be sold at $4.50 per share A) Compute break-even point. B) Compute DOL. C) Compute DFL and DCL for both financing plans.
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XYZ Co is opening their new business next month. They have provided the following information:
Variable Costs = 35% of sales
Fixed Costs = 360,000
1st Years Sales est. = 1,050,000
Startup Costs = 1,800,500
Two Financing Options:
1) 60% Equity Financing and 40% Debt at 13%
2) 100% Equity - Common Stock can be sold at $4.50 per share
A) Compute break-even point.
B) Compute DOL.
C) Compute DFL and DCL for both financing plans.
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- Our company, which was founded 10 years ago, has allocated 10,000 shares to investors at 1 TL nominal price. Today, earning per share of our company is 60 kuruş and the company has announced that payout ratio is 40%. If the expected return on equity is 24%, a What is the current price of one share today? b. What would be the price of one share 5 years later (Ps)? c. What would be the total market value of the equity 5 years later?Barton Industries expects next year's annual dividend, D1, to be $2.00 and it expects dividends to grow at a constant rate gL = 4.9%. The firm's current common stock price, P0, is $25.00. If it needs to issue new common stock, the firm will encounter a 4.0% flotation cost, F. Assume that the cost of equity calculated without the flotation adjustment is 12.9% and the cost of old common equity is 12.4%. What is the flotation cost adjustment that must be added to its cost of retained earnings? Do not round intermediate calculations. Round your answer to two decimal places. % What is the cost of new common equity considering the estimate made from the three estimation methodologies? Do not round intermediate calculations. Round your answer to two decimal places. %Barton Industries expects next year's annual dividend, D1, to be $1.80 and it expects dividends to grow at a constant rate g = 4.3%. The firm's current common stock price, P0, is $20.00. If it needs to issue new common stock, the firm will encounter a 5.9% flotation cost, F. What is the flotation cost adjustment that must be added to its cost of retained earnings? Do not round intermediate calculations. Round your answer to two decimal places. What is the cost of new common equity considering the estimate made from the three estimation methodologies? Do not round intermediate calculations. Round your answer to two decimal places.