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Inessa05 [86]
3 years ago
12

Round Hammer is comparing two different capital structures: An all-equity plan (Plan I) and a levered plan (Plan II). Under Plan

I, the company would have 155,000 shares of stock outstanding. Under Plan II, there would be 105,000 shares of stock outstanding and $1.3 million in debt outstanding. The interest rate on the debt is 6 percent, and there are no taxes. a. If EBIT is $200,000, what is the EPS for each plan
Business
1 answer:
s2008m [1.1K]3 years ago
7 0

Answer:

Plan A $1.29

Plan B $1.16

Explanation:

The computation of Earning per share is given below:-

                                                        Plan 1              Plan 2

Earning before interest and tax     $200,000      $200,000

Less: Interest 1,300,000 × 6%                                $78,000

Earning to stock holders A                $200,000     $122,000

Number of stocks B                            155,000        105,000

Earning per share  A ÷ B                     $1.29             $1.16

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Trade-off

A trade-off is a situational decision in which one quality, quantity, or feature of a set or design is reduced or lost in exchange for gains in other areas. A tradeoff occurs when one thing increases while another must decline.

What is consumer's real wage?

Real earnings are salaries that have been factoring in inflation, or wages in perspective of the amount of services and goods that may be purchased.

Main Content

$606

Given the answers to the question, the complete or implicit income of the consumer would be determined as follows:

When the customer works, she earns an hourly wage of $17.00, therefore when she works for 24 hours, she will earn:

=$17\times24

=$408

Also, when the customer  sells all the 17 units of the composite good, she will earn:

=$11\times18

=$198

Therefore, the customer's full income would be:

=$408+$198

=$606

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6 0
2 years ago
What one culture considers rude, another sees as perfectly acceptable. In some cultures, it is appropriate to use a stern, direc
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Answer:

Social conventions

Explanation:

Based on the information provided within the question it can be said that this is an example of cross-cultural diversity in terms of Social conventions. Social conventions refer to the rules or norms that individuals in society perform subconsciously. Such actions or behaviors can include greeting someone, shaking hands, or even driving on the right side of a road.

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3 years ago
The AFL was an organization
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B. that promoted social, labor, and economic issues


6 0
4 years ago
Flounder Inc. issued $2,840,000 par value, 7% convertible bonds at 97 for cash. If the bonds had not included the conversion fea
olganol [36]

Answer:

Given that,

Flounder Inc. issued convertible bonds = $2,840,000 par value

Interest rate = 7%

Sold for cash = $97

If the bonds had not included the conversion feature, then

Sold for = $95

Therefore, the journal entry is as follows:

Cash A/c ($2,840,000 * 0.97)         Dr.     $2,754,800

Discount on issue of Bond A/c       Dr.    $85,200

To 7% Convertible Bonds payable                               $2,840,000

8 0
3 years ago
A consultant hired by your organization has advised your manager to increase his team's cohesiveness. he asks you, "what benefit
Natalija [7]

Answer:

  • <u>Members of teams with high cohesiveness feel higher loyalty to the team and have better job satisfaction.</u>
  • <u>Teams with high cohesiveness are generally more productive due to the energizing effect of regular interaction among team members.</u>

Explanation:

Remember, cohesiveness looks at the degree to which team members <em>stick</em> together in times of difficulties.

Also cohesive teams are good communicators; they would involve in regular interactions among team members, an attitude which when applied to an organisation setting would increase the team's productivity.

7 0
4 years ago
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