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Nataliya [291]
3 years ago
14

Three Waters Co. is a small company and is considering a project that will require $700,000 in assets. The project will be finan

ced with 100% equity. The company faces a tax rate of 25%. What will be the ROE (return on equity) for this project if it produces an EBIT (earnings before interest and taxes) of $140,000? 15.75% 11.25% 15.00% 10.50%
Business
2 answers:
lidiya [134]3 years ago
8 0

Answer:

15.00%

Explanation:

The formula to compute the return on equity is shown below:

Return on equity = (EBIT × 1 - tax rate) ÷ (total equity)

                            = ($140,000 × 0.75) ÷ ($700,000)

                            = ($105,000) ÷ ($700,000)

                            = 15%

It shows a relationship between the earning after tax and total equity in respect of assets required for the project so that the accurate return can come

zlopas [31]3 years ago
6 0

Answer:

ROE 15%

Explanation:

Given data:

Total assets is $700,000

percentage of equity is 100%

tax rate is 25%

return on equity is given as

ROE = Net Income/ Total equity

net income is given as

Net\ Income = EBIT \times (1 - tax\ rate)

                    = 140,000*(1 - 0.25) = 105,000

Total equity  is equal to  Total assets = 600,000

plugging all value to get ROE value

ROE = \frac{105,000}{600,000}

        = 0.15 = 15.00% (Option c)

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The US agricultural sector experienced a severe drought in 2012. A drought decreases the supply of agricultural products, which
Nataliya [291]

Answer:

True

Explanation:

Exceptionally good weather will guarantee a good yield in crops. This will lead to an increase in supply of produce to the market, and when supply increases, the supply curve shifts to the right.

This is simply because there are more products and more sellers, and this will result in more supply.

5 0
3 years ago
In the​ past, Peter​ Kelle's tire dealership in Baton Rouge sold an average of 1 comma 000 radials each year. In the past 2​ yea
Lina20 [59]

Answer:

Explanation:

For computing the demand for each sale, first we have to compute the average sale for each season which is show below:

Average sale in fall = (240 + 260) ÷ 2 = 250

Average sale in winter = (340 + 300)  ÷ 2 = 320

Average sale in spring = (140 + 160)  ÷ 2 = 150

Average sale in summer = (320 + 240) ÷ 2 = 280

Demand for next fall = (250  ÷ 1,000) × 1,200 = 300

Demand for next winter = (320  ÷ 1,000) × 1,200 = 384

Demand for next spring = (150  ÷ 1,000) × 1,200 = 180

Demand for next summer = 1,200 - (300+384+180) = 336

6 0
3 years ago
Which of these are fixed expenses?
AysviL [449]

Answer:

car insurance, rent, student loan payments

Explanation:

Fixed expenses or fixed costs remain constant throughout a financial period. In the year under consideration, fixed expenses will have the same figures regardless of the production level.  Fixed costs contrast variable costs, which vary depending on the level of business activities.

From the list provided, car insurance, rent, student loan payments will likely remain the same in the financial period. The other expenses, such as pet needs, entertainment, public transportation costs, and gifts, are bound to be determined by production volumes.

3 0
3 years ago
An employee has​ year-to-date earnings of . The​ employee's gross pay for the next pay period is . If the FICAOASDI is ​% and th
taurus [48]

Answer:

$192

Explanation:

Calculation for how much FICA-OASDI tax will be withheld from the employee's pay?

FICA-OASDI tax=($117,000-$113,900)*6.2%

FICA-OASDI tax=$3,100*6.2%

FICA-OASDI tax=$192

Therefore how much FICA-OASDI tax will be withheld from the employee's pay is $192

5 0
2 years ago
The Federal Deposit Insurance Corporation was established in 1933, during the Great Depression, to:_________
ICE Princess25 [194]

Answer:

b) help stop bank failures throughout the United States.

Explanation:

A bank run can be defined as a situation where bank clients or depositors make withdrawals of their money simultaneously from banks as a result of them being scared or afraid the depository institution will run out of cash (bankruptcy) and become insolvent.

The Federal Deposit Insurance Corporation which is also generally referred to as the FDIC was a New Deal program introduced by President Franklin D. Roosevelt in 1933 and it was designed to prevent bank failures or bank runs and restore the public's faith in the banking system.

Hence, the Federal Deposit Insurance Corporation (FDIC) was established on the 16th of June, 1933 so as to counter or mitigate the problem with bank runs.

Generally, the income generated from the premium payments of insured banks is used to fund or finance the Federal Deposit Insurance Corporation (FDIC).

Additionally, to avoid bank runs or other financial institutions from being insolvent, the Federal Reserve (Fed) and Central banks (lender of last resort) are readily accessible and available to give monetary funds to these institutions when they're running out of money and as well as regulate their activities.

In conclusion, the Federal Deposit Insurance Corporation (FDIC) was established in 1933, during the Great Depression, to help stop bank failures throughout the United States.

7 0
3 years ago
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