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3 years ago

The primary operating goal of a publicly-owned firm trying to best serve its stockholders should be to.

1 answer:

3 0

The primary operating goal of a publicly-owned firm trying to best serve its stockholders should be to maximize the firm's expected EPS, which must also maximize the firm's price per share.

<h3>What is a a publicly-owned firm?</h3>

A publicly-owned firm is a firm that is owned by members of the public who buy shares in the firm and thus become shareholders. Managers are employed to run the firm.

As the value of shares of the publicly-owned firm increases, the wealth of shareholders also increase.

Here is the complete question:

The primary operating goal of a publicly-owned firm trying to best serve its stockholders should be to

a Maximize managers' own interests, which are by definition consistent with maximizing shareholders' wealth.

b. Maximize the firm's expected EPS, which must also maximize the firm's price per share.

c. Minimize the firm's risks because most stockholders dislike risk. In turn, this will maximize the firm's stock price.

d. Use a well-structured managerial compensation package to reduce conflicts that may exist between stockholders and managers.

e Since it is impossible to measure a stock's intrinsic value the text states that it is better for managers to attempt to maximize the current stock price than its intrinsic value.

To learn more about publicly-owned firms, please check: brainly.com/question/26194963

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With a regressive tax system, as the level of income increases in an economy, the average tax rate will:  A. Increase B. Decreas

Ostrovityanka [42]

Answer:

The correct answer to the following question is option B) decrease.

Explanation:

Regressive tax is that of tax which is imposed in such manner that when the income level in the economy increases , the average tax rate would decrease. This type of tax has heavy burden on the low income people as it takes high proportion of their income. So it can be said here that there is an inverse relationship between tax payer's ability to pay ( which can be measured in income , assets or consumption) and the tax rates imposed.

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4 years ago

The inventory of Cullumber Company was destroyed by fire on March 1. From an examination of the accounting records, the followin

maria [59]

Answer:

a. Merchandise lost by fire value = $20,760

b. Merchandise lost by fire value = $25,770

Explanation:

Net sales = $51,000 - $1,100

= $49,900

Net purchase cost = $31,000 + 1,200 - $1,500

= $30,700

a. Gross profit = $49,900 × 40%

= $19,960

Cost of goods sold = $49,900 - $19,960

= $29,940

Cost of goods sold = beginning inventory + Purchases - ending inventory

= $29,940 = $20,000 + $30,700 - ending inventory

Ending inventory = $20,760

Merchandise lost by fire value = $20,760

b. Gross profit = $49,900 × 30%

= $14,970

Cost of goods sold = $49,900 - $14,970

= $34,930

Cost of goods sold = beginning inventory + Purchases - ending inventory

= $34,930 = $30,000 + $30,700 - ending inventory

ending inventory = $25,770

Merchandise lost by fire value = $25,770

5 0

3 years ago

Ingraham Inc. currently has $820,000 in accounts receivable, and its days sales outstanding (DSO) is 54 days. It wants to reduce

Oksanka [162]

Answer: 451759.29

Explanation:

To solve the question, we need to calculate the current sales. This will be calculated by using the formula:

DSO = (Account receivable × 365) / Sales

54 = 820000 × 365 / Sales

Sales = 820000 × 365 / 54

Sales = 5542593

After the new policy, the expected sales will be:

= 5542593 × (1 - 15%)

= 5542593 × (1 - 0.15)

= 5542593 × 0.85

= 4711204.5

The level of accounts receivable following the change will be:

DSO = (Account receivable × 365) / Sales

35 = Account receivable × 365 / 4711204.5

Account receivable = 35 × 4711204.5 / 365

Account receivable = 451759.29

8 0

3 years ago

If you were in the dry-cleaning business, whom would you benchmark for their technological innovations? List companies in relate

Yanka [14]

You may want to compare your services, machineries, and others compared to your benchmark

4 0

4 years ago

1) In the previous problem, suppose Ferguson has announced it is going to repurchase $15,600 worth of stock. What effect will th

Softa [21]

Answer:

1. Equity reduces to $372,300

2. 11,517 shares

3. $32.33

Explanation:

1. Effect on Equity

The company will use $15,600 cash to buy the equivalent amount of shares.

Cash Balance will reduce by;

= 52,900 - 15,600

= $37,300

Equity will reduce by the amount of stock repurchased;

= 387,900 - 15,600

= $372,300

2. Shares Outstanding

Current Stock Price = $\frac{Equity Value}{Number of shares outstanding}$

= 387,900/12,000

= $32.33

Number of shares repurchased = 15,600/32.33

= 483 shares

New Shares Outstanding = 12,000 shares - 483 shares

= 11,517 shares

3. Price per share after repurchase

= $\frac{New Equity Value}{New Number of shares outstanding}$

= 372,300 / 11,517

= $32.33

4. Dividends declared reduces the equity value.

= 32.33 - 1.30

= $31.03

The share repurchase is the same as the cash dividend because the stock price after the repurchase is the same as the stock price if dividends are declared less the cash dividends.

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3 years ago