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shepuryov [24]
4 years ago
12

NewKirk Inc.., is an unlevered firm with expected annual earnings before taxes of $21 million in perpetuity. The current require

d return on the firm's equity is 16 percent, and the firm distributes all of its earnings as dividends at the end of each year. The company has 1.3 million shares of common stock outstanding and is subject to a corporate tax rate of 35 percent. The firm is planning a recapitalization under which it will issue $30 million of perpetual 9 percent debt and use the proceeds to buy back shares. What is cash flows available to equity holders after recapitalization?
Business
1 answer:
IrinaVladis [17]4 years ago
8 0

Answer:

$11,895,000

Explanation:

Expected annual earnings before tax = $21,000,000

Debt issue = $30,000,000

Interest rate = 9%

Annual Interest expenses = $30,000,000 × 9%

= $2,700,000

EBT = EBIT - Interest expenses

= $21,000,000 - $2,700,000

= $18,300,000

Net income = $18,300,000 × (1 - 35%)

= $11,895,000

Cash flows available to equity holders after recapitalization will be $11,895,000.

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notsponge [240]

Answer: shared leadership

Explanation:

Shared leadership occurs when the employees in a company lead each in order to achieve a successful outcome.

In shared leadership, the team environment relies on a shared voice and purpose. In shared leadership, the human resources in the company are maximized by empowering the employee and then giving them an opportunity to take up leadership positions.

Shared leadership are most effective when organizations are utilizing teams to achieve organizational objectives.

5 0
3 years ago
On december 1, victoria company signed a 90-day, 6% note payable, with a face value of $15,000. what amount of interest expense
Zepler [3.9K]
To calculate the accrued interest:

Just multiply the interest rate by the balance to determine the annual interest expense. Divide the annual interest expense by 12 to calculate the amount of interest to record in a monthly adjusting entry.So fotr this problem, if a $15,000 note payable has a 6 percent interest rate, multiply 10 percent, or 0.06, by $15,000 to get $900 in annual interest. Divide $900 by 12 to get $75 in monthly interest.

Therefore, the accrued interest is $75.
4 0
4 years ago
Carly knows that according to ________, if she administers positive reinforcement or avoidance learning, her employees will tend
Yuri [45]

Answer:

Law of effect

Explanation:

This law was developed by Edward Thorndike

When Responses are followed by satisfaction, it causes people to become more attached to a situation. This is likely going to cause these people to continue doing things as they are doing them now. This is why if Carly uses positive reinforcement, her employees will do their jobs same way they are doing it now.

Conversely, if the situation is followed by discomfort, that is she uses punishments or extinction, the

employers will disconnect themselves from doing their jobs the same way they have been doing it.

7 0
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Answer:

An open office

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