Identify one way in which setting a goal can help a person budget<br> more effectively.

Duffert Industries has total assets of $940,000 and total current liabilities (consisting only of accounts payable and accruals)

Studentka2010 [4]

Answer:

ROE = 13.04%

ROIC = 7.83%

Explanation:

Data provided in the question:

Total assets = $940,000

Total current liabilities = $130,000

Interest rate on its debt = 8%

Tax rate = 40%

The firm's basic earning power ratio = 14%

Debt-to capital rate = 40% = 0.40

Now,

Basis earning power = EBIT ÷ Total Assets

or

EBIT = Basis earning power × Total assets

= 14% × $940,000

= $131,600

Total Assets = Total Debt + Total Equity + Total Current Liabilities

$940,000 = Total Debt + Total equity + $130,000

Debt + Equity = $940,000 - $130,000

= $810,000

Debt to capital ratio = Debt ÷ [ Debt + Equity ]

0.40 = Debt ÷ $810,000

or

Total Debt = $324,000

Thus,

Debt + Equity = $810,000

or

$324,000 + Equity = $810,000

or

Equity = $810,000 - $324,000

= $486,000

Interest = 8% of Debt

= 0.08 × $324,000

= $25,920

Taxes = 40% of [ EBIT - Interest ]

= 0.40 × ($131,600 - $25,920 )

= $42,272

Therefore,

ROE = [ EBIT - interest - Taxes ] ÷ Equity

= [$131,600 - $25,920 - $42,272 ] ÷ $486,000

= 0.1304

= 13.04%

ROIC = [ EBIT - interest - Taxes ] ÷ Total capital

= [$131,600 - $25,920 - $42,272 ] ÷ [Debt + Equity]

= [$131,600 - $25,920 - $42,272 ] ÷ $810,000

= 0.0783 = 7.83%

5 0

2 years ago

The Peter's Group originated four years ago, and since then, the company has grown each year. Management has focused on making s

Gekata [30.6K]

Answer:

The Peter's Group originated four years ago, and since then, the company has grown each year. Management has focused on making sure that the organization's strategic goals cascade down through the organization so that the employees can work together in pursuit of common ends. Peter's Group is using aligned goals in their organization.

Explanation:

Aligned goals is what organizations do in order to gather all the forces towards the achievement of common objectives.

6 0

2 years ago

A produce distributor uses 774 packing crates a month, which it purchases at a cost of $12 each. The manager has assigned an ann

ki77a [65]

Answer:

$444.42

Explanation:

For computing the saving amount, first need to calculate the economic order quantity, total cost etc

The economic order quantity is

$= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}$

where,

Annual demand is

= 774 packaging crates × 12 months

= 9,932 crates

And, the carrying cost is

= $12 × 34%

= $4.08

$= \sqrt{\frac{2\times \text{9,288}\times \text{\$29}}{\text{\$4.08}}}$

= 363.37 crates

Now the total cost is

= Annual ordering cost + Annual carrying cost

= Annual demand ÷ Economic order quantity × ordering cost per order + Economic order quantity ÷ 2 × carrying cost per unit

= 9,288 ÷ 363 × $29 + 363 ÷ 2 × $4.08

= $742.02 + $740.52

= $1,482.54

Now the total cost in case of 774 packing crates is

= Annual ordering cost + Annual carrying cost

= Annual demand ÷ Economic order quantity × ordering cost per order + Economic order quantity ÷ 2 × carrying cost per unit

= 9,288 ÷ 774 × $29 + 774 ÷ 2 × $4.08

= $348 + $1,578.96

= $1,926.96

So, the annual saving cost is

= $1,926.96 - $1,482.54

= $444.42

6 0

3 years ago

Lakeview Company completed the following two transactions. The annual accounting period ends December 31.

Ann [662]

Answer: Check attachment and explanation.

Explanation:

a. The question has been solved. Check the attachment.

b. LAKEVIEW COMPANY

Balance sheet (Partial)

December 31

Current liabilities

FICA Payable=$4800 + $4800= $9600

Charitable contribution payable = $2400

Withheld income tax payable = $6400

State and Federal unemployment tax payable = $560

Unearned rent revenue = $5700 - $3800 = $1900

Total current liabilities = $20860

6 0

2 years ago

Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Dat

Wittaler [7]

Answer:

Estimated manufacturing overhead rate= $3 per machine hour

Explanation:

Giving the following information:

Machine Hours Per Unit:

Rings= 6 (1,000 units)

Dings= 11 (2,040 units)

All of the machine hours take place in the Fabrication Department, which has an estimated total factory overhead of $85,200.

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= 85,200/(6,000 + 11*2,040)= $3 per machine hour

6 0

2 years ago

Identify one way in which setting a goal can help a person budget more effectively.