Answer:
country X will export 27 pounds of Bananas for 4.21 pounds of sugars
Explanation:
For country X
1 labor period = 15.4 pounds of bananas
1 labor period = 2.4 pounds of sugar
next calculate opportunity costs
opportunity cost of 1 pound of Banana = 2.4 / 15.4 = 0.1558
opportunity cost of 1 pound of sugar = 15.4 / 2.4 = 6.4167
For country Y
1 labor period = 8.7 pounds of bananas
1 labor period = 3.1 pounds of sugar
opportunity cost of 1 pound of banana = 3.1 / 8.7 = 0.3563
opportunity cost of 1 pound of sugar = 8.7 / 3.1 = 2.8064
when the opportunity costs are compared
Country X has a lower opportunity cost for the production of banana while
Country Y has a lower opportunity cost for the production of sugar
Hence country X will export Banana
I pound of Banana will be exported for 0.1558 sugars
i.e. 27 pounds of Bananas will exchanged for ( 27 * 0.1558 ) sugars
27 pounds of Bananas = 4.21 pounds of sugars
QUESTION 2 of 10: What is the term used by recruiters to describe their ideal candidate?
a) Pink cow
b) Red rabbit
c) Purple squirrel
d) None of the above
Answer:
Purple squirrel is the answer
Answer:
we gottta kill dem critters
Explanation:
Explain in detail the difference between the United states government's budget deficit versus the national debt.
Answer:
The debt is the total the U.S. government owes—the sums it borrowed to cover last year's deficit and all the deficits in years past.
Explanation:
The LFH Corporation makes and sells a single product, Product T. Each unit of Product T requires 1.5 direct labor-hours at a rate of $10.50 per direct labor-hour. The direct labor workforce is fully adjusted each month to the required workload. LFH Corporation needs to prepare a Direct Labor Budget for the second quarter of next year. The company has budgeted to produce 28,000 units of Product T in June. The finished goods inventories on June 1 and June 30 were budgeted at 800 and 600 units, respectively. Budgeted direct labor costs for June would be:
A. $294,000
B. $441,000
C. $444,150
D. $437,850
Answer:
the budgeted direct labor cost is $441,000
Explanation:
The computation of the budgeted direct labor cost is shown below:
Budgeted direct labor cost
= Budgeted production × hours per unit × rate per hour
= 28,000 units × 1.5 × $10.50
= $441,000
Hence, the budgeted direct labor cost is $441,000
So the correct option is B.
In response to accounting scandals and the collapse of Enron at the turn of the century, the U.S. Congress passed the Sarbanes-Oxley Act to establish a system of federal oversight of corporate accounting practices. The purpose of the law is to hold CEOs accountable in matters of financial reporting, and to ensure the truthfulness of statements offered to investors. Despite the law's good intentions, businesses must now spend millions of dollars each year just to comply with the regulations. However, the steep challenges of compliance have created a boom in new accounting firms that specialize in helping companies meet the law's requirements.Answer the multiple choice questions that follow the video content.Congress passed Sarbanes-Oxley into law as a response to:a. Globalization b. Financial scandals and corporate fraud c. Consumer protection violations d. Executive CEO pay How does Sarbanes-Oxley attempt to improve business ethics?a. By regulating executive retirement plans b. By legally requiring companies to certify the truth of their statements to investors c. By enacting legal protections against discrimination d. By offering suggestions for how companies might be more transparent Which aspect of Sarbanes-Oxley has created severe difficulties for businesses?
a. The law's whistle-blower protections
b. The creation of the Public Company Accounting Oversight Board c
. The law's aim to hold CEOs accountable
d. The cost and difficulties of compliance
Answer:
b. Financial scandals and corporate fraud.b. By legally requiring companies to certify the truth of their statements to investors.d. The cost and difficulties of compliance.Explanation:
After the U.S. was rocked by the financial scandals and corporate fraud of companies like Enron and WorldCom, the U.S. Congress enacted the Sarbanes-Oxley Act to mitigate the risk of such ever occurring again.
