Business, 07.04.2020 17:52 guazet7650
Firm's HL and LL are identical except for their leverage ratios and the interest rates they pay on debt. Each has $20 million in assets, $4 million of EBIT, and is in the 40 percent federal-plus-state tax bracket. Firm HL, however, has debt ratio (D/A) of 50 percent and pays 12 percent interest on its debt, whereas LL has a 30 percent debt ratio and pays only 10 percent interest on its debt. Calculate the rate of return on equity (ROE) for HL.
Answers: 1
Business, 22.06.2019 19:30
Anew firm is developing its business plan. it will require $615,000 of assets, and it projects $450,000 of sales and $355,000 of operating costs for the first year. management is reasonably sure of these numbers because of contracts with its customers and suppliers. it can borrow at a rate of 7.5%, but the bank requires it to have a tie of at least 4.0, and if the tie falls below this level the bank will call in the loan and the firm will go bankrupt. what is the maximum debt ratio the firm can use? (hint: find the maximum dollars of interest, then the debt that produces that interest, and then the related debt ratio.)a. 41.94%b. 44.15%c. 46.47%d. 48.92%e. 51.49%
Answers: 3
Business, 22.06.2019 23:20
Warby parker, a manufacturer of fashionable prescription eyewear, notes on its website, "warby parker was founded with a rebellious spirit and a loft objective: to offer designer eyewear at a revolutionary price, while leading the way for socially-conscious business." this excerpt from the company's website states warby parker's
Answers: 1
Business, 23.06.2019 07:00
Nthis economy, community members typically use simple tools to plant and harvest crops. food supplies are supplemented by hunting animals and gathering plant materials. members trade with each other to obtain needed goods, as few people hold currency. little economic growth occurs. what type of economy is being described?
Answers: 3
Business, 23.06.2019 11:00
What are the factors that affects on the process of planning
Answers: 3
Firm's HL and LL are identical except for their leverage ratios and the interest rates they pay on d...
Spanish, 27.10.2019 23:43
History, 27.10.2019 23:43
English, 28.10.2019 00:43
Computers and Technology, 28.10.2019 00:43
Mathematics, 28.10.2019 00:43
Mathematics, 28.10.2019 00:43
Computers and Technology, 28.10.2019 00:43
Mathematics, 28.10.2019 00:43
English, 28.10.2019 00:43
Mathematics, 28.10.2019 00:43
Mathematics, 28.10.2019 00:43