Answer:
The correct option is D,$41,200
Explanation:
The fact that inventory reduced by 1,400 units implies that the fixed costs of 1,400 units added to closing inventory under absorption costing method has now been released into income statement as an additional cost in the current year,as result profit under absorption costing method reduce by the increased fixed costs:
net operating income under variable costing $52,400
less:additional fixed costs (1,400*$8) ($11,200)
Profit under absorption costing method $41,200
The correct option is D,$41,200
Under normal conditions, a firm's expected ROE would probably be higher if it financed with short-term rather than with long-term debt, but using short-term debt would probably increase the firm's risk.
Option A
<u>Explanation:
</u>
In business finance, the productivity of an undertaking, also defined as net assets or asset minus debt, is a calculation of its viability with respect to equity.ROE is a calculation about how well funds are used to produce increases in profits.
Companies are able to fund themselves with stocks and bonds. A business will raise its investment value by increasing the number of debt capital compared to its equity capital. There was a misunderstanding. Then you see that the new company has a better ROE because of its financial resources as you split the net income per shareholder's capital stock.
Havent you played monoply?
Answer:
Consider the following calculation and analysis
Explanation:
We will analyse from cost perspective, the alternative with lower cost should be selected.
Total no. of doctor visit = 12 monthly visit + 3 times special visit = 15
Cost = 50 * 15 = $750
Under Traditional health checkup plan
Cost of plan = $ 250 + (20% of doctor visiting charges) = 250 + 20% of 750 = $400
Under HMO
Premium = 20 * 12 months = $240
Co payment = 10 * 15 = 150
Total = $ 390
There is a saving of $10 in HMO, so she should opt for this option. Moreover, the benefit of HMO would be the payments are monthly in small installments ,rather than a big outflow as in the case of traditonal plan.
Answer:
10.67%
Explanation:
Gecko Company
Gecko = Expected Earnings growth rate = 8% annually
As there are no Capital gains tax, thus after Tax returns = Pretax returns
= 8%
Expected Dividend yield of Gordon = 5%
After tax returns = 5(1-.25)
=5(0.75)
= 3.75%
Assuming the pay out ratio = 100%
Gordon’s required pretax return = 8/ (1-.25)
=8/0.75
= 10.67%
At pretax return of 10.67% on Gordon the after tax returns on both the stocks are equal.