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Kitty [74]
2 years ago
15

Blueline Publishers is considering a recapitalization plan. It is currently 100% equity financed but under the plan it would iss

ue long-term debt with a yield of 9% and use the proceeds to repurchase common stock. The recapitalization would not change the company's total assets, nor would it affect the firm's basic earning power, which is currently 15%. The CFO believes that this recapitalization would reduce the WACC and increase stock price. Which of the following would also be likely to occur if the company goes ahead with the recapitalization plan?
The company's earnings per share would decline.

The company's cost of equity would increase.

The company's ROA would increase.

The company's ROE would decline.

The company's net income would increase.
Business
1 answer:
BaLLatris [955]2 years ago
4 0

Answer:The company earning per share will decline

Explanation:

This will be as a result of increased expenses from interest payment on the long term debt which reduces earning available for distribution which itself still remains unchanged , at 15% . The numbers of shareholders that will share the left over earnings have also increased compared to last year.

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Shawna would like to explore a career that would allow her to work outdoors with natural resources. Which two careers would be t
Anni [7]

Answer:

The only two jobs that deal with natural resources are:

  1. oil rig driller
  2. wind turbine engineer

Oil rig drillers work in the ocean completely surrounded by water, or maybe other oil rigs but they are never too close.

Wind turbine engineers work on open spaces, surrounded by very few things other than wind turbines. Wind turbines are HUGE and they are usually located on very isolated places.

5 0
2 years ago
Fizzzle Inc. sold a piece of equipment during the period for $230,000 and recorded a gain of $45,000 on the sale. How should thi
saw5 [17]

Answer:

The gain is subtracted from net income in the operating activities section

Explanation:

Given that

Sale value of an equipment = $230,000

And, the gain on the sale = $45,000

So by considering the above information

We can say that the Sale value of an equipment is shown in the investing activities as a cash inflow while the gain on the sale is to be subtracted from the net income in the operating activities and if there is a loss than it would be added to the net income

4 0
2 years ago
Angelica and Celeste invested all their savings in a small pizzeria they opened outside the University of Missouri. They operate
Katena32 [7]

Answer:

The answer is: Angelica and Celeste lose their personal assets as the result of their company's financial problems.

Explanation:

The advantages of a general partnership are:

  • Each partner files the profits or losses of the business on his or her own personal income tax return.
  • This way the business does not get taxed separately.
  • Easy to establish.

Some of the disadvantages are:

  • <u>Partners share unlimited personal liability with respect to debts, obligations, contracts, torts, potential lawsuits, etc. </u>
  • A partner cannot transfer interest in the partnership without the unanimous consent of the partners.

4 0
2 years ago
Read 2 more answers
Gwendolyn Hunt was driving while intoxicated when she hit and killed Felicia Meyers, a seven- year-old, in a school crosswalk. G
BigorU [14]
<span>A major difference between juvenile and adult courts is that juvenile courts are more likely to consider extenuating circumstances (emotional, mental, situational, etc.). Frequently, young people will only be moved to adult courts if their crime was particularly heinous, a history of rehabilitation services have not improved the situation, the young person needs a significant about of intervention, or simply that the juvenile is nearly an adult. Though there is evidence of some past intervention on Gwendolyn's behalf, we have no evidence that the crime was planned. Though she was breaking the law and one could say that the possibility of an accident was a logical conclusion, there is (based on this) no evidence that she went out with the intention of hurting or killing someone. Also, given that she is still a minor and at an age when her reasoning abilities are not fully formed, she honestly may not have been able to make that connection. So, no, she should not be tried as an adult. However, she should serve actual time in a center, receiving rehabilitative services and completing community service in order to balance out some of the horror she has brought into the world through the death of a child.</span>
4 0
2 years ago
Giglio Inc. has the following information for the previous year: Net income = $400; Net operating profit after taxes (NOPAT) = $
forsale [732]

Answer:

the free cash flow for the current year is zero.

Explanation:

Net income = $400; Net operating profit after taxes (NOPAT) = $500; Total assets = $2,000; and Total operating capital = $1700

Net income = $800; Net operating profit after taxes (NOPAT) = $700; Total assets = $2,300; and Total operating capital = $2,100.

current year:

operating profit after taxes                             700

Capital expenditures:        2,000 - 2,300 =  (300)

working capital expeneses 1,700 - 2,100  = (400)

free cash flow:                                                       0

As assets increase the company use cash to increase his assets

Also, the operating capital increase the comapny pa debts, extend his collection cycle or any other desition which, increases his cahs needs.

Therefore the free cash flow for the year is zero.

7 0
2 years ago
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