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3 years ago

7

Blood Alcohol Concentration is the amount of alcohol in an individual's body, measured by the weight of the alcohol in a volume

of blood.

1 answer:

pickupchik [31]3 years ago

3 0

True.

BAC, or Blood Alcohol Concentration is the amount of alcohol in the bloodstream at any given time.

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Kaelea, Inc., has no debt outstanding and a total market value of $81,000. Earnings before interest and taxes, EBIT, are project

son4ous [18]

Answer:

a. We have:

EPS under normal = $1.09 per share

EPS under expansion = $1.34 per share

EPS under recession = $0.74 per share

b. We have:

Percentage changes in EPS when the economy expands = 23%

Percentage changes in EPS when the economy enters recession = –32%

c. We have:

EPS under normal after recapitalization = $1.24

EPS under expansion after recapitalization = $1.59 per share

EPS under recession after recapitalization = $0.75 per share

d. We have:

Percentage changes in EPS after recapitalization when the economy expands = 28.23%

Percentage changes in EPS when the economy enters recession = –39.52%

Explanation:

a. Calculate earnings per share, EPS, under each of the three economic scenarios before any debt is issued.

Shares outstanding = 5,400

Net income under normal = EBIT under normal - (EBIT under normal * Tax rate) = $9,800 - ($9,800 * 40%) = $5,880

EPS under normal = Net income under normal / Shares outstanding = $5,880 / 5,400 = $1.09 per share

Net income under expansion = (EBIT under normal * (100% + Percentage increase in EBIT)) - ((EBIT under normal * (100% + Percentage increase in EBIT)) * Tax rate) = ($9,800 * (100% + 23%)) – (($9,800 * (100% + 23%))* 40%) = $7,232.40

EPS under expansion = Net income under expansion / Shares outstanding = $7,232.40 / 5,400 = $1.34 per share

Net income under recession = (EBIT under normal * (100% - Percentage decrease in EBIT)) - ((EBIT under normal * (100% - Percentage decrease in EBIT)) * Tax rate) = ($9,800 * (100% - 32%)) – (($9,800 * (100% - 32%))* 40%) = $3,998.40

EPS under recession = Net income under recession / Shares outstanding = $3,998.40 / 5,400 = $0.74 per share

b. Calculate the percentage changes in EPS when the economy expands or enters a recession.

Percentage changes in EPS when the economy expands = ((EPS under expansion - EPS under normal) / EPS under normal) * 100 = (($1.34 - $1.09) / $1.09) * 100 = 23%

Percentage changes in EPS when the economy enters recession = ((EPS under recession - EPS under normal) / EPS under normal) * 100 = (($0.74 - $1.09) / $1.09) * 100 = –32%

c. Calculate earnings per share, EPS, under each of the three economic scenarios after the recapitalization.

Market price per share = Total market value / Shares outstanding before recapitalization = $81,000 / 5,400 = $15

Number of shares to repurchase = Debt amount / Market price per share = $23,100 / $15 = 1,540

Shares outstanding after recapitalization = Shares outstanding before recapitalization - Number of shares to repurchase = 5,400 – 1,540 = 3,860

Interest on debt = Debt amount * Interest rate = $23,100 * 8% = $1,848

Net income under normal after recapitalization = EBIT under normal – Interest on debt - ((EBIT under normal – Interest on debt) * Tax rate) = $9,800 - $1,848 - (($9,800 - $1,848) * 40%) = $4,771.20

EPS under normal after recapitalization = Net income under normal after recapitalization / Shares outstanding after recapitalization = $4,771.20 / 3,860 = $1.24

EBIT under expansion = EBIT under normal * (100% + Percentage increase in EBIT) = ($9,800 * (100% + 23%)) = $12,054

Net income under expansion after recapitalization = EBIT under expansion – Interest on debt – ((EBIT under expansion – Interest on debt) * Tax rate) = $12,054 - $1,848 - (($12,054 - $1,848) * 40%) = $6,123.60

