Leslie's Unique Clothing Stores offers a common stock that pays an annual dividend of $2.60 a share. The company has promised to maintain a constant dividend. How much are you willing to pay for one share of this stock if you want to earn a return of 13.80 percent on your equity investments

Answers

Answer 1

Answer:

$18.84

Explanation:

The amount i would be willing to pay is the present value of the dividend payment

Present value = [tex]\frac{dividend}{r}[/tex]

r = interest rate

2.6 / 0.1380 =  $18.84


Related Questions

Suppose that the average wage earner saves 3% of her take-home pay and spends the other 97%. Also suppose that 97% of any amount spent is always re-spent (with 3% saved). Estimate the impact that a proposed $35 billion tax cut will have on the economy over the long run due to the additional spending generated. (Round your answer to the nearest integer.)

Answers

Answer:

A proposed $35 billion tax cut will make $1,132 billion to be circulated through the economy over the long run due to the additional spending generated.

Explanation:

MPS = Marginal propensity to save = Average wage earner saves = 3%, or 0.03

MPC = Marginal propensity to consume = Average wage earner spends = 97%, or 0.97

Tax multiplier = - MPC/MPS = - 0.97/0.03 = - 32.3333333333333

Tax cut = - $35 billion

Impact of $35 billion tax cut = Tax multiplier * Tax cut = (- 32.3333333333333) * (- $35 billion) = $1,132 billion

Therefore, a proposed $35 billion tax cut will make $1,132 billion to be circulated through the economy over the long run due to the additional spending generated.

On January 1, 2021. Nana Company paid $100,000 for 6200 shares of Papa Company common stock The ownership in Papa Company is 10%. Nana Company does not have significant influence over Papa Company Papa reported net income of $60,000 for the year ended December 31, 2021. The fair value of the Papa stock on that date was 563 per share. What amount will be reported in the balance sheet of Nana Company for the investment in Papa at December 31 2021?
a. $330,600
b. $315,600
c. $390,600
d. $345.600

Answers

I am pretty sure the answer is b

Shelton Company has the following account balances at year-end:
Accounts receivable $140,000
Allowance for doubtful accounts 7,200
Sales discounts 4,800
Shelton should report accounts receivable at a net amount of:__________
a. $120,000.
b. $ 12,800.
c. $1 08,000.
d. $115,200

Answers

Answer:

See below

Explanation:

Given the above information, Shelton should report the account receivable at a net amount as computed below;

= Accounts receivables - Allowance for doubtful account

Accounts receivables = $140,000

Allowance for doubtful account = $7,200

= $140,000 - $7,200

= $132,800

Therefore, account receivables at a net amount is $132,800

Ford Motor Company agreed to pay its workers ​$37 an hour in 1999 and ​$37 an hour in 2001. The CPI in 1999 was 166 and in 2001 was 180. Calculate the real wage rate in each year​ (to the nearest​ cent). Did these workers really get a pay raise between 1999 and​ 2001?

Answers

Answer:

No, the wage rate did not raise.

Explanation:

Given the nominal wage rate for the year 1999 = $37

CPI for 1999 = 166

The real wage for the year 1999 = [ Nominal wage / CPI ] x 100

The real wage for the year 1999 = [ 37/ 166] x 100 = $22.28

Given the nominal wage rate for the year 2001 = $37

CPI for 2001 = 180

The real wage for the year 2001 = [ Nominal wage / CPI ] x 100

The real wage for the year 2001 = [ 37/ 180] x 100 = $20.55

No the wage rate did not raise.

Javier computer services began operations in July 2017. At the end of the company prepares monthly financial statements. It has the following information for the month.

a. At July 31, the company owed employees $1,800 in salaries that the company will pay in August.
b. On July 1, the company borrowed $40,000 from a local bank on a 10-year note. The annual interest rate is 12%.
c. Service revenue unrecorded in July totaled $3,000.

Required:
Prepare the adjusting entries needed at July 31, 2017.

