suppliers and other creditors, paying supplier bills or bills, and recording the short-term liabilities of the business.
What qualifications do you need for Accounts Payable?Accounts Payable Specialists must have at least a high school diploma or GED certification. Some employers prefer candidates who also have an associate's degree in accounting or another related field. Related courses include economics, accounting principles, spreadsheets, computerized accounting, and taxation.
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the kimballs and their lender have agreed to a loan modification. how is the loan modification documented?
The original executed home loan modification agreement (and documented, if applicable) should be given to the right custodian, and copies should be kept in the mortgage loan servicing file as well as sent to the borrower and the mortgage insurer or guarantor.
What is the process of a loan modification?Extending the mortgage's term (e.g., from a 30-year term to a 40-year term) lowering interest rates. the outstanding principal balance is increased by any overdue sums, including interest and escrow, and then reamortized over the new period.
A Trial Payment Plan (TPP) will be provided to you by your lender after you have been granted permission to modify your loan. Recordation is required to ensure that the modified mortgage loan retains its first lien position and is enforceable in accordance with its stipulations at the time of the modification, for the duration of the modified term, and throughout any bankruptcy or foreclosure proceedings involving the modified mortgage loan.
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what are current liabilities? (check all that apply.) multiple select question. current liabilities are usually settled by paying out current assets such as cash. current liabilities are property, plant and equipment that are tangible and depreciated. current liabilities are liabilities that are not due to be settled within one year or the operating cycle, whichever is longer. current liabilities are liabilities due to be paid within one year.
Current liabilities are usually settled by paying out current assets such as cash are current liabilities. Commonly, current assets—assets that are depleted within a year—are utilised to settle current liabilities.
Accounts payable, short-term debt, dividends, notes payable, and unpaid income taxes are a few examples of current obligations. On the balance sheet, current liabilities include things like accounts payable, payroll due, payroll taxes, accrued expenses, short-term notes payable, assets income taxes, interest payable, accrued interest, utilities, rental fees, and other short-term loans. A company's current liabilities are its debts that are due within a year of the balance sheet date and will either utilise current assets or generate new current liabilities.
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a machine with a cost of $174,000, accumulated depreciation of $107,000, and current year depreciation expense of $28,000 is sold for $57,600 cash. the amount that should be reported as a source of cash under cash flows from investing activities is:
Zero using the direct approach; expense for depreciation of $28,000 using the indirect method.
What is the Statement of Cash Flows' Operating Section?Operating, financing, and investing are the three main activities that make up the statement of cash flows. The company's primary operations are the source of the net cash inflow that is reported in the operating section of the statement of cash flows.
All transactions that result in cash inflows and outflows are reported according to the direct method of the statement of cash flows. Since none of the amounts in the transaction resulted in cash inflows or outflows as a result of the primary operations of the business, none of them would be included in the statement of cash flows that would have been reported using the direct method.
In contrast, the indirect method of preparing the statement of cash flows starts with net income and is adjusted for non-cash items like depreciation expense and the movement of current and non-current liabilities to determine the amount of cash flows from operating activities.
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Ethnicity can be mobilized by groups and individuals for economic, political, and other gains. Identity entrepreneurs and ethno-corporations both use ethnicity in such a way. Identify whether the following statements describe identity entrepreneurs or ethno-corporations.
The following statements describe marketers/ entrepreneurs. The maximum not unusualplace ethnicity of marketers is White (70.9%), observed through Hispanic or Latino (14.3%), Asian (6.2%) and Black or African American (6.0%).
Ethnicity/ethnic-corporation, are phrases for ascribed identification bestowed on businesses or categories described through their unique cultural attributes inclusive of language and religion. They are frequently, however now no longer necessarily, ranked inside their societies. Ethnic entrepreneurship is basically described as enterprise possession amongst immigrants, ethnic institution individuals or each. Ethnicity is a experience of historical, cultural, and from time to time ancestral connection to a set of folks who are believed to be wonderful from the ones out of doors the institution.
Ethnic war frequently happens inside a rustic because of colonial affect and activity. Identify the international locations where out of doors powers have negatively affected ethnic relations. Ethnic organizations, which frequently end result from voluntary or involuntary segregation or segmented financial systems, are financial entities tied to unique cultural businesses. They offer items and offerings each inside and outside to the unique institution. Ethnic organizations which might be related to ethnic groups offer avenues for social mobility, socialization, and acculturation for institution individuals. There are numerous factors, going on each inner and outside to the unique community, that account for the viability of ethnic organizations. For example, amongst a few immigrant groups (inclusive of Koreans), ethnic organizations appear like extra colourful and convey substantially better prices of self-employment than in the relaxation of the United States. Alternatively, a few racialized businesses, inclusive of blacks, seem to have markedly decrease prices of business enterprise viability and self-employment.
