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jolli1 [7]
3 years ago
14

Companies HD and LD have the same total assets, sales, operating costs, and tax rates, and they pay the same interest rate on th

eir debt. Both firms finance using only debt and common equity, and total assets equal total invested capital. However, company HD has a higher total debt to total capital ratio. Which of the following statements is CORRECT?
a. Company HD has a lower equity multiplier.
b. Company HD has more net income.
c. Company HD pays more in taxes.
d. Company HD has a lower ROE.
e. Company HD has a lower times-interest-earned (TIE) ratio
Business
1 answer:
aliina [53]3 years ago
7 0

Answer:

B) Company HD has more net income.

Explanation:

The total debt to capital ratio is calculated by dividing total liabilities by the sum of total shareholders' equity + total debt:

  • debt to capital ratio = total debt / (total debt + total equity)

Since company HD uses more debt to finance its operations, its net income will be lower since it has to pay more interests, but its ROE will be higher since equity is much lower also. Companies that use a lot of financial leverage are more risky but at the same time can generate higher returns to their owners.

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What functional-level strategies has Amazon pursued to boost its efficiency? What functional-level strategies has Amazon pursued
Arisa [49]

Answer:

All answers which are asked related to Amazon's strategies and its customer responsiveness are answered below in details.

Explanation:

  • Amazon has executed several approaches to improve its performance. These approaches include optimizing their picking and packing methods by using robots to decrease the expenses that the customer spends.
  • Amazon has achieved new technology to improve performance, and customer responsiveness to increase product quality by spending in Kiva.
  • Quality for Amazon implies increasing quality as perfection; rendering products, by third party retailers, that are not affected, not lapsed or broken.
  • Amazon went from trading books to trading a wide variety of media and general- commodity goods.

It has a sustainable competing advantage

  • When people purchase goods, they match different suppliers on a graded assortment of factors. For Amazon shoppers, those parts, or customer purchasing criteria (CPC), involve cost, fast shipment, and reliable service.
8 0
3 years ago
The Intramural Sports Club reports sales revenue of $578,000. Inventory at both the beginning and end of the year totals $110,00
Genrish500 [490]

Answer:

$363,500

Explanation:

Gross profit = Revenue - Cost of Goods Sold.

In the case

Revenue = $578,000.

The Cost of Goods Sold: COGS

Inventory turn over = COGS/ Average turnover

Average turnover = Opening stock + closing stock/2

In this case Opening stock + Closing stock = $110,000

Average turnover = $110,000 /2 =$55,000

Therefore:

3.9 = COGS/$55,000

COGS = $55,000 x 3.9

COGS =$214,500

Gross profit =  $578,000 - $214,500

Gross profit = $363,500

3 0
3 years ago
Why should a cover letter be short (usually one page)?
melomori [17]

Answer:

When sending an email cover letter, it's even more important to be concise. The first paragraph is what readers pay attention to when reading an email. The rest of the message is typically skimmed.

7 0
3 years ago
When incorporating, a business
DedPeter [7]

Answer:

May incorporate in any state it chooses.

Explanation:

Incorporation can be defined as the creation of a new business which will have equal rights as that of an individual.

The different steps for incorporation include:

- Proper documentation of the reports of incorporation.

- Choosing a suitable name for the business.

- Documenting the various operational agreements.

- Appointing managers to supervise the daily activities.

- Getting a federal employment identification number.

- Opening accounts for keeping the revenues that will be generated by the company.

- Employing diffetents workers to carry out various activities in the company.

5 0
3 years ago
Categorize each statements as a component of Gross Domestic Product (GDP): consumption, investment, government, or net exports.
Natasha2012 [34]

Answer:

-Consumption: ice cream, a domestically manufactured personal computer, cab fare for personal use, 55 cent tacos, A super bowl ticket bought new from the NFL

- Investments: A domestically manufactured business computer

-Government: A public school teacher

-Net Exports: An exported doll house

Explanation:

Gross Domestic Product is the market value of goods and services produced locally within a given period. GDP includes goods and services produced during a particular time interval. In the past, bargains for products produced are not reflected in GDP. Usually this interval is years or quarters.

Consumption contains produced goods and services. It is used by people to meet their needs and wishes. In the Keynesian economy, consumption means individual consumption expenditure and is indicated by the consumption function. The most important part of the consumption function is the marginal consumption trend. MPC shows what percentage of each new income earned is used for consumption expenditures.

Public expenditure, in economy, indicates the complex of money of public origin that is used by the State in public goods and / or public services aimed at pursuing public purposes, regardless of the nature (public or private) of the obligation that is the title . These are therefore the exits by the state and therefore an item of liabilities within the state budget, the coverage of which is necessarily entrusted to taxation on taxpaying citizens or public debt. Otherwise, the repercussions are of an inflation or devaluation type, depending on the domestic or foreign destination of the capital.

Trade balance (Trade deficit) or Net Export is the balance of trade (export, import) of one country (with other countries). Based on this, the Trade Balance (Foreign Trade Balance) is the relationship between exports and imports. If the country's exports are greater than the import, net exports will be greater than 0, and in this case, the country's foreign trade balance will increase (a positive balance). In a word, the trade balance is positive. Otherwise, net exports will be less than 0 if the country exports are smaller than imports. In this case, the country will have a foreign trade deficit. In other words, the trade balance will be negative. The negative trade balance also indicates that the country needs foreign products in addition to its own products.

7 0
3 years ago
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