Answers

Answer and Explanation:

The adjusting entries are shown below:

a. Salaries expense Dr $1,400

        To Salaries payable $1,400

(being salaries expense is recorded)

b. Interest expense ($40,000 × 12% × 1 ÷12) $400

     To interest payable $400

(being interest expense is recorded)

c. Account receivable Dr $3,000

         To Service revenue $3,000

(being revenue is recorded)

These 3 entries should be recorded

The CAPM is a theory of the relationship between risk and return that states that the expected risk premium on any security equals its beta times the market return.a. Trueb. False

Answers

Answer:

a. True

Explanation:

As we know that

Under CAPM, the cost of the capital  is  

= risk free rate of return + beta × (market rate of return - risk free rate of return)

=  risk free rate of return + beta × market risk premium

So it shows the relationship between the risk and return on which the expected risk premium equivalent to the beta and the same should be multiplied with the market return

Therefore the given statement is true

Camelot Company has estimated the following costs for this year for 50,000 units: Manufacturing Selling and Administrative Variable $100,000 $ 25,000 Fixed 150,000 75,000 Total $250,000 $100,000 What is the initial selling price needed to obtain a target profit of $50,000 using the manufacturing cost markup method

Answers

Answer:

the initial selling price is $8 per unit

Explanation:

The computation of the initial selling price is shown below;

Total manufacturing costs = $250,000

Now

Markup required is

= $100,000 + $50,000

= $150,000

So, the Initial selling price is

= ($250,000 + $150,000) ÷ 50,000

= $8.00

hence, the initial selling price is $8 per unit

The government has imposed a fine on the Imperial Company. The fine calls for annual payments of $100,000, $250,000, and $250,000, respectively over the next three years. The first payment is due one year from today. The government plans to invest the funds until the final payment is collected and then donate the entire amount, including investment earnings, to a national health center. The government will earn 3.5% on the funds held. How much will the national health center receive three years from today

Answers

Answer: $615,872.50

Explanation:

The amount the National Health Center will receive is the sum of the future values, 3 years from now, of the annual payments of the fines.

Future value of $100,000 paid 1 year from today:

= 100,000 * (1 + 3.5%)²

= $107,122.50

Future value of $250,000 paid 2 years from now:

= 250,000 * (1 + 3.5%)

= $258,750

Future value of $250,000 paid 3 years from today:

= $250,000

Total is:

= 107,122.50 + 258,750 + 250,000

= $615,872.50

An investment opportunity requires a payment of $910 for 12 years, starting a year from today. If your required rate of return is 6.5 percent, what is the value of the investment to you today

Answers

Answer:

PV= $7,424.44

Explanation:

Giving the following information:

Annual payment (A)= $910

Number of periods (n)= 12 years

Rate of return (i)= 6.5%

To calculate the value of the investment today (PV), we need to use the following formula:

PV= A*{(1/i) - 1/[i*(1 + i)^n]}

PV= 910*{(1/0.065) - 1/ [0.065*(1.065^12)]}

PV= $7,424.44

The following items are reported on a company's balance sheet: Cash $160,000 Marketable securities 75,000 Accounts receivable (net) 65,000 Inventory 140,000 Accounts payable 200,000 Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place. a. Current ratio fill in the blank 1 b. Quick ratio fill in the blank 2

Answers

Answer and Explanation:

a. The current ratio is

We know that

Current ratio = Current Assets ÷ Current Liabilities

= $440,000 ÷ $200,000

= 2.2

Cash $160,000

Marketable Securities $75,000

Account receivable $65,000

Inventory $140,000

Current Assets $440,000

Account Payable $200,000

current liabilities $200,000

b

Quick ratio =( Current assets - inventory ) ÷ Current Liabilities

= ($440,000 - $140,000 ) ÷ $200,000

= 1.5

g Suppose there are 100 consumers with individual demand curves like the one in Question 1 and 10 producers with individual supply curves like the one in Question 1. Find the competitive equilibrium for this marke

Answers

Answer:

The correct answer is "16".

Explanation:

The given question seems to be incomplete. Please find the attachment of the full query.

According to the question,

The supply per producer when there are overall 10 producers,

⇒ [tex]P(\frac{Y}{10} )=10+(\frac{Y}{200} )[/tex]

or,

⇒       [tex]Y=200P-2000[/tex]

The consumption per producer when there are overall 100 producers,

⇒ [tex]P(\frac{x}{100} )= 40-(\frac{2x}{100} )[/tex]

or,

⇒          [tex]x = 2000-50 P[/tex]

At equilibrium,

⇒ [tex]200P-2000=2000-50P[/tex]

On adding "2000" both sides, we get

⇒ [tex]200P-2000+2000=2000-50P+2000[/tex]

⇒                        [tex]200P=4000-50P[/tex]

                          [tex]250P=4000[/tex]

                               [tex]P=\frac{4000}{250}[/tex]

                                   [tex]=16[/tex]

You are considering an investment that promises to pay $1,000 per year for the next 10 years. The interest rate associated with investments having similar risk is 6.0%. How much would you be willing to pay for this investment

Answers

Answer:

$7360.09

Explanation:

the amount i would be willing to pay can be determined by calculating the present value of the cash flows

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow each year from year 1 to 10 = 1000

I = 6%

PV = $7360.09

To determine PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

A company with a higher contribution margin ratio is either more or less sensitive to changes in sales revenue, depending on other factors. likely to have a lower breakeven point. less sensitive to changes in sales revenue. more sensitive to changes in sales revenue.

