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Harman [31]
2 years ago
13

Trapper Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Und

er Plan I, the company would have 320,000 shares of stock outstanding. Under Plan II, there would be 240,000 shares of stock outstanding and $2,272,000 in debt outstanding. The interest rate on the debt is 10 percent, and there are no taxes.
Assume that EBIT is $700,000. Compute the EPS for both Plan I and Plan II.
Business
1 answer:
AlladinOne [14]2 years ago
6 0

Answer:

Plan I EPS = $2.19

Plan II EPS = $1.97

Explanation:

The computation of EPS for both Plan I and Plan II is shown below:-

                               Plan I                Plan II

Expected EBIT      $700,000       $700,000

Less Interest                                 $227,200

                                            ($2,272,000 × 10%)

Profit before tax a   $700,000      $472,800

Less: Tax

Earning to equity

shareholder b           $700,000      $472,800

Number of equity

Shares (a ÷ b)              $2.19             $1.97

Therefore for Plan I the EPS = $2.19 and for Plan II the EPS = $1.97

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Irina-Kira [14]

Answer:

E) Market Exchange

Explanation:

Market exchange refers to at least two people or firms trading one good or service for another. In this case, the theater group is trading a free show and other promotional activities (standup comedy nights, and volunteer work) in exchange for higher membership to their group or higher attendance to their shows.

A trade does not necessarily imply a money exchange, it can also include goods or services that provide utility for the other party. For example, an increase in group membership will help the theater group perform better.  

5 0
3 years ago
What are the board directors in charge of
Mama L [17]

Answer:

The board of directors is elected to represent shareholders' interests

Explanation:

Every public company must have a board of directors composed of members from both inside and outside the company. The board makes decisions concerning the hiring and firing of personnel, dividend policies and payouts, and executive compensation. hope this helps you :)

7 0
3 years ago
Suppose you buy some stock in the Alpha Corporation at a price of $45.95 per share. 410 days later you sell the stock for $48.27
kondaur [170]

Answer: 6.79%

Explanation:

The holding period return is:

= (Current price - Cost price + Dividend) / Cost price

= (48.27 - 45.95 + 1.20) / 45.95

= 7.66%

The annualized return is:

= ( ( 1 + holding period return) ^ number of days in a year/ number of days stock was held - 1)

= ( ( 1 + 7.66%) ³⁶⁵ / ⁴¹⁰ - 1)

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8 0
3 years ago
Consider consecutive processes A-B-C, where process A has a capacity of 20 units per hour, process B has a capacity of 25 units
g100num [7]

Answer:

The operation manager would want the inventory in front of process A based on the lean system.

Explanation:

To fully understand the basis on which we chose the answer, we need to define what a lean system is.

A Lean system refers to a business process plan. More a of business model canvass that meticulously deal with business process plan and development for the purpose of achieving maximum value in production, client and customer satisfaction while still at a reduced cost of running business.  It should also be noted that the lean system is mostly a continuum of existing process and subsequent process progress are mostly determined by the level of integrity attained by the primary design stage.

With the understanding gotten from the definition above, it then obvious from the narrative of the question that the process is consecutive. As such, follows a pattern of A to B to C and thus the level of integrity of process design achieved at A will be passed down to B and C.

This is the more reason why the operation manager will prefer to to want an inventory at A which is the primary point of start.

7 0
3 years ago
Read 2 more answers
Mara Kay is a system analyst for a national department store. She was tasked to identify previously unknown relationships in the
kherson [118]

Answer: Data Mining

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Data Mining can therefore be defined as the examination of large pre-existing databases in order to discover/identify patterns that will be useful in generating new information.

Data Mining is also known as Knowledge Discovery in Databases.

Data Mining will not be complete if the results of the analysis are not used for future purposes, therefore, Mara Kay will use the results of her findings for future promotions.

5 0
3 years ago
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