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a supervisor has nine identical tasks that must be completed and five (different) employees to whom she may assign them. if she wishes to ensure that each employee is assigned at least one task to perform, how many ways are there to assign the tasks to the employees?
5760 Therefore, for each of the aforementioned 360 assignments, we have 4 4 = 16 4 4 = 16 options for the final two jobs. Therefore, there are 36016=5760 different ways to distribute six jobs among four workers so that each has at least one job.
The act of assigning any authority to another person to carry out particular tasks is known as delegation. It is one of the fundamental ideas of management leadership.
However, the person who assigned the task still bears responsibility for the outcome of the assignment.
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which of the following is a true statement? a) the deduction for interest on educational loans is subject to a phase-out limitation. b) the deduction for moving expenses is subject to a phase-out limitation. c) self-employed taxpayers are allowed to deduct health care premiums even if the taxpayer is eligible to participate in an employer-provided health plan. d) excess business losses are deductible up to $100,000. e) all of these choices are false.
Option a is true. It is true that the deduction for interest on educational loans is subject to a phase-out limitation.
A phase-out restriction applies to the student loan interest deduction.The phrase "phase out" is used in the financial industry to describe the steady lowering of a credit as the threshold for eligibility of a taxpayer's income approaches.
There is a minimal amount for higher income earners and a maximum amount for poorer earners.
For a number of credits, Internal Revenue Services has acknowledged phase out. For households with low to middle incomes, phase-out is intended. The maximum tax credit for student loan interest is $2,500.
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the value of melvin's alpha biotechnology stock in 2014 is how many times as large as the value of his stock in 2012? times as large the value of melvin's alpha biotechnology stock in 2013 is how many times as large as the value of his stock in 2014?
The stock's value is 49,842/43,363 in 2013, or 1.15 times higher than in 2014.
An = P(1-R)n gives the value $An after n years for an item of value $P that depreciates at R% per year:A4= 100,000(1- 0.13)4 = $57,289.761 = $57,290 (approximately) in the year 2012, P = $100,000, R = 13% = 0.13 a.
A5 = 100,000(1- 0.13)5 = $49,842.09 = $49,842 (approximately) in the year 2013.
The stock's value is 49,842/57,290 in 2013, which is 0.87 times higher than in 2012.
b. In 2010, A2 = 100,000(1-0.13)2 = $75,690; in 2011, A3 = 100,000(1-0.13)3 = $65,850; the stock's value in 2011 is 65,850/75,690, or 0.87 times more than it was in 2010.
c. In the year 2014,
A6= 100,000(1-0.13)6 = $43,363
In the year 2012,
A4= $57,290 (approx.)
As a result, the stock's value increased by 0.76 times in 2014 to 43,363/57,290.
d. In 2013, A5 was worth $49,842; in 2014, A6 was worth $43,363. As a result, the stock's value in 2013 was 49,842/43,363, or 1.15 times more than it was in 2014.
What determines a stock's worth?Fundamentally, stock prices are determined by market supply and demand. The value of a business is the sum of its price and the number of outstanding shares, or market capitalization.
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Full Question - In 2008 Melvin thought that he was making a sound investment by buying $100,000 worth of Alpha Biotechnology stock. Unfortunately, his investment has depreciated, losing 13% of its current value each year.
A. the value of melvin's alpha biotechnology stock in 2013 is how many times as large as the value of his stock in 2012?
B. the value of melvin's alpha biotechnology stock in 2011 is how many times as large as the value of his stock in 2010?
C. the value of melvin's alpha biotechnology stock in 2014 is how many times as large as the value of his stock in 2012?
D. the value of melvin's alpha biotechnology stock in 2013 is how many times as large as the value of his stock in 2014?
Which of these situations provides an external opportunity that the company may exploit to gain competitive advantage?
O Monica's rare book company has weak competition.
O Jack's food processing plant faces strict government scrutiny.
O Norm's engine manufacturing facility is outdated and needs new equipment.
O Kevin's insurance group lost market capitalization.