Answers

Answer:

more sensitive to changes in sales revenue.

Explanation:

Contribution margin can be defined as the subtraction of variable cost from the sales price.

Mathematically, it given by the formula;

[tex] Contribution \; margin = sales \; price - variable \;cost[/tex]

Variable cost refers to cost which are the same per unit of production but vary directly with level of output.

Generally, a company that has a higher contribution margin ratio is more sensitive to changes in sales revenue because it affects it in the long-run.

Consumers have become more vulnerable to privacy infringement and identity theft MOST LIKELY due to which trend? A) consumers' decreasing awareness of investment scams B) the proliferation of automated financial transactions C) the rising rate of mortgage foreclosures during the recession D) the government's increasing regulation of the consumer credit industry

Answers

A) consumers’ decreasing awareness of investment scams.

Consumers that have more vulnerable to privacy infringement and identity theft because of this trend so it is option A.

What is privacy infringement?

At the time when the information related to the person that should be obtained against his or her so it should be either by coercion or it should be forced. Here the right to privacy should be violated. So, Consumers that have more vulnerable to privacy infringement and identity theft because of this trend so it is option A.

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Scenario 3-2 In country A a worker who works 40 hours can produce 200 pounds of rice or 100 pounds of broccoli. In country B a worker who works 40 hours can produce 160 pounds of rice or 120 pounds of broccoli.
Refer to Scenario 3-2. What is the opportunity cost of producing rice? Refer to Scenario 3-2. What is the opportunity cost of producing broccoli? Refer to Scenario 3-2. Which country, if either, has a comparative advantage producing rice? Refer to Scenario 3-2. Which country, if either, has a comparative advantage producing broccoli? Refer to Scenario 3-2. Give a range of prices in terms of pounds of rice per pound of broccoli at which the two countries would be both be willing to trade.

Answers

Answer:

The answer is below

Explanation:

1) Opportunity cost of producing rice:

For country A, opportunity cost of producing rice = 100 pounds of broccoli / 200 pounds of rice = 1/2 pounds of broccoli

For country B, opportunity cost of producing rice = 120 pounds of broccoli / 160 pounds of rice = 3/4 pounds of broccoli

Opportunity cost of producing broccoli:

For country A, opportunity cost of producing broccoli = 200 pounds of rice / 100 pounds of broccoli = 2 pounds of rice

For country B, opportunity cost of producing broccoli = 160 pounds of rice / 120 pounds of broccoli = 4/3 pounds of rice

2) The country with comparative advantage is the country with lower opportunity cost.

Country A has a comparative in producing rice (1/2 pounds of broccoli < 3/4 pounds of broccoli)

Country B has a comparative in producing broccoli (4/3 pounds of rice <  2 pounds of rice)

3) For better off trade, the price should lie between two different opportunity costs.

Therefore, the price per pound of broccoli in terms of pounds of rice should lie between 4/3 and 2 pounds of rice  

 

 

Legacy issues $630,000 of 9.0%, four-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. They are issued at $571,310 when the market rate is 12%.

Required:
a. Prepare the January 1, 2018, journal entry to record the bonds' issuance.
b. Prepare the journal entries to record the first two interest payments.

Answers

Solution :

a). Prepare the journal entry to record the bonds' issuance as shown below:

Interest paid = [tex]$\$630,000 \times 9\%\times \frac{1}{2}$[/tex]

                      = $ 28,350

   Date           Accounts titles and explanation             Debit ($)       Credit($)

1 Jan 2018      Cash                                                         571,310

                       Discount on bonds payable                    58,690

                        ($ 630,000 - $ 571,130)

                      Bonds payable                                                              630,000

b). Preparing the journal entries to record the first two interest payments :

        Date      Accounts Titles and explanation     Debit($)        Credit($)

 30/6/2018   Interest expense                              35,686.25

                      Discount on bonds payable                                  7,336.25

                      Cash                                                                        28,350

31/12/2018     Interest expense                            35,686.25

                      Discount on bonds payable                                     7,336.25

                       Cash                                                                           28,350                          

                     