The Act involves making the management personally liable for the accuracy of the statements by legally requiring companies to certify the truth in their statements to their investors.
While this seems easy enough, it requires a lot of information gathering which has left companies paying millions to comply.
Is entrepreneur Born or learned
Answer:
The answer is "learned"
Answer:
Learned
Explanation:
Rationality in the household decision-making process means that: a. households want to earn as much income as possible. b. households act in their own best interests. c. everyone in the household agrees on all decisions. d. all households make the same decisions. e. all households have the same information on product quality and prices.
Answer:
households act in their own best interests.
Explanation:
Economic Decision-Makers includes the Households, Firms, Governments, and the Rest of the World. Economic decision-making is the means or process of selecting which needs and wants that should be satisfied. The factors that determines what is produced are Resources available and consumer preferences and the factors that determines what is purchased are consumer preference and price.
The Households demand for goods and services will lead to what the industries produces. Households are seen as rational because they try to act in their upmost best interests and not what will make them sad.Utility maximization is dependent on household's subjective goals.
In 2013, Natural Selection, a nationwide computer dating service, had $500 million of assets and $200 million of liabilities. Earnings before interest and taxes were $120 million, interest expense was $28 million, the tax rate was 40%, principal repayment requirements were $24 million, and annual dividends were 30 cents per share on 20 million shares outstanding.
a) Calculate the following for Natural Selection:
1) Liabilities-to-equity ratio
2) Times-interest-earned ratio
3) Times burden covered
b) What percentage decline in earnings before interest and taxes could Natural Selection have sustained before failing to cover:
1) Interest payment requirements?
2) Principal and interest requirements?
3) Principal, interest, and common dividend payments?
Answer and Explanation:
The computation is shown below:
a) Liabilities to equity ratio is
= $200 ÷ ($500 - $200)
= 0.667
Times interest earned ratio is
= EBIT ÷ Interest expense
= $120 ÷ $28
= 4.285
Times burden covered is
= EBIT ÷ (Interest +Principal repayment ÷ ( 1 -tax rate))
= 120 ÷ (28+24 ÷ (1-0.4))
= 1.764
b)
Interest paying requirements
= ($128 - $20) ÷ 120
= 76.7%
Principal and interest requirements
= [$120 - ($28 + $24 ÷ (1-0.4))] ÷ 120
= 0.433 or 43.3%
Principal, Interest and Common dividend payments -
= [$120 - ($28 + (($24 + 0.3 × 20) ÷ (1 - 0.4))] ÷ 120
= 0.35 or 35%
Timothy purchased a new computer for his consulting practice on October 15 th of the current year. The basis of the computer was $4,000. During the Thanksgiving holiday, he decided the computer didn't meet his business needs and gave it to his college-aged son in another state. The computer was never used for business purposes again. Timothy had $50,000 of taxable income before depreciation. What is Timothy's total cost recovery expense with respect to the computer during the current year
Answer:
$0
Explanation:
Computer was sold during the same year which it is purchased. No depreciation is allowed in such a case.
In other word, there would be $0 total cost recovery as there is no Depreciation Expense given and in the same year the computer is given to Thomas son so no Depreciation Is allowed in this case.
writing in a business environment differs from other types of writing. in professional settings, written messages and oral presentations should be purposeful, economical, and audience oriented. identify the correct business writing objective for the following description. identify the problem you are trying to solve or the information you are trying to convey, and then develop a strategy to address that need. purposeful audience oriented persuasive economical
Answer:
The correct business writing objective for the given description is:
Purposeful
Explanation:
To be purposeful is to ensure that a business communication conveys the required information, solves the identified problems, and remains relevant in both context and tune. The other business writing objectives include being persuasive, economical and audience-oriented. To be persuasive, a business writing must ensure that the audience believes and accepts the message. To be economical requires the presentation of clear, concise, and efficient messages, devoid of ambiguity. Finally, audience-orientation requires the demonstration of audience-perspective.
