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maks197457 [2]
3 years ago
10

Last year, Michelson Manufacturing reported $10,250 of sales, $3,500 of operating costs other than depreciation, and $1,250 of d

epreciation. The company had no amortization charges, it had $3,500 of bonds outstanding that carry a 6.5% interest rate, and its federal-plus-state income tax rate was 40%. This year's data are expected to remain unchanged except for one item, depreciation, which is expected to increase by $725. By how much will the depreciation change cause the firm's net after-tax income and its net cash flow to change? Note that the company uses the same depreciation calculations for tax and stockholder reporting purposes.a. -$383.84; $206.68b. -$425.30; $229.01c. -$435.00; $290.00d. -$471.25; $253.75e. -$404.04; $217.56

Business
1 answer:
svet-max [94.6K]3 years ago
6 0

Answer:

c. -$435.00

The answer and procedures of the exercise are attached in a microsoft excel document.

Explanation:

Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.  

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A measure of risk-adjusted performance that is often used is the Sharpe ratio. The Sharpe ratio is calculated as the risk premiu
soldier1979 [14.2K]

Answer:

Explanation:

Sharpe ratio is the measure of the excess return per unit of risk in an investment asset or trading strategy.

To calculate the Sharpe of the following annual return using the formula:

Sharpe ratio = \dfrac{R_p-R_f}{\sigma _p}

where;

R_p = return of portfolio asset

From the given information, the risk-free rate R_f wasn't given, So let's assume that the risk-free rate  R_f = 3.2%

∴

For Bledsoe S&P 500 Index fund

Sharpe Ratio = \dfrac{10.15\%-3.2\%}{23.85\%}

= 0.2914

Small-cap Funs Sharpe Ratio = \dfrac{14.83\%-3.2\%}{29.62\%}

= 0.3926

Large company stock Fund Sharpe Ratio = \dfrac{11.08\%-3.2\%}{26.13\%}

= 0.3016

Bond Fund Sharpe Ratio = \dfrac{8.15\%-3.2\%}{26.13\%}

= 0.1894

                          10-Year                    Standard       Sharpe Ratio

                           Annual Return        deviation

Bledsoe S&P -      10.15%                    23.85%           0.2914    

500 Index fund

Small Cap Fund     14.83%                  29.62%           0.3926

Large Company -   11.08%                       26.13%         0.3016

Stock Fund      

Bond Fund              8.15%                        10.34%          0.1894      

As depicted in the table above, the small-cap fund has the highest return per unit of risk, and company stock has the lowest return per unit of risk.

The ratio is clearly appropriate for the index funds. The whole risk is reflected by the Sharpe ratio, which is believed to be completely diversified, and systemic risk is reduced.

It is good for other stock funds since the overall risk is crucial for small investors who cannot readily diversify.

It is also acceptable to invest in bond funds since we may compare their Sharpe ratio to stock funds and take a financial investment decision.

We would take and make use of the Sharpe ratio when:

  • Comparing various assets with differing risks, then the Sharpe ratio would be applied to alter the "unit."
  • We are concerned about any type of volatility.

3 0
3 years ago
What are some factors that would influence supply? Explain
lakkis [162]

Answer:

Some of the factors that influence the supply of a product are described as follows:

i. Price: ...

ii. Cost of Production:  

iii. Natural Conditions:  

iv. Technology:  

v. Transport Conditions:  

vi. Factor Prices and their Availability:  

vii. Government's Policies:  

viii. Prices of Related Goods

<h2>Please mark me as brainliest</h2>
6 0
3 years ago
The higher the potential return, the _____. higher the liquidity of an investment higher the time risk for an investment higher
Inga [223]
<span>higher the risk for an investment</span>
8 0
3 years ago
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Both Projects A and B are acceptable as independent projects. However, the selection of either one of these eliminates the optio
Slav-nsk [51]

Answer: Mutually exclusive

Explanation:

In probability theory and logic, two propositions or events are disjoint or mutually exclusive if both events cannot occur at the same time. An example is the outcomes derived from the single toss of a coin which either be head or tail

In the project example given, the theory used is called mutually exclusive since both projects can not be chosen at the same time and it is only one project at w time. Mutually exclusive events are also called independent events since they have no effect on the viability of the other options.

4 0
3 years ago
Need answer like, fast.
grigory [225]

Answer:

D

Explanation:

7 0
3 years ago
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