A firm has forecasted sales of $4,500 in April, $3,000 in May, and $5,000 in June. All sales are on credit. 30% is collected in the month of the sale, and the remainder in the following month. What will be the balance in accounts receivable at the end of June

Answers

Answer:

$3,500

Explanation:

Calculation to determine What will be the balance in accounts receivable at the end of June

Balance in accounts receivable =June Forecasted sales* (Remaining percentage-Percentage collected)

Let Plug in the formula

Balance in accounts receivable =$5,000*(100%-30%)

Balance in accounts receivable=$5,000*70%

Balance in accounts receivable=$3,500

Therefore the balance in accounts receivable at the end of June will be $3,500

Discussion Week 3 х + -mccneb.edu/courses/16958/discussion_topics/147424 The second posting provides students an opportunity to interact with one another, simulating classroom discussion, with respect to the postings of others. This response should include a critical and respectful review of other postings. The second posting must be no less than 200 words in length to be considered for grade assessment. Any posting less than 200 words in length will not be reviewed and a grade of -- will be assigned. Subsequent postings (in addition to the aforementioned first and second posting) are invited. There is no length requirement for subsequent postings. Please note, attachments will not be opened or reviewed for grade consideration Any postings after the due date has past will not be considered for grading. Discussion 3: Please explain the difference between express and implied easements giving an example of each. Then tell us, if you wanted to know if there was ar easement that involved a property, what are the ways you could find out - i.e. where would you look and what would you look at? Then discuss the importance o implied easements to our society and provide an example. Search entries or author Unread Subscrib Reply Brianna Ferrero Sunday An express easement is created by an agreement or document, it must be in writing. For example, one neighbor may want to build a parking pad or basketball court off their driveway, but not have enough room on their lot to do so because their driveway already butts up against the property line. This individual may offer to pay the neighbor for his consent to grant an express easement for them to build a parking pad and a basketball court off their driveway that extends or the neighbors land.​

Answers

aAnswer:ya

Explanation:ya

Margaret sells hand-knit scarves at a flea market. Each scarf sells for $25. Margaret pays $30 to rent a vending space for one day. The variable costs are $15 per scarf. How many scarves should she sell each day in order to break even?

Answers

Answer:

The answer is 3 units

Explanation:

Break even sale is the amount of sales a firm or business needs to sell to break even , that is, the amount to sell to neither make profit nor loss.

Break even sales = Fixed cost ÷ ( unit sales - variable costs)

$30/($25 - $15)

$30/$10

=3 units

Break even sales is 3 units. That means Margaret needs to 3 units of hand-knit scarves to neither make profit or loss. Units above 3 will result into profit making while units below 3 will result into loss making.

Why does insurance matter? What have you heard about insurance from your parents or the news?

Answers

Insurance matters because it gives you coverage from the state to insure that you have protection from incidents you may not predict to happen. For example, car accidents.

Bookmark question for later Overhead allocation based on volume alone: results in facility support costs not being allocated among the various products. is a key aspect of the ABC model. must be used for external financial reporting. will systematically overcost high-volume products and undercost low-volume products.

Answers

Answer:

will systematically overcost high-volume products and undercost low-volume products.

Explanation:

Manufacturing costs can be defined as the overall costs associated with the acquisition of resources such as materials and the cost of converting these raw materials into finished goods. Manufacturing costs include direct labor costs, direct materials cost and manufacturing overhead costs.

An overhead allocation that is typically based on volume alone, will systematically overcost the high-volume products that are also complex and undercost low-volume products that are simple in nature.

Ignoring possible tax effects and signaling costs, the total value of a firm's equity remains the same irrespective of how the firm distributes its residual earnings-dividends or stock repurchases. Each distribution method has certain advantages and disadvantages.
Based on your understanding of dividends and stock repurchases, select the best terms to go with the statements.
Select the best term to complete the sentence Sell Buy
Repurchases give stockholders a choice to ???? their stock and realize their capital gains or keep their stock and receive future dividends. False True
Repurchases allow a firm to buy back as much stock as it wants, at whatever price it wants, without affecting shareholders. This statement is ???? True False
Dividends provide signals about a firm's future prospects, whereas some investors might misinterpret why a firm is repurchasing stock. This statement is???? Saves Increases
Repurchase transactions allow a firm to buy back stock that may be needed to fulfill obligations when employees exercise their stock options. This ???? the costs associated with issuing new shares.