Choosing option (a) is the right move. Monica's Rare Books has little outside competition, which creates a chance for the company to gain a competitive edge.
What factors of external competition are there?The external influences can include market or competitive position changes as well as macroeconomic concerns including technology advancement, legislation, and sociocultural shifts. The results are frequently displayed as a matrix.
What distinguishes competitive advantage from a strategic advantage?Your capacity to outcompete others in a market is your competitive edge. Your capacity to outperform competitors more broadly, including your returns to stakeholders like investors, employees, and communities
Why is it vital to achieve a competitive advantage?Having a competitive advantage allows a business to stand out from its rivals by providing clients with something unique and exceptional. A company with a competitive advantage can also outperform its rivals in the market and generate bigger profits.
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what type of team allows people to connect with distant team members across borders and time zones, and to work interdependently with a shared purpose across space, time, and organizational boundaries using technology?
Virtual team allows people to connect with distant team members across borders and time zones.
A virtual team is also referred to as a geographically dispersed team. It is a collection of individuals who communicate with one another online. A virtual team typically consists of individuals from various locations. Since virtual teams communicate virtually, trust and effective communication are essential to their success.
A virtual team has a number of benefits, including:
Lower office expenses: Members can operate from home or a remote location without renting office space from the company.Flexibility: Individual members can develop more flexibility.Productivity gains: Because there is less time lost in commuting and traveling, members of a virtual team typically produce more.A 24-hour workday: Businesses can run on a 24-hour schedule by assigning shifts to several nations.Talent accessibility: Since members can be employed anywhere, the limitation of relying just on the local talent pool is removed.To read about online workspace visit:
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the income tax base for an individual tax return is: a) realized income from whatever source derived. b) gross income. c) adjusted gross income. d) adjusted gross income minus from agi deductions.
The income tax base for an individual tax return is d) adjusted gross income minus AGI deductions.
What is adjusted gross income?Adjusted gross income (AGI) is described as the income of an individual from which certain adjustments are deducted from the income. It is important to mention that the adjusted gross income highly influences the tax deductions as well as highlight the eligibility of an individual regarding income.
Adjusted gross income is a modified type of gross income when certain adjustments are made to it, it provides the exact amount on which the tax liabilities are determined.
It can be concluded that the income tax base for an individual tax return is d) adjusted gross income minus AGI deductions.
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an exogenous variable is a a variable a. that varies with changes in current income. b. that is independent of current income. c. that is independent of taxes. d. that comprises variables such as consumption, saving, and aggregate expenditures.
The correct answer is Option D.
Exogenous variables help to explain various factors or outcomes with in model by having a reason that is independent of the model.
What is Exogenous variables?A variable that is exogenous to the system is one that is unaffected by other variables. Consider a straightforward causal system, such as farming. Crop output is influenced by exogenous factors such as weather, farmer skill, pests, and seed availability.Exogenous variables help explain other factors or outcomes with in model by having a reason that is independent of the model.Exogenous variables are seen as independent in contrasting to endogenous variables. In other words, changes in one variable with in formula do not automatically or directly affect changes in another. Exogenous variables don't relate to one another directly or through a formula.An exogenous variable in an economic model is one whose value is established outside the model and imposed upon the model, whereas an . A change in an exogenous variable is known as an exogenous change.To learn more about exogenous variables refer to :
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an economy is experiencing a high rate of inflation. the government wants to reduce consumption by $36 billion to reduce inflationary pressure. if the multiplier is 2, by how much should the government cut spending to achieve its objective?
If the government wants to decrease the output by $36 billion then they should cut the expenditure by $18 billion. (36/2) should the government cut spending to achieve its objective.
Inflationary pressure:
Inflationary pressures are the underpinning causes of affectation. These pressures are the reason that the product of goods increases to meet or exceed consumer demand or that prices boost due to lack of force. Inflationary pressures beget the frugality to acclimate as a result of force and demand.
Why is there inflationary pressure?Inflation can do when prices rise due to increases in product costs, similar as raw accoutrements and stipend. A swell in demand for products and indulgences can beget inflation as consumers are willing to pay further for the product.
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which section of the uniform commercial code (ucc) defines usage of trade as any practice that members of an industry expect to be part of their dealings?
Warranty implied: Merchantability; Utilization of Trade1) If the seller is a merchant with regard to goods of that kind, a warranty that the goods shall be merchantable is implied in a contract for their sale unless excluded or modified (Section 2-316).
