Dividends that were paid last year = $200
Retained earnings = $522
Net Income = Retained earnings + Dividends paid = 200+522 =722
Tax rate was 38%.
Earnings before tax (EBT) = Net income/ (1-tax rate) =722/(1-0.38) = 1,164.52
Interest expense= 624
Earnings before interest and tax (EBIT) = EBT + interest expense = 1,164.52 + 624 = 1,788.52
Earnings before interest and tax (EBIT) = 1,788.52
Answer:
An advertising agency
Explanation:
An advertising agency is an agency that dedicates it's business to creating , planing , and managing all aspects of a client's advertising. It also specializes in promotions and marketing for its client.
Advertising can be carried out via websites, online and social campaigns, brochures, catalogs, direct mail, print ads, radio and TV commercials, and sales letters.
An advantage of an Advertisement agency is that it helps provide a creative environment that combines interesting activities with work, and great exposure too
Answer:
$37,600 favorable
Explanation:
Variable overhead spending variance can be computed as;
= (Actual hours worked × Actual variable overhead rate) - ( Actual hours worked - Standard variable overhead rate)
= ( 18,800 hours × $77,700/12,000) - (18,800 hours × $4.5)
= [(18,800 × $6.5) - (18,800 × $4.5)]
= $122,200 - $84,600
= $37,600 favorable
C: They charge extremely high interest rates.
Answer:
What rate of return (IRR) would you earn if you bought this asset?
8,48%
Explanation:
To find the IRR it's necessary to know which is the discount rate that applied to the cash flow of the assets gives a value that compensate the investment of $200,500.
Year 1 $100.000 / (1+0,0848)^1 = $92.182
Year 2 $100.000 / (1+0,0848)^2 = $35.690
Year 3 $100.000 / (1+0,0848)^3 = $41.398
Year 4 $100.000 / (1+0,0848)^4 = $31.230
Total Present Value of Cash Flow=
$92.182 + $35.690 + $41.398 + $31.230 = $200,500
There is no way to find the IRR without Excel, the only way is to try with different rates in the current cash flow formula.