Answers

Answer:

The Total Value of a Firm's Equity and Distribution Methods:

1. Repurchases give stockholders a choice to sell their stock and realize their capital gains or keep their stock and receive future dividends. False True

2. Repurchases allow a firm to buy back as much stock as it wants, at whatever price it wants, without affecting shareholders. This statement is False.

3. Dividends provide signals about a firm's future prospects, whereas some investors might misinterpret why a firm is repurchasing stock. This statement is True.  

4. Repurchase transactions allow a firm to buy back stock that may be needed to fulfill obligations when employees exercise their stock options. This saves the costs associated with issuing new shares.

Explanation:

Dividends and stock repurchase are two methods of distributing net earnings by a company.  Both methods reduce the equity balance by decreasing the Retained Earnings, which are components of the Stockholders' Equity. Stock repurchase is usually embarked upon by management when it wants to reduce the number of outstanding shares, increase both the demand for the shares and the price, and boast the Earnings Per Share.

Consolidated Corporation,a U.S.firm,wishes to participate,but limit its involvement,in Middle Eastern markets.Consolidated empowers Doha Ltd. ,an Egyptian firm,to enter into contracts in certain countries on behalf of Consolidated.This is:________
A) a distribution agreement.
B) an agency relationship.
C) indirect exporting.
D) direct exporting.

Answers

Answer:

B) an agency relationship.

Explanation:

A contract can be defined as an agreement between two or more parties (group of people) which gives rise to a mutual legal obligation or enforceable by law.

There are different types of contract in business and these includes: fixed-price contract, cost-plus contract, bilateral contract, implies contract, unilateral contract, adhesion contract, unconscionable contract, option contract, express contract, executory contract, etc.

In this scenario, Consolidated (principal) empowers Doha Ltd., an Egyptian firm to enter into contracts in certain countries on behalf of Consolidated. Thus, this is an agency relationship.

An agency relationship can be defined as a mutual relationship existing between two parties, wherein a principal authorizes the agent to act as the principal's representative or on his behalf (fiduciary role) in dealing with third parties.

Basically, Consolidated is the principal based on the agency relationship while Doha Ltd. is considered to be an agent and as such is authorized or empowered to enter into contracts in certain countries on behalf of Consolidated.

What is a production​ function? How does a​ long-run production function differ from a​ short-run production​ function? A. A function showing the minimum output that a firm can produce for every specified combination of inputs. In the​ short-run production​ function, all inputs are​ variable, whereas the​ long-run production function has at least one fixed input.. B. A function showing the highest output that a firm can produce for every specified combination of inputs. In the​ short-run production​ function, all inputs are​ variable, whereas the​ long-run production function has at least one fixed input. C. A function showing the minimum output that a firm can produce for every specified combination of inputs. In the​ long-run production​ function, all inputs are​ variable, whereas the​ short-run production function has at least one fixed input. D. A function showing the highest output that a firm can produce for every specified combination of inputs. In the​ long-run production​ function, all inputs are​ variable, whereas the​ short-run production function has at least one fixed input.

Answers

Answer:

A

Explanation:

Suppose you forecast that the standard deviation of the market return will be 20% in the coming year. If the measure of risk aversion in is A = 4: a. What would be a reasonable guess for the expected market risk premium? b. What value of A is consistent with a risk premium of 9%? (Round your answer to 2 decimal places.) c. What will happen to the risk premium if investors become more risk tolerant?

Answers

Answer:

a) 16%

b) 2.25

c) Increase in expected market risk premium

Explanation:

Expected standard deviation of market return = 20%

measure of risk aversion ( A ) = 4

a) Determine a reasonable  expected market risk premium

= A * ( std ) ^2

= 4 * ( 20%)^2

=  16%

b) determine Value of A

market risk premium = A * ( std )^2

∴ A = 9% / ( 20% ) ^2

      = 0.09 / 0.04

      = 2.25

c) If investors become more risk tolerant the expected market risk premium will increase

What are costs that can be identified specifically with a cost objective, but are not direct labor or direct material costs?

Answers

Answer:

Other direct cost (ODC)

Explanation:

Other direct cost (ODCs) are costs that can be identified specifically with a final cost objective but are not treated as either a direct material or direct labor cost. Costs are identified as other direct cost so that it would be given proper treatment. Also, identifying costs as ODC helps in infective cost allocation.

Examples of ODCs include travel cost, preservations, equipment testing, consultancy and computer services, etc.

