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Vesna [10]
3 years ago
12

ART has come out with a new and improved product. As a result, the firm projects an ROE of 27%, and it will maintain a plowback

ratio of 0.20. Its earnings this year will be $4.0 per share. Investors expect a 15% rate of return on the stock. What price do you expect ART shares to sell for in 4 years
Business
1 answer:
emmasim [6.3K]3 years ago
4 0

Answer:

$41.14

Explanation:

Dividend per share=$4

Divided=1-retained profits=1-.2=.8

Cost of equity=15%

Growth rate=27%*.2=5.4%

The formula is;

Current Stock price=Dividend/(cost of equity-growth rate)

Current stock price=4(1-.2)/(.15-.27*.2)=$33.33

Share price after 4 year will be=$33.33(1+.27*.2)^4=$41.14

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Suppose during 2014 that Federal Express reported the following information (in millions): net sales of $35,497 and net income o
Lorico [155]

Answer:

Asset turnover 1.42

Return on assets 0.39%

Explanation:

Here, we are asked to calculate the asset turn over and the return on assets.

Mathematically;

Asset turnover = Net sales/Average total assets

Net sales = $35,497

average total assets = (25,633+24,244)/2 = 24938.5

Asset turnover = 35,497/24938.5 = 1.42

The return on assets can also be calculated mathematically.

mathematically, return on assets = Net income/Average total assets

Net income = $98

Average total assets = 24,938.5 from above

= 0.0039 or 0.39%

5 0
3 years ago
Read 2 more answers
Assume that a parent company acquired 80% of the outstanding voting common stock of a subsidiary on January 1, 2012. On the acqu
AleksandrR [38]

Answer:

consolidation financial statements are for the parent and the subsidiary for the year =$ 1682,875

Explanation:

5 0
3 years ago
Bankston Corporation forecasts that if all of its existing financial policies are followed, its proposed capital budget would be
Reil [10]

Answer:<em> Option (E) is correct.</em>

From the given option, the following will reduce Bankston's need to issue new common stock: <em>Increase the percentage of debt in the target capital structure.</em>

With an increase in percentage of debt , there will be a proportional increase in cost of equity and thereby decreasing investment in equity. This will therefore reduce Bankston's need to issue new common stock

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3 years ago
Hsu Company reported the following on its income statement: Income before income taxes $302,634 Income tax expense 90,790 Net in
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Answer:

5.79  times

Explanation:

The times interest earned ratio tells us the number of times the company's made earnings in multiple of its debt interest obligation.

The formula for times earned interest ratio is the income before interest and taxes divided by the interest expense.

income before tax is $302,634

income before interest and taxes= $302,634+$63,228=$365,862.00  

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Metadata describe the data characteristics and the set of relationships that links the data found within the database.
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Metadata is defined as "data about data" or "data that describes other data." In technological circles, the prefix "meta" usually refers to "an underlying definition or description." Metadata facilitates locating and dealing with data by enabling the user to sort or locate particular documents.

Author, creation, and modification dates, as well as file size, are some instances of basic metadata. Unstructured data like pictures, videos, web pages, spreadsheets, etc. are also utilized with metadata. Meta tags are a common way for web pages to contain info.

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