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Paladinen [302]
2 years ago
15

Information of Company X:

Business
1 answer:
kondaur [170]2 years ago
7 0

Answer:

a. Calculate Company X's sustainable growth rate

sustainable growth rate = retention rate x return on equity

retention rate = ($12,400 - $8,200) / $12,400 = 33.87%

ROI = $12,400 / $54,000 = 22.96%

g = 33.87% x 22.96% = 7.78%

b. In question (ii), we assume that Company X's management wants to maintain a constant debt-equity ratio and in the next year, the growth rate of Company X is what we've calculated in question (i).Calculate the amount of new debt that Company X has to take.

I will assume that the whole debt is current debt and it changes proportionally as the company's sales grow.

EFN = ($118,000/$160,000) x ($12,448) - ($64,000/$160,000) x ($12,448) - (0.0775 x $172,448 x 0.0778) = $9,180 - $4,979 - $1,040 = $3,161

c. If Company X's management does not want any external financing, what would be the growth rate

ROA = $12,400 / $118,000 = 10.51%

Internal growth rate = (10.51% × 33.87%) / [1 - (10.51% × 33.87%)] = 3.56% / 0.9644 = 3.69%

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Answer:

a. $13,000

Explanation:

Calculation for what royalty revenue should be

First step is to find the estimated amount for the second half of the year

Royalties for the second half =

15%*$30,000

Royalties for the second half= $4,500

Now let Compute for the total royalty revenue

Total royalty revenue for 20X5=$8,500+$4,500

Total royalty revenue for 20X5=$13,000

Therefore the royalty revenue should be $13,000

6 0
3 years ago
Which statement best describes the two billing cycle method that some credit card companies use
Alborosie

Answer:

Double-cycle billing is a method used by creditors, usually credit card companies, to calculate the amount of interest charged for a given billing period. It takes into account not only the average daily balance of the current billing cycle (usually one month), but also the average daily balance of the previous cycle.

Explanation:

idk...my mom helped me answer this for you

3 0
3 years ago
The level of the Baring market index is 22,300 at the start of the year and 26,800 at the end. The dividend yield on the index i
marshall27 [118]

Answer: 24.48%

Explanation:

Return on the index over the year is calculated by;

= Dividend yield + (Ending index value - Beginning index value)/ Beginning index value

= 4.3% + (26,800 - 22,300) / 22,300

= 24.48%

8 0
3 years ago
Jordan deposits $100 into a savings account that pays him with a compound interest rate of 3%. Justin deposits $100 into an acco
ipn [44]

Answer:

Jordan

Explanation:

Given that :

JORDAN :

Principal (P) = $100

Compound interest rate (r) = 3%

AMOUNT AFTER 3 YEARS:

A = P(1 + r/n)^nt

n = number of times interest is applied per period

t = time ; A = final amount

A = 100(1 + 0.03)^3

A = 100(1.03)^3

A = 100(1.092727)

A = $109.2727

JUSTIN :

Principal = $100

SIMPLE INTEREST interest rate = 3%

A = P(1 + rt)

A = 100(1 +(0.03 * 3))

A = 100(1 + 0.09)

A = 100(1.09)

A = 1.09 * 100

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4 0
3 years ago
Companies should kick-off sustainability efforts with diagnosis because: diagnosis is easier to understand than other aspects of
pashok25 [27]

Answer: It helps focus employees on what needs to change

Explanation:

For change in anything to be implemented, there needs to be a recognition of what it is that is lacking that needs to be changed.

This is why diagnosis is very important. It shows the company what they need to change in order to be more sustainable and when the company is aware of these things, their employees will become more focused on those things with the view to change them.

5 0
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