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ipn [44]
1 year ago
8

Brown Office Supplies recently reported $20,000 of sales, $8,250 of operating costs other than depreciation, and $1,750 of depre

ciation. It had $10,000 of long-term debt outstanding that carries a 7.0% interest rate, and its federal-plus-state income tax rate was 40%. How much was the firm's earnings before taxes?
Business
1 answer:
laiz [17]1 year ago
4 0

Answer:

Net earnings before taxes = $9,300

Explanation:

Provided information, we have

Sales for the period = $20,000

Less: Operating Cost = $8,250

Less: Depreciation = $1,750

Operating income = $10,000

Less: Interest = $10,000 \times 7% = $700

Thus, net earnings before taxes = $9,300

Note: All the expenses including depreciation, and interest are charged before taxes.

Therefore, depreciation and interest has been deducted before charging taxes.

You might be interested in
Last year a certain bond with a face value of $5,000 yielded 8 percent of its face value in interest. If that interest was appro
Katen [24]

Answer:

bond's selling price is $6154

Explanation:

given data

face value = $5,000

interest = 8 % of face value

rate = 6.5 %

to find out

bond's selling price

solution

we find interest that is

interest = 8 % of face value

interest = 8 % × 5000

interest = 400

so we consider bond selling price is x

so

bond selling equation will be

interest = rate × bond selling price

400 = 0.065 × x

x = 6154

so bond's selling price is $6154

8 0
1 year ago
Suppose an investment project is projected to provide $198,000 in revenues if the project is undertaken. the investment will cos
Dominik [7]
<span>Yes. By investing $180,000 and having a revenues of $198,000, the company would earn $18,000 (before tax) from this project investment. Assuming that the $180,000 investment already factored in time/labor and the projected $190,000 revenues is very likely to occur.</span>
7 0
2 years ago
Bypassing regular sales channels in favor of Internet retailing can have strong appeal if it A. D) includes partnering rather th
jolli1 [7]

Answer:

Option A.

Includes partnering rather than competing with existing distributors

Explanation:

Through internet retailing, a business can partner with other distributors and enlist the products of the distributors on their website along side their products.They can charge a fee for each product sold via their platform, which can serve as additional revenue to the business, without much extra costs. This is because the platform is already available.

This is the business model that companies such as Amazon apply. They enlist products of other businesses on their online platform, sell them and make some profit for themselves.

This is what gives internet retailing a strong appeal.

5 0
2 years ago
Jason purchased ABC stock at $40 per share and DEF stock at $35 per share on the same day in 2015. Exactly 6 months later, the A
Pachacha [2.7K]

Answer:

C) ABC 5% and DEF 5.7%

Explanation:

Data provided in the question:

Purchasing Cost of Stock ABC purchased = $40 per share

Purchasing Cost of Stock DEF purchased = $35 per share

Time = 6 months

Selling price of share of ABC = $42 per share

Selling price of DEF share = $36

Dividend paid to the DEF = $0.5 each quarter i.e $0.5 twice in 6 months

Thus,

Total dividend paid to DEF = $0.5 × 2

= $1

Now,

For ABC

Total return = Selling price - Purchasing Cost

= $42 - $40

= $2 per share

thus,

Holding period return = [ Total return ÷ Purchasing cost ] × 100%

= [ $2 ÷ $40 ] × 100%

= 5%

For DEF

Total return = Selling price + Dividend received - Purchasing Cost

= $36 + $1 - $35

= $2 per share

thus,

Holding period return = [ Total return ÷ Purchasing cost ] × 100%

= [ $2 ÷ $35 ] × 100%

= 5.7%

Hence,

option C) ABC 5% and DEF 5.7%.

7 0
1 year ago
Which of the following is most likely to be a constraint to implementing your suggested solution?A. Sales reps who are unwilling
pentagon [3]

<u>Explanation</u>:

       i. Limited cash on hand to make changes

              It is apparent from the case that the company is experiencing a drop in the sales from the past 5 years and thus, the financial reserves will be a constraint in the accomplishment of the idea.

       ii. Costumers purchase lifestyle products from people who they know and who have expertise

It is the idea that the director of the company mark always encourages direct interaction with the clients and personal selling rather than retail or online sales considering personal relation makes exposure to the experts and their advice.

      iii. Meet with mark, your direct supervisor, about how to establish your credibility with the owner

Being a newbie to the company, it is a wise option to follow the instructions of the reporting authority to establish rapport with the owner of the organization.

      iv. Sales have declined because customers have lower disposable income

It is also evident from the case of the financial crisis and recession in going in the market due to which the customer has a lower income to make purchases.

       v. Suggesting techniques to help our sales reps become more trusted advisors

It is the time to perform a forward step by the sales reps to take the role of the advisors i.e. trusted ones for the customer in recommending the best of all.  

6 0
2 years ago
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