Business, 05.05.2020 19:41 blkrosesss
You have the following information about two firms, Debt Free, Inc. and Debt Spree, Inc. Both firms have the same prospects for sales and EBIT, and both have the same level of assets, tax rate and borrowing rate. They differ in their use of debt financing.
Scenario Sales EBIT
Bad year 200 24
Normal year 275 30
Good year 380 49
Debt Free Debt Spree
Total assets 250 250
Tax rate 35 % 35 %
Debt 0 150
Equity 250 100
Borrowing rate 16 % 16
%
Calculate the interest expense for each firm:
Interest expense for Debt Free $
Interest expense for Debt Spree $
Calculate the following items for each firm for each scenario (bad year, normal year, good year): return on assets (ROA), net profit, and return on equity (ROE).
Answers: 2
Business, 22.06.2019 09:40
Wilson center is a private not-for-profit voluntary health and welfare entity. during 2017, it received unrestricted pledges of $638,000, 65 percent of which were payable in 2017, with the remainder payable in 2018 (for use in 2018). officials estimate that 14 percent of all pledges will be uncollectible. a. how much should wilson center report as contribution revenue for 2017? b. in addition, a local social worker, earning $20 per hour working for the state government, contributed 600 hours of time to wilson center at no charge. without these donated services, the organization would have hired an additional staff person. how should wilson center record the contributed service?
Answers: 2
Business, 22.06.2019 17:00
Zeta corporation is a manufacturer of sports caps, which require soft fabric. the standards for each cap allow 2.00 yards of soft fabric, at a cost of $2.00 per yard. during the month of january, the company purchased 25,000 yards of soft fabric at $2.10 per yard, to produce 12,000 caps. what is zeta corporation's materials price variance for the month of january?
Answers: 2
Business, 22.06.2019 19:40
Sue now has $125. how much would she have after 8 years if she leaves it invested at 8.5% with annual compounding? a. $205.83b. $216.67c. $228.07d. $240.08e. $252.08
Answers: 1
Business, 22.06.2019 23:00
The sign at the bank reads, "wait here for the first available teller," suggests the use of a waiting line system.a. multiple server, single phaseb. random server, single phasec. single server, multiphased. multiple server, multiphasee. dynamic server, single phase
Answers: 2
You have the following information about two firms, Debt Free, Inc. and Debt Spree, Inc. Both firms...
Physics, 20.09.2020 07:01
Chemistry, 20.09.2020 07:01
Mathematics, 20.09.2020 07:01
Mathematics, 20.09.2020 07:01
Mathematics, 20.09.2020 07:01
Computers and Technology, 20.09.2020 07:01
Mathematics, 20.09.2020 07:01
Mathematics, 20.09.2020 07:01
Mathematics, 20.09.2020 07:01