10. What is an advantage of using a credit card?
1 point
It will not affect your credit score or credit history
Since it is tied directly to your checking account, it prevents you from spending money
you do not have
If you need to carry a balance, the interest rates are generally quite low (less than 5%)
If you pay off your balances every month in full, it's like getting a short-term interest-
free lom
11. Each of the following financial products will help you build a credit
history EXCEPT

Answers

10. The correct advantage of using a credit card is: if you pay off your balances every month in full, it's like getting a short-term interest-free loan.

11. All the mentioned financial products can help build credit history when used responsibly, so none of them should be excluded from the list.

10. Using a credit card responsibly and paying off the balance in full each month offers the advantage of essentially accessing interest-free credit for a short period.

When you make purchases with a credit card and pay the full amount by the due date, you avoid paying any interest charges on those purchases. This can be particularly beneficial if you have a large purchase or unexpected expense that you need to make and would prefer to pay off gradually over a few weeks or months without incurring interest.

11. As for the financial products that help build credit history, all of the following options can contribute to establishing a credit history:

Credit cards: Responsible use, such as making timely payments and keeping credit utilization low, can help build a positive credit history.

Loans (e.g., student loans, auto loans, mortgages): Consistently making payments on time and in full can demonstrate your ability to manage debt responsibly.

Lines of credit: Similar to credit cards, properly managing lines of credit and making timely payments can contribute to a positive credit history.

Secured credit cards: These cards require a security deposit but can still help build credit history if used responsibly.

Therefore, all the mentioned financial products can help build credit history when used responsibly, so none of them should be excluded from the list.

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An entity had the following opening and closing inventory balances during the current year: 1/1 12/31 Finished goods $ 90,000 $260,000 Raw materials 105,000 130,000 Work-in-progress 220,000 175,000 The following transactions and events occurred during the current year: $300,000 of raw materials were purchased, of which $20,000 were returned because of defects. $600,000 of direct labor costs were incurred. $750,000 of production overhead costs were incurred. The cost of goods sold for the current year ended December 31 would be A. $1,500,000 B. $1,480,000 C. $1,650,000 D. $1,610,000

Answers

Answer:

B. $1,480,000

Explanation:

The computation of the cost of the goods sold is shown below:

Direct material consumed:    

beginning Inventory of RM  $105,000  

Add: Net Purchase ($300,000 - $20,000) $280,000  

Total material available  $385,000  

Less: ending inventory  -$130,000  

Direct material consumed $255,000

Now  

Cost of goods manufactured:    

Beginning inventory of Wip  $220,000  

Current cost:    

Direct material $255,000  

Direct labor $600,000  

Manufacturing OH $750,000  

Total current cost $1,605,000  

Total cost of WIP $1,825,000  

Less: Ending inventory of Wip $175,000  

Cost of goods manufactured $1,650,000  

Cost of goods sold:    

Beginning inventory of FG $90,000  

Add: Cost of goods manufactured $1,650,000  

Total  cost of goods available for sale 1740000  

Less: Ending inventory of FG -$260,000  

Cost of goods sold $1,480,000

You are given the following information on Kaleb's Heavy Equipment: Profit margin 6.5 % Capital intensity ratio .74 Debt-equity ratio .8 Net income $ 78,000 Dividends $ 16,000 Calculate the sustainable growth rate.

Answers

Answer: 14.36%

Explanation:

The sustainable growth rate will be calculated thus:

Firstly, we will calculate the return on equity(ROE) which will be:

= Profit margin × (1/Capital intensity ratio) × (1 + Debt equity ratio)

= 6.5% (1/0.74) × (1 + 0.8)

= 0.065 × 1.35 × 1.8

= 0.158

Then, we'll calculate the plowback ratio which will be:

= 1 - (16000/78000)

= 1 - 0.2051

= 0.7949

Therefore, the growth rate will be:

= (ROE × Plowback ratio) / [1 - (ROE × Plowback ratio)]

= (0.158 × 0.7949) / [1 - (0.158 × 0.7949)]

= 0.1256 / 0.8744

= 0.1436

= 14.36%

The sustainable growth rate is 14.36%

what's is the difference between external dimensions and internal dimensions fators​

Answers

Answer:

Internal Environment dimension refers internal conditions with a business or organization that effect its growth and working such as employees, machinery, working hours, funds etc.

Extern Environment dimension refers external conditions  that effect business or organization growth and working such as organization's performance, profitability, and functionality

Explanation:

Internal Environment dimension refers internal conditions with a business or organization that effect its growth and working such as employees, machinery, working hours, funds etc.

Extern Environment dimension refers external conditions  that effect business or organization growth and working such as organization's performance, profitability, and functionality

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