The Cookie Shoppe expects sales of $500,000 next year at a 6% pretax profit margin and an average tax rate of 33%. If it chooses to pay out 30% of its earnings as dividends, what is the projected increase in retained earnings?
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- Hernandez Corporation expects to have the following data during the coming year. What is Hernandez's expected ROE? (Show your work) Assets = $200,000 D/A = 65% EBIT = $25,000 Interest rate = 8% Tax rate = 40%Suppose a firm's tax rate is 25 %. What effect would a $ 11.4 million capital expense have on this year's earnings if the capital expenditure is depreciated at a rate of $ 2.28 million per year for five years? What effect would it have on next year's earnings?Suppose a firm's tax rate is 25%. a. What effect would a$9.85 million operating expense have on this year's earnings? What effect would it have on next year's earnings? b. What effect would an $8.95million capital expense have on this year's earnings if the capital is depreciated at a rate of $1.79 million per year for five years? What effect would it have on next year's earnings?
- What is the projected increase in retained earnings ?? General accountingWhat is the projected increase in retained earnings ??Suppose a firm's tax rate is 35%. a. What effect would a $9.64 million operating expense have on this year's earnings? What effect would it have on next year's earnings? b. What effect would an $8.70 million capital expense have on this year's earnings if the capital is depreciated at a rate of $1.74 million per year for five years? What effect would it have on next year's earnings? a. What effect would a $9.64 million operating expense have on this year's earnings? Earnings would increase (decline) by $ ☐ million. (Round to two decimal places, and use a negative number for a decline.) What effect would it have on next year's earnings? (Select the best choice below.) A. There would be no effect on next year's earnings. B. Next year's earnings will be affected by a decline of $3.37 million. C. Next year's earnings will be affected by an increase of $3.37 million. D. Next year's earnings will be affected by the same amount. b. What effect would an $8.70 million capital expense have on…
- The Bakery Inc. expects sales of $750,000 next year at a 5% pretax profit margin and an average tax rate of 30%. If it chooses to pay out 25% of its earnings as dividends, what is the projected increase in retained earnings?Suppose a firm’s tax rate is 25%. 1. What effect would a $9.26 million operating expense have on this year's earnings? What effect would it have on next year's earnings? (Select all the choices thatapply.) A. A $9.26 million operating expense would be immediately expensed, increasing operating expenses by $9.26 million. This would lead to a reduction in taxes of 25%×$9.26 million=$2.32 million. B. A $9.26 million operating expense would be immediately expensed, increasing operating expenses by $9.26 million. This would lead to an increase in taxes of 25%×$9.26 million =$2.32 million. C. Earnings would decline by $9.26 million−$2.32 million=$6.94 million. The same effect would be seen on next year's earnings. D. Earnings would decline by $9.26 million−$2.32 million=$6.94 million. There would be no effect on next year's earnings. 2. What effect would a $11.75 million capital expense have on this year's earnings if the capital expenditure is depreciated at a rate of $2.35 million…Suppose a firm's tax rate is 25%. 1. What effect would a $10.92 million operating expense have on this year's earnings? What effect would it have on next year's earnings? (Select all the choices that apply.) A. $10.92 million operating expense would be immediately expensed, increasing operating expenses by $10.92 million. This would lead to a reduction in taxes of 25%×$10.92 million=$2.73 million. B. A $10.92 million operating expense would be immediately expensed, increasing operating expenses by $10.92 million. This would lead to an increase in taxes of 25%×$10.92 million=$2.73 million C. Earnings would decline by $10.92 million−$2.73 million=$8.19 million. There would be no effect on next year's earnings. D. Earnings would decline by $10.92 million−$2.73 million=$8.19 million. The same effect would be seen on next year's earnings 2. What effect would a $10.25 million capital expense have on this year's earnings if the capital expenditure is depreciated at a rate of $2.05…