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juin [17]
3 years ago
11

Consider two companies in a world with no taxes that are alike except in borrowing choices. Company 1 has no debt​ financing, an

d Company 2 uses debt financing. The EBIT for both companies is​ $1,000. Company 1 has 500 shares outstanding and pays no interest. Company 2 has 300 shares outstanding and pays​ $250 in interest. What is the EPS for each​ company?
Business
1 answer:
Alekssandra [29.7K]3 years ago
6 0

Answer:

Company 1 = $2 per share

Company 2 = $2.50 per share

Explanation:

Given that,

EBIT for both companies = $1,000

Number of shares outstanding for company 1 = 500

Number of shares outstanding for company 2 = 300

Interest paid by company 2 = $250

EPS for company 1:

= (Total income - Preferred dividend) ÷ Shares outstanding

= ($1,000 - $0) ÷ 500

= $2 per share

EPS for company 2:

= (Total income - Preferred dividend) ÷ Shares outstanding

= ($1,000 - $250) ÷ 300

= $750 ÷ 300

= $2.50 per share

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An increase in the reserve requirement _____. rev: 06_20_2018 Multiple Choice increases the money supply by decreasing excess re
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Determine the amount of teller cost in total and the average teller cost per transaction for a branch that processes 55,000, 65,
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Everybody at a company is assigned a unique 8 digit id. how many unique ids exist? (note: you should also count the id consistin
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If everybody at a company is assigned a unique 8-digit id, then 3628800 unique IDs exist.

<h3>What is a unique ID?</h3>
  • Any document that can be used to prove a person's identity (also known as ID or paper) is considered an identity document.
  • It is commonly referred to as an identity card (IC, ID card, citizen card), or passport card when issued in the form of a small, standard credit card.
  • Some countries issue formal identity documents, such as national identification cards, which may be required or optional, whereas others may require identity verification via regional identification or informal documents.
  • A photo ID is a form of identification that includes a person's photograph.

To find out the number of unique IDs:

  • Given, assigned unique id= 9 digits.
  • Unique numbers= 1,2,3,4,5,6,7,8,9,0

Then,

  • n = 10
  • unique number: r = 9 digits

Using formula:

\begin{aligned}\rightarrow{ }^n P_r=\frac{n !}{n-r !} \\\rightarrow P_9^{10} &=\frac{10 !}{(10-9 !)} \\&=\frac{10 !}{(10-9 !)} \\&=\frac{10 !}{(1 !)} \\&=\frac{10 !}{1} \\&=3628800\end{aligned}

Therefore, if everybody at a company is assigned a unique 8-digit id, then 3628800 unique IDs exist.

Know more about a unique ID here:

brainly.com/question/6013251


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The correct question is given below:
Everybody at a company is assigned a unique 9-digit ID. How many unique IDs exist? (note: you should also count the id consisting of all zeros)

3 0
1 year ago
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