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ludmilkaskok [199]
2 years ago
12

has assets with a market value of $100 million, $10 million of which are cash. has debt of $40 million, and 10 million shares ou

tstanding. Suppose that distributes $10 million as a dividend. Assuming perfect capital markets, what will new market debt-equity ratio be after the dividend is paid
Business
1 answer:
Rufina [12.5K]2 years ago
6 0

Answer:

See below

Explanation:

First, we need to calculate new stock price.

Current stock price = (Assets market value - debt) / Number of shares outstanding.

= (100 - 40)/10

= $6

Assets value after dividend distribution = 100 - 10

= 90

Number of shares purchased = 10/6 = 1.667 million shares

New stock price = (90 - 40)/(10 - 1.667)

= $7.20

Debt equity ratio = Debt / Equity

Equity = Stock price × number of shares

= $ (7.20 × (10 - 1.667)

= $ (7.2 × 8.33)

= $60

Debt = 40

Debt equity = 40/60 = 0.667 times

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In the past few years, the demand for donuts has decreased. this would be illustrated by a change from?
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The decrease in demand would be illustrated by a change from A to C.

<h3>What will be the change?</h3>

The demand curve is a downward sloping curve that shows the relationship between price and the quantity demanded. There is a negative relationship between price and quantity demanded.

A change in demand is caused by other factors other than the price of the good. Other factors include a change in income, a change in consumer taste or a change in the price of substitute goods.

When there is a change in demand, the demand curve would shift either to the right or to the left. When demand decreases, the demand curve would shift to the left. When demand increases, the demand curve would shift to the right.

Since, the demand for donuts have decreased, the demand curve would shift to the left. This would be a shift from A to C.

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1 year ago
Toby operates a small deli downtown. the deli industry is monopolistically competitive. toby says he is producing the quantity t
evablogger [386]
Here is the answer that completes the statement above.
Regarding the situation of Toby who runs a small deli downtown, if he is already maximizing his profits, therefore, we can say that the number or amount of delis will soon increase or rise. Hope this answers your question.
5 0
3 years ago
YOOO I NEED HELPPP I'LL GIVE YOU 30 POINTS
cricket20 [7]

Answer:

im in 7th grade trying to help so heres my answer

Explanation:

Another possible work place is somewhere where there would be a healthier place other places may pay more but its not worth it after some time you'll have alot of money and health. A place you should work at is a place where youll be safe and health such as a well secured workplace for example a gardener for such people or maybe a selling homes person or artist seller or a dream job but always think of health and saftey and wear a mask and gloves to avoid germs.

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2 years ago
What are the three questions you need to ask yourself before you start investing
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Explanation:

Is the seller licensed?

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6 0
2 years ago
The ACogs-153 company has provided the following data for the month of May: Inventories: Beginning Ending Work in process $ 24,0
meriva

Answer:

$209,000

Explanation:

   Schedule of Cost of goods manufactured

Particulars                                                Amount

Direct materials                                        $64,000

Direct labor cost                                       $94,000

Manuf. overhead cost applied to WIP     <u>$68,000</u>

Total manufacturing costs                        $226,000

Add: WIP Inventory, Beginning                $24,000

Less: WIP Inventory, Ending                     <u>$19,000</u>

Cost of goods manufactured                   $231,000

Add: Beginning Finished goods              $53,000

Less: Ending Finished goods                   <u>$57,000</u>

Unadjusted cost of goods sold                $207,000

Add: Underapplied manuf. overhead      <u>$2,000    </u> ($70,000-$68,000)

Adjusted cost of goods sold                   <u>$209,000</u>

4 0
2 years ago
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