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vovikov84 [41]
3 years ago
7

Honeycutt Co. is comparing two different capital structures. Plan I would result in 12,700 shares of stock and $109,250 in debt.

Plan II would result in 9,800 shares of stock and $247,000 in debt. The interest rate on the debt is 10 percent. The all-equity plan would result in 15,000 shares of stock outstanding. Ignore taxes for this problem.a. What is the price per share of equity under Plan I? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)b. What is the price per share of equity under Plan II? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Business
1 answer:
Ulleksa [173]3 years ago
5 0

Answer:

Check the following calculations

Explanation:

All-Equity Plan:

Number of shares = 15,000

Plan I:

Number of shares = 12,700

Value of debt = $109,250

Price per share = Value of debt / (Number of shares under All-Equity Plan - Number of shares under Plan I)

Price per share = $109,250 / (15,000 - 12,700)

Price per share = $109,250 / 2,300

Price per share = $47.50

Plan II:

Number of shares = 9,800

Value of debt = $247,000

Price per share = Value of debt / (Number of shares under All-Equity Plan - Number of shares under Plan II)

Price per share = $247,000 / (15,000 - 9,800)

Price per share = $247,000 / 5,200

Price per share = $47.50

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alexandr1967 [171]

<u>Explanation:</u>

<u></u>

growth_multiplier  is 1.1

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desc = "compound interest "

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# Print  

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Now,

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8 0
2 years ago
Paul owns a fishing boat with his father John. They have been in business together for over 15 years. Paul is thinking of invest
Leni [432]

Answer:

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Explanation:

231/5000

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5 0
2 years ago
Tamara and her children live in a subdivision with a tennis court and swimming pool. Her children are thrilled to be able to use
Semenov [28]

Answer:

The correct answer is B. The tennis court and swimming pool are owned in common by all the property owners. It is a Planned Unit Development.

Explanation:

The planned unit developtment is a type of possession where individuals actually own the building or Unit in which they live but there are common areas that are jointly owned with the other members of the development or association. Unlike a Condominium, where individuals actually own the airspace of their unit, but common buildings and areas are jointly owned with others in a development or association.

6 0
2 years ago
John, Lesa, and Tabir form a limited liability company. John contributes 60 percent of the capital, and Lesa and Tabir each cont
marishachu [46]

Answer:

<em>2.statute.</em>

Explanation:

<em>The court ruling will be decided by the contractual agreement signed by the three parties. A Limited Liability Agreement will usually be demonstrated by three parties signing a contract together. </em>

The situation will become difficult once, within each partner, there is no written statement about the distribution of profit. Every partner must obtain the suitable yield rate, based on their original investment.

The verdict begins to appear as if it falls into the hands of the state. By considering the Revised Uniform Partnership Act-Section 306. It relies heavily on where the business is registered, authorized, type of business.

However, John is the majority shareholder with 60 per cent of financial and legal accountability[ which is why he owes more to investment return]. It is also partly due to unlawful double tax laws and they are intended to protect the owner / partner of the business.

The confusion could've been avoided if an attorney and bookkeeper were available to describe the process, before the agreement was made and/or written. The condition they submit for incorporation makes a huge difference however, it does not seem to be the circumstance.

8 0
2 years ago
Dairy Days Ice Cream sells ice cream cones for​ $5 per customer. Variable costs are​ $2 per cone. Fixed costs are​ $2100 per mon
qwelly [4]

Answer:

0.6 or 60%

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The contribution margin ratio is calculated by the formula below.

Contribution margin ratio = <u>contribution margin</u>

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= For Dairy D's

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=$5-$2

= $3 per unit

Contribution margin = <u>Contribution  margin per unit</u>

    sale price per unit

   =3/5

   =0.6 or 60%

4 0
2 years ago
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