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mash [69]
3 years ago
14

Casey Motors recently reported net income of $148 million. The firm's tax rate was 40.0% and interest expense was $46 million. T

he company's after-tax cost of capital is 11.0% and the firm's total investor supplied operating capital employed equals $1,036 million. What is the company's EVA? (Answers are in $ millions.)
Business
1 answer:
HACTEHA [7]3 years ago
3 0

Answer:

$61,640,000

Explanation:

Earning before tax:

= Net income ÷ 60%

= $148,000,000 ÷ 60%

= $246,666,667

EBIT:

= Earning before tax + Interest expense

= $246,666,667 + $46,000,000

= $292,666,667

EVA:

= EBIT(1 - t) - (Capital employed × cost of capital)

= $292,666,667(1 - 0.4) - ($1,036,000,000 × 11%)

= $175,600,000 - 113,960,000

= $61,640,000

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A life insurance salesperson who takes advantage of the foot-in-the-door phenomenon would be most likely to
LiRa [457]

C. Ask customers to respond to a brief survey of their attitudes regarding insurance.

The "foot in the door" phenomenon is the tendency for people to agree to a large request if they have already previously agreed to a smaller/easier request. In this case, because the salesman has already convinced the customer to sit down and talk to him, they will be more likely to agree to do more by taking the survey.

7 0
3 years ago
Bonita and Miller Manufacturing is trying to determine the equivalent units for conversion costs with 11400 units of ending work
ratelena [41]

Answer:

The equivalent units for conversion cost are 28080.

Explanation:

Firstly, we need to find our how much units are being sold

Units Sold= physical units - ending units

Units sold= 31500 - 11400 = 20100

Then we need to add units sold with percentage completion of ending units in order to find out equivalent units for conversion cost

Formula:

Equivalent units for conv. cost= units sold + (%completion of ending units)

Equivalent units for conv. cost= 20100 + ( 70% ×11400)

Equivalent units for conv. cost= 20100 + 7980

Equivalent units for conv. cost= 28080

8 0
3 years ago
James Company began the month of October with inventory of $32,000. The following inventory transactions occurred during the mon
NARA [144]

Answer

The answer and procedures of the exercise are attached in the following archives.

Explanation  

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

Download xlsx
3 0
4 years ago
A company recently issued 9% preferred stock. The preferred stock sold for $40 a share with a par of $20. The cost of issuing th
Westkost [7]

Answer:

The company's cost of preferred stock is 5.1%

Explanation:

In order to find the cost  of the preferred stock we will need to divide the dividend the company pays on it by the net amount that the company is receiving for selling it.

In order to find the dividend we will multiply 9% by the par value of 20

Dividend = 0.09*20=1.8

Now we need to find the net amount the company receives for selling the preferred stock.

The company sells the stock for $40 but also has a issuing cost of $5, so in order to find the net amount we will subtract the cost from the price.

40-5= 35

35 is the net amount the company receives.

Now we will divide the the dividend 1.8 by the net amount 35

1.8/35=0.051

=5.1%

The company's cost of preferred stock is 5.1%

5 0
3 years ago
Suppose that during the past year, the price of a laptop computer rose from $2,750 to $2,880. During the same time period, consu
icang [17]

Answer: Elasticity of demand is 7.06

Explanation:

P1= $2,750

P2=$2,880

Q1=446,000

Q2=321,000

Elasticity = \frac{Q2 - Q1}{\frac{Q1 + Q2}{2} } * \frac{\frac{P1 + P2}{2} }{P2 - P1}

Elasticity = \frac{321,000 - 446,000}{\frac{446,000 + 321,000}{2} } * \frac{\frac{2750 + 2880}{2} }{2880 - 2750}

Elasticity = \frac{-125,000}{383,500} * \frac{2815}{130}

Elasticity = - 0.3259*21.6598

Elasticity = -0.76

Thus, elasticity of demand for laptops is 7.06. This means that laptops are highly price elastic as it is greater than 1.



8 0
4 years ago
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