Visa cards, gas cards and department store cards are all

The market value of the equity of Skipper, Inc., is $720,000. The balance sheet shows $46,400 in cash and $230,700 in debt, whil

shutvik [7]

Answer:

3.34 times

Explanation:

The market value of skipper incorporation is $720,000

The balance sheet shows a cash of $46,400 and debt of $230,700

The income statement has an EBIT of $103,700

The depreciation and amortization is $166,900

The first step is to calculate the enterprise value

= Market capitalization + debt - cash

= $720,000 + $230,700 - $46,400

= $904,300

The EBITDA can be calculated as follows

= EBIT + depreciation and amortization

= $103,700 + $166,900

= $270,600

Therefore the enterprise value-EBITDA can be calculated as follows

= 904,300/270,600

= 3.34 times

3 0

2 years ago

True or false: it doesn’t matter whether you compute marginal cost using total cost or variable cost.

Elena L [17]

It is TRUE. Marginal cost is the amount added when there is an additional unit of product or service produced. Meanwhile, the total cost, as defined in accounting, is composed of the total fixed costs and its total variable costs. Fixed cost is not affected by the number of output a company produced. Thus it won’t affect the marginal cost.

8 0

2 years ago

Paar Corporation bought 100 percent of Kimmel, Inc., on January 1, 2015. On that date, Paar’s equipment (10-year remaining life)

iogann1982 [59]

Answer:

The method the parent use will have no effect on consolidated total because it is only for internal reporting purpose.

Explanation:

Paar's equipment book value—12/31/15 of $294,000

Add Kimmel's equipment book value—12/31/15 of $190,400

Add Original acquisition-date allocation to

Kimmel's equipment of ($400,000 − $272,000) = $128,000

Less Amortization of Allocation

($128,000/10 years * 3 years) = ($38,400)

<h3>Equals Consolidated Equipment of $574,000 </h3>

The method the parent use will have no effect on consolidated total because it is only for internal reporting purpose.

4 0

2 years ago

Procter & Gamble (P&G) has a paper towel and baby diaper business that both use paper products. This is an example of va

tia_tia [17]

Answer:

a) True

Explanation:

Procter & Gamble's (P&G) paper towel and baby diaper business that both use paper products reveals them as an example of value created through transferring its core competency.

They have a corporate level diversification strategy. Such strategy is geared in order to create value. This gives them a competitive advantage over their competitors which is achieved through selection and management of a mix of businesses.

4 0

2 years ago

Classify each of the following costs as a direct cost or an indirect cost, assuming that the cost object is the Juniors Departm

Tems11 [23]

Answer:

a. Indirect Cost

b. Direct Cost

c. Indirect Cost

d. Indirect Cost

e. Indirect Cost

f. Direct Cost

g. Direct Cost

h. Direct Cost

i. Indirect Cost

j. Indirect Cost

k. Indirect Cost

l. Direct Cost

Explanation:

The first step in determining whether a cost is a direct cost or indirect cost is to identify the cost object. This is very important !

So with Juniors Department selected as the cost object, we then need to identify costs that can be directly traced by observation into the Juniors Department (Direct Cost) and those costs that can not be directly traced to the Juniors Department (Indirect Costs).

3 0

2 years ago