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
Fed [463]
3 years ago
14

Last year Mason Inc. had a total assets turnover of 1.33 and an equity multiplier of 1.75. Its sales were $320,000 and its net i

ncome was $10,549. The CFO believes that the company could have operated more efficiently, lowered its costs, and increased its net income by $5,250 without changing its sales, assets, or capital structure. Had it cut costs and increased its net income in this amount, by how much would the ROE have changed? Select the correct answer. a. 4.38% b. 2.14% c. 3.26% d. 3.82% e. 2.70%
Business
1 answer:
docker41 [41]3 years ago
4 0

Answer: d. 3.82%

Explanation:

ROE = Net Income / Equity so Equity need to be ascertained.

1.75 = Total Assets/ Total Equity

Total Equity = Total Assets/ 1.75

1.33 = Revenue / Total Assets

Total Assets = Revenue / 1.33

= 320,000/1.33

= $240,601.50

Total Equity = 240,601.50/1.75

= $137,486.57

Old ROE = 10,549/ 137,489.57

= 0.07672582

= 7.67%

New ROE = (10,549 + 5,250) / 137,489.57

= 0.11491053466

= 11.49%

Difference = 11.49 - 7.67

= 3.82%

You might be interested in
What is the net energy yield for producing oil in 1954?
raketka [301]
<span>The net energy yield underlies various energy aggregation in economics and ecology such as tropic dynamics, national energy accounting and energy input output modelling in economics and the yield in 1954 can be derived from all this data.</span>
4 0
3 years ago
Delish Foods sells jars of special spices used in Italian cooking. The variable cost is $2 per unit. Fixed costs are $9,000,000
Ymorist [56]

Answer:

$3.38 per unit

Explanation:

Total costs:

= Total fixed cost + Total variable cost

= $9,000,000 + (5,000,000 units × $2 per unit)

= $9,000,000 + $10,000,000

= $19,000,000

Target revenue:

= Total costs - Desired profit

= $19,000,000 - ($42,000,000 × 5%)

= $19,000,000 - $2,100,000

= $16,900,000

Sales price per unit = Target revenue ÷ Total units

                                = $16,900,000 ÷ 5,000,000

                                = $3.38 per unit

8 0
3 years ago
Which of the following statements is true?
OlgaM077 [116]

Answer:

These statements are true:

A) The Federal Reserve does not set the Federal funds rate, but it influences it through the use of open market operations:

For example, at the very moment the Fed funds rate is 1.75%. If the Fed wanted to raise it to 2%, it would have to do so through the use of open market operations (in this case, because it wants to raise the rate, it would have to sell securities in order to reduce the money supply).

C) The Federal Reserve sets the target for the Federal funds rate, and then uses the reserve ratio to push banks toward that target.

Reserve requirements are perhaps the most powerful, and least often used, monetary policy tool that the Fed has at its disposal. It is very powerful because it directly increases or decreases the money supply.

For example, if the Fed wants to increase the fed funds rate, it can raise the reserve ratio so that banks keep more money in reserves, have less money to loan, and in consequence, create less money, causing the money supply to shrink and the fed funds rate to rise accordingly.

D) The Federal Reserve sets the Federal funds rate.

Correct. More specifically, the Federal Open Market Committee, which meets eight times a year to set the target for the fed funds rate.

3 0
3 years ago
Dakota Corporation decided to issue three-year bonds denominated in 5 million Russian rubles at par. The bonds have a coupon rat
sertanlavr [38]

Answer:

23.39%

Explanation:

From the given information, the amount was raised in rubies, Hence, we will convert them to dollars to be able to pay back the needed obligations.

However, according to the exchange rates, the IRR of dollar cash flow is the actual cost of financing that the company will address.

By applying the EXCEL FORMULA to compute the actual cost of financing, we get;

   A                    B                    C                    D                          E

Coupon              17%

Year                      0                    1                    2                         3

Cashflow in

rubles            5,000,000   5000000*17%  5000000*17%    5000000+850

                                           = 850000          = 850000         000

                                                                                                 = 5850000

Exchange          $0.30         $0.032                 $0.034              $0.035

rate

(per rubles)   5,000,000       5,000,000          5,000,000      5,000,000

Cash flow      × 0.03            × 0.032               × 0.034           × 0.035

in dollars    =  $150000.00  27200.00        28900.00           204750.00

IRR                   23.39%

8 0
3 years ago
Freeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee points
muminat

Answer:

thx lol

Explanation:

5 0
3 years ago
Read 2 more answers
Other questions:
  • Jessica completed a four-year degree program in Finance and Accounting. She hasn’t yet gained any work experience in this field.
    14·2 answers
  • The particular type of shareholder voting used has become less important with the influence of takeovers, leveraged buy-outs, an
    10·1 answer
  • The __________ is a graphical representation of the term structure of interest rates.
    13·1 answer
  • Parent Inc. purchased 30% of the common stock of Affiliate Co. on January 1, YR01 for $5,000 and appropriately accounted for thi
    15·1 answer
  • What motivates companies like starbucks to expand into international markets with little perceived interest for their product?
    6·1 answer
  • The country of Dalima has long been a substantial exporter of agricultural goods, reflecting its unusual abundance of arable lan
    5·1 answer
  • On March 1, Song Corp. receives a $100,000, 90-day, noninterest-bearing note receivable from a customer. The note has a 12% disc
    12·1 answer
  • Frank has saved $40.00 for concert tickets, but decides to buy a new pair of jeans instead. In this scenario, what do the concer
    15·1 answer
  • Why is it important to have a digestive deposition transcript prepared before trial?
    11·2 answers
  • In market-basket terminology, ________ describes the probability that two items will be purchased together.
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!