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3 years ago

The firm's target capital structure should do which of the following?

Business

1 answer:

inysia [295]3 years ago

8 0

Answer:

e. Minimize the weighted average cost of capital (WACC)

Explanation:

A: Earnings per share is linked to the stockholders' only, therefore, it cannot achieve the target capital structure. It is a wrong statement.

B: Minimizing the cost of equity is related to the equity only, so, it is also a false statement.

C: Cost of debt is only related to liabilities. It cannot minimize the total target capital structure. Therefore, it cannot be an answer.

D: It is out of question because target capital structure cannot obtain the bond rating.

E: Since weighted average cost of capital is the combination of debt and equity capital's cost, it can be minimized with the firm's target capital structure.

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Serial Problem Business Solutions LO P4 Business Solutions sells upscale modular desk units and office chairs in the ratio of 3:

stich3 [128]

Answer:

Instructions are below.

Explanation:

Giving the following information:

The selling prices are $1,310 per desk unit and $560 per chair. The variable costs are $810 per desk unit and $310 per chair. Fixed costs are $180,000.

The company sells 3 deks per 2 chairs.

Sales proportion:

Desks= 3/5= 0.6

Chairs= 2/5= 0.4

1) Selling price per composite unit= sales proportion*selling price

Selling price per composite unit= 0.6*1,310 + 0.4*560

Selling price per composite unit= $1,010

2) Variable cost per composite unit= sales proportion*unitary variable cost

Variable cost per composite unit= 0.6*810 + 0.4*310

Variable cost per composite unit= 610

3) Break-even point (units)= Total fixed costs / Weighted average contribution margin

Break-even point (units)= 180,000/ (1,010 - 610)

Break-even point (units)= 450 units

4) Number of units for each product:

Desks= 0.6*450= 270

Chairs= 0.4*450= 180

5 0

3 years ago

At the beginning of the current year, Paxx County’s enterprise fund had a $125,000 balance for accrued compensated absences. At

valentina_108 [34]

Answer:

a. $425,000

Explanation:

<em>Calculation of compensated absences expense for the year</em>

Closing balance of compensated absences = $150,000

+ Payments made for compensated expenses = $400,000

- Opening balance of compensated absences =<u> - $125,000</u>

Compensated absences expense for the year = $425,000

7 0

3 years ago

martin's has current assets of $600 and total assets of $2,900. the firm has total debt of $1,500 and long-term debt of $1,100.

lions [1.4K]

The current ratio is 1.5.

<h3>What is the current ratio?</h3>

Current ratio is a liquidity ratio. Liquidity ratios measure a firm's ability to honour its short terms obligations.

Current ratio is the ratio of current assets to current liabilities. Current assets are assets that would be used up in a year. Current liabilities are debt obligations that would be settled within a year. Current liabilities excludes long-term debt.

The higher the current ratio, the higher the firm's liquidity and its ability to meet short term obligations.

Current ratio = current asset /current liability

= 600 / (1500 - 1100)

= 600 / 400

= 1.5

To learn more about financial ratios, please check: brainly.com/question/26092288

#SPJ1

3 0

1 year ago

Upon arrival at the international airport in the country of Canteberry, Charles Alt exchanged $200 of U.S. currency 1,000 florin

cricket20 [7]

Answer:

Explanation:

Here's the answer!! Hope this helped...

7 0

3 years ago

A detailed written statement that describes the nature of the business, the target market, the advantages the business will have

oee [108]

The answer is business plan.

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3 years ago