If the expected earnings per share are $12, what is the implied value of the ROE on future investment opportunities?

Answers

Answer 1

Answer:

15%

Explanation:

The computation of the implied value of the ROE is as follows:

As we know that

Growth rate = (RoE) × (1 - dividend payout ratio)

where,

The Growth rate is 5%

Dividend payout ratio = dividend per share ÷ earning per share

= $8 ÷ $12

= 66.66667%

Now

Growth rate = ROE × retention ratio

5% = ROE × (1 - dividend payout ratio)

5% = ROE × (1 - 0.666667)

ROE = 5% ÷ 1 - 0.666667

= 5% ÷ 0.333333

= 15%


Related Questions

Piper Pipes has the following inventory data: July 1 Beginning inventory 20 units at $120 5 Purchases 120 units at $112 14 Sale 80 units 21 Purchases 60 units at $115 30 Sale 56 units Assuming that a periodic inventory system is used, what is the cost of goods sold on a LIFO basis?
a. $15,392.
b. $15,412.
c. $7,328.
d. $7,348.

Answers

Answer:

COGS= $15,412

Explanation:

Giving the following information:

July 1 Beginning inventory 20 units at $120

July 5 Purchases 120 units at $112

July 14 Sale 80 units

July 21 Purchases 60 units at $115

July 30 Sale 56 units

First, we need to calculate the number of units sold:

Units sold= 136

To calculate the cost of goods sold using LIFO (last-in, first-out), we need to use the cost of the last units incorporated into inventory:

COGS= 60*115 + 76*112

COGS= $15,412

Company Earnings per Share Market Value per Share
Hilton $ 12.00 $ 176.40
SPG 10.00 96.00
Hyatt 7.50 93.75
Accor 50.00 250.00
Compute the price-earnings ratio for each of these four separate companies.
Price-Earnings Ratio
Company Choose Numerator: Divided by Choose Denominator: Price-Earnings Ratio Price-earnings ratio
Hilton
SPG
Hyatt
Accor

Answers

Answer:

Price-Earnings Ratio = Market Value Per Share / EPS

Hilton  Price-Earnings Ratio = 176.40 / 12

Hilton  Price-Earnings Ratio = $14.7

SPG  Price-Earnings Ratio = 96.00 / 10.00

SPG  Price-Earnings Ratio =  $9.6

Hyatt  Price-Earnings Ratio = 83.75 / 7.50

Hyatt  Price-Earnings Ratio = $12.5

Accor Price-Earnings Ratio = 250.00 / 50.00

Accor Price-Earnings Ratio = $5.0

The average number of times each dollar in the money supply is used to purchase goods and services is called:______.
a. the fractional reserve system.
b. the velocity of money.
c. the discount rate.
d. the quantity theory of money.

Answers

Answer:

o think the answer is the discount rate

The average number of times each dollar in the money supply is used to purchase goods and services is called the velocity of money.

What are the goods?

The term Goods are products and resources that satisfy people's needs and wants. A good can be a natural science object, a provided service, or some accumulation of the two. Just about anything is good if it supplies some kind of benefit to consumers.

The velocity of money refers to The frequency with which an average dollar is spent on goods and services in a certain period of time is known as the velocity of money.

As a result, When the money supply and its velocity as a product grow more quickly than real GDP, prices rise.

Therefore, The right option (B) is correct.

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Retained earnings can be decreased by all of the following except for Group of answer choices stock splits. some disposals of treasury stock. stock dividends. cash dividends.

Answers

Answer:

stock splits.

Explanation:

Retained earnings also known as accumulated earnings, can be defined as the total amount of net income held by a corporation for its future use after paying out dividends to its shareholders.

The retained earnings statement refers to a financial statement that enumerate changes in retained earnings for an organization over a specific period of time. The retained earnings statement is the statement of owner's equity that outlines details of changes in the amount of retained earnings (profits) over a specified period in an organization.

The main purpose of preparing a retained earnings statement is to boost investor's confidence and improve market value.

Retained earnings can be decreased by the following; some disposals of treasury stock, stock dividends, cash dividends except for stock splits.

Explain how the circular flow of income operates making reference to the injections and withdrawals and physical and monetary flows.

Answers

Answer:

It shows flows of goods and services and factors of production between firms and households

The circular flow shows how national income or Gross Domestic Product is calculated

Businesses produce goods and services and in the process of doing so, incomes are generated for factors of production (land, labour, capital and enterprise) – for example wages and salaries going to people in work.

Leakages (withdrawals) from the circular flow

Not all income will flow from households to businesses directly. The circular flow shows that some part of household income will be:

1.Put aside for future spending, i.e. savings (S) in banks accounts and other types of deposit

2.Paid to the government in taxation (T) e.g. income tax and national insurance

3.Spent on foreign-made goods and services, i.e. imports (M) which flow into the economy

Withdrawals are increases in savings, taxes or imports so reducing the circular flow of income and leading to a multiplied contraction of production (output)

Injections into the circular flow are additions to investment, government spending or exports so boosting the circular flow of income leading to a multiplied expansion of output.

Capital spending by firms, i.e. investment expenditure (I) e.g. on new technology

The government, i.e. government expenditure (G) e.g. on the NHS or defence

Overseas consumers buying UK goods and service, i.e. UK export expenditure (X)

An economy is in equilibrium when the rate of injections = the rate of withdrawals from the circular flow.