What parts of the Uniform Commercial Code include the "best bid" rule?The perfect tender rule, which can be found in Article 2 of the Uniform Commercial Code, states that a buyer has the right to reject goods shipped or delivered by a seller if the seller's tender of the goods isn't perfect.
The Uniform Commercial Code: What is It?The United Commercial Code (UCC) was a plan to create laws that reflected actual business practices. The UCC has been adopted in some form by each of the fifty states. The UCC's Article 2 deals with goods sales. tangible things that can be moved when they are added to a contract.
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which of the following statements about marketing is the most accurate? a. marketers recognize the need to learn as much as possible about customers and do everything possible to satisfy them. b. once a product is sold, focus on the next customer. c. because nonprofit organizations are not motivated by profit, marketing activities are not consistent with their goals. d. to be successful, marketers must be able to persuade consumers to purchase goods they don't really need.
Marketers recognize the need to learn as much as possible about customers anddo everything possible to satisfy them to become successful.(Option d is correct)
In moment's fast- paced terrain, marketing is the catalyst for brand growth. What was formerly spoken communication has changed to include audio and videotape. Moment's digital marketing channels are setting the standard and aiding in the success of numerous companies. People who are considering career options in this area need to know what marketing in business is as well as what a marketer is.
A marketer is a person who advertises the goods and services of a company. They identify the tactics that can increase deals and income while making sure that these tactics are in line with both client and request need.
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which section would you open in your analytics property in order to find advanced techniques that can help you uncover deeper insights about your customers' engagement?
Explorations is a group of cutting-edge methods that go beyond conventional reporting to aid in the discovery of deeper insights.
Cutting-edge technology, often known as technology at the cutting edge of knowledge, is defined as technological tools, methods, or accomplishments that make use of the most recent and advanced IT breakthroughs. Organizations at the forefront of the IT sector are frequently referred to as "cutting edge."
Contrary to bleeding-edge technology, that is sufficiently new that it puts users at risk for unreliability, cutting-edge technology refers to contemporary and sufficiently formed technology features.
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arrange the five steps of the decision-making process given below in the correct order. a. obtain information b. make predictions about the future c. identify the problem and uncertainties d. make decisions by choosing among alternatives e. implement the decision, evaluate performance, and learn
Correct order is- C = Identify the problem and uncertainties
A = Obtain information
E = Make predictions about the future
B = Make decisions by choosing among alternatives
D = Implement the decision, evaluate performance, and learn
An individual goes through a decision-making process while deciding which alternative or course of action will best suit their needs. It is a series of actions performed by managers in an organization to decide the intended course for business objectives and to initiate particular actions. Business intelligence and analytics tools should be used to help analyze objective facts and base choices on them.
You begin the decision-making process by determining the issue or selecting the objective. After that, you look for information about the issue and design uncertainties using that data.
You then pick one of the scenarios and decide in accordance with it. If the choices don't lead to the problem being solved, a different option is picked, and step 5 is repeated.
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during a strike, management is allowed to discharge non-strikers who refuse to take over a striker's job. True or False
The statement that management is allowed to discharge non-strikers who refuse to take over a striker's job is True.
How should companies handle strikes?Even though strikes can hurt the production of goods or services for a company, they are not allowed to act n certain ways. One of them is that they cannot offer benefits to those striking as this might undermine the striking union.
Companies can however, ask their non - striking workers to take over the jobs left by the strikers for the time being. If the non - striker refuses, they can be discharged.
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holiday brands issued $33 million of 6%, 30-year bonds for $30.5 million. what is the amount of interest that holiday will pay semiannually to bondholders? (enter your answers in whole dollars.)
A bond is a written promise to pay bondholders a certain amount at maturity.In addition, periodic interest will be paid to bondholders.This is one way that the issuing company can get more money.
Let's figure out how much interest is paid to bondholders.The period is two because the interest is paid semiannually.
The amount of interest that Holiday will pay to bondholders semiannually is $990,000, or $33 million x 6% / 2 = $0.99 million. Interest paid = Face value of bond x Interest rate / Period
A bond covenant is a term of an agreement between a bond issuer and a bondholder that must be followed by law.Bond covenants aim to safeguard both parties' interests.
Is a bond a guarantee of payment?
A promise to pay is a bond. It's a promise to pay in the future in exchange for today's payment. Bonds—promises—can be purchased and sold. A lender is the bond buyer.
