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LiRa [457]
3 years ago
5

Katz is an all-equity development company that has 52,000 shares of stock outstanding at a market price of $32 a share. The firm

's earnings before interest and taxes are $46,000. Katz has decided to issue $176,000 of debt at a rate of 8 percent and use the proceeds to repurchase shares. What should Leslie do if she owns 500 shares of Katz stock and wants to use homemade leverage to offset the leverage being assumed by the firm?
Business
1 answer:
PolarNik [594]3 years ago
8 0

Answer:

Explanation:

Share repurchased = 176,000/ 32 = 5,500

Value of Equity = (52,000 - 5,500) x 32 = 1,488,000

Value of debt = 176,000

Debt Ratio = 176,000/ (176,000 + 1,488,000) = .10576

Leslie needs to reduce its investment in the firm by 10.576%

Leslie will sold stocks = .10576 x 500 = 53 shares

Therefore, Leslie need to Sell 53 shares and loan out the proceeds.

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On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flo
Brums [2.3K]

Answer and Explanation:

The computation of the purchase of fixed assets is shown below:-

March 12 Purchase of  fixed assets = $274,000. This same is shown in the investing activities section of the cash flow statement in the negative sign

October 4 Sale of fixed assets = $151,000. This same is shown in the investing activities section of the cash flow statement in the positive sign

Gain on sale of the fixed asset is

= Sales Value - Cost of asset

= $151,000 - $129,000

= $22,000

This amount is shown in the operating activities section of the cash flow statement in the negative sign

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4 years ago
As a new salesperson for a textbook publisher, Kylie is creating a list of professors that decide what texts their schools use.
spayn [35]

Answer: Option D

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Similarly, qualifying refers to analyzing the characteristics of a lead to determine if it qualifies as a prospect.

Hence from the above we can conclude that Kylie is performing the function of prospecting and qualifying.

4 0
4 years ago
Microsoft working with Best Buy to open stores-within-a-store at numerous Best Buy locations is an example of a smaller specialt
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Answer: True

Explanation:

Microsoft opening a special store inside the shopping buildings of Best buy various branches spread across various locations, enables Microsoft to have stores in various locations without having to build shops. This saves Microsoft from the risk and cost associated with running a full business shopping complex.

6 0
3 years ago
In declining markets: 1. the only effect advertising will have on primary demand is to slow the rate of decline.2. advertisers a
vovangra [49]

Answer: 1. The only effect advertising will have on primary demand is to slow the rate of decline.

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Common characteristics of the decline stage include a decrease in sales, an increasing difficulty to make a profit, and a decrease in advertising.

7 0
3 years ago
A form of communication management that seeks to influence the feelings, opinions, or beliefs held by customers, prospective cus
exis [7]

Answer: Public relations

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3 years ago
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