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babymother [125]
3 years ago
5

In its first year, Raydine Inc. reported sales revenue of $1,300,000, net income of $200,000, and paid dividends of $26,000 on c

ommon stock. It also paid dividends on its 10,000 shares of 6%, $100 par value, noncumulative preferred stock. Common stockholders' equity was $1,200,000 at the start of the year and $1,800,000 at the end of the year. How much is the company's return on common stockholders' equity in its first year?
Business
1 answer:
klemol [59]3 years ago
8 0

Answer:

Return on common stockholders' equity=0.0933=9.33 %

Explanation:

Net Income=$200,000

Preferred Stockholder Dividends=Number of shares* value per share*interest

Preferred Stockholder Dividends=10000*$100*6%

Preferred Stockholder Dividends=10000*$100*0.06

Preferred Stockholder Dividends=$60,000

Average Common  stockholders' equity= (Equity at start of year+Equity at end of year)/2

Average Common  stockholders' equity= \frac{\$ 1,200,000+\$1,800,000 }{2}

Average Common  stockholders' equity=$1,500,000

Return on common stockholders' equity=(Net Income-Preferred Stockholder Dividends)/Average Common  stockholders' equity

Return on common stockholders' equity=\frac{\$200,000-\$60,000}{\$1,500,000}

Return on common stockholders' equity=0.0933=9.33 %

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3 years ago
A small Canadian firm that has developed some valuable new medical products using its unique biotechnology know-how is trying to
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Answer:

Part a. Manufacturing the goods at home and let overseas sales managers handle the marketing.

Advantages  

  1. Can have a full authority in production activities.
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  3. Having better regulator over human resources.
  4. The foreign sales agents will enhanced the understanding of European marketplaces.
  5. It lower the exit costs if product fails.

Disadvantages

  1. Having lack of information in European pharmaceutical procedures.
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  3. Additional costs in delivery of the products.

Part b. Manufacture the products at home and set up a wholly owned subsidiary in Europe to handle marketing.

Advantages

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  3. Having better regulator over human resources.
  4. The brand name will not be damaged since the marketing is controlled by the same company

Disadvantages

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  2. Having lack of information in European pharmaceutical procedures.
  3. Additional costs in delivery of the products  
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Part c. Enter into a strategic alliance with a large European pharmaceutical firm. The product would be manufactured in Europe by the 50/50 joint venture and marketed by the European firm

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Disadvantages

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7 0
3 years ago
The Closed Fund is a closed-end investment company with a portfolio currently worth $260 million. It has liabilities of $2 milli
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Answer and Explanation:

The computation is given below:

NAV = (Total value - Liabilities) ÷ Number of shares outstanding

= ($260M - $2M) ÷ 6M

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= ($40 - $43) ÷ $43

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Which of the following activities describes the opportunity cost of attending an economics class?
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Answer:

C is the correct option

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<u>Full question:</u>

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Researchers could access this data by using Bar codes

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