Simplify ratio 6:4 , please answer quick!!!

Ghost, Inc., has no debt outstanding and a total market value of $369,600. Earnings before interest and taxes, EBIT, are project

arlik [135]

Answer:

Ghost Inc.

A1.

Earnings Per share (EPS)

EPS in normal projection is $4.61 per share

EPS in an expansion is $5.31 Per share

EPS in a recession is $3.51 Per share

A2.

Changes to EPS in an expansion is +15.18%

Changes to EPS in a recession is -23.86%

B1.

Earnings Per share (EPS)

EPS in normal projection is $7.23 per share

EPS in an expansion is $8.62 Per share

EPS in a recession is $5.01 Per share

B2.

Changes to EPS in an expansion is +19.23%

Changes to EPS in a recession is -30.71%

Step-by-step explanation:

Underlying Information:

Earnings before interest and taxes, EBIT projections = $51,000

Expansionary EBIT projections = $51,000 x (100% + 15%) = $58,650

Recessionary EBIT projections = $51,000 x (100% -24%) = $38,760

Tax Rate = 24%

Market to Book Ratio = 1.0

Stock Price is constant.

Solution to A1.

Scenario 1 (Projected Earnings)

Earnings Per Share (EPS) = Net Income (Earnings after Tax) divided by Outstanding Shares in Issue

Net Income = EBIT minus tax = $51,000 - ($51,000 x 24%)

= $51,000 - $12240

= $38,760

Outstanding shares in issue = 8,400 ordinary Shares

EPS = $38,760 divided by 8,400 shares = $4.61 Per share

Scenario 2 (Projected Earnings in a strong expansion)

Earnings Per Share (EPS) = Net Income (Earnings after Tax) divided by Outstanding Shares in Issue

Net Income = EBIT minus tax = $58,650 - ($58,650 x 24%)

= $58,650 - $14,076

= $44,574

Outstanding shares in issue = 8,400 ordinary Shares

EPS = $44,574 divided by 8,400 shares = $5.31 Per share

Scenario 3 (Projected Earnings in a Recession)

Earnings Per Share (EPS) = Net Income (Earnings after Tax) divided by Outstanding Shares in Issue

Net Income = EBIT minus tax = $38,760 - ($38,760 x 24%)

= $38,760 - $9,302.4

= $29,457.6

Outstanding shares in issue = 8,400 ordinary Shares

EPS = $44,574 divided by 8,400 shares = $3.51 Per share

Solution to A2.

1.Changes to EPS in an expansion = EPS (Expansion) minus EPS (normal projection), all divided by EPS (normal projection)

= (5.31 - 4.61) / 4.61

= +15.18% change during an expansion

2.Changes to EPS in a recession = EPS (Recession) minus EPS (normal projection), all divided by EPS (normal projection)

= (3.51 - 4.61) / 4.61

= -23.86% change during a recession

Underlying Information:

Debt issue = $185,000

Interest on debt issued = 6% = $11,100

Market to Book Ratio = 1.0

Stock Price is constant.

Therefore Share Price = Market Value divided by Outstanding shares in issue = 369,600 / 8400 = $44

This implies our proceeds of $185,000 from debt issue would have repurchased $185,000 divided by $44 = 4,205 ordinary shares

This decision to repurchase its shares indicates the shares outstanding will reduce by 4,205. New outstanding shares will now be 4,195 shares

*Earnings before interest and taxes, EBIT normal projections = $51,000 & Earnings Before Tax (EBT) = $51,000 minus $11,100 (debt interest) = $39,900

*Expansionary EBIT projections = $51,000 x (100% + 15%) = $58,650 & Earnings Before Tax = $58,650 minus $11,100 (debt interest) = $47,550

*Recessionary EBIT projections = $51,000 x (100% -24%) = $38,760 & Earnings Before Tax = $38,760 minus $11,100 (debt interest) = $27,660

Tax Rate = 24%

Solution to B1.

