Name one organization that can help a new entrepreneur funding and skill development

The Management of “TanjungUdaBerhad” is planning a RM4,000,000 expansion this year. The expansion can be financed by issuing eit

Sveta_85 [38]

Based on the price of the bonds to be issued, and the selling price of the shares, the indifference level of EBIT between the plans is $1,142,857.

Between issuing shares and issuing bonds, the one with the higher EPS will be<u> Issuing Bonds</u> with EPS of 0.59

<h3>What is the indifference level?</h3>

First find the number of shares if the plan is to issue shares:

= Current number of shares + New shares

= (2,400,000 value / Price per share) + (4,000,000 / $5 Price per new share)

= 2,000,000 shares

The interest if bonds are picked is:

= 12% coupon x Bond value

= 12% x 4,000,000

= $480,000

Assuming the indifference level is denoted as L, the indifference level is:

(L x ( 1 - tax rate) - Preference share dividends) / Outstanding shares if new shares are issued = ( (L - Interest) x (1 - tax rate) - Preference dividends) / Outstanding shares if bonds issued

(L x ( 1 - 30%) - 10,000) / 2,000,000 = ( ( L - 480,000) x ( 1 - 30%) ) / 1,200,000

L = $1,142,857

<h3>Which plan gives the higher EPS?</h3>

Issuing bonds:

= ( ( 1,500,000 - 480,000) x ( 1 - 30%) ) / 1,200,000

= 0.59

Issuing shares:

(1,500,000 x ( 1 - 30%) - 10,000) / 2,000,000

= 0.52

Find out more on Earnings Per Share (EPS) at brainly.com/question/11448221.

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8 0

2 years ago

A major accounting contribution to the managerial decision-making process in evaluating possible courses of action is to a. assi

mojhsa [17]

Answer:

<em>provide relevant revenue and cost data about each course of action.</em>

Explanation:

Accounting reports are extremely relevant for business decision making. It can help executives make more effective decisions based on periodic cost and revenue accounting data that will guide management to know the real situation of the company, and thus identify the best strategy to correct potential problems.

7 0

3 years ago

Dane purchased a 15-year, 10% bond in 2014. At the time, the yield to maturity (YTM) on the bond was 8.8%. The bond currently se

posledela

Answer:

Rate of return < current YTM

Explanation:

In order to determine whether the current YTM is greater or less,we need to first of all determine the current YTM using excel rate formula as shown below:

=rate(nper,pmt,-pv,fv)

nper is the number of coupon payments the bond pay which is 15

pmt is the annual coupon payment of $100(10%*$1000)

pv is the current price of $890

fv is the face value of $1000

=rate(15,100,-890,1000)=11.58%

Since the rate of return is 8.8% while the current YTM is 11.58%,the third option is correct

4 0

4 years ago

Jim has an annual income of $180,000. Jim is looking to buy a house with monthly property taxes of $140 and monthly homeowners i

MariettaO [177]

Answer:

$787,471.02

Explanation:

Given:

Jim's annual income = $180,000

Monthly property taxes = $140

Monthly homeowners insurance = $70

Monthly student loan payments = $178

Maximum front end DTI limit = 28%

Maximum back end DTI limit = 36%

Amortizing period = 30 years = 360 months

annual rate = 4.5% compounded monthly

Now,

Monthly salary = $\frac{\textup{Annual income}}{\textup{12 months}}$

or

Monthly salary = $\frac{\textup{180,000}}{\textup{12 months}}$

or

Monthly salary = $15,000

Maximum front end DTI limit

= (Maximum Monthly loan payment + monthly property taxes + monthly homeowner's insurance) ÷ Monthly income

0.28 × $15,000 = Maximum Monthly loan payment + $140 + $70

Maximum Monthly loan payment = $4,200 - $140 - $70

= $3,990

and,

Maximum back end DTI limit =

or

0.36 × $15,000 = Maximum Monthly loan payment + $140 + $70 + $178

or

Maximum Monthly loan payment = $5,400 - $140 - $70 - $178

= $5,012

Now,

The monthly payment = minimum of [ $3990, $5012 ]

therefore,

The monthly payment = $3,990

Thus,

The maximum amount of loan = Monthly payment × $[\frac{(1-(1+\frac{r}{k})^{-kn})}{(\frac{r}{k})}]$

here,

k = 12 when compounded monthly

n = 30 years

r = 4.5% = 0.045

The maximum amount of loan = $3,990 × $[\frac{(1-(1+\frac{0.045}{12})^{-12\times30})}{(\frac{0.045}{12})}]$

or

The maximum amount of loan = $787,471.02

8 0

3 years ago

Based on the information provided, what rental rates would you include in your forecast/proforma model from the tenants?

KATRIN_1 [288]

Answer:

Insufficient information to determine

Explanation:

The question makes reference to information provided as a basis for making a decision. But, there is no information provided. This makes it impossible to select any rental rates, whether Contract rental rates, Market rental rates, or a blend of contract and market rental rates, to include in the forecast or proforma model from the tenants. So, the conclusion is that there is insufficient information to determine.

7 0

3 years ago