Answer:
$102 million and 6.25%
Explanation:
The computation is shown below:
a. For net income
As we know that
Net income = (Earning before interest and taxes - interest) × (1 - tax rate)
where,
EBIT is calculated after finding out the sales, operating cost which is given below:
Sales = $700 million × 1.20 = $840 million
And, the operating costs = 75% × $840 million = $630 million
So, the EBIT is
= $840 million - $630 million
= $210 million
Now the net income is
= ($210 million - $40 million) × (1 - 40%)
= $102 million
2. Now expected growth rate in net income is
= (Latest year Net income ÷ previous year net income) - 1
= ($102 million ÷ $96 million) -1
= 6.25%
Since dividend payout ratio is same so the growth rate in dividend should be equal to the growth rate in net income i.e 6.25%
Answer:
d.) $38,000
Explanation:
Given that
Acquired value of the plant = $190,000
Recovery period = 5 years
So according to section 179, the total deduction is limit to the 1 by 5 i.e useful life or recovery period of acquired price or purchase price
So, the amount is
= Acquired value of the plant ÷ recovery period
= $190,000 ÷ 5 years
= $38,000
By dividing the acquired value with the recovery period we can get the maximum deduction
Answer:
(Decrease, Increase)
Explanation:
When the government formulates and implements policies aimed at increasing equality, the society will experience a reduction in the level of efficiency. For example, an increase in income tax on wealthiest Americans, and redistribution of the tax revenue to the poorest Americans would may discourage the wealthy from taking more income-generating activities which create jobs, this is not optimal. At the same time, this policy would reduces the peoples’ incentive to work hard to earn their own money.
Answer:
The answer is B.
Explanation:
The correct option is B. - give up a share of its ownership. Venture capitalist invest in a start up ventures or small businesses that they believe have high future prospects.
Because venture capitalists are exprienced business wise and have enough money, they tend to make or provide managerial decisions. The business will be in form of partnership, hence, Artificial Intelligence Inc. giving up part of its ownership.
It is not a must venture business pay a periodic dividend but business capitalist share in the profit or loss of the business.
