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Ghella [55]
3 years ago
9

QUESTION 40 The capital budget forecast for the Santano Company is $725,000. The CFO wants to maintain a target capital structur

e of 45% debt and 55% equity, and it also wants to pay dividends of $500,000. If the company follows the residual dividend policy, how much income must it earn, and what will its dividend payout ratio be
Business
1 answer:
Alex777 [14]3 years ago
7 0

Answer:

$898,750 and 55.63%

Explanation:

The computation is shown below:

For income earned, the calculation is

= Foretasted capital budget × equity capital structure + dividend paid

= $725,000 × 0.55 + $500,000

= $398,750 + $500,000

= $898,750

And, the dividend payout ratio is

= Dividend ÷ Total earnings

= $500,000 ÷  $898,750

= 55.63%

Hence, the income earned is $898,750 and the dividend payout ratio is 55.63%

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evablogger [386]

Explanation:

relies on gallery format

3 0
3 years ago
Market Value Ratios Val's Volleyball Supply's market-to-book ratio is currently 3.31 times and PE ratio is 5.51 times. If Val's
Serhud [2]

Answer:

Book Value per share is $2.96 and Earnings per share is $1.78

Explanation:

The market-to-book ratio is:

<u>Market Value </u> = 3.31 times

Book Value

The market value of the stock is $9.80 per share. Therefore, to calculate the Book Value, we make the Book Value subject and divide the ratio by Market Value per share:

Book Value per Share =  <u>Market Value per share</u>

                                           Market-to-Book ratio

                                     =  <u>9.80</u>

                                          3.31

                                     = $2.96

The PE ratio is:

<u>    Price  </u> = 5.51 times

Earnings

The price of the stock is $9.80 per share. Therefore, to calculate the Earnings per share, we make the Earnings subject and divide the PE ratio by Price of stock:

Earnings per share  =    <u>   Price   </u>

                                     PE Ratio  

                               =  <u>9.80</u>

                                    5.51

                                = $1.78

4 0
4 years ago
Ben learns that the company was going to be laying off several employees over the next several months. He knew that the rumor mi
Mademuasel [1]

Answer:

D. Call an all staff meeting and give everyone the news.

8 0
3 years ago
At February 1, 2022, the balance in Bonita Industries supplies account was $3080. During February Bonita purchased supplies of $
ICE Princess25 [194]

Answer:

Balance of Suppliers Account is $2200 debit

Explanation:

It is important to know that the Supplies Account increases on the debit side and decreases on the credit side.

On 1 February the account was $ 3080 and this was a debit since it was an existing balance.

Purchase during the year by Bonita Industries increased the Supplies Account. A debit entry of $2640 must be recorded.

Used supplies during the year decrease the Supplies Account. A credit entry of $3520 must be made

There for the balance left $2200(3080+2640-3520) is still on the increase side (debit).Hence the answer $2200 debit is correct.

5 0
4 years ago
Which of the following types of training should employers NOT provide to their workers? (1 point)
solong [7]

Correct answer choice is:

D. Accident investigation.

Explanation:

An accident investigation is a method of concluding the source cases of accidents, on-the-job damages, resources destruction, and alike notes in classification to stop them from happening repeatedly.

When conflicts are reviewed, the importance should be focused on determining the root reason of the occurrence so you can block the event from occurring again. The goal is to find evidence that can direct to remedial activities, not to determine responsibility. Constantly look for distant causes.

6 0
3 years ago
Read 2 more answers
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