On May 7, Hatch Company purchased on account 700 units of raw materials at $19 per unit. During May, raw materials were requisitioned for production as follows: 217 units for Job 200 at $17 per unit and 336 units for Job 305 at $19 per unit. Journalize the entry on May 7 to record the purchase. If an amount box does not require an entry, leave it blank.
Answer and Explanation:
The journal entry is shown below:
On May 7
Raw material Dr (700 units × $19) $13,300
To Account payable $13,300
(being the raw material is purchase on an account is recorded)
Here the raw material is debited as it increased the assets and credited the account payable as it also increased the liabilities
Milk producers across Arizona and nationwide currently are facing prices that are so low that many dairies have already gone bankrupt. The government decides to step in and establishes a price floor of $2 per gallon for milk. The current market equilibrium price for milk is $1 per gallon:
Question Completion:
What is a price floor?
Answer:
A price floor of $2 for milk producers across Arizona and nationwide means that the government does not want the price of milk to fall below $2. This measure enables dairies to remain in operation. It favors producers to the detriment of consumers, at least in the short-run.
Explanation:
However, assuming that the market was efficient before the price floor was introduced by the government, the price floor of $2 per gallon for milk could cause a deadweight loss to occur. In Economics, a deadweight loss reduces economic efficiency. It implies that consumers pay a higher price for the same quantity of goods they were purchasing before the price floor was introduced. Thus, the reaction of consumers would be to reduce their demand or drop out of the market entirely (instead of producers dropping out of the market through the normal operation of the market forces).
You are bullish on Telecom stock. The current market price is $50 per share, and you have $5,000 of your own to invest. You borrow an additional $5,000 from your broker at an interest rate of 8% per year and invest $10,000 in the stock. (LO 3-4) a. What will be your rate of return if the price of Telecom stock goes up by 10% during the next year
Answer:
12%
Explanation:
Initial investment =$5,000.00
Value of stock with 10%=$10,000*(1+10%)=$11,000
The amount repayable to the broker after one year is the amount borrowed plus interest of 8%
Amount borrowed plus interest= $5,000+( $5,000 *8%)
Amount borrowed plus interest=$5,400
Rate of return=(Value of stock with 10%-Amount borrowed plus interest-equity fund)/amount borrowed
Rate of return=($11,000-$5,400-$5000)/$5,000=12%
Assume that a hypothetical economy with an MPC of 0.75 is experiencing a severe recession. Instructions: In part a, round your answers to 1 decimal place. Enter your answers as a positive number. In part b, enter your answers as a whole number. a. By how much would government spending have to rise to shift the aggregate demand curve rightward by $25 billion
Answer:
$6.25 billion
Explanation:
Calculation for how much would government spending have to rise
First step is to calculate the spending multiplier using this formula
Spending multiplier=1/(1-MPC)
Let plug in the formula
Spending multiplier=1/(1-0.75)
Spending multiplier=4
Now let calculate how much would government spending have to rise
Using this formula
Increase in government spending =Change in GDP/Spending multiplier
Let plug in the formula
Increase in government spending=$25 billion/4
Increase in government spending=$6.25 billion
Therefore how much would government spending have to rise will be $6.25 billion
Consider the following income statement for the Heir Jordan Corporation:
HEIR JORDAN CORPORATION
Income Statement
Sales $ 49,000
Costs 40,300
Taxable income $ 8,700
Taxes (22%) 1,914
Net income $ 6,786
Dividends $ 2,400
Addition to retained earnings 4,386
A 20 percent growth rate in sales is projected.
Prepare a pro forma income statement assuming costs vary with sales and the dividend payout ratio is constant. (Input all answers as positive values. Do not round intermediate calculations.)
What is the projected addition to retained earnings? (Do not round intermediate calculations.)
Answer:
HEIR JORDAN CORPORATION
The projected addition to retained earnings is $5,743.
