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4 years ago

What is the business cycle? What causes changes from one phase of the business cycle to another

1 answer:

4 0

A business cycle is a showcase of consitent and successive stages or phrases an economy goes through.

Changes are caused by exogenous endogenous factors which in simple language is internal and external elements for example weather conditions, unexpected events like an outbreak of war and changes in consumer preference amongst others.

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Sunset Corp. currently has an EPS of $2.09, and the benchmark PE for the company is 18. Earnings are expected to grow at 6.5 per

olga_2 [115]

Answer:

a. The estimate of the current stock price is $37.62

b. The target stock price in one year is $40.065

c. The implied return on the company's stock over the next year, Assuming the company pays no dividends is 6.51%

Explanation:

a. In order to calculate estimate of the current stock price would have to mak the following calculation:

current stock price=EPS*PE

current stock price=$2.09*18

current stock price=$37.62

The estimate of the current stock price is $37.62

b. To calculate the target stock price in one year we would have to make the following calculation:

target stock price in one year=EPS in one year* PE

EPS in one year=EPS*(1+percentage of Earnings expected to grow)

EPS in one year=$2.09*(1+0.065)

EPS in one year=$2.226

Therefore, target stock price in one year=$2.226*18

target stock price in one year=$40.065

The target stock price in one year is $40.065

c. To calculate the implied return on the company's stock over the next year Assuming the company pays no dividends we would have to use the following formula:

implied return on the company's stock over the next year=P1-P0/P0

implied return on the company's stock over the next year=$40.065-$37.62/$37.62

implied return on the company's stock over the next year=6.51%

The implied return on the company's stock over the next year, Assuming the company pays no dividends is 6.51%

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3 years ago

Which of the following changes would bring the U.S. capital stock, currently below the Golden Rule level, closer to the steady-s

Vlada [557]

Answer:

The answer is increasing the saving rate

Explanation:

Increasing the saving rate.

4 0

4 years ago

Wolfgang Electricals estimates that the company takes 31 days on average to pay off its suppliers. It also knows that it has day

Makovka662 [10]

Answer:

57 days

Explanation:

The computation of the cash conversion cycle is shown below:

The cash conversion cycle = Days inventory outstanding + days sale outstanding - days payable outstanding

= 54 days + 34 days - 31 days

= 57 days

Hence, the cash conversion cycle is 57 days

We simply added the days' sales in inventory and days sales' outstanding and deduct the days payable outstanding so that the cash conversion cycle could come

8 0

4 years ago

Financial statement data for years ending December 31 for tango company follow

maxonik [38]

The inventory turnover for Tango company are: 4.8, 5.3.

<h3>Inventory turnover</h3>

Using this formula

Inventory Turnover = Cost Of Goods Sold / ((Beginning Inventory + Ending Inventory) / 2)

20Y7

Inventory Turnover =$3,864,000 /($770,000+$840,000)/2

Inventory Turnover=$3,864,000/$805,000

Inventory Turnover=4.8

20Y6

Inventory Turnover = $4,001,500 /($740,000+$770,000)/2

Inventory Turnover= $4,001,500 /$755,000

Inventory Turnover=5.3

Therefore the inventory turnover for Tango company are: 4.8, 5.3.

The complete question is:

Financial statement data for years ending December 31 for tango company follow

20Y7 20Y6

Cost of goods sold $3,864,000 $4,001,500

Inventories:

Beginning of year 770,000 740,000

End of year 840,000 770,000

Determine the turnover for 20Y7 and 20Y6.

Learn more about inventory turnover here:brainly.com/question/18914383

#SPJ1

8 0

2 years ago

Presented below is information related to equipment owned by Bramble Company at December 31, 2020. Cost $10,260,000 Accumulated

Neporo4naja [7]

Answer and Explanation:

The journal entry to record the impairment of the loss is shown below:

Loss on impairment Dr $3,670,800

To Accumulated depreciation - Equipment $3,670,800

(Being the loss on impairment is recorded)

For recording this we debited the loss on impairment as it increased the losses and credited the accumulated depreciation as it increased the balance of accumulated depreciation

Working note:

Cost $10,260,000

Less: Accumulated depreciation -$1,140,000

Carrying Amount $9,120,000

Less Fair value -$5,472,000

Plus: Cost of disposal $22,800

Loss on impairment $3,670,800

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4 years ago