Caren's canoes is considering relaxing its credit standards to encourage more sales. as a result, sales are expected to increase 15 percent from 300 canoes per year to 345 canoes per year. the average collection period is expected to increase to 40 days from 30 days and bad debts are expected to double the current 1 percent level. the price per canoe is $850, the variable cost per canoe is $650 and the average cost per unit at the 300 unit level is $700. the firm's required return on investment is 20 percent. (assume a 360-day year) what is the cost of marginal investments in accounts receivable under the proposed plan?

You are chairman of the board of a successful technology firm. there is a nominal federal corporate tax rate of 35 percent, yet the effective tax rate of the typical corporation is about 12.6%. your firm has been clever with use of transfer pricing and keeping money abroad and has barely paid any taxes over the last 5 years; during this same time period, profits were $28 billion. one member of the board feels that it is un-american to use various accounting strategies in order to avoid paying taxes. others feel that these are legal loopholes and corporations have a fiduciary responsibility to minimize taxes. one board member quoted what the ceo of exxon once said: “i’m not a u. s. company and i don’t make decisions based on what’s good for the u. s.” what are the alternatives? what are your recommendations? why do you recommend this course of action?

How are interest rates calculated by financial institutions? financial institutions generally calculate interest as (1) interest or (.

On september 1, 2016, steve loaned brett $2,000 at 12% interest compounded annually. steve is not in the business of lending money. the note stated that principal and interest would be due on august 31, 2018. in 2018, steve received $2,508.80 ($2,000 principal and $508.80 interest). steve uses the cash method of accounting. what amount must steve include in income on his income tax return?