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ioda
4 years ago
10

Bruce & Co. expects its EBIT to be $100,000 every year forever. The firm can borrow at 11 percent. Bruce currently has no de

bt, and its cost of equity is 18 percent. The tax rate is 31 percent. Bruce will borrow $61,000 and use the proceeds to repurchase shares, which is referred to as the recapitalization. What will the debt-to-equity ratio be after the recapitalization? Multiple Choice 0.00 percent 15.16 percent 17.88 percent 84.84 percent 100.00 percent
Business
1 answer:
zhenek [66]4 years ago
3 0

Answer:

15.16 percent

Explanation:

Debt Equity ratio measures the ratio of the debt to its equity.

Formula for debt equity ratio is as follow

Debt / Equity ratio = Debt of the company/ Equity of the company

As per given data

Equity = $383,333.33 + 0.31($61,000) = $402,243

Debt = $61,000

Placing values in the formula

Debt / Equity ratio = $61,000 / $402,243

Debt / Equity ratio = 15.16%

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The Ayayai Corp. purchased $7990 worth of laundry supplies on June 2 and recorded the purchase as an asset. On June 30, an inven
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Explanation:

The adjusted journal entry is shown below:

Corp Laundry supplies Expense A/c Dr $6,580

       To Corp Laundry supplies A/c $6,580

(Being the corp supplies expense is recorded)

It is computed below:

= Purchased value of laundry supplies - still on hand

= $7,990 - $1,410

= $6,580

The answer is correct but The options that are given are incorrect.

8 0
4 years ago
Jane is an employee of Tyco, Inc. and she is in charge of payroll. Every week she issues a check in the name of a fictitious emp
KengaRu [80]

Answer:

b. Tyco is liable because it authorized Jane to issue payroll checks.

Explanation:

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Therefore, the option b is correct

4 0
3 years ago
Which sentence from the passage supports the following statement?
vazorg [7]

Answer:

idk sorry have a good day!!!!!

Explanation:

8 0
4 years ago
The production of small consumer goods is referred to as?
AURORKA [14]
The correct answer is  :  light Industry

Since a light industry only produce small consumer goods such as clothes, shoes, hand made dolls, etc, it usually less capital oriented than the heavy industries and more consumer oriented than business oriented
8 0
3 years ago
Explain the reasons why risk management might increase the value of a corporation?
vlada-n [284]

Explanation:

Risk management is to increase a firm ’s profitability;

(1) Raise all use of borrowing by them.

(2) Preserve their optimum budget for resources in accordance.

(3) Reduce potential distress-related expenses.

(4) Make use of their comparable liquidity advantages compared to the individual's liquidity capacity.

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3 years ago
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