Answer: a. $5.50
b. $6.1
c. $3,500,000
Explanation:
a. From the question, we are informed that Hawar International is a shipping firm with a current share price of $5.50 and 10 million shares outstanding and that Hawar announces plans to lower its corporate taxes by borrowing $20 million and repurchasing shares.
We are informed that Hawar announces plans to lower its corporate taxes by borrowing $20 million and repurchasing shares. This is a transaction and therefore, the value if the share won't be changed. So, the value for the share will still be $5.50.
b. If the only imperfection is corporate tax rate of 30%, the share price after this announcement will be:
= [30% × (20million/10million)] + $5.50
= [0.3 × 2] + $5.50
= $0.6 + $5.50
= $6.1
Therefore, the share price be after this announcement will be $6.1.
c. If the share price rises to $5.75 after this announcement, the PV of financial distress costs Hawar will incur as the result of this new debt will be:
= ($6.1 - $5.75) × 10,000,000
= $0.35 × 10,000,000
= $3,500,000
Answer:
$34.8
Explanation:
Profits = sales - costs( variable costs +fixed costs)
In this case : total sales will be price $0.75 x units sold X= 0.75X
Variable costs : =$10 x units sold= $10x
Fixed cost remain $25 as they are not affected by quantity.
profits for the Week
P= (0.75x- 0.10x)-$25
Profit for the week with units sold as 92: x = 92
p= ( {0.75x92} - {0.10x92} )- $25
P= $69 - $9.2- $25
P=$59.8- $25
=$34.8
Answer:
True
Explanation:
Generally Acceptable Accounting Principles (GAAP) is only applicable in the United States of America whereas International Financial Reporting Standards (IFRS) has been adopted by most countries on the globe. This makes Report prepared on IFRS more comparable and make it easier to raise capital globally.
Answer:
Externship
Explanation:
Externship refers to an agreement between the employer and university wherein the university imparts skills required by the employer from employees which relate to a particular job designation.
Externship enables the employees to gain a short term practical knowledge which is related to their job position. Externship, unlike internship is for a shorter duration and during such a course the volunteered employees supervise the learning process of the externs.
Such a concept is also referred to as Job shadowing.
<span>long-term debt=Totol liability-Current liability
long-term debt=$350-$130
=$220
long-term debt ratio=long term debt/ total assets
=$220/$1,000
=22%
so long term debt ratio is 22%</span>
