The tax rate applicable to Blue Co. is 20%. The firm pays 5% interest on the P350,000 outstanding loan and the total preferred dividends to be distributed is P16,500. What is the Financial Breakeven point?
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The tax rate applicable to Blue Co. is 20%. The firm pays 5% interest on the P350,000 outstanding loan and the total preferred dividends to be distributed is P16,500. What is the Financial Breakeven point?
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- The tax rate applicable to Ivan Co. is 20%. The firm pays 5% interest on the P350,000 outstanding loan and the total preferred dividends to be distributed is P16,500. What is the Financial Breakeven point?The financial breakeven point of Soillnc. is P90,000,while the tax rate applicable to the company is 30%.The company pays 10% interest on the P200,000 outstanding loan. How much is the total preferred dividends distributed? |The financial breakeven point of Soil Inc. is P90,000, while the tax rate applicable to the company is 30%. The company pays 10% interest on the P200,000 outstanding loan. How much is the total preferred dividends distributed?
- Company Y has a target debt ratio of 55%. Currently its debt ratio is 60% and it expects to revert to the target ratio in the near future. The company has a market cost of equity of 20%. While it has no bonds, it has interest payments of R1 000 000 on liabilities of R10 000 000. Assume the tax rate is 27%. What is the WACC for the company? a. 6.36% b. 14.05% c. 13.02% d. 9.10%Company Y has a target debt ratio of 55%. Currently its debt ratio is 60% and it expects to revert to the target ratio in the near future. The company has a market cost of equity of 20%. While it has no bonds, it has interest payments of R1 000 000 on liabilities of R10 000 000. Assume the tax rate is 28%. What is the WACC for the company? Ⓒa. 6.36% b. 9.00% c. 12.33% d. 12.96%Choose the correct letter of answer: The following data applies to a firm: Interest Charges P10 Million, Sales/CGS P80 Million, Tax Rate 50% and Net profit margin 10%. What is the firm's interest covered ration? a. 1.6b. 2.6c. 3.6d. 4.6e. 5.6
- Suppose a company named Arts Pvt. Ltd has taken a loan from a bank for business expansion at a rate of interest of 8%, and the tax rate is 20%. Calculate the cost of debt.1. Soda Fizz has debt outstanding that has a market value of $3 million. The company's stock has a book value of $2 million and a market value of $6 million. What are the weights in SodaFizz's capital structure? 2. The yield to maturity on Soda Fizz's debt is 7.2%. If the company's marginal tax rate is 21%, what is Soda Fizz's effective cost of debt? 3. SodaFizz paid a dividend of $2 per share last year; its dividend has been growing at a rate of 2% per year, and that growth rate is expected to continue into the future. The stock of SodaFizz is currently trading at $19.50 per share. According to the constant dividend growth model, what is the cost of equity capital for Soda Fizz? 5. Given the answers to Problems 1, 2, and 3, what is SodaFizz's WACC when the constant dividend growth model is used to calculate its equity cost of capital?Please see image to answer question.
- Lever Age pays an 10% rate of interest on $10.20 million of outstanding debt with face value $10.2 million. The firm's EBIT was $1.2 million. a. What is its times interest earned? (Round your answer to 2 decimal places.) > Answer is complete but not entirely correct. Times interest earned 0.01 X b. If depreciation is $220,000, what is its cash coverage ratio? (Round your answer to 2 decimal places.) > Answer is complete but not entirely correct. Cash coverage ratio 0.01 XICU Window, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 9 years to maturity that is quoted at 107 percent of face value. The issue makes semiannual payments and has an embedded cost of 6.6 percent annually. What is the company's pretax cost of debt? If the tax rate is 24 percent, what is the aftertax cost of debt? Pretax cost of debt: __________% Aftertax cost of debt: __________%The market value of Stan Company's equity is P15 million, and the market value of its risk free debt is P5 million. If the required rate of return on the equity is 20% and that on the debt is 8%, calculate the company's cost of capital. (Assume no taxes.) (round your answer to the nearest whole number)
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