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3 years ago

Name at least two risk banks face

Business

1 answer:

Lana71 [14]3 years ago

4 0

Question: Name at least two risk banks face?

Answer: There are many types of risks that banks face. Two of out of these eight risks, credit risk and market risk

Hope this helps!.

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~A.W~ZoomZoom44

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Sheryl’s Shipping had sales last year of $10,000. The cost of goods sold was $6,500, general and administrative expenses were $1

Amiraneli [1.4K]

Answer:

What are earnings before interest and taxes?

To find this figure, we substract the cost of goods sold, general and administrative expenses, and depreciaction expense from the total sales:

Earnings Before Interest and Taxes (EBIT) = $10,000 - $6,500 - $1,000 - $1,000 = $1,500

What is net income?

To find the net income, we take the EBIT we found above, and substract from it the interest expense, which gives us the taxable income:

Taxable Income = $1,500 - $500

= $1,000

Now that we have the taxable income, we multiply this figure by the tax rate, to obtain the tax expense.

Tax expense = $1,000 x 35%

= $350

Finally, our net income is equal to the taxable income minus the tax expense:

Net Income = $1,000 - $350

= $650

What is cash flow from operations?

We add the non-cash expenses to net income to find this figure. In this case, we only have one non-cash expense: depreciation expense.

Cash flow from operations = $650 + $1,000

= $1,650

8 0

4 years ago

Suppose that Rearden Metal currently has no debt and has an equity cost of capital of 12%. Rearden is considering borrowing fund

Alexxandr [17]

Answer:

Option (C) is correct.

Explanation:

We have to use MM proposition that cost of equity will change itself in such a manner so that it can take care of its debt.

Cost of equity:

= WACC of all equity firm + (WACC of all equity - Cost of debt ) × (Debt -to-equity ratio)

At the beginning, when there was no debt,

WACC = cost of equity = 12 %

Levered cost of equity:

= 12% + ( 12% - 6%) × 0.5

= 15%

Therefore, Rearden's levered cost of equity would be closest to 15%.

4 0

4 years ago

Your company is considering a new project that will require $10,000 of new equipment at the start of the project. The equipment

zmey [24]

Answer:

Estimate the present value of the tax benefits from depreciation:

D. $1,851

Explanation:

Step 1: Determine annual depreciation

A.D=(A.C-S.V)/N

where;

A.D=annual depreciation

A.C=acquisition cost

S.V=salvage value

N=useful life

In our case;

A.D=unknown, to be determined

A.C=$10,000

S.V=$3,000

N=5 years

replacing;

A.D={(10,000-3,000)/5}=7,000/5=$1,400

Annual depreciation=$1,400

Step 2: Determine annual tax benefits

Annual tax benefits=tax rate×annual depreciation

where;

tax rate=34%=34/100=0.34

annual depreciation=$1,400

replacing;

Annual tax benefits=0.34×1,400=$476

Step 3: Determine present value of the annual tax benefits

Year Future value Present value

1 476 476/{(1+0.09)^1}=436.70

2 476 476/{(1+0.09)^2}=400.64

3 476 476/{(1+0.09)^3}=367.56

4 476 476/{(1+0.09)^4}=337.21

5 476 476/{(1+0.09)^5}=309.37

Total present value of the tax benefits=436.70+400.64+367.56+337.21+309.37=$1,851.48

Estimate the present value of the tax benefits from depreciation=$1,851

3 0

3 years ago

He theoretic perspectives of priming, agenda setting, and framing are all similar, yet scholars say they are not exactly the sam

Tasya [4]

I was stuck on the same thing in my class test. I ended up failing but if I get the answers to it I’ll totally send them to you!!!

3 0

4 years ago

The management of Helberg Corporation is considering a project that would require an investment of $203,000 and would last for 6

levacccp [35]

Answer:

Helberg Corporation

The payback period of the period is closest to:

1 year and 6 months (1 1/2 years).

Explanation:

a) Data and Calculations:

Required project investment = $203,000

Scrap value of project's assets = $23,000

Depreciable amount of project's assets = $180,000

Period of project = 6 years

Annual depreciation = $30,000 ($180,000/6)

Annual net operating income = $103,000

Annual cash inflow = $133,000 ($103,000 + $30,000)

b) The payback period of the project = $203,000/$133,000 = 1.53 or 1 year and 6 months. This shows that the project will break-even in a year and six months, when the project's cash outflow equals the cash inflow.

7 0

3 years ago