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NEW QUESTION: 1
Lukers Co is structured on a functional basis. Two of the departments are purchase and production. The directors wish to improve product quality, and are considering the introduction of an incentive scheme.
Which of the following performance measures would be an appropriate basis for the incentive scheme?
A. Share price
B. Company profit
C. Volume of products returned by customers
D. Favourable material price variances
Answer: C
NEW QUESTION: 2
Which of the following statements is characteristic of all assets?
A. They are owned free and clear by the organization.
B. They are obligations to a third party.
C. They are owned or controlled by the organization.
D. They can be converted to cash in the short term.
Answer: C
NEW QUESTION: 3
Heather, Erika, and Shelby are members in HES LLC. Heather works 40 hours per week and Erika and
Shelby work 20 hours per week. Heather contributed $30,000 to the LLC and Erika and Shelby
contributed $60,000 each. Erika and Shelby have each originated 45% of the LLC's business and Heather
has originated the other 10%. Absent an agreement to the contrary, how will the LLC's $120,000 profits
be divided among the members?
A. Option D
B. Option A
C. Option B
D. Option C
Answer: A
Explanation:
Rule: Absent an agreement to the contrary, the LLC's profits will be divided among the members in
proportion to their contributions. Here, Heather's, Erika's and Shelby's contributions were $30,000,
$ 60,000, and $60,000, respectively. Thus, the profits will be divided in a 1:2:2 ratio (20% of $120,000 to
Heather; 40% of $120,000 to Erika; and $120,000 to Shelby).
Choice "d" is correct.
Heather Erika Shelby
D. $24,000 $48,000 $48,000
Choices "a", "b", and "c" are incorrect, per the above rule.