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How do a firm calculate its profit?
A firm calculates its profit by subtracting total expenses from total revenues. Profit can be categorized into gross profit, which is revenue minus the cost of goods sold, and net profit, which accounts for all operating expenses, taxes, and interest. The formula can be summarized as: Profit = Total Revenue - Total Expenses. This calculation helps firms assess their financial performance over a specific period.
A forecast predicts the revenues costs and expenses a firm will incur for a period longer than one year?
A forecast predicting a firm's revenues, costs, and expenses for a period longer than one year is typically referred to as a long-term financial projection. This type of forecast helps businesses plan for future growth, assess potential profitability, and make informed decisions regarding investments and resource allocation. It often incorporates various assumptions about market conditions, economic trends, and company performance, allowing firms to strategize effectively for sustained success. Long-term forecasts are crucial for stakeholders who seek to understand the financial viability and risk associated with the business's future.
An equity issue sold to the firms existing stockholders is called?
A general cash offer
Is a firms comprehensive income always the same as its net income?
Is comprehensive income both greater than or less than net income or just either one
What are the five areas in the accounting profession?
Had you visited St. Charles, Illinois (about fifty miles southwest of Chicago), back in 2001, you would have noticed an impressive training and conference center owned by Arthur Andersen (then one of the so-called "Big 5" public accounting firms). Had you gone in, you could have toured a room dedicated to the history of Arthur Andersen, a proud firm with eighty-nine years of corporate history. You'd have learned how a company started by a young accounting professor from Chicago grew into one of the world's largest public accounting firms, with twenty-eight thousand employees and annual revenues of over $4 billion.
How do investment bankers generate revenues for their firms?
Investment bankers can generate revenues for their firms by the amount of money they bring in from their customers. By bringing in money, the firm will have more to invest.
Why firms invest and borrow?
Firms invest in order to make dividend and interest income when they have an excessof money over current operating expenses. Firms borrow to pay bills when they have an excess of operating expenses over the cash available.
How does collusion improve the financial standing of firms?
Collusion can improve the financial standing of firms by allowing them to work together to manipulate prices, reduce competition, and increase profits. This can lead to higher revenues and market power for the colluding firms, ultimately boosting their financial performance.
Who are the market leaders in anthracite mining?
Pennsylvania had 31 anthracite mines in 2001. Leading anthracite-mining firms included Bradford Coal Company (2002 revenues, $19 million), Anthracite Industries, Inc. (2002 revenues, $8.2 million), and Reading Anthracite (2002 revenues, $3.4 million).
Is the importance of financial managers to firms with large cash inflows greater than for firms with smaller cash flows?
true
Why do Firms trying to avoid competition?
Firms try to avoid competition so that they can set higher profits and earn greater profits.
Why do firms become monopolies?
Two main reasons: 1. There are greater profits to be gained by being a monopoly, either in the form of lower costs (economies of scale) or higher revenues (since all the industry demand is supplied by one company). 2. Less uncertainty. You don't have to worry about competition.
Why can firms not always reduce prices until they increase sales and profits?
if marginal production costs exceed marginal revenues, the firm will suffer losses, not profits.
What is monopolist's marginal revenues less than the price of its goods?
because the monopolist firms are price maker and they can set any price they want and the customers are not perfect knowleged
Why do firms invest and borrow?
Firms invest in order to make dividend and interest income when they have an excessof money over current operating expenses.Firms borrow to pay bills when they have an excess of operating expenses over the cash available.
What is One of the best ways for firms to enhance customer satisfaction is by providing?
Greater Value on Products
How does a firm know when it can afford to hire more workers?
if the MRP is greater than a firms MC
