Ask Question, Ask an Expert


Ask Basic Finance Expert

1. A company has operating profits of $15,000 on unit sales of 10,000 units. Fixed costs are $30,000. What is the firm's break-even sales level?
a) less than 6,000 units.
b) 6,000 units.
c) more than 6,000 units
d) There is not enough information to determine the unit break-even point.

2) Crenshaw Inc., expects to generate an annual EBIT of $750,000 and needs to obtain financing for $1,200,000 of assets. Their tax bracket is 40%. If the firm goes with a short-term financing plan, their rate will be 7.5 percent, and with a long-term financing plan their rate will be 9 percent. By how much will their earnings after tax change if they choose the more conservative financing plan instead of the more aggressive plan?
a) ($10,800)
b) $6,000
c) ($6,000)
d) $10,000

3) Frederickson Inc. is considering selling to a group of new customers that will bring in credit sales of $24,000 with a return on sales of 5%. The only new investment will be in accounts receivable. Frederickson has a turnover ratio of 6 to 1 between sales and accounts receivable. What is the return on investment?
a) 30%
b) 25%
c) 5%
d) none of these

4) Veritan Inc. expects to receive annual incremental income after taxes of $25,000 which includes an adjustment for un-collectible accounts. What is the maximum commitment to A/R they should be willing to assume if the firm's minimum required after-tax return is 8%?
a) $168,000
b) $312,500
c) $180,000
d) $36,000


Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M926149

Have any Question? 

Related Questions in Basic Finance

1 what is multiple regression and how is it used in

1. What is multiple regression, and how is it used in behavioral science research? 2. What is a spurious relationship? 3. What is the difference between a common-causal variable, an extraneous variable, and a mediating v ...

You buy a stock for 35 per share one year later you receive

You buy a stock for $35 per share. One year later you receive a dividend of $3.50 per share and sell the stock for $30 per share. What is your total rate of return on this investment? What is your capital gain or loss yi ...

A column in the wall street journal observes that while

A column in the Wall Street Journal observes that "while many people buy stocks in the hope of scoring profits down the road, dividends deliver cash right now." If stockholders desire dividends, why do some firms, such a ...

1 do outliers increase or decrease the magnitude of

1. Do outliers increase or decrease the magnitude of correlation coefficients? 2. What impact does reliability have on correlation? 3. Why can we infer causality from correlation?

1 distinguish between construct and criterion-related

1. Distinguish between construct and criterion-related validity. 2. Distinguish between convergent and discriminant validity. Do these terms refer to types of construct validity or criterion-related validity?

You learn that your inheritance will allow you to receive

You learn that your inheritance will allow you to receive the amount of $5800 at the end of each year for a total of 12 consecutive years. However, because of your young age, these amounts will not begin until the end of ...

Individual paper - analysis of an ethical dilemmathe

Individual Paper - Analysis of an Ethical Dilemma The assignment is as follows: Each student should research and write a paper about an organization that has encountered a serious ethical dilemma in the past. Please do n ...

The following excerpts are taken from dividend policy

The following excerpts are taken from "Dividend Policy Determinants: An Investigation of the Influences of Stakeholder Theory" by Mark E. Holder, Frederick W. Langrehr, and J. Lawrence Hexter, published in the Autumn 199 ...

1 describe why teams are being formed more frequently in

1. Describe why teams are being formed more frequently in business today. What are some of the special considerations required for a team to be successful? 2. Defend a position on the following question: Does radical org ...

1 in analyzing the data from an experiment why is it not

1. In analyzing the data from an experiment, why is it not sufficient simply to examine the condition means to see whether they differ? 2. Assuming that all confounds were eliminated, the means of the conditions in an ex ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen