Answer:
36%
Explanation:
For the computation of the company's return on equity first we need to follow some steps which is shown below:-
Step 1
Earnings before tax = EBIT - Interest
= $452,000 - $152,000
= $300,000
Step 2
Earnings after interest and taxes = Earnings before tax - Tax
= $300,000 - ($300,000 × 40%)
= $300,000 - $120,000
= $180,000
Step 3
Asset turnover ratio = Total revenue ÷ Total assets
3.6 = $4,000,000 ÷ Total assets
Total assets = $1,111,111.11
Step 4
Equity ratio = 1 - Debt ratio
= 1 - 0.55
= 0.45
Step 5
Total Equity = Equity ratio × Total assets
= 0.45 × $1,111,111.11
= $500,000
and finally
Return on Equity = Net income ÷ Equity
= $180,000 ÷ $500,000
= 0.36
or
= 36%
The court which you were sentenced to go to. thats where i wrote mine to
Don’t fall for the links love!
Answer:
The total investment in P should be $405.40 which is further divided in X and Y as $243.24 and $162.16 respectively.
Explanation:
Expected return of risky portfolio is given as
E(P)=W(X)E(X)+W(Y)R(Y)
= 0.60*14% + 0.40*10 % = 12.40%
So the expected return of risky portfolio is 12.40%.
Let the investment in risky portfolio be p
(1-p)*5% + p*12.40% = 8%
Solving this gives
p = 0.4054*$1000=$405.4
So the amount to be added in the risky portfolio is $405.4. This is further divided in X and Y as follows
amount invested in X = 0.4054*0.60*1000 = $243.243
amount invested in Y 0.4054*0.40 * 1000 = $162.162
So the total investment in P should be $405.40 which is further divided in X and Y as $243.24 and $162.16 respectively.
= Cash flow from assets - change in net working capital + net capital spending
= - $ 247,500 - $ 124,000 + $ 950,000
= $ 578,500
