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2 years ago

All else being equal, a company with a low operating leverage will have:

Business

1 answer:

nlexa [21]2 years ago

5 0

Answer:

c) relatively high variable costs

Explanation:

Operating leverage is a ratio that is used to analyze and understand the cost structure of a business. It gives the relation between the variable and fixed cost to the the total cost of running the business.

A business with a large amount of fixed cost relative to variable is said to have a high operating leverage . For such business, operating income would be more volatile because the operating income would not increase in commensurate proportion as sales revenue.

And a company with low operating leverage has low amount of fixed cost relative to variable cost and therefore a relatively high variable costs

Operating leverage is calculated as

Contribution /Earnings before interest and Tax

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The Sports Club plans to pay an annual dividend of $1.20 per share next year, $1.12 per share a year for the following two years

Delicious77 [7]

Answer:

$9.63

Explanation:

Data provided in the question:

Year Annual dividend paid

1 $1.20

2 $1.12

3 $1.12

4 $14.20

Now,

Year Annual dividend paid Present value factor Present value

1 $1.20 0.84246 1.011

2 $1.12 0.84246 0.7949

3 $1.12 0.59793 0.6696

4 $14.20 0.50373 7.1529

===============================================================

Worth of stock = 1.011 + 0.7949 + 0.6696 + 7.1529

= $9.6284 ≈ $9.63

Note:

Present value factor = [ 1 ÷ (1 + 0.187)ⁿ]

here,

n is the year

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3 years ago

According to the insurance research council, 14% of u.s. drivers are uninsured. a random sample of seven drivers was selected. w

navik [9.2K]

I think the answer is 0.0620

8 0

2 years ago

Gullett corporation had $44,000 of raw materials on hand on november 1. during the month, the corporation purchased an additiona

Zina [86]

Answer:

Dr Raw materials $93,000

Cr Accounts payable $93,000

Explanation:

Based on the information given we were told that during the month, the corporation had to purchased an additional raw materials of the amount of $93,000 which means that the journal entry to record the purchase of raw materials would include a:

Dr Raw materials $93,000

Cr Accounts payable $93,000

(To record purchase of raw materials)

4 0

3 years ago

A sharp downturn in the U.S. housing market reduced the income of many who worked in the home construction industry. A Wall Stre

Shalnov [3]

Answer:

Answer is explained in the explanation section.

Explanation:

If the wages of the Hispanics construction worker in America are less then, they will not have near as much money to send home to their relatives back in Mexico.

And if their families do not have as much as it use to be then they will not be able to buy near as much as they used to.

It means that if the construction workers don't get as much money as they used to then, neither they nor their families will be able to spend as much as they use to which will obviously hurt each of their economies.

6 0

3 years ago

Your company expects to receive CAD 1,200,000 in 90 days. The 90 day forward rate for CAD is $0.80 and the current spot rate is

Masteriza [31]

Answer:

Cost of hedging = $24,000

Explanation:

cost of hedging = 1,200,000 * ($0.80 - $0.82) = 1,200,000 * $0.02 = -$24,000

Since the actual forward rate was higher than th eexpected forward rte, the coampny lost money by hedging the operation. The cost of hedging the operation was $24,000.

4 0

2 years ago