An investment services company experienced dramatic growth in the last two decades. The following models for the company's revenue R and expenses or costs C (both inmillions of dollars) are functions of the years past 1990.R(t) = 21.4e0.131t and C(t) = 18.6e0.131t(a) Use the models to predict the company's profit In 2021. (Round your answer to one decimal place.)$ 43.8million(b) How long before the profit found in part (a) is predicted to double? (Round your answer to the nearest whole number.)years after 1990Enter a number.

The revenue function represents the revenue to be generated by the firm after a time 't' while the…

Answered: An investment services company…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Consider the following information that you propose to use to obtain an estimate of year 2004 EPS for the MacLog Company. Estimated Year 2019 Year 2020 GDP 11,000 Billion GDP growth 3.5% Sales per share $800 Operating profit margin 12% Depreciation/Fixed Assