1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Ganezh [65]
3 years ago
9

Beranek Corp has $720,000 of assets (which equal total invested capital), and it uses no debt—it is financed only with common eq

uity. The new CFO wants to employ enough debt to raise the total debt to total capital ratio to 40%, using the proceeds from borrowing to buy back common stock at its book value. How much must the firm borrow to achieve the target debt ratio?
Business
1 answer:
lozanna [386]3 years ago
7 0

Answer:

firm must borrow $288000 to achieve the target debt ratio

Explanation:

given data

assets = $720,000

debt to total capital ratio = 40%

to find out

How much must the firm borrow to achieve the target debt ratio

solution

we get here debt here by Debt to Total capital ratio that is express as

Debt to Total capital ratio = Debt ÷ (  Debt + Equity  )   ....................1

put here value we get debt

0.40 = \frac{debt}{720000}

debt = $288000

so firm must borrow $288000 to achieve the target debt ratio

You might be interested in
Brenda is a new employee orientation trainer for a global corporation with subsidiaries all over the world. She needs to convey
iren [92.7K]

Answer:

High context cultures are heavily dependent on non verbal cues and subtle situational cues while communicating with others. In such cultures a person's reputation, prestige, status in society are considerably important.

Explanation:

In high context cultures are complete contrast to low context. In low context cultures, communication takes place clearly through language and rules of communication are clearly stated. While on the other hand in high context cultures, communication is subtle through body language, tone of voice, person's status etc. The use of contextual elements is more.

5 0
3 years ago
In King v. Riedl,
vovangra [49]

Answer:

Court ruled over in favor of the plaintiffs.

Explanation:

The result was that the court ruled in the favor of the plaintiffs because the contractor was statutorily barred from bringing an action to enforce payment because he doesn't has the residential home builder license and the amount of the contract satisfied statutory requirements.

8 0
2 years ago
When a company sells property and then leases it back, any gain on the sale should usually bea. deferred and recognized as incom
Julli [10]

Answer: A. deferred and recognized as income over the term of the lease.

Explanation:

In a sale-leaseback transaction, that is when a property is sold by a company and leased back, the property seller is the lessee and the property purchase is the lessor. In this case, a sale-leaseback will allow a company to sell an asset so that the company can raise capital, after which the asset can then be leader back.

When a company sells property and then leases it back, any gain on the sale should usually be deferred and recognized as income over the term of the lease.

6 0
3 years ago
An open-market purchase of securities by the Fed results in ________ in reserves and ________ in the supply of money. Group of a
qaws [65]

Answer:

an increase; an increase

Explanation:

Open market operations is a monetary policy instrument which is used by the Fed to control the money supply in an economy. In open market operations, there is a buying and selling of government securities from the public through banks.

If Fed purchases the government securities from the market then this will increase the money supply in an economy and there is a flow of money from Fed to public. This purchase of securities will also increase the reserves of the banks which they can utilized in lending to the individuals and other organisations.

7 0
2 years ago
The Boat Company has a capital structure of 30 percent riskless debt and 70 percent equity. The assumed tax rate is 23 percent.
mash [69]

Answer: 0.68

Explanation:

Using the measures given, the equity beta can be calculated as:

Equity beta = Asset beta * (1 + (1 - Tax rate) * (Debt/Equity)

= 0.9 * ( 1 + ( 1 - 23%) * (30% / 70%)

= 1.593 * 0.3/0.7

= 0.68

7 0
3 years ago
Other questions:
  • Many hydrothermal mineral deposits of copper, gold, silver, and other metals have been found in the countries bordering the paci
    11·1 answer
  • A lower interest rate increases consumption, investment, and __________, which ___________ aggregate demand.
    9·1 answer
  • Dividends cause a(n) __________ in equity and are recorded directly in the _______ account.
    15·1 answer
  • Which is true? Group of answer choices Typically, only highly skilled statisticians perform trend and root cause analysis. Ultim
    7·1 answer
  • The management approach of _____ was one of the first to recognize that enriching the lives of organizational and community fami
    5·1 answer
  • Saving money becomes easier if we do this first.
    8·1 answer
  • A government annually collects $320 billion in tax revenue and allocates $80 billion to education spending. What percentage of t
    10·1 answer
  • A bookstore organizes its stock by topic. It has a mystery novel section, a romance novel section, a how-to-do-it section, a tra
    12·1 answer
  • Scott Company had sales of $12,350,000 and related cost of goods sold of $7,500,000. Scott provides customers a refund for any r
    15·1 answer
  • Suppose maria and nikki can produce ballet shoes. if maria's opportunity cost of producing ballet shoes is higher than nikki's o
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!