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3 years ago

The Miller model begins with the MM model with taxes and then adds personal taxes. True or False?

Business

1 answer:

tankabanditka [31]3 years ago

4 0

Answer:

The statement is: True.

Explanation:

The Modigliani-Miller (<em>M&M</em>) Theorem is used in financial and economic studies to analyze the value of a firm such as a business or a corporation. The M&M theorem states that a firm's value is based on its ability to earn revenue plus the risk of its underlying assets. Thus, the way a company finances its operations should not affect its value.

When it comes to taxes, the M&M theorem states that the capital structure of a company is not affected when there are no taxes. The theorem starts with the corporate taxes to then relate the approach to personal taxes.

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On January 1, 2012, Fei Corp. issued a 3-year, 5% coupon, $100,000 face value bond. The bond was priced at an effective interest

xz_007 [3.2K]

Answer:

c. $7,418

Explanation:

Calculation to determine What was Fei’s Interest Expense on the bond during fiscal year 2012

Using this formula

Interest Expense =Interest payable+Amortization of bonds discount interest expense

Let plug in the morning

Interest Expense=(5%*100,000)+$2,418

Interest Expense=$5,000+$2,418

Interest Expense=$7,418

Therefore Fei’s Interest Expense on the bond during fiscal year 2012 is $7,418

3 0

3 years ago

What is the difference between a layoff and being fired?

KIM [24]

Being laid off is when the company is goes through financial struggles so they have to chose people to cut off, being fired is when you did something wrong so they fire you.

4 0

4 years ago

Read 2 more answers

The individual mechanism that deals with workers' psychological reactions to overtaxing job demands is referred to as?

Mekhanik [1.2K]

The individual mechanism that deals with workers psychological reactions to overtaxing job demands is referred to as stress.

Stress is considered as a defensive mechanism, as it follows the three stages of resistance, alarm, and exhaustion. The psychological stress is usually associated with negative life changes.

So here in this case, the individual mechanism, which is dealing with the workers psychological reactions to overtaxing job demands is considered as stress. As the workers are stressed due to the overtaxing job demands.

Hence, the coping mechanisms are the strategies people often use in the face of stress in order to help manage painful or difficult emotions.

To learn more about stress here:

brainly.com/question/9643296

#SPJ4

5 0

2 years ago

The management of California Corporation is considering the purchase of a new machine costing $400,000. The company's desired ra

Julli [10]

Answer:

c. 1.14

Explanation:

Year Cash Flow PV Factor 10% PV of Cash flows

($) ($)

Year 1 180,000 0.909 163,620

Year 2 120,000 0.826 99,120

Year 3 100,000 0.751 75,100

Year 4 90,000 0.683 61,470

Year 5 90,000 0.621 55,890

Total = 455,200

Initial cash outflow = $400,000

Cash inflow = $455,200

So, we can calculate the present value index by using following formula,

Present value index = Cash inflow ÷ Cash outflow

= $455,200 ÷ $400,000

= 1.14

4 0

3 years ago

Required information Exercise 4-47 and 4-48 (Static) (LO 4-4) [The following information applies to the questions displayed belo

LiRa [457]

Answer:

a. If Mel decides to sell dinners, what are the total costs for both making and buying the cookies?

if Mel decides to sell dinners, the he will not have any spare capacity for producing cookies, so the production costs would be different:

direct materials $0.20

direct labor $0.15

total overhead (including variable and fixed) $0.45

total cost per cookie = $0.80

Purchase price form external supplier = $0.60 per cookie (same as before).

b. Should Mel continue to buy the cookies? Yes No

It would be better for Mel to simply buy the cookies from an external supplier at $0.60.

Mel should only produce the cookies if he decides not to sell dinners.

6 0

3 years ago