Building up the model

In this next series of images we build up the circular flow model from just having a domestic sector and then adding in an external sector (exports and imports) before including the financial sector which channels savings and hopefully provides the finance available to fund investment.

The Domestic Circular Flow of Income and Spending

The external sector involves businesses exporting goods and services overseas (X) and consumers and business buying imported products from other countries (M)

Explanation:

PLEASE MARK ME AS BRAINLIEST

When leakage equals injections, the nation's economic cycle is said to be in balance.

What is economic cycle?

The term "economic cycle," usually referred to as a "business cycle," describes the swings in the economy's growth and decline.

The present stage of the economic cycle can be determined using variables like gross domestic product (GDP), interest rates, total employment, and consumer expenditure.

Since the economic cycle directly affects stocks, bonds, profits, and corporate earnings, understanding it can help investors and businesses decide whether to invest and when to withdraw their funds.

An economy travels in a circular motion from expansion to recession and back again, which is referred to as an economic cycle. Growth is a sign of an expanding economy.

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The Belwood Bread Company uses an average of 4,000 kilos of flour daily, with a standard deviation of 500 kilos per day. The average lead time to get a shipment of flour is 9 days with a standard deviation of 2 days. The owner of the bakery wants to maintain a service level of 95%.

z-value Probability
1.63 .9485
1.64 .9500
1.65 .9505
1.66 .9515
1.67 .9615
Which one of the following is true about the reorder point for flour?

Answers

Answer:

The Belwood Bread Company uses an average of 4,000 kilos of flour daily, with a standard deviation of 500 kilos per day is explained below in detail.

Explanation:

In my practice, it doesn't save capital, but it's still deserving it because it's wholesome and better than reserve purchased at the same amount.

For me, 1kg of all-purpose powder yields 1.6kg of bread (as two cubes). Each 13x4x4" (Pullman) loaf measures about 800 grams after freezing and yields between 22-30 slices related to its width. The value per loaf is under $1.00 and incorporates all components, charge, and electricity for mixing, baking, slicing.

I've created a few hundred loaves based on modifications of this formula:

                     %  grams   cost  calories sodium protein fat sugar

all-purpose powder    100  500   0.417  1833   0      50    17      0

   instant yeast    0.8    4   0.067    16   0       0     0      3

 non-fat dry milk      4   20   0.203    70   0       7    10    109

sugar      4   20   0.019    75   0       0    20      0

      canola oil     10   50   0.072   429  50       0     0

            salt      2   10   0.006     0   0       0     0   3933

           water     56  280   0.000     0   0       0     0      0

     dough total  176.8  884  $0.783  2422  50      57    47   4045

The FICA (social security) tax is a matching tax with a portion paid by both the employer and the employee.
A. True
B. False

Answers

Answer:

A) true

Explanation:

FICA Tax can be regarded as matching tax, it is been paid by the employees and employers at equal rate. The tax can be divided into Social Security tax as well as Medicare tax. It shouldbe noted the FICA (social security) tax is a matching tax with a portion paid by both the employer and the employee.

Superfine Company collected the following data in preparing its cash flow statement for the year ended December 31, 2017: Amortization of bond discount $ 1,000 Dividends declared 22,500 Dividends paid 19,000 Gain on sale of equipment 3,000 Proceeds from the sale of equipment 5,000 Proceeds from the sale of treasury stock (carrying amount $32,500) 37,500 Purchase of BAS Inc. bonds (par value $100,000) 90,000 Required: Determine the following amounts that should be reported in Superfine’s 2017 statement of cash flows. What amount should Superfine report as net cash used in investing activities? What amount should Superfine report as net cash provided by financing activities?

Answers

Answer: a. ($85,000) ; b. $18500

Explanation:

a. What amount should Superfine report as net cash used in investing activities?

Sale of equipment = $5,000

Less: Purchase of bond = ($90,000)

Net cash used in investing activities = ($85,000)

b. What amount should Superfine report as net cash provided by financing activities?

Proceeds from treasury sold = $37500

Less: Dividend paid = ($19,000)

Net cash provided by financing activities will be: = $18500

Which activity does the IRS allow nonprofit organizations to engage in?

advertising tax deductions for donations
compensating business owners based on profits
selling pharmaceuticals if it is a healthcare organization
increasing the value of shareholder’s investments

Will give brainliest to correct answer!

Answers

Answer: advertising tax deductions for donations

Explanation:

The activity does the IRS allow nonprofit organizations to engage in is

advertising tax deductions for donations.

What is IRS?

It stands for Internal revenue service that administered the federal tax laws. In this, it contains the processing of tax return, tax payer service, and the enforcement.

So based on this, we can say that The activity does the IRS allow nonprofit organizations to engage in is advertising tax deductions for donations.

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Most state and local income taxes are either

Answers

Answer:

tax collected on the purchase price of goods or services

Explanation:

tax collected on the purchase price of goods or services

Most state and local income taxes are either tax collected on sales.

What is Tax?

Tax are levy or due paid by an individual, organization or firm. It is paid to the government purse and the money is used by the government for their spending.

The payment is compulsory and the amount to aly is determined by the government.

Therefore, most state and local income taxes are either tax collected on sales.

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