EPS under expansion after recapitalization = Net income under expansion after recapitalization / Shares outstanding after recapitalization = $6,123.60 / 3,860 = $1.59 per share

EBIT under recession = EBIT under normal * (100% - Percentage decrease in EBIT) = ($9,800 * (100% - 32%)) = $6,664

Net income under recession after recapitalization = EBIT under recession – Interest on debt – ((EBIT under recession – Interest on debt) * Tax rate) = $6,664 - $1,848 - (($6,664 - $1,848) * 40%) = $2,889.60

EPS under recession after recapitalization = Net income under recession after recapitalization / Shares outstanding after recapitalization = $2,889.60 / 3,860 = $0.75 per share

d. Calculate the percentage changes in EPS when the economy expands or enters a recession.

Percentage changes in EPS after recapitalization when the economy expands = ((EPS under expansion after recapitalization - EPS under normal after recapitalization) / EPS under normal after recapitalization) * 100 = (($1.59 - $1.24) / $1.24) * 100 = 28.2%

Percentage changes in EPS when the economy enters recession = ((EPS under recession - EPS under normal) / EPS under expansion) * 100 = (($0.75 - $1.24) / $1.24) * 100 = –39.52%

6 0

3 years ago

Pacific West Utility has made a takeover offer to the shareholders (51% of the shares) of San Diego Edison. The board and manage

bazaltina [42]

Answer: a. Western Power must comply with the Williams Act.

Explanation: The Williams Act was passed into law in 1968 and is a federal defining the rules of acquisitions and tender offers in response to hostile attempts at takeovers from corporate raiders who make cash tender offers for stocks they owned. These offers often destroy value since they force stockholders to tender stocks on a shortened timetable and as such, the Williams Act also includes time constraints specifying the number of days to make a decision and also the least amount of time such cash offers may be open. In accordance with the Act, Western Power must follow the tenets stipulated within the Act.

4 0

3 years ago

Dear Mr. Trujillo: Subject: To all employees We’ve instituted a new process for requesting vacation time. Here’s how it will wor

ankoles [38]

Answer:

The answer is False.

Explanation:

The qualities of effective communication are:

<em>Completeness.</em> Effective communications are complete, i.e. the receiver gets all the information he needs to process the message and take action. If the information is complete there is no need to see HR for any questions.
<em>Conciseness:</em> The communication was fairly concise. Conciseness is about keeping your message to a point.
<em>Consideration:</em> Effective communication takes into account the receiver’s background and points of view. There was no compliments at the beginning of the message. Second, the message assumed on point 2 that people will know what to do with the Tab for Requests.
<em>Concreteness: </em> Concreteness mitigates the risk of misunderstanding, fosters trust and encourages constructive criticism.
<em>Courtesy: </em>The tone of the email lacked courtesy.
Clearness: Clear communications build on exact terminology and concrete words, to reduce ambiguities and confusion in the communication process.
<em>Correctness: </em>Correct grammar and syntax vouch for increased effectiveness and credibility of your message. Formal errors might affect the clarity of your message, trigger ambiguity and raise doubts. The email opens up with an address to Dear Mr. Trujillo when it is supposed to go to all staff.

Cheers!

8 0

3 years ago

A group of political leaders believe that businesses should switch to using renewable energy. A factory owner argues that his bu

Mamont248 [21]

Answer:

Limited role of government

Explanation:

Apex- Econ

5 0

3 years ago

A certain project has a project cost of $387,000 and the annual inflows resulting from the product created is $64,000. What is t

Komok [63]

Answer:

Payback period is 6.5625 years

Explanation:

All amounts are in $

Item outflow inflow balance

Year 0 387,000 0 (387,000)

Year 1 0 64,000 (323,000)

Year 2 0 64,000 (259,000)

Year 3 0 64,000 (195,000)

Year 4 0 64,000 (131,000)

Year 5 0 64,000 (67,000)

Year 6 0 64,000 (3,000)

The remaining $3000 will flow in

= (3000/64000) × 12

= 0.5625

Payback period is 6.5625 years

4 0

3 years ago