1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Paul [167]
3 years ago
7

Last year, Jackson Tires reported net sales of $80 million and total operating costs (including depreciation) of $52 million. It

had $115 million of investor-supplied capital, with an after-tax cost of 7.5%. If the company’s tax rate is 40%, how much value did its management create or lose for Jackson Tire during the year?
Business
1 answer:
Zolol [24]3 years ago
7 0

Answer:

Value created for the firm = $8.18 million

Explanation:

given data

net sales = $80 million

total operating costs = $52 million

Investor-supplied capital = $115 million

after-tax cost = 7.5%

company’s tax rate = 40%

solution

we get here Earning Before Interest and tax that is express as

Earning Before Interest and tax = Net Sales - Operating costs   .........1

put here value and we get

Earning Before Interest and tax  = $80 million - $52 million

Earning Before Interest and tax  = $28 million

and

Net Operating profit after tax = $28 × ( 1 - 40% )    .........2

Net Operating profit after tax  = $16.8 million

and

Return on investor-supplied capital will be

Return on investor-supplied = $115 million × 7.5%

Return on investor-supplied = $8.625 million

so here Value created for the firm will  be

Value created for the firm = Net operating profit after tax - Return on investor-supplied capital    ..................3

Value created for the firm = $16.8 - $8.625 = $8.175 million

Value created for the firm = $8.18 million

You might be interested in
The financial statements of Weston Office Supply include the following​ items:20172016Cash​ $43,500​ $50,000Shortminus−term Inve
aivan3 [116]

Answer:

The current ratio is 1.18 times

Explanation:

Current Ratio: The current ratio is that ratio which shows a relationship between the current assets and the current liabilities

The computation of the current ratio is shown below

Current ratio = Total Current assets ÷ total current liabilities

where,

Total current assets = Cash + short-term investments + net accounts receivable + merchandise inventory

=  $43,500 + $27,000 + $102,000 + $125,000

= $297,500

And, the total current liabilities is $251,000

Now put these values to the above formula  

So, the ratio would equal to

= $297,500 ÷ $251,000

= 1.18 times

The long term note payable is not a current liabilities,hence it is not considered in the computation part.

6 0
3 years ago
All functions and departments in the enterprise have tasks that they need to complete to produce outputs or ________ in order to
VMariaS [17]

Answer: 1. Deliverables

2. Objectives

Explanation: A deliverable is a project management term that describes tangible or intangible goods or services that are produced from the project, with the intention of being delivered to a consumer.

An objective in this context is a goal that an enterprise aspires towards achieving.

In every enterprise each section is tasked with producing outputs within each department, and deliver to customers. The intention is to of achieve the overall objectives set by the enterprise. Functions are designed to operate cohesively, with the aim of achieving these 2 aspects and ensuring that the enterprise runs smoothly and generates the best possible outcome.

7 0
3 years ago
Congress enacts the Ad Restriction Act (ARA) to limit advertising in certain circumstances. The ARA will be considered valid il
Bond [772]

Answer:

A) and goes further than necessary to ensure full coverage

8 0
3 years ago
Free contract is the _____.rivalry among sellers to attract customers while lowering costs concept that people may decide what a
creativ13 [48]
Almost positive the answer would be <span>concept that people may decide what agreements they want to enter into</span>
8 0
3 years ago
Read 2 more answers
A ________ check would be used to restrict the fines for speeding violations from $50 to $250.
snow_lady [41]
Range would be the check that is used to restrict the fines for speeding violations from $50-$250
8 0
3 years ago
Other questions:
  • How many times may customers use the same plate at a self service buffet ?
    13·2 answers
  • Western auto inc. pays a​ $1.77 preferred dividend every quarter and will maintain this policy forever. what price should you pa
    9·1 answer
  • The money supply, m, is the total value of all the cash and checking account balances in an economy. it is determined by the val
    5·1 answer
  • Which factors play a role in purchasing insurance? Check all that apply. the consumer’s age and current lifestyle the price of t
    8·1 answer
  • As a candidate at a job interview for the position of video and graphic designer, Steve is asked to create a design using Corel
    10·1 answer
  • Onslow Co. purchased a used machine for $178,000 cash on January 2. On January 3, Onslow paid $2,840 to wire electricity to the
    10·1 answer
  • Oscar’s Red Carpet Store maintains a checking account with Academy Bank. Oscar’s sells carpet each day but makes bank deposits o
    5·1 answer
  • Which of the following is the LEAST important factor to consider when constructing an investment portfolio for a high net worth
    12·1 answer
  • Can somone awnse r my math question in my questions on my profile caus im low in math
    11·1 answer
  • Consider the following two, completely separate, economies. The expected return and volatility of all stocks in both economies i
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!