1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
vekshin1
3 years ago
7

Use the following information to answer the next question. Total Asset = $40 million Depreciation = $1.0 million. Basic earning

power (BEP) ratio is 20% Lease payments = 0.6 million Times-interest-earned (TIE) ratio is 6.55 Principal payments = 4 million What is the company's EBIT? The company's interest expense? Select one: a. $8.0 million; $1.22 million b. $7.5 million; $0.75 million c. $8.0 million; $0.62 million d. $1.35 million; $0.37 million e. $3.33 million; $0.83 million​
Business
1 answer:
Marizza181 [45]3 years ago
5 0

Answer:

a. $8.0 million; $1.22 million

Explanation:

The computation is shown below:

As we know that

Basic earnings power = EBIT ÷ total assets

So,

EBIT = Basic earnings power × total assets

= 0.20 × 40 million

= $8 million

Now

Times interest earned = EBIT ÷ interest expense

So,  

Interest expense = EBIT ÷ Times interest earned

= $8 million ÷ 6.55

= $1.22 million

You might be interested in
What is a professional organization affiliated with human resource management?
astra-53 [7]

HR organizations, mainly.

For more help under this topic, you should visit this link:

<u>https://www.google.com/search?q=What+is+a+professional+organization+affiliated+with+human+resource+management%3F&rlz=1C1CHBF_enUS777US777&oq=What+is+a+professional+organization+affiliated+with+human+resource+management%3F&aqs=chrome..69i57.322j0j7&sourceid=chrome&ie=UTF-8</u>

<u>(just copy and paste it into link bar)</u>

hope this helped

7 0
3 years ago
Hayden Company is considering the acquisition of a machine that costs $324,000. The machine is expected to have a useful life of
Sati [7]

Answer:

Cash payback period= 3.2 years.

Explanation:

Lets first understand what a cash payback period is. As the name suggest, payback period is the time duration within which a business recovers it's investment and/or capital investment and the payback period is expressed in number of years. The formula for payback period is as follows:

Payback period= initial investment ÷ annual cash-flows

In the question annual operating income is given just for distraction.

payback period = $324000 ÷ 100000

payback period= 3.2 years.

This means if Hayden company decides to invest in the machine, it would recover the cost of machine (i.e it's investment) in approximately three and half years.

7 0
3 years ago
g What are the causes of rising government budget deficits when expansionary fiscal policy is used during recessions
Irina18 [472]

Answer:

reduced economic activity  and increased government borrowing

Explanation:

Expansionary fiscal policy increases the level of aggregate demand, through either increases in government spending or reductions in tax rates. Expansionary policy can do this by (1) increasing consumption by raising disposable income through cuts in personal income taxes or payroll taxes; (2) increasing investment spending by raising after-tax profits through cuts in business taxes; and (3) increasing government purchases through increased federal government spending on final goods and services and raising federal grants to state and local governments to increase their expenditures on final goods and services.

5 0
2 years ago
If the FOMC orders the open market desk to sell government​ securities,
Delicious77 [7]

Answer: Option(a) is correct.

Explanation:

FOMC (Fed open market committee) is monetary policy making body of United states who implements various money supply related policy.

Here, FOMC orders the open market desk to sell government​ securities, which lowers the money supply and increases the interest rate.

Fed use this monetary policy instrument to control the money supply in the economy.

This effect also shown in a diagram.

In the IS-LM diagram, it was shown that there is a shift in the LM curve leftwards due to decrease in the money supply. So, this decrease in the money supply raises the interest rate from i to i' and decreases output from Y to Y'.

5 0
3 years ago
Unions contribute to Select one: a. frictional unemployment but not the natural rate of unemployment. b. the natural rate of une
Verizon [17]

Answer:

The correct answer is letter "C": both frictional unemployment and the natural rate of unemployment.

Explanation:

Natural unemployment is defined as the lowest rate of unemployment an economy will reach. It is called natural because its causes are other than an adverse economy. Natural unemployment is a combination of <em>frictional unemployment</em> -employment transitions, <em>structural unemployment</em> -mismatch between abilities and current position, and <em>labor surplus</em>.

Unions are groups of individuals who join to set minimum standards at work in regards to wages, compensations, and conditions. <em>Union members are, by default, always available to join the workforce even if there is work to be done or not. Sometimes, union members are assigned duties their abilities outperform just to avoid having the member unemployed. These are the reasons why unions are said to contribute to natural unemployment.</em>

5 0
4 years ago
Other questions:
  • If $17,000 is invested at 11​% per​ year, in approximately how many years will the investment​ double?
    10·1 answer
  • Use the IS-LM graphs to answer this question. Suppose there is a simultaneous increase in government spending and reduction in t
    11·1 answer
  • Toward the end of the fiscal year, the owner of a small company came back from lunch concerned because he had learned that a bus
    11·1 answer
  • Cash flows directly related to production and sale of a​ firm's products and services are called​ ________. A. cash flow from in
    10·1 answer
  • Laurel contributed equipment worth $200,000, purchased 10 months ago for $250,000 cash and used in her sole proprietorship, to S
    8·1 answer
  • A free enterprise system provides individuals the opportunity to make their own economic decisions, without restrictions from th
    10·2 answers
  • What is an accurate definition of a skill?
    7·2 answers
  • Parker Hardware Store had net credit sales of $8,000,000 and cost of goods sold of $5,000,000 for the year. The Accounts Receiva
    15·1 answer
  • iscuss the burden placed on people or organizations contacted as references for job candidates. How do organizations cope with t
    12·1 answer
  • In order to make sure that a creditor of the insured is not paid more than the outstanding loan at time of claim, the policyowne
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!