Explanation:
a) Data and Calculations:
HEIR JORDAN CORPORATION
Income Statement Current Year Projected
Sales $ 49,000 $58,800 ($49,000 * 1.2)
Costs 40,300 48,360 (40,300 * 1.2)
Taxable income $ 8,700 10,440 (8,700 * 1.2)
Taxes (22%) 1,914 2,297 (1,914 * 1.2)
Net income $ 6,786 8,143 (6,786 * 1.2)
Dividends $ 2,400 2,400
Addition to retained earnings 4,386 5,743
During May, $62,500 in raw materials (all direct materials) were drawn from inventory and used in production. The company's predetermined overhead rate was $12 per direct labor-hour, and it paid its direct labor workers $15 per hour. A total of 380 hours of direct labor time had been expended on the jobs in the beginning Work in Process inventory account. The ending Work in Process inventory account contained $7,450 of direct materials cost. The Company incurred $43,200 of actual manufacturing overhead cost during the month and applied $42,000 in manufacturing overhead cost.The direct materials cost in the May 1 Work in Process inventory account totaled:
Answer:
$7,240
Explanation:
Missing word "Tyare Corporation had the following inventory balances at the beginning and end of May
May 1 May 30
Raw materials $29,500 $38,000
Finished Goods $79,000 $74,000
Work in Process $17,500 $17,116"
Calculation Of Direct Material Cost
Particular Amount
Beginning WIP Inventory $17,500
Less: Direct Labor Cost (15*380) $5,700
Less: Manufacturing OH applied on WIP (12*380) $4,560
Direct Material Cost $7,240
The income statement of Dolan Corporation for 2014 included the following items: Interest revenue $ 121,000 Salaries and wages expense 180,000 Insurance expense 18,200 The following balances (all normal balances) have been excerpted from Thompson Corporation's balance sheets: December 31, 2014 December 31, 2013 Interest receivable $ 18,200 $ 15,000 Salaries and wages payable 17,800 8,400 Prepaid insurance 2,200 3,000 The cash paid for salaries and wages during 2014 was
Answer:
$170,600
Explanation:
The fact that salaries and wages payable increased in 2014 is a pointer to the fact that the salaries and wages expense incurred in 2014 was not fully settled in cash as the increase in salaries and wages payable represent the 2014 expense still owed.
The cash paid for salaries and wages during 2014=salaries and wages expense-increase in salary and wages payable
salaries and wages expense=$180,000
increase in salary and wages payable=$17,800-$8,400=$9,400
The cash paid for salaries and wages during 2014=$180,000-$9,400
The cash paid for salaries and wages during 2014=$170,600
What are the limitations and constraints that this form of business has on the operations of the Green Bay Packers?
Answer:
Green Bay Packers
The limitations and constraints of a not-for-profit association are:
1. Unlimited liability of the club members: This means that the members could be exposed to personal financial liability arising from their membership of the club. When the club is unable to meet its debt obligations, individual members will be held liable for the remaining debts.
2. An unincorporated association is subject to liquidation at the slightest event. In the event of the members' death, the association will not be able to continue.
3. A unincorporated not-for-profit organization may not be able to attain credibility as much as an incorporated organization. This disadvantage limits its ability to raise external finance.
Explanation:
The Green Bay Packers is a football club under the NFL. It is a not-for-profit association. Therefore, members do not enjoy the benefits arising from limited liability.
Jack took up the job of a front desk staff at a reputed hotel. He will be interacting with various customers and employees from different parts of the world. Which two strategies can Jack's manager suggest to help him adapt to a diverse workplace?
The manager is quite impressed with Jack. He wants to encourage Jack to actively listen and explore all solutions. He also wants to train Jack to avoid using I-statements and encourage him to participate in programs that teach him more about his own ethnic group. In addition, the manager wants to help Jack to understand the customs of other cultures.
Answer:
He wants to encourage Jack to actively listen and explore all solutions.
Jack to understand the customs of other culture
Explanation:
Since in the question it is mentioned that jack has working as a front desk staff in reputed hotel. His job role is to interacting with the differnt customers who belong from different countries so the strategies that need him to adopt the diverse workplace is to motivate him for actively listen and explore the solutions also understands the other culture customs
Which report do you produce to see total sales for the company?