Scenario 1 (Projected Earnings)

Earnings Per Share (EPS) = Net Income (Earnings after Tax) divided by Outstanding Shares in Issue

Net Income = EBT minus tax = $39,900 - ($39,900 x 24%)

= $39,900 - $9,576

= $30,324

Outstanding shares in issue = 4,195 ordinary Shares

EPS = $30,324 divided by 4,195 shares = $7.23 Per share

Scenario 2 (Projected Earnings in a strong expansion)

Earnings Per Share (EPS) = Net Income (Earnings after Tax) divided by Outstanding Shares in Issue

Net Income = EBT minus tax = $47,550 - ($47,550 x 24%)

= $47,550 - $11,412

= $36,138

Outstanding shares in issue = 4,195 ordinary Shares

EPS = $36,138 divided by 4,195 shares = $8.62 Per share

Scenario 3 (Projected Earnings in a Recession)

Earnings Per Share (EPS) = Net Income (Earnings after Tax) divided by Outstanding Shares in Issue

Net Income = EBT minus tax = $27,660 - ($27,660 x 24%)

= $27,660 - $6,638.40

= $21,021.60

Outstanding shares in issue = 4,195 ordinary Shares

EPS = $21,021.60 divided by 4,195 shares = $5.01 Per share

Solution to B2.

1.Changes to EPS in an expansion = EPS (Expansion) minus EPS (normal projection), all divided by EPS (normal projection)

= (8.62 - 7.23) / 7.23

= +19.23% change during an expansion

2.Changes to EPS in a recession = EPS (Recession) minus EPS (normal projection), all divided by EPS (normal projection)

= (5.01 - 7.23) / 7.23

= -30.71% change during a recession

6 0

3 years ago

How do I find: If 6^x=1/216,find the value of x with and without a Casio calculator?

san4es73 [151]

Answer:

The value of x is -3.

Step-by-step explanation:

To find x, we have to put everything in base 6 and continue to simplify. Since we know that 216 is 6^3, we can replace that.

6^x = 1/216

6^x = 1/(6^3)

Now, when there is a power in the denominator, we know we can move it to the numerator by making it negative. We can do that to get the bases to match.

6^x = 1/(6^3)

6^x = 6^-3

Now that they are both put in simple base 6 systems, we can just eliminate the bases and assume that the powers are equal. This lets us know that x = -3.

8 0

3 years ago

How do you do this question?

IRINA_888 [86]

Answer:

∑ (-1)ⁿ⁺³ 1 / (n^½)

∑ (-1)³ⁿ 1 / (8 + n)

Step-by-step explanation:

If ∑ an is convergent and ∑│an│is divergent, then the series is conditionally convergent.

Option A: (-1)²ⁿ is always +1. So an =│an│and both series converge (absolutely convergent).

Option B: bn = 1 / (n^⁹/₈) is a p series with p > 1, so both an and │an│converge (absolutely convergent).

Option C: an = 1 / n³ isn't an alternating series. So an =│an│and both series converge (p series with p > 1). This is absolutely convergent.

Option D: bn = 1 / (n^½) is a p series with p = ½, so this is a diverging series. Since lim(n→∞) bn = 0, and bn is decreasing, then an converges. So this is conditionally convergent.

Option E: (-1)³ⁿ = (-1)²ⁿ (-1)ⁿ = (-1)ⁿ, so this is an alternating series. bn = 1 / (8 + n), which diverges. Since lim(n→∞) bn = 0, and bn is decreasing, then an converges. So this is conditionally convergent.

5 0

3 years ago

CAN SOMEONE HELP ME WITH PATTERN 1

jeyben [28]

1- 6
2- 4
3- 2
And that’s all I can tell you? It’s decreasing so I don’t think 10 would have any stars unless if negative numbers are allowed

5 0

3 years ago

Can someone help me with this question please

DENIUS [597]

37 im pretty sure sorry if not correct.

6 0

3 years ago