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2 years ago

Explain five reasons that may cause a company to redeem its own shares

1 answer:

4 0

- Companies buyback shares for a variety of reasons, including firm consolidation, increased equity value, and to appear more financially appealing.

-The disadvantage of buybacks is that they are frequently financed with debt, putting a burden on cash flow.

-Stock repurchases can have a modestly favorable impact on the economy as a whole.

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Danny operates a plumbing business, and this year the three-year-old van he used in the business was destroyed in a traffic acci

seropon [69]

Answer:

$4,600

Explanation:

Casualty loss deduction = Adjusted basis - insurance compensation = 5800-1200= $4,600

3 0

3 years ago

What is it called where consumers react to rising prices by consuming less of a good and more of it's competitors?

adelina 88 [10]

Answer:

Substitute Effect

Explanation:

When a product's price increases, it becomes relatively expensive compared to its alternatives. The high price will encourage consumers to choose other goods that are relatively cheaper. Consequently, the price increase reduces the demand for the product while increases the demand for its substitutes.

The substitution effect describes how consumption is affected by an increase or a decrease in a product's price.

6 0

3 years ago

Selected income statement data follow for Harley Davidson, Inc., for the year ended December 31, 2016 (in thousands): Income bef

Alina [70]

Answer:

D. 35.5

Explanation:

Times Interest Earned

$\frac{EBIT}{Interest \:Expense}$

Where EBIT = Earning before interest and taxes

In your assingment we have the Income before the income taxes, whgich means it is including the interest expense, we need to remove it:

EBT + Interest expense = EBIT

1,023,911 + 29,670 =1,053,581

Now we calculate the TIE

1,053,581 / 29,670 = 35.50997641 = 35.51 = 35.5

The company earns their interest 35.5 times.

6 0

3 years ago

1. List some of the tools that organizations can use to make the most of its

pentagon [3]

Some of the tools that organizations can use to make the most of its diverse workforce are, assessing the organization's progress toward goals, attracting the employees, retaining employees, etc.

An organization's plan in order to become multicultural and making the most of its diverse workforce should includes the given components, such as: securing top management's leadership and commitment, progress toward goals, attracting employees, and training employees in diversity,

Diversity is the range of human differences. However, having a range of people with various racial, ethnic, cultural, and socioeconomic backgrounds with various lifestyles, interests, and experience.

There are certain different types of organizations that result from prevailing assumptions about people and cultures. A monolithic organization tend to have a very little cultural integration, here its employee population is highly homogeneous.

Hence, in multicultural organizations, diversity not only exists but is also valued.

To learn more about diverse workforce here:

brainly.com/question/3804682

#SPJ1

7 0

1 year ago

The Stanton Stationery Shoppe wants to acquire The Carlysle Card Gallery for $450,000. Stanton expects the merger to provide inc

ra1l [238]

Question:

The Stanton Stationery Shoppe wants to acquire The Carlysle Card Gallery for $450,000. Stanton expects the merger to provide incremental earnings of about $70,000 a year for 10 years. Carol Stanton has calculated the marginal cost of capital for this investment to be 8%. Conduct a capital budgeting analysis to determine whether she should purchase The Carlysle Card Gallery.

Answer:

Capital Budgeting Analysis is a process of evaluating how we invest in capital assets; i.e. assets that provide cash flow benefits for more than one year.

An organization has to take many decisions regarding the expansion of business and investment. To do that, they will require the help of NPV method and base its decision on the same.

Net present value is used in Capital budgeting to analyze the profitability of a project or investment. It is calculated by taking the difference between the present value of cash inflows and present value of cash outflows over a period of time.

As the name suggests, net present value is nothing but net off of the present value of cash inflows and outflows by discounting the flows at a specified rate.

From the question the following are given:

Capital Expenditure = $450,000
Useful life of expenditure = 10 years
Annual return from expenditure = $70,000
Marginal cost of Capital = 8%

Step 1:

It's formula is given as:

Formula for NPV

NPV = (Cash flows)/( 1+r)i

<em>Where</em>

i- Initial Investment

Cash flows= Cash flows in the time period

r = Discount rate

i = time period

Computing with a spreadsheet, the Net Present Value of the Investment is given at $ 19,706.

Kindly see attached spreadsheet.

Judgement: Since the NPV is positive the investment is profitable and hence Nice Ltd can go ahead with the expansion.

Cheers!

7 0

3 years ago

Explain five reasons that may cause a company to redeem its own shares ​

Explain five reasons that may cause a company to redeem its own shares