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AnnZ [28]
3 years ago
10

Rudyard Corporation had 240,000 shares of common stock and 24,000 shares of 6%, $100 par convertible preferred stock outstanding

during the year. Net income for the year was $680,000 and dividends were paid to both common and preferred shareholders. Rudyard's effective tax rate is 25%. Each share of preferred stock is convertible into five shares of common stock. What is Rudyard's diluted EPS (rounded)?
Business
1 answer:
defon3 years ago
8 0

Answer:

$1.90 per share

Explanation:

The computation of the diluted earning per share is shown below:

Diluted earning per share = Net income ÷ Weighted number of outstanding shares

where,

Net income is $680,000

And, the Weighted number of outstanding shares is

= 240,000 + 24,000 × 5

= 240,000 + 120,000

= 360,000 shares

So, the diluted EPS is

= $680,000 ÷ 360,000 shares

= $1.90 per share

We simply applied the above formula

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AudioCables, Inc., is currently manufacturing an adapter that has a variable cost of $0.50 per unit and a selling price of $1.40
Sedaia [141]

Answer: Yes. AudioCable should buy a new equipment

Explanation:

Audiocables Inc. without new equipment:

Selling price: $1.40

Variable cost: $0.50

Fixed cost: $14,000

Sales: 30000 units

Total cost = Fixed cost + Variable cost

= $14000 + ($0.50 × 30000)

= $14000 + $15000

= $29000

Revenue = Sales × Selling price

= 30000 × $1.40

= $42000

Profit = Revenue - Total Cost

= $42000 - $29000

= $13000

Audiocables Inc. with new equipment:

Selling price: $1.40

Variable cost: $0.60

Fixed cost: $14,000 + $6000 = $20000

Sales: 50000 units

Total cost = Fixed cost + Variable cost

= $20000 + ($0.60 × 50000)

= $20000 + $30000

= $50000

Revenue = Sales × Selling price

= 50000 × $1.40

= $70000

Profit = Revenue - Total Cost

= $70000 - $50000

= $20000

From the calculations made, AudioCable buy a new equipment as profit generated is more.

5 0
3 years ago
I need help on number 8 9 and 10 please help
elena55 [62]

Answer:

8. The opportunity cost is c. wearing the shoes

9. To gain the most satisfaction possible

10. A new toy is less exciting to a child with many toys

Explanation:

3 0
2 years ago
Margot has fallen in love with a three-bedroom, 2,500-square-foot property in her friend’s neighborhood. It’s listed for $400,00
fenix001 [56]

Answer:

subsititution

Explanation:

Since in the situation it is mentioned that margot has fallen with 3 set bedroom i.e. 2500 square foot and its amount is $400,000. Now there is another three set bedroom of 2,400 square foot and its amount is $350,000 so here two options are given and according to the price he opted for the second property

So out of two choices he should opt for one that means it is a subsititution economic principle

5 0
3 years ago
Brian is a manager at a clothing store. He spends most of his time in the store with his employees, making sure they work their
Sophie [7]

Answer:

First line manager

Explanation:

First line managers are the lowest forms of managers in an organizational structure. They are the managers that deals with employees directly. They operate their departments by assigning work to the employees and monitoring their actions. In this case, the activities of Brian which included making sure they work their scheduled hours, watching them interact with customers and so on indicates that he is a First-Level Manager.

8 0
3 years ago
Suppose that the S&P 500, with a beta of 1.0, has an expected return of 13% and T-bills provide a risk-free return of 4%. a.
Aleksandr [31]

Answer:

a. The answers are as follows:

(i) Expected of Return of Portfolio = 4%; and Beta of Portfolio = 0

(ii) Expected of Return of Portfolio = 6.25%; and Beta of Portfolio = 0.25

(iii) Expected of Return of Portfolio = 8.50%; and Beta of Portfolio = 0.50

(iv) Expected of Return of Portfolio = 10.75%; and Beta of Portfolio = 0.75

(v) Expected of Return of Portfolio = 13%; and Beta of Portfolio = 1.0

b. Change in expected return = 9% increase

Explanation:

Note: This question is not complete as part b of it is omitted. The complete question is therefore provided before answering the question as follows:

Suppose that the S&P 500, with a beta of 1.0, has an expected return of 13% and T-bills provide a risk-free return of 4%.

a. What would be the expected return and beta of portfolios constructed from these two assets with weights in the S&P 500 of (i) 0; (ii) 0.25; (iii) 0.50; (iv) 0.75; (v) 1.0

b. How does expected return vary with beta? (Do not round intermediate calculations.)

The explanation to the answers are now provided as follows:

a. What would be the expected return and beta of portfolios constructed from these two assets with weights in the S&P 500 of (i) 0; (ii) 0.25; (iii) 0.50; (iv) 0.75; (v) 1.0

To calculate these, we use the following formula:

Expected of Return of Portfolio = (WS&P * RS&P) + (WT * RT) ………… (1)

Beta of Portfolio = (WS&P * BS&P) + (WT * BT) ………………..………………. (2)

Where;

WS&P = Weight of S&P = (1) – (1v)

RS&P = Return of S&P = 13%, or 0.13

WT = Weight of T-bills = 1 – WS&P

RT = Return of T-bills = 4%, or 0.04

BS&P = 1.0

BT = 0

After substituting the values into equation (1) & (2), we therefore have:

(i) Expected return and beta of portfolios with weights in the S&P 500 of 0 (i.e. WS&P = 0)

Using equation (1), we have:

Expected of Return of Portfolio = (0 * 0.13) + ((1 - 0) * 0.04) = 0.04, or 4%

Using equation (2), we have:

Beta of Portfolio = (0 * 1.0) + ((1 - 0) * 0) = 0

(ii) Expected return and beta of portfolios with weights in the S&P 500 of 0.25 (i.e. WS&P = 0.25)

Using equation (1), we have:

Expected of Return of Portfolio = (0.25 * 0.13) + ((1 - 0.25) * 0.04) = 0.0625, or 6.25%

Using equation (2), we have:

Beta of Portfolio = (0.25 * 1.0) + ((1 - 0.25) * 0) = 0.25

(iii) Expected return and beta of portfolios with weights in the S&P 500 of 0.50 (i.e. WS&P = 0.50)

Using equation (1), we have:

Expected of Return of Portfolio = (0.50 * 0.13) + ((1 - 0.50) * 0.04) = 0.0850, or 8.50%

Using equation (2), we have:

Beta of Portfolio = (0.50 * 1.0) + ((1 - 0.50) * 0) = 0.50

(iv) Expected return and beta of portfolios with weights in the S&P 500 of 0.75 (i.e. WS&P = 0.75)

Using equation (1), we have:

Expected of Return of Portfolio = (0.75 * 0.13) + ((1 - 0.75) * 0.04) = 0.1075, or 10.75%

Using equation (2), we have:

Beta of Portfolio = (0.75 * 1.0) + ((1 - 0.75) * 0) = 0.75

(v) Expected return and beta of portfolios with weights in the S&P 500 of 1.0 (i.e. WS&P = 1.0)

Using equation (1), we have:

Expected of Return of Portfolio = (1.0 * 0.13) + ((1 – 1.0) * 0.04) = 0.13, or 13%

Using equation (2), we have:

Beta of Portfolio = (1.0 * 1.0) + (1 – 1.0) * 0) = 1.0

b. How does expected return vary with beta? (Do not round intermediate calculations.)

There expected return will increase by the percentage of the difference between Expected Return and Risk free rate. That is;

Change in expected return = Expected Return - Risk free rate = 13% - 4% = 9% increase

4 0
3 years ago
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