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Dahasolnce [82]
2 years ago
14

You are in the 32% federal tax bracket. You are offered a taxable bond with a yield of 8.0% and a municipal (muni) bond with a y

ield of 5.8%. What is the breakeven federal tax rate where you are indifferent with regard to purchasing the taxable bond or the municipal bond? Should you buy the taxable bond? A) 27.50% breakeven tax bracket; No, you should buy the muni bond B) 27.50% breakeven tax bracket; Yes, you should buy the taxable bond C) 29.80% breakeven tax bracket; No, you should buy the muni bond D) 29.80% breakeven tax bracket; Yes, you should buy the taxable bond E) 37.93% breakeven tax bracket; No, you should buy the muni bond F) 37.93% breakeven tax bracket; Yes, you should buy the taxable bond G) None of the above
Business
1 answer:
tekilochka [14]2 years ago
5 0

Answer: A. 27.50% breakeven tax bracket; No, you should buy the muni bond

Explanation:

The breakeven federal tax rate where one is indifferent with regard to purchasing the taxable bond or the municipal bond will be calculated as:

= 1 - municipal bond yield/taxable bond yield

= 1 - (5.8% / 8%)

= 1 - (0.058 / 0.08)

= 1 - 0.725

= 0.275

=27.50%

Therefore, the answer will be A) 27.50% breakeven tax bracket; No, you should buy the municipal bond.

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Firm X has total earnings of $49,000, a market value per share of $64, a book value per share of $38, and has 25,000 shares outs
sveticcg [70]

Answer:

$1,456,000

Explanation:

Calculation to determine the value of the total equity of the combined firm, XY, if the purchase method of accounting is used

First step is to calculate the Assets from Firm X

Assets from Firm X = 25,000 ( $38 )

Assets from Firm X= $950,000 (book value)

Second step is to calculate the Assets from Firm Y

Assets from Firm Y = 22,000 ( $21 )

Assets from Firm Y = $462,000 (Market value)

Third step is to calculate the Goodwill

Goodwill = 22,000 ($21 + 2 ) - $462,000

Goodwill= $44,000

Now let calculate the the total equity of the combined firm, XY,

Total equity of XY = $950,000 + $462,000 + $44,000

Total equity of XY = $1,456,000

Therefore the value of the total equity of the combined firm, XY, if the purchase method of accounting is used will be $1,456,000

6 0
2 years ago
Current Attempt in Progress
Allisa [31]

Answer:

Net Increase in cash = $124,200

Explanation:

Note: The correct value for Year 2021 inventory is $510,300 not $10,300.

Also note: See the attached excel file for the statement of cash flows for 2022.

In the attached excel file, the following workings are used:

Workings:

w.1: Increase in accounts receivable = Account receivable in 2022 - Account receivable in 2021 = $237,600 - $205,200 = $32,400

w.2: Decrease in inventory = Inventory in 2022 - Inventory in 2021 = $450,900 - $510,300 = -$59,400  

w.3: Decrease in accounts payable = Accounts receivable 2022 - Accounts receivable 2021 = $105,300 - $116,100 = -$10,800

w.4: Disposal of land = Land in 2021 - Land in 2022 = $270,000 - $216,000 = $54,000

w.5: Purchase of equipment = Equipment in 2022 - Equipment in 2021 = $702,000 - $540,000 = $162,000

Download xlsx
3 0
2 years ago
Financial data for Joel de Paris, Inc., for last year follow:
suter [353]

Answer:

profit margin: 7.09%

<u />

<u>Turnover: </u>

Assets : 1.85

Account Receivable: 11.53

Inventory: 9.05

ROI: 28.94%

2.- residual income 91,395

Explanation:

sales 4,700,000

net income 333,000

<u>profit margin:</u>

net income / sales

333,000 / 4,700,000 = 0,070851 = 7.09%

<u>Turnovers:</u>

Will be sales over an asset account to calcualte how many times  the assets converts to cash or rotate.

the average will be calcualte as (beginning + ending)/2

<em>Assets turnover:</em>

sales/average assets

sales 4,700,000

(2,505,000 + 2,585,000) / 2 = 2,545,000

Ratio: 1,8467 = 1.85

<em>Account Receivable Turnover:</em>

sales/ average turnover

sales 4,700,000

(344,000 +471,000)/2 = 407,500

Ratio: 11,5337 = 11.53

<em>Inventory Turnover</em>

Sales/ average inventory

Sales 4,700,000

(568,000 + 471,000)/2 = 519,500

Inventory turnover: 9,04716 = 9.05

<u>ROI</u>

net income / average equity

<u>where:</u>

average equity : (beginning + ending)/2

1,092,000 + 1,209,000 = 1,150,500

333,000/1,150,500 = 0,28943

<u></u>

<u>Residual income:</u>

net income - Equity x expected return

    333,000 - 1,150,500 x 0.21 =

     333,000  -  241,605‬  = 91,395

5 0
3 years ago
T. L. Jones Trucking Services establishes a petty cash fund on April 3 for $500. By the end of April, the fund has a cash balanc
djyliett [7]

Answer:

The question is missing some figures which can be seen from the attached image.

Petty cash is a fund set aside in the office to pay minor day to day expenses incurred.Usually, an amount is made available at the beginning of period called float,from which expenses can be paid and the amount equal to spend is reimbursed at the end of the month.

In order, to make payment even more easier,some businesses take up credit cards from financial institutions,from  which expenses can be paid on account.

The balance of $415 means in petty fund,implies that $85  spent needs to be replenished at month end and that the remaining expenses were paid with credit card.

Explanation:

Find in the attached spreadsheet the entries posted in respect of petty cash and credit card expenses in the month.

5 0
3 years ago
Consider an industry in which chief executive ocers (CEOs) run rms. There are two types of CEOs: exceptinal and average. There i
klemol [59]

Answer

The answer and procedures of the exercise are attached in the following 3 images.

Explanation  

Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in 3  sheets with the formulas indications.  

8 0
3 years ago
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