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omeli [17]
3 years ago
15

Galaxy Products is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under P

lan I, Galaxy would have 230000 shares of stock outstanding. Under Plan II, there would be 224478 shares of stock outstanding and $210000 in debt outstanding. The interest rate on the debt is 8.2 percent and there are no taxes. What is the breakeven EBIT?
Business
1 answer:
ankoles [38]3 years ago
6 0

Answer:

break even EBIT is $717,240.13

Explanation:

given data

stock outstanding = 230000 shares

stock outstanding = 224478 shares

debt outstanding = $210000

interest rate = 8.2 percent

to find out

What is the break even EBIT

solution

we get break even EBIT is here express as

\frac{EBIT}{230000} = \frac{EBIT-210000*0.082}{224478}

EBIT × 224478 = 230000  × ( EBIT - 17220 )

solve it we get

EBIT  = $717,240.13

so break even EBIT is $717,240.13

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Answer:

The monthly withdrawal is $701.10  

Explanation:

The monthly withdrawal can be computed with PMT formula using excel spreadsheet.

The formula is PMT(rate,nper,-pv)

The fv and type are both taken as zero.

However, the rate of 5.5 % given in the question is a yearly rate,but the requirement of the question is monthly withdrawal, hence the rate is divided by 12 months to reflect a monthly rate i.e 5.5%/12

Besides, the nper should  also to be adapted to show that the withdrawal is to be made every month for 18 years, hence nper is 12*18

The computation of the pmt based on the above highlighted points is found in the attached.

Download xlsx
6 0
3 years ago
A german firm raising capital by selling stock through the london stock exchange is an example of _____.
antiseptic1488 [7]
<span>A german firm raising capital by selling stock through the london stock exchange is an example of transnational financing.

Transnational financing occurs when a firm goes to another country to raise capital through the issue of stocks and bonds.
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7 0
3 years ago
HELP!
Elza [17]

Answer:

i think the answer is true

Explanation:

6 0
3 years ago
Read 2 more answers
Another bank is also offering favorable terms, so Rahul decides to take a loan of $14,000 from this bank. He signs the loan cont
nikklg [1K]

Answer: $14,426.43

Explanation:

At the end of 4 months and assuming a  12 months and 365 days in a year, the formula to be used to calculate how much Rahul owes is;

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3 0
3 years ago
A manager asks a chef to continue cooking chicken breasts after seeing them cooked to an incorrect temperature. This is an examp
harina [27]

The action where the manager asks the chef to cook the chicken breasts again is what is called corrective action.

<h3>What is corrective action?</h3>

This is an  action that has to be carried out as a way of taking care of something that has not being done in the way that it should have been done. It is the way of getting people to take care of their mistakes.

The manager wants the chef to take care of her mistakes this was the reason why he has asked her to re cook the because the temperature was not right.

Read more on corrective action here: brainly.com/question/15851754

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6 0
2 years ago
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