Answer:
pay a premium price for a successful company or buy a struggling company at a bargain price
Explanation:
Here the biggest confusion with respect to the firm i.e. acquisition minded faces that whether they have to a pay a premium price for becoming a successful company or still have to struggle for purchasing a company at a bargaining price
So according to the given situation, the last option would be correct
Answer:
0.0678
Explanation:
Given:
Profit margin = 6% = 0.06
Dividend payout ratio = 37% = 0.37
Total asset turnover = 1.2
Equity multiplier = 1.4
Required:
Find the sustainable rate of growth.
First find the return on equity using the formula: Equity Multiplier × Assets turnover × Profit margin
= 1.4 * 1.2 * 0.06
= 0.1008
Return on equity = 0.1008
To find the sustainable growth, we have the following:
Therefore, sustainable growth = 0.0678
Answer and Explanation:
Income statement-Partial
Income from operation 6545600
Other revenue & gains
Interest revenue 17250
6562850
other expenses & losses
Loss due to volcano 787700
Impairment loss 49730
Income before income tax 5725420
income tax 1717626
Net income /loss 4007794
Per share common stock
Net income /loss 0.81
Earning per share
Earning per share common stock
Income from operation(6545600/4936300) 1.33
Non operating income
interest revenue (17250/4936300) 0.003
Income before extraordinary items 1.33
extraordinary loss
(787700+49730)/4936300 -0.17
Income tax expenses (1717626/4936300) -0.35
Net income 0.81
Answer:
The return on investment for the Pencil Division is 14,55% (two decimal places.)
Explanation:
The Return on Investments is calculated as ;
Return on Investments = Divisional Profit Contribution / Assets Employed in the Division
= $40,000 / $275,000 × 100
= 14,545454 or 14,55% (two decimal places.)
Conclusion :
The return on investment for the Pencil Division is 14,55% (two decimal places.)
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