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taurus [48]
3 years ago
7

Fauver Industries plans to have a capital budget of $650,000. It wants to maintain a target capital structure of 40% debt and 60

% equity, and it also wants to pay a dividend of $225,000. If the company follows the residual dividend policy, how much net income must it earn to meet its investment requirements, pay the dividend, and keep the capital structure in balance?
Business
1 answer:
Anon25 [30]3 years ago
8 0

Answer:

$ 615,000

Explanation:

Data provided :

Capital budget = $ 650,000

Debt ratio = 40%

Equity ratio = 60%

thus,

The capital funded by the equity = 60% of the capital = 0.6 × $ 650,000

= $ 390,000

Dividend to be paid = $ 225,000

Therefore,

the net income must be earned = $ 390,000 + $ 225,000

or

The net income must be earned = $ 615,000

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marissa [1.9K]

Electric relays a number of devices to mistake-proof a process. the following would not be included.

<h3>What are the devices?</h3>

A device is a complete piece of natural science hardware that is used to compute or support computer mathematical functions within a larger system. Some devices, such as peripheral devices, are subsidiary in nature and can provide input, output, or both to a computer.

Relays are electrically powered switches that operate by receiving electrical signals from other sources to open and close circuits. By turning the switch on and off, they receive an electrical signal and transmit it to other pieces of equipment.

Therefore, Thus, option (B) is correct.

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6 0
1 year ago
Recently, the owner of a trader joe's franchise decided to change how she compensated her top manager. last year, she paid him a
Wewaii [24]

Net earning for owner after payment to top manager, last year = $(130,000 - 65,000) = $65,000

This year, out of the forecast profit of $270,000, Owner has to pay to the top manager = $35,000 + 16% x $270,000

= $(35,000 + 43,200) = $78,200

Net money earned by owner this year = $(270,000 - 78,200) = $191,800

Change in net owner's earning = $(191,800 - 65,000) = $126,800

8 0
3 years ago
In order to produce a new product, a firm must lease equipment at a cost of $100,000 per year. The managers feel that they can s
bezimeni [28]

Answer:

$73 = unitary variable cost

Explanation:

<u>To calculate the unitary variable cost that will yield the break-even point, we need to use the following formula:</u>

Break-even point in units= fixed costs/ contribution margin per unit

50,000= 100,000 / (75 - unitary variable cost)

3,750,000 - 50,000unitary variable cost= 100,000

3,650,000 = 50,000unitary variable cost

$73 = unitary variable cost

5 0
3 years ago
A highly liquid financial instrument with a maturity of 90 days would be traded in: the bond market. none of the above. the mone
Lady_Fox [76]

Answer:

The Money Market.

Explanation:

The Financial markets can be broadly classified into two categories: Capital Market and Money Market. This classification is based on the maturity period of Financial instruments that trade in these markets. Lets study these two types of markets in detail:

<u>Money Market</u>

It is a market in which securities with a maturity of less than one year are traded. This is highly liquid market since the investors are repaid with the invested amount within one year of time. Due to a short duration, the instruments traded in this market are exposed to lower interest rate risk. A popular example of money market instrument can be Treasury Bills.

<u>Capital Market</u>

The securities that are traded in capital market are long-term and have a maturity of more than one year. The securities of capital market offer beefy returns to the investors due to higher duration and interest rate risks. If the security is of equity nature, then the market is termed as stock market. And if the traded security is bond, then we refer to it as a bond market. Examples of capital market instruments are shares and bonds.

3 0
3 years ago
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Journal entries of hari started business with cash and goods​
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Answer:

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