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Virty [35]
3 years ago
5

Confu Inc. expects to have the following data during the coming year. The company is small, so it is not subject to the interest

deduction limitation. What is the firm's expected ROE?
a. Capital $155,000
b. Interest rate 8%
c. Debt/Capital, book value 65%
d. Tax rate 25%
e. EBIT $25,000
Business
1 answer:
Black_prince [1.1K]3 years ago
4 0

Answer:

23.42%

Explanation:

EBIT = 25,000

EBT = EBIT - Interest

       = 25,000  - ($155,000 × 65% × 8%)

       = $25,000 - $8,060

       = $16,940

Net income = EBT × (1 - Tax)

                    = $16,940 × (1 - 0.25)

                    = $12,705

Shareholder's Equity = capital  × (1 - Debt/Capital)

                                   =  $155,000 × (1 - 0.65)

                                   =  $54,250

Equity = Net income ÷ Shareholder's Equity

          = ($12,705 ÷ $54,250) × 100

          = 0.2342 × 100

          = 23.42%

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inessss [21]

Answer:

selling price of this car is $22700  

Explanation:

given data

zero interest = 72 months

monthly payment = $350

market interest rate = 3.5% per year = 0.2917 % per month

time = 6 year = 72 months

solution

we get here present value of annuity that is

present value  annuity  = ( 0.2917 % per month , 72 months )

present value  annuity  =  64.8568

so here selling price of car is

selling price = monthly payment ×  present value  annuity  ............1

selling price = $350 × 64.8568

selling price = $22700

so selling price of this car is $22700  

8 0
3 years ago
Is the loss in efficiency due to market power large or​ small? explain. the loss in efficiency due to market power is?
saul85 [17]

Answer:

Small

Explanation:

Competition limits the market power, even when the market is not perfectly comparative.

Market power refers to a company's relative ability to manipulate the price of an item in the marketplace by manipulating the level of supply demand or both.

A company with substantial market power has the ability to manipulate the market price and thereby control its profit margin, and possibly the ability to increase obstacle to potential new entrants into the market.

5 0
3 years ago
If an insured is concerned about being unable to pay the premiums on his or her whole life policy in the event of a total disabi
ELEN [110]

Answer:

c. Waiver of Premium

Explanation:

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Because in the case of this question the insured is concerned about becoming disable and losing the ability to pay for the contract, he is likely to benefit from a waiver of premium included in his insurance contract.

4 0
2 years ago
A company has two products: A1 and B2. It uses activity-based costing and has prepared the following analysis showing budgeted c
lawyer [7]

Answer:

E $4.00

Explanation:

Calculation of the approximate overhead cost per unit of Product B2 under activity-based costing.

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$48,000 × 4,800/6,000 = $38,400

Calculation of the Activity 2 allocated to Product B2 line:

$63,000 × 4,760/7,000 = $42,840

Calculation of the Activity 3 allocated to Product B2 line:

$80,000 × 800/8,000 = $8,000

Hence the Total overhead allocated to Product B2 will be :

$38,400+$42,840+$8,000

= $89,240

The Overhead per unit of Product B2 will be :

$89,240/22,310

= $4.00

Therefore the approximate overhead cost per unit of Product B2 under activity-based costing will be $4.00

4 0
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Artyom0805 [142]

Answer:

5678

Explanation:

45678

8 0
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