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
nadya68 [22]
3 years ago
8

Banerjee Inc. wants to maintain a target capital structure with 30% debt and 70% equity. Its forecasted net income is $825,000,

and its board of directors has decreed that no new stock can be issued during the coming year. If the firm follows the residual dividend model, what is the maximum capital budget that is consistent with maintaining the target capital structure?
a. $1,143,214
b. $954,643
c. $1,178,571
d. $1,296,429
e. $1,437,857
Mathematics
1 answer:
bulgar [2K]3 years ago
6 0

The capital budget will be supported with 30% debt and 70% equity. Since the company's income will be $825,000 this is the maximum equity that can be put towards the capital budget and therefor is matched in the ratio 70:30 by borrowings. If $825000 is 70%, divide that (825,000/.70) you’ll get the total maximum budget of $1,178,571 which is letter c. To get the 30%, just deduct the $825,000 to $1,178,571, you’ll get $353,571. To make sure your answer is correct, add up the 70% and 30% values and if they make the original total value, then the answer is correct. $825,000 + $353,571 = $1,178,571

You might be interested in
The work of a student to find the dimensions of a rectangle of area 6 + 8x and width 2 is shown below:
tatiyna
Answer:
Step 2; 2(3) = 2(4x)
5 0
3 years ago
Read 2 more answers
Find the slope of the line that passes through the pair of points. <br><br> (1, 7), (10, 1)
horrorfan [7]

this is how I solve it

6 0
3 years ago
Read 2 more answers
Jill makes 40 hours per week. She makes $20 per hour. What is his gross pay
krek1111 [17]

Answer:

Weekly Gross Income: $800

Anual Gross Income: $41,600

Monthly Gross Income: $3,466.67

Step-by-step explanation:

Weekly: 40 x 20 = 800

Anual: 40 x 20= 800     800x52= 41,600

Monthly:41,600 / 12= 3,466.6666666666666666666666

4 0
3 years ago
How do i expand (3x+5)^2
shepuryov [24]
I don't know how you expand it but the answer is 3x + 25 unless that's expanding.
8 0
2 years ago
Read 2 more answers
Multiplying by 1.36 is the same as increasing by<br> %.
frutty [35]

Answer:

36%

Step-by-step explanation:

1 = 100%

so 1.36 is increasing by 36%

4 0
2 years ago
Read 2 more answers
Other questions:
  • Can someone help please? And explain it.
    7·1 answer
  • Simplify the expression. 2n/3n​
    12·1 answer
  • Write the equation of the line fully simplified slope-intercept form.
    14·1 answer
  • The vertical lines that intersect and form 90 degree angles<br> are called
    9·1 answer
  • Maria can clean the entire house in two hours. Her sister, Sasha, can clean the house in three hours. How long would it take for
    12·1 answer
  • F(x) = 20 - x What is the y intercept
    12·1 answer
  • An office manager has received a report from a consultant that includes a section on equipment replacement. The report indicates
    8·1 answer
  • Is this a function or not a function. Please help
    7·1 answer
  • 12x-13x write an equivalent expression.
    6·1 answer
  • Carlie used a coupon and paid $9.99 for pizza that normally costs $14.99. What is the percent of change?
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!