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eimsori [14]
3 years ago
8

One of the indirect costs of bankruptcy is the effect that a potential bankruptcy has on the firm's decisions. The general resul

t is that:A. the firm will select only all-equity financed projects.B. stockholders expropriate value from bondholders by selecting high-risk projects.C. the firm will always select the lowest-risk project available.D. bondholders expropriate value from stockholders by selecting high-risk projects.E. the firm will rank all projects and select the project which results in the highest expected firm value.
Business
1 answer:
Oksana_A [137]3 years ago
8 0

Answer: B. stockholders expropriate value from bondholders by selecting high-risk projects.

Explanation:

Bankruptcy simply means when an individual or business cannot pay back the funds that is owed to the creditor. When bankruptcy is declared by a particular business, the assets for the business are used in paying back the debt.

One of the indirect costs of bankruptcy is the effect that a potential bankruptcy has on the firm's decisions. The general result is that stockholders expropriate value from bondholders by selecting high-risk projects.

Therefore, option B is the answer.

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Each month, Burrel Incorporated produces 500 units of a product that has unit variable costs of $22. Total fixed costs for the m
Gnom [1K]

Answer:

difference between the offered price and the variable cost per unit

Explanation:

The contribution margin per unit of a product is the difference between the selling price per unit and variable cost per unit. The contribution margin per unit shows the amount available from each unit sold that cater to fixed costs and profits. A higher amount of contribution margin is desirable as it assures that each unit sold is contributing to profitability.

When the variable costs are more than the selling price, it means a business is not meeting any of its costs. The firm is running at a loss and is likely to close down soon. Before accepting or rejecting the special offer, the business should compare the proposed price and variable costs. If the contribution margin is positive, then the order should be considered.

5 0
3 years ago
Marston Corp. writes 28 checks a day for an average amount of $398 each. These checks generally clear the bank 3 days after they
irina [24]

Answer:

The Marston Corp. disbursement float is  $ (16,768.00)

Explanation:

The firm writes 28 checks a day for an average amount of $398 each, is equal to say = 28 * $398 =  $ 11,144.00 . If these checks generally clear the bank 3 days after they are written, then =  $ 11,144.00 * 3 =  $ 33,432.00

And, the firm generally receives 40 checks with an average amount of $502 each, is equal to say = 40 * $502 =  $ 20,080.00 . If the deposited amounts are available after an average of 2.5 days, then = $ 20,080.00  *  2.5 =  $ 50,200.00

The Marston Corp. disbursement float is  = $ 33,432.00  -  $ 50,200.00 =

$ (16,768.00)

7 0
3 years ago
Pick the correct statement from below. a. Stocks can only be assigned one dividend growth rate. b. Preferred stocks generally ha
Pani-rosa [81]

Answer:

e. Stocks can have negative growth rates.

Explanation:

According to the given options, the option e is correct as the growth rate could never be zero and positive as it is not necessary that the growth rate should be same or constant

But in the other cases the things can be changed like the stock could assigned to more than one dividend growth rate, etc

Therefore the option e is correct

8 0
3 years ago
The next dividend payment by Dizzle, Inc., will be $2.85 per share. The dividends are anticipated to maintain a growth rate of 5
devlian [24]

Answer:

10.78%

Explanation:

The next dividend payment for Dizzle incorporation is $2.85

The growth rate is 5%

Current stock price is $49.30

Therefore the required return can be calculated as follows

= dividend payment/stock price + growth rate

= 2.85/49.30 + 5/100

= 0.0578 + 0.05

= 0.1078 × 100

= 10.78%

3 0
3 years ago
Read 2 more answers
Stockholders, employees and environmentalists are examples of stakeholders whose interests
jasenka [17]

Stockholders, employees and environmentalists are examples of stakeholders whose interests often conflict.

<h3>What is conflict?</h3>

Conflict refers to the disagreement among the two individual or the group which occurs due to the difference in the ideas, thoughts, attitudes, understanding and interest or opinion.

The interest of the stockholders, employees and environmentalist often tends to conflict because stockholders wants the company to maximize the profits as much as possible, employees wants to increase salary and promotion.

Environmentalist wants to industrialist ans other stockholders to show some concern over the environment and spend some of their earnings in for the environmental growth.

Learn more about Stakeholders here:

brainly.com/question/14514176

#SPJ1

8 0
2 years ago
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