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Artyom0805 [142]
3 years ago
11

Dabney Electronics currently has no debt. Its operating income is $20 million and its tax rate is 40%. It pays out all of its ne

t income as dividends and has a zero growth rate. The current stock price is $40 per share, and it has 2.5 million shares of stock outstanding. If it moves to a capital structure that has 40% debt and 60% equity (based on market values), its investment bankers believe its weighted average cost of capital would be 10%. What would its stock price be if it changes to the new capital structure
Business
1 answer:
ValentinkaMS [17]3 years ago
6 0

Answer:

$29 per stock

Explanation:

WACC=PBIT*(1-tax)/Market value of firm

10%=$20,000,000*(1-40%)/Market Value of the firm

Market Value of the firm=$20,000,000*60%/10%=$120,000,000

Stock price for all shares=$120,000,000*60%=$72,000,000

Stock price per share=$72,000,000/2,500,000=$29 per share

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Who on here can drive and lives in Florida?
iragen [17]

Answer: aye im 15 i can drive and no i dont live in florida

Explanation:

8 0
3 years ago
Wildhorse Company accumulates the following data concerning a mixed cost, using miles as the activity level. Miles Driven Total
tangare [24]

Answer:

Variable cost per unit= $1.4 per unit

Explanation:

Giving the following information:

Miles Driven Total Cost Miles Driven Total Cost

January: 8,000 $14,120

March: 8,550 $14,979

February: 7,490 $13,495

April: 8,195 $14,490

To calculate the variable cost under the high-low method, we need to use the following formula:

Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)

Variable cost per unit= (14,979 - 13,495) / (8,550 - 7,490)

Variable cost per unit= $1.4 per unit

7 0
3 years ago
A bond with a face value of $100,000 was issued for $93,500 on January 1 of this year. The stated rate of interest was 8 percent
Inessa05 [86]

Answer:

So interest payment will be $8000

Explanation:

We have given face value of the bond = $100000

And bond is issued for $93500

Standard rate of interest = 8 %

And market rate of interest = 10 %

We have to find the interest paid

Interest payment will be given by

Interest payment = face value of bond × standard rate of interest

= $100000×0.08 = $8000

So interest payment will be $8000

5 0
3 years ago
Billie Jean has $120 to spend and wants to buy either a new amplifier for her guitar or a new mp3 player to listen to music whil
Lady_Fox [76]

Answer:

B) people face trade offs

Explanation:

Resources are scarce, and that applies to every person and every organization in the world. Even the richest person or richest organization has a certain finite amount of money, time and other resources. For example, if we decide to work 12 hours a day, we will make more money, but we will also have less time o do other activities that we like.

In this case, Billie Jean only has $120 and she wants to buy both products, but she can only buy one. Whatever product she decides to buy will leave her with $0, so if she wants to purchase the other product she will need to find a job and earn some money, or if she already has a job, she will need to work more hours.

5 0
3 years ago
In this career, you consult with various companies about the well-being of their employees, emissions standards, and waste dispo
aksik [14]

Answer:

A. waste management

Explanation:

option A is the correct answer

Mark me as Brainliest

5 0
2 years ago
Read 2 more answers
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