Answer: 5.9%
Explanation:
Before:
Equity is calculated as:
= Total Assets / Equity Multiplier
= $ 175,000 / 1.2
= $ 145,833
Therefore, ROE will be:
= (Turnover × Profit Margin) / Equity
= ($ 395,000 × 5.3%) / $ 145,833
= $ 20935 / $145,833
= 0.1436
= 14.36%
After:
New Total Assets will be:
= $ 175,000 - $ 51,000
= $ 124,000
Equity
= Total Assets / Equity Multiplier
= $ 124,000 / 1.2
= $ 103,333
ROE will then be:
= (Turnover × Profit Margin) / Equity
= ($ 395,000 × 5.3%) / $ 103,333
= $ 20935 / $ 103,333
= 0.2026
= 20.26%
Therefore, the change in ROE will be:
= 20.26% - 14.36%
= 5.9%
= 4.035%
Answer:
C. $ 7,500
Explanation:
Estimated direct labor cost $ 100,000
Estimated direct labor hours 20,000 hours
Predetermined rate per direct labor hours $ 5 per direct labor hour
Actual hours used on a job 1,500 hours
Applied overhead based on the predetermined overhead
rate per direct labor hours
$ 5 per direct labor hours * 1,500 hours $ 7,500
The information regarding machine hours is not relevant to the requirements of the question.
Answer:
9.09%
Explanation:
The required return of ZYX, Inc shall be determined using the following mentioned formula:
r=[d(1+g)/MV]+g
In the given question
r=required rate of return of ZYX, Inc=?
d(1+g)=next dividend payment to be made by the ZYX, Inc=$2.95
MV=current selling price of share=$58
g=growth rate of dividend=4%
r=required rate of return=[$2.95/$58]+4%
r=required rate of return=9.09%
