Answer:
0.36
Explanation:
Cost of equity of 16.8%,
Pretax cost of debt of 8.1%
Return on assets of 14.5%
As per NN proposition: Cost of equity = Return on asset + D/E ratio (Return on asset-Cost of debt)
0.168 = 0.145 + D/E (0.145 - 0.082)
0.168 - 0.145 = D/E (0.064)
0.023 = D/E (0.064)
D/E = 0.023/0.064
D/E = 0.359375
D/E = 0.36
Thus, the debt-equity ratio is 0.36
Answer:
Jan 22
Dr Cash $720,000
Cr Common stock $720,000
Feb 14
Dr Cash $2,420,000
Cr Preferred stock $2,420,000
30
Dr Cash $540,000
Cr Preferred stock $495,000
Cr Paid in capital in excess of par-Preferred stock $45,000
Explanation:
Preparation of the journal entries
Jan 22
Dr Cash $720,000
Cr Common stock $720,000
(180,000 shares * $4)
Feb 14
Dr Cash $2,420,000
Cr Preferred stock $2,420,000
(44,000 shares * $55)
30
Dr Cash $540,000
(9,000 shares * $60)
Cr Preferred stock $495,000
(9,000 shares * $55)
Cr Paid in capital in excess of par-Preferred stock $45,000
[9,000 shares *($60- $55) ]
Answer:rate of return on total assets=22.22%
Explanation: Return on total assets is a ratio that measures the earnings generated by a company before interest and taxes in ralation to its total net assets which can be calculated from amount of financial and operations income grom a company's financial year in comparison to the average of that company's total assets.
For Montana Investments, Inc. in December31, 2019, we have that
Net income= $26,000
Interest expense
= $11,000
Average total assets= $194,000+$139,000/2
Return on total assets
=
(Net Income + Interest Expense) / Average total assets =
{$26,000 + 11,000 ) / [($194,000 + $139,000 ) / 2] =
37,000/166500=0.2222
=22.22%
Answer:
1.74%
Explanation:
Mean number of hours (μ) = 2,220 hours
Standard deviation (σ) = 285 hours
Assuming a normal distribution, the z-score for any number of hours a network stays up, X, is given by:
For X = 2,800 hours, the z-score is:
A z-score of 2.11 corresponds to the 98.26th percentile of a normal distribution. The probability that the network will stay up for 2,800 hours before it fails is:
The probability is 1.74%.