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true or false: a classified balance sheet separates liabilities into current and non-current categories.
Liabilities are divided into current and non-current categories on a categorized balance sheet. The operating activities are directly related to a large number of current obligations. It is true to say this.
Additionally, current and non-current are used to categorize the parts of assets and liabilities. A classified balance sheet format is used by larger firms because it gives users extensive information for better decision-making. While no such component division is created in the case of an unclassified balance sheet.
Numerous current liabilities that appear on the balance sheet, including Accounts payable, accrued wages, and deferred revenue, are directly related to the things that happen on the cash flow statement. There are additional sub-headings that separate the components of assets, liabilities, and equity.
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the net pay owed to an employee amounts to their gross pay minus deductions made. these deductions can include:
Employers are prohibited from taking unauthorized deductions from employees' salary and compensation, including several other groups of people. Employers must abide by the provisions of your employment contract and may only deduct wages under certain circumstances.
Learn about your rights to protection and when employers may deduct money from your pay.Your earnings and your salary differ slightly. Your employer pays you a salary in relation to the work you do. The minimum amount you should be paid is called pay (for example your monthly or hourly pay rate). Your pay may consist of:
any fees, bonuses, commissions, holiday compensation, or any wages related to your employment, excluding
statutory wages (such as Statutory Sick Pay or Statutory Maternity Pay)
Gift certificates, lunch coupons, and other vouchers with a set value that can be used to buy products, services, or money.
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the north ridge diner is always swamped during the weekends. what could the restaurant do to keep customers from becoming impatient while they wait?
The north ridge diner is always swamped during the weekends. The restaurant, in order to keep customers from becoming impatient while they wait could Alert guests that their tables are ready via text message.
What is customer service?Generally, Customer service refers to the assistance and guidance that a company offers to individuals who purchase or make use of the goods or services that it offers.
Every sector has its own unique standards for customer service, but in the end, a successful service should be measured by its ability to boost earnings.
On the weekends, there is typically a line out the door at the North Ridge Diner. A text message could be sent to the guests at the restaurant to let them know when their tables are ready. This would help the restaurant's customers avoid becoming irritable while they wait.
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if a specific set of importing steps will be performed frequently, how can that process be made more efficient?
Data is entered into a table using the datasheet view.
Is there a database object that retrieves particular data from multiple database objects?
A database object known as a query is one that retrieves particular data from one or more database objects known as tables or other queries.You can enter, edit, or display data from a table or a query using an Access object called a form.
Is it used for each and every piece of data in every record?
a method. a single piece of information that is formatted as a column in a database table and is stored in each record. a list of the table's field names. A field's characteristics that regulate how the field displays and how data can be entered.
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question content area if a company mistakenly counts less items during a physical inventory than actually exist, how will the error affect the cost of merchandise sold? a.understated b.no change c.only inventory will be affected d.overstated
An erroneous physical inventory will cause the cost of goods sold and net income to be overestimated.
How does inventory work?All the goods, services, and equipment that a company keeps in hand with the goal of selling them for just a profit are referred to as inventory. Example: If a paper provider uses a vehicle to deliver newspapers to customers, just the newspaper will be considered inventory.
What are the four different types of inventory?Although there are more types of inventory, the four main ones are raw materials and components, finished goods, collaborate, and upkeep, repair, and operational supplies. Inventory is regarded as an asset by businesses since it costs money to purchase it, which it then sells for a profit.
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advantages of the payback period include that it is easy to calculate, easy to understand, and that it is based on cash flows rather than on accounting profits. group of answer choices true false
This assertion is accurate. The payback period has several benefits, such as being simple to calculate and comprehend, and being based on cash flows rather than accounting profits.
What Is Capital Budgeting?This concern has to do with capital budgeting, a method used by companies to evaluate investments including new initiatives, capital investments, equipment replacements, and other projects. Expected future cash flows are evaluated to determine whether investment is required (and frequently discounted).
There are numerous capital budgeting techniques, such as the payback period approach, internal rate of return technique, and net present value analysis (PPM). The latter approach is more widely used, simple to comprehend, and quick to calculate. In essence, the PPM involves assessing whether a project's payback period—the period of time (usually measured in years) required to recover the initial investment—falls within a minimal acceptable timeline. Either an undiscounted basis or a discounted basis can be used to conduct the review, which is more concerned with cash flows than accounting profits.
The assertion is accurate, as shown by the facts up top.
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