(a) Debt ratio = 0.82
Debt/ Assets = 0.82
Debt/(Debt + Equity) = 0.82
Debt = 0.82Debt + 0.82 Equity
0.18Debt = 0.82 Equity
Equity = 0.18Debt/0.82
Debt/Equity = Debt/(0.18Debt/0.82) = 4.5556
Debt/Equity = 0.82/0.18 =4.5556
Debt-Equity ratio = 4.56 times
(b) Equity Multiple = 1 + Debt-equity ratio
Equity multiplier = 1+4.56 = 5.56
Equity multiplier = 5.56 times
Answer:
c. Argues that a firm's first choice for capital is retained earnings as there is no informational cost associated with using retained earnings.
Explanation:
The Pecking order theory states that a business should first of all seek for internal funds (retained earnings) as a first choice of capital.
When internal funds are depleted, it can now look to debt as a source of finance.
In turn when debt options have been exhausted the last resort is to look for funding from equity.
So the Pecking order argues that a firm's first choice for capital is retained earnings as there is no informational cost associated with using retained earnings.
Answer:
Mitigated damages term
Explanation:
The best defense for Stewarts in this situation is Mitigated damage term. This enables him to reduce his penalty on the breach of contract,
Even though the situation was outside his control , but the contract he signed stipulated that he will pay $50,000/ day of delay in the project which had unfortunately happened.
However , the damages can be reduced or even avoided if he sue for mitigated damage term
Answer:
Paid sick leave benefit
Explanation:
The amount of this benefit usually included in the initial contract when you signed up for the job. Not all companies provide this since it's not required under the federal law.
in most cases, companies who implement Paid sick leave will transfer the amount of money each month in order to help sustaining the life of their employees since they have no capability to work for additional income.
Answer:
False.
It wasn't stated if the life insurance covers risky hobbies/activities like skydiving
Explanation:
In this scenario Rudolph does not know Macy. Most likely they are not related for him to tender Macy's death certificate in fulfillment of the requirements for payment.
Delays to payouts may also arise if:
The insured party died during the course of illegal activity such as driving under the influence.
The insured party lied on the policy application.
The insured omitted health issues or risky hobbies/activities like skydiving.
