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otez555 [7]
2 years ago
11

You own 25 percent of Unique Vacations, Inc. You have decided to retire and want to sell your shares in this closely held, all-e

quity firm. The other shareholders have agreed to have the firm borrow $1.5 million to purchase your 1,000 shares of stock. What is the total value of this firm today if you ignore taxes
Business
1 answer:
Akimi4 [234]2 years ago
3 0

Answer:

$6 million

Explanation:

If 25% of the firm is worth $1.5 million, then 100% of the firm will be worth $6 million (= $1.5 million x 4).

This is an all equity firm, which means it has no liabilities, and it is also a closely held corporation which makes it harder for a stockholder to sell his/her shares. Basically the fair value of the 1,000 shares is the money you can get from your fellow shareholders.

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The Nantell Corporation just purchased an expensive piece of equipment. Assume that the firm planned to depreciate the equipment
gtnhenbr [62]

Answer:

D

Explanation:

Nantell's operating income (EBIT) will increase., because now the company will record lower depreciation expense in the income statement due to increase in the life from 5 to 7 taken for the depreciation purposes. So decline in depreciation will result in higher EBIT.

a. is wrong as lower depreciation means higher net income.

b. is wrong as tax liability will not get impacted as tax will follows old method of depreciation.

c. is incorrect as depreciation is non cash expense thus does not impact cash position and tax has already be on the earlier method.

e. is incorrect as increase in EBIT will result in higher taxable income.

hence option D is the only correct option

4 0
2 years ago
Which of the following statements is not true of a strategic inflection point?
Elanso [62]

Answer:

The correct anwer is E) A new CEO is an example of a strategic inflection point.

Explanation:

The statement that "A new CEO is an example of a strategic inflection point" is false since to determine a strategic inflection point we rely on other factors that affect companies such as the power of competitors, the power of customers, the power of potential competitors, the power of suppliers and the power of substitutes.

For example, if my product or service is exceeded 10 times more by the competition in quality or price; we are talking about a strategic inflection point.

8 0
2 years ago
Lori recently quit her job and decided to start her own company, which will sell makeup to small beauty salons. What should she
dedylja [7]

Lori has already decided she wants to sell beauty products and market them to small beauty salons. She now needs to decide how she wants to price her product so that the beauty salons will buy it. Option B. decide how to price her product is the next step that Lori should take. After she decided the price, she will have the what, where and how much and then she can move on to how she will advertise her product to the small beauty stores.

5 0
2 years ago
Read 2 more answers
If a certain market were a monopoly, then the monopolist would maximize its profit by producing 4,000 units of output. If, inste
nevsk [136]

Answer:

A

Explanation:

A monopoly is when there are two firms operating in an industry.

A duopoly is when there are two firms operating in an industry. When the two firms collude, they become a monopoly.

If a monopoly maximises profit by producing 4000 units, the colluding duopolist would also maximise profit by producing 4000 units

3 0
2 years ago
Rachel initiated the practice of company visits as part of reaching out to her company’s loyal customers . She set up a campaign
USPshnik [31]

Answer:

Rachel has displayed the explicit concept of CSR

Explanation:

The corporate sector has a duty towards its very own business, investors as well as towards the society. Subsequently, every corporate unit must have a duty regarding the upliftment of society which is comprehensively considered as Corporate Social Responsibility (CSR).

The social duty of a business demonstrates standards and commitments by the corporate leadership to take proper activities which can ensure and improve the welfare of society alongside securing business interest.

Corporate social responsibility has been accepted more and more in the recent past. This is because the actions of the corporate sector most of the time cause negative effects to the society, therefor taking up this responsibility towards the society aims at giving back to the society while at the same time achieving their business goals.

The CSR can be divided two two main concepts; implicit and explicit Corporate social responsibility (CSR). Explicit CSR alludes to corporate rules and arrangements that accept and accountability in the interest of society.  They regularly comprise of deliberate projects by  companies to combine social and business worth and address issues viewed as being part of their social obligation. An example is a move by various corporations to provide relief aid to the victims of hurricane Katrina in 2005. On the other hand, implicit CSR refers to the role of corporations in the formal and informal institution for the benefit of the society. It usually comprises of qualities, standards  and rules which bring about obligatory and standard prerequisites that need to be addressed by the organizations.

A major key difference between implicit and explicit CSR is that implicit CSR is usually thought of as a mandatory and involuntary exercise as a reaction to it's environment, while explicit CSR is often seen as a deliberate and voluntary exercise. In our case, Rachel displayed the explicit concept of CSR since the intent was deliberate and voluntary towards the benefit of the society while at the same time improving the image of the company in the mind of the loyal customers.

7 0
3 years ago
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