The Great Giant Corp. has a management contract with its newly hired president. The contract requires a lump sum payment of $25,400,000 be paid to the president upon the completion of her first 8 years of service. The company wants to set aside an equal amount of funds each year to cover this anticipated cash outflow. The company can earn 7 percent on these funds. How much must the company set aside each year for this purpose?
Answer:
The Great Giant Corp.
The Corporation must set aside the sum of $2,475,681.17 in order to achieve $25,400,000 in 8 years at an interest rate of 7%.
Explanation:
a) Data and Calculations:
Future value = $25,400,000
No. of periods = 8 years
Interest rate = 7%
Therefore, annual amount that must be set aside is $2,475,681.17.
Schedule of Payments into the Fund:
Period Present Value Annual Payment Interest Future Value
1 $0.00 $-2,475,681.17 $0.00 $2,475,681.17
2 $-2,475,681.17 $-2,475,681.17 $-173,297.68 $5,124,660.02
3 $-5,124,660.02 $-2,475,681.17 $-358,726.20 $7,959,067.38
4 $-7,959,067.38 $-2,475,681.17 $-557,134.72 $10,991,883.27
5 $-10,991,883.27 $-2,475,681.17 $-769,431.83 $14,236,996.26
6 $-14,236,996.26 $-2,475,681.17 $-996,589.74 $17,709,267.17
7 $-17,709,267.17 $-2,475,681.17 $-1,239,648.70 $21,424,597.04
8 $-21,424,597.04 $-2,475,681.17 $-1,499,721.79 $25,400,000.00
what do u all think about India...??
Which of the following would not be a part of a company's human resources?
A Managers
B. Full-time employees
C. Temporary employees
D. All would be included as human resources
Simon Company’s year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago Assets Cash $ 30,200 $ 35,250 $ 37,000 Accounts receivable, net 88,400 62,000 49,000 Merchandise inventory 111,000 81,200 53,500 Prepaid expenses 10,800 9,300 4,800 Plant assets, net 280,000 254,000 225,000 Total assets $ 520,400 $ 441,750 $ 369,300 Liabilities and Equity Accounts payable $ 129,200 $ 75,500 $ 51,200 Long-term notes payable secured by mortgages on plant assets 96,000 100,750 81,800 Common stock, $10 par value 163,000 163,000 163,000 Retained earnings 132,200 102,500 73,300 Total liabilities and equity $ 520,400 $ 441,750 $ 369,300 The company’s income statements for the Current Year and 1 Year Ago, follow. For Year Ended December 31 Current Yr 1 Yr Ago Sales $ 725,000 $ 550,000 Cost of goods sold $ 449,500 $ 341,000 Other operating expenses 232,000 126,500 Interest expense 11,200 13,000 Income tax expense 9,350 8,525 Total costs and expenses 702,050 489,025 Net income $ 22,950 $ 60,975 Earnings per share $ 1.41 $ 3.74 For both the Current Year and 1 Year Ago, compute the following ratios: (3-a) Return on total assets. (3-b) Based on return on total assets, did Simon's operating efficiency improve or worsen in the Current Year versus 1 Year Ago?
Answer:
Simon Company
a) Return on total assets:
For Year Ended December 31, Current Yr 1 Yr Ago
Return on total assets = 4.41% $13.8%
b) Based on the return on total assets, Simon's operating efficiency worsened in the Current Year versus 1 Year Ago because ROA reduced from 13.8% to 4.41%.
Explanation:
a) Data and Calculations:
Simon Company’s year-end balance sheets follow.
At December 31 Current Yr 1 Yr Ago 2 Yrs Ago
Assets
Cash $ 30,200 $ 35,250 $ 37,000
Accounts receivable, net 88,400 62,000 49,000
Merchandise inventory 111,000 81,200 53,500
Prepaid expenses 10,800 9,300 4,800
Plant assets, net 280,000 254,000 225,000
Total assets $ 520,400 $ 441,750 $ 369,300
Liabilities and Equity
Accounts payable $ 129,200 $ 75,500 $ 51,200
Long-term notes payable secured by mortgages
on plant assets 96,000 100,750 81,800
Common stock,
$10 par value 163,000 163,000 163,000
Retained earnings 132,200 102,500 73,300
Total liabilities and
equity $ 520,400 $ 441,750 $ 369,300
The company’s income statements for the Current Year and 1 Year Ago, follow.
For Year Ended December 31, Current Yr 1 Yr Ago
Sales $ 725,000 $ 550,000
Cost of goods sold $ 449,500 $ 341,000
Other operating expenses 232,000 126,500
Interest expense 11,200 13,000
Income tax expense 9,350 8,525
Total costs and expenses 702,050 489,025
Net income $ 22,950 $ 60,975
Earnings per share $ 1.41 $ 3.74
Return on Total Assets:
For Year Ended December 31, Current Yr 1 Yr Ago
Net income $ 22,950 $ 60,975
Total assets $ 520,400 $ 441,750
Return on total assets = 4.41% $13.8%
Use the following information to answer the question(s) below. A company near a large city is required to keep its smokestack pollution to new lower levels, costing the company $2 million in additional equipment (which will last at least 10 years) and $100,000 a year in additional labor. Lowering the air pollutants in the region is expected to save $4 million in medical expenses in the affected region over the next 10 years. Over this 10-year period, the benefit to cost ratio is
Answer:
Over this 10-year period, the benefit to cost ratio is:
= 1.33.
Explanation:
a) Data and Calculations:
Cost of additional anti-pollution equipment = $2 million
Estimated useful life of the equipment = 10 years
Additional annual labor cost for equipment usage = $100,000
This gives a total labor cost of $1 million over the 10-year period.
Therefore, the total cost = $3 million
Savings (benefits) from lowering the air pollutants in the region = $4 million in medical expenses.
The benefit-to-cost ratio (BCR) = $4/$3 = 1.33
b) The Benefit-to-cost ratio (BCR) is a cost–benefit analysis that summarizes the value-for-money of a project by expressing the relationship between the project's benefits and costs in monetary terms. The BCR shows the future profitability of investment alternatives or options. It is normally expressed in terms of net present value.
a business is a step into the unknown, discuss critically it's risks and uncertainties.
Explanation:
Risks and uncertainties are inherent in every business. When starting a new venture, there must be studies and research involved to assess the viability of the business, the risks, the return on investment, the potential audience, etc.
Strategic planning is a necessary tool for any business, regardless of size or structure, through planning the company develops its identity, its strengths and weaknesses, defines the action plan to achieve its objectives and goals, etc., which helps the business to be more viable and structured to reduce risks and negative externalities.
Quigley Inc. is considering two financial plans for the coming year. Management expects sales to be $300,000, operating costs to be $265,000, assets (which is equal to its total invested capital) to be $200,000, and its tax rate to be 35%. Under Plan A it would finance the firm using 25% debt and 75% common equity. The interest rate on the debt would be 8.8%,but under a contract with existing bondholders the TIE ratio would have to be maintained at or above 5.0. Under Plan B, the maximum debt that met the TIE constraint would be employed. Assuming that sales, operating costs, assets, total invested capital, the interest rate,and the tax rate would all remain constant, by how much would the ROE change in response to the change in the capital structure
Answer:
%Change in ROE = 1.85%
Hence, The ROE change in response to the change in the capital structure will be 1.85%
Explanation:
Data Given:
Sales = 300,000
Operating Cost = 265,000
EBIT = Earnings Before Interests and Taxes = Sales - Operating Costs
EBIT = 300,000 - 265,000
EBIT = 35000
So,
For PLAN A, we have TIE = 5
We know that,
TIE = EBIT/Interest
Interest = EBIT/TIE
Interest = 35000/5
Interest = 7000
Now, we need to find out the maximum amount of Debt:
Maximum amount of debt = Interest/Rate of Interest
We know that,
Rate of Interest = 8.8%
Interest = 7000
So,
Maximum amount of debt = 7000/0.088
Maximum amount of debt = 79,545.45
For PLAN A:
Assets = 200,000
Debt (25%) = 50,000
Equity (75%) = 150,000
Interest Rate = 8.8%
For PLAN B:
Assets = 200,000
Debt (25%) = 79,545.45
Equity (75%) = 120,454.54 (200,000 - 79545.45)
Interest Rate = 8.8%
Income Statement:
For Plan A:
Sales = 300,000
Operating Cost = 265,000
EBIT = 35000
Interest = 4400 (50,000 x 8.8%)
EBT = 30,600 (35000 - 4400)
Tax (35%) = 10710 (35% x 30,600)
Net Income After Tax = 19890
Similarly, For Plan B:
Sales = 300,000
Operating Cost = 265,000
EBIT = 35000
Interest = 7000 (79,545.45 x 8.8%)
EBT = 28,000 (35000 - 4400)
Tax (35%) = 9800 (35% x 28000)
Net Income After Tax = 18200
ROE = Net income / Equity
ROE For Plan A = 19890/ 150,000 x 100
ROE for Plan A = 13.26 %
Similarly,
ROE for Plan B = Net income / Equity
ROE for Plan B = 18200/ 120,454.54
ROE for Plan B = 15.109%
%Change in ROE = 15.11% - 13.26%
%Change in ROE = 1.85%
Hence, The ROE change in response to the change in the capital structure will be 1.85%
The ROE change in response to the change in the capital structure is 1.85%.
Return on equityEBIT = Earnings Before Interests and Taxes = Sales - Operating Costs
EBIT = 300,000 - 265,000
EBIT = 35000
TIE = EBIT/Interest
Interest = EBIT/TIE
Interest = 35000/5
Interest = 7000
Maximum amount of Debt:
Maximum amount of debt = Interest/Rate of Interest
Maximum amount of debt = 7000/0.088
Maximum amount of debt = 79,545.45
PLAN A
Assets = 200,000
Debt=(25%×200,000)
Debt = 50,000
Equity=(75%×200,000)
Equity= 150,000
PLAN B:
Assets = 200,000
Debt = 79,545.45
Equity= (200,000 - 79545.45)
Equity=120,454.54
Income Statement for Plan A:
Sales 300,000
Operating cost 265,000
EBIT 35,000
(300,000-265,000)
Earning before tax 30,600
[35,000-(50,000 x 8.8%)]
Tax 10,710
( 35% x 30,600)
Net income after tax 19890
(30,600-10,710)
Income statement for Plan B
Sales 300,000
Operating cost 265,000
EBIT 35,000
(300,000-265,000)
Earning before tax 28,000
[35,000- (79,545.45 x 8.8%)]
Tax 9,800
( 35% x 28,000)
Net income after tax 18,200
(28,000-9,800)
PLAN A ROE
ROE = Net income / Equity
ROE = 19890/ 150,000 x 100
ROE = 13.26 %
PLAN B ROE
ROE = Net income / Equity
ROE= 18200/ 120,454.54
ROE = 15.109%
Percentage Change in ROE
Percentage Change = 15.11% - 13.26%
Percentage Change = 1.85%
Inconclusion the ROE change in response to the change in the capital structure is 1.85%.
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Your new team is working hard, but they are all less experienced than you and don't complete their tasks as quickly
Answer:
I would personally try to teach them myself since I have more experience and help them get better at their work environment.
Explanation:
Given the following linear demand forecast: Demand = 50 + 10 X (where X is the desired forecast period), what is the predicted forecast at period 6?
The predicted forecast at period 6 is 90
Calculation of the predicted forecast at period 6:Since there is linear demand forecast: Demand = 50 + 10 X (where X is the desired forecast period)
So
= 50 + 10X
= 50 + 10(6)
= 50 + 60
= 90
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If hot dogs decrease in price, what will happen to the demand for hot dog buns?
O It will increase, due to a change in consumer income
O It will decrease, due to a change in consumer expectations
It will increase, due to a change in the price of a complement good
Factors of production are the parts of the economy that:
A. prevent the government from interfering with the economy.
B. protect consumers during difficult economic times.
c. are necessary for creating goods and services.
D. measure the health of an economy at any time.