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My name is Ann [436]
3 years ago
15

Holo Company reported the following financial numbers for one of its divisions for the year; average total assets of $5,800,000;

sales of $5,375,000; cost of goods sold of $3,225,000; and operating expenses of $1,147,000. Assume a target income of 15% of average invested assets. Compute residual income for the division:a. $100,300.
b. $196,750.
c. $150,500.
d. $133,000.
e. $150,450
Business
1 answer:
kondaur [170]3 years ago
6 0

Answer:

Option D

Residual income= $133,000

Explanation:

<em>Residual Income is measure of how much a division or a part of a business is able to generate over and above the company-wide opportunity cost of capital.  </em>

<em>A division with a controllable profit over and margin over and above the cost of fund is evaluated to be profitable .  </em>

Residual income = Controllable margin - (cost of capital(%)× operating assets)  

cost of capital = target ROI = 15%

controllable profit= 5,375,000- 3,225,000- 1,147,000

                             = 1003000

Residual income =  1,003,000 -(15%×5,375,000)

                            = $133,000

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8 0
3 years ago
A municipal bond carries a coupon of 6.75% and is trading at par. What is the equivalent taxable yield to a taxpayer in a combin
Bingel [31]

Answer:

10.23%

Explanation:

Formula for computation of equivalent taxable yield is r = rm/1-t. Where the tax rate is t, rm is Yield on municipal bond and r is Tax equivalent yield

r = rm/1-t

r = 6.75% / 1 - 34%

r = 6.75% / 0.66%

r = 10.22727272727273%

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So, the equivalent taxable yield to a taxpayer in a combined federal plus state 34% tax bracket is 10.23%.

8 0
3 years ago
sarah has two dependent children who attend sun valley day care while she is at work. she will claim a $1,200 credit for child a
castortr0y [4]

If Sarah is in the income tax band that has a marginal rate of 24%, the amount of the deduction that must be taken in order to generate a tax advantage that is equivalent to that provided by the child care credit is x = 5000.

This is further explained below.

<h3> What amount of deduction is necessary to provide a tax benefit that is equal to that provided by the child care credit if Sarah is in the 24% marginal income tax bracket?</h3>

Generally, The proportion of an individual's income that must be paid in taxes is referred to as that person's marginal tax rate.

The average tax burden may be conceptualized as the entire tax burden expressed as a proportion of the income that is produced.

Tax: Taxes are payments to the government that is required of all citizens, whether they be people or companies.

In conclusion,

Available deduction = 1200

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6 0
2 years ago
Why do you think coins have been a more desirable form of money than paper currency throughout u.s history?
GrogVix [38]
Hello!!

The metal coins are/were made from is worth more tangibly than the paper that currency notes were written on.

Hope this helps! Thank you!!
6 0
3 years ago
Suppose the price of barley increases by 16.53%. If breweries buy 3.28% less barley after the price increase, the total revenue
son4ous [18]

Answer:

The total revenue for barley producers will increase because the price effect is greater than the quantity effect.

Correct option is D.  increase; price; quantity

Explanation:

Price effect (which is the impact that a change has on prices) in the scenario above is greater than Quantity effect (a reduction in commodities sold after an increase in price).

Since breweries still buy below the percentage of the Price effect, the revenue of barley sellers will continue to increase.

However, the revenue will start to decrease when the quantity effect exceeds the price effect.

6 0
3 years ago
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