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djverab [1.8K]
3 years ago
6

Granfield Company is considering eliminating its backpack division, which reported an operating loss for the recent year of $42,

800. The division sales for the year were $975,200 and the variable costs were $483,000. The fixed costs of the division were $535,000. If the backpack division is dropped, 40% of the fixed costs allocated to that division could be eliminated. The impact on Granfield's operating income for eliminating this business segment would be: Multiple Choice $492,200 decrease $278,200 decrease $278,200 increase $492,200 increase $214,000 increase

Business
1 answer:
maxonik [38]3 years ago
8 0

Find the given attachment

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A firm's sustainable growth rate represents the:
Alecsey [184]

Answer:

1. A firm's sustainable growth rate represents the:

highest growth rate without increasing financial leverage.

2. The sustainable growth rate of a firm with net income of $2.90 million, cash dividends of $1.90 million, and return on equity of 16% is:

= c. 5.52%

Explanation:

a) Data and Calculations:

Sustainable growth rate = Return on equity * Retention rate

Net income =  $2.90 million

Cash dividends 1.90 million

Retained earnings = $1.0 million

Retention rate = $1.0/$2.90 * 100 = 34.48%

Return on equity = 16%

Therefore, the sustainable growth rate = 16% * 34.48%

= 5.5168%

= 5.52%

b) Sustainable growth rate is the rate of revenue growth, which an entity can attain without increasing its financial leverage (debts).  The sustainable growth rate answers the question of how much a company can grow without additional equity or debt financing.  It is a ratio that investment analysts and investors widely seek.  There are four main ways of increasing an entity's sustainable growth rate, including sale of debt, issue of equity, increased profitability through efficient sales revenue, and reduced dividends payout to increase retained earnings.

7 0
3 years ago
Harrington makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60%
nikklg [1K]

Answer:

Cash Collection is $122,000

Receivable as on August 31, is $97,000

Explanation:

Total budgeted cash collection in the month of August is $122,000 and total receivables as on August 31 is $97,000.

A schedule for the cash collection is made in MS Excel file, which is attached with this answer, please find it.

Download xlsx
5 0
3 years ago
How does the size of the order impact organizational buying?.
harkovskaia [24]

Answer:

Because many organizational purchases involve a lot of money, a competitive bidding process is used.

6 0
2 years ago
Customer-Level Planning Circle K operates a number of convenience stores worldwide. Assume that an analysis of operating costs,
Naddika [18.5K]

Answer:

11,000 people

Explanation:

fixed costs per store $80,000

variable cost ratio 0.80

average sale per customer $15

average customer sales per week 1.75

customers as portion of population 4%

each customer shops 1.75 x 52 = 91 times per year

contribution margin per visit = $15 - ($15 x 0.8) = $3

contribution margin per client per year = $3 x 91 = $273

in order to make $40,000 in profits, you need at least:

($80,000 + $40,000) / $273 = 439.56 ≈ 440 customers

to determine the city's total population = 440 / 0.04 = 11,000

4 0
3 years ago
Define bond economics.​
valentinak56 [21]
In finance, a bond is an instrument of indebtedness of the bond issuer to the holders. The most common types of bonds include municipal bonds and corporate bonds. Bonds can be in mutual funds or can be in private investing where a person would give a loan to a company or the government.
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2 years ago
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