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
Y_Kistochka [10]
3 years ago
15

If a firm has a $1,500,000 debt limit before AT kd will change and if taxes are 40% and total equity in the capital structure is

40% and the rest is debt, calculate the debt breakpoint in the MCC schedule.
Business
1 answer:
andrew-mc [135]3 years ago
6 0

Answer:

$2,500,000

Explanation:

Break Point = Level of debt / Weight of debt

(100%-40%)

=60%

Hence:

= 1,500,000 / 60%

= $2,500,000

Therefore the debt breakpoint in the MCC schedule will be $2,500,000

You might be interested in
Suppose that the risk-free rate is 5% and that the market risk premium is 7%. What is the required return on (1) the market, (2)
Nesterboy [21]

Answer:

1.

r market = 0.12 or 12%

2.

r stock = 0.12 or 12%

3.

r Stock = 0.169 or 16.9%

Explanation:

The required rate of return can be calculated using the CAPM or Capital asset pricing model equation. The formula for required rate of return under this model is,

r = rRF + Beta * rpM

Where,

  • rRF is the risk free rate
  • rpM is the risk premium on market
  • r represents the required rate of return

1.

The beta of the market is always considered to be 1. Thus, the required rate of return on market would be,

r market = 0.05 + 1 * 0.07

r market = 0.12 or 12%

2.

For a stock whose beta is 1.0, the required rate of return would be same as that for market. So, the required rate of return for a stock with a beta of 1.0 is,

r Stock = 0.05 + 1 * 0.07

r Stock = 0.12 or 12%

3.

The required rate of return for a stock with a beta of 1.7 is,

r Stock = 0.05 + 1.7 * 0.07

r Stock = 0.169 or 16.9%

3 0
3 years ago
Which is not an intensity level of distribution?
nika2105 [10]
A.exclusive it’s not an intense level of distribution
4 0
2 years ago
Which of the following is an argument for free trade?
ipn [44]

i think it's" B" , from the explanation!

Explanation:

Free trade increases the size of the economy as a whole. It allows goods and services to be produced more efficiently. ... Free trade is good for consumers. It reduces prices by eliminating tariffs and increasing competition. Greater competition is also likely to improve quality and choice.

4 0
3 years ago
The Jack Frost Law Firm prepays for advertising in the local newspaper. On January​ 1, the law firm paid $ 11 comma 000 for ten
Svet_ta [14]

Answer:

a. $11,000

b. $2,200

Explanation:

According to the cash basis accounting, the cash is recorded when actual cash is received

But as per the accrual basis of accounting, the revenue is recorded when it is realized or earned whether cash is received or not                      

So,

a. Cash basis = $11,000

b. Accrual basis

= $11,000 ÷ 10 months × 2 months

= $2,200

8 0
3 years ago
Which is the correct order of the following steps in the accounting cycle? Prepare financial statements, journalize and post adj
murzikaleks [220]

Answer:

Explanation:

Prepare a post-closing trial balance.Step 9

Prepare an adjusted trial balance.Step 6

Analyze business transactions.Step 1

Prepare a trial balance.Step 4

Journalize the transactions.Step 2

Journalize and post closing entries.Step 8

Prepare financial statements.Step 7

Journalize and post adjusting entries.Step 5

Post to ledger accounts.Step 3

3 0
3 years ago
Other questions:
  • Rodeo ranch's agent slim is authorized to draw checks on rodeo ranch's account in town bank. upper range corporation is a rodeo
    13·1 answer
  • A product is invented in Country X and is first manufactured there. The International Product Life Cycle Theory holds that the p
    14·1 answer
  • According to entry-level analysis project (elap) statistics, what percentage of therapists are leaving the profession in the fir
    8·1 answer
  • The demand for an electronic component is normally distributed with an average daily demand of 500 units and a standard deviatio
    7·1 answer
  • On April 1, the price of gas at Bob’s Corner Station was $4.95 per gallon. On May 1, the price was $5.45 per gallon. On June 1,
    14·1 answer
  • What element of a Crisis Management Plan defines the process that should unfold once an issue or crisis is identified? Hint: it
    5·1 answer
  • Advantages of investment companies to investors include all but which one of the following?
    10·1 answer
  • Making a profit by lending money is ____________.<br> a. capital<br> c. usury<br> b. barter
    14·2 answers
  • . In the step-by-step deployment of MIS in a business, which (and why) of the following will you consider as a Foundation Step f
    10·1 answer
  • If your company matches 75 cents on the dollar,and you contribute $200 a paycheck, how much will your employee match?
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!