Represents capital structure decision

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Reference no: EM132040390

1. Which of the following represents a capital structure (or financing) decision?

A. A decision to issue $25 million of bonds.

B. A decision to invest $25 million in the stock of another company.

C. A decision to buy a new accounts payable software package for $2 million.

D. A decision to write-off $3 million of accounts receivable.

E. A decision to introduce a just-in-time inventory system, which will reduce inventories by an estimated $10 million

2. A firm is reviewing a project with labor cost of $8.90 per unit, raw materials cost of $21.63 per unit and fixed costs of $8,000 per month. Sales are projected at 10,000 units over the three-month life of the project.

What are the total variable costs of the project.

A. $329,300

B. $297,300

C. $313,300

D. $305,300

E. $216,300

Reference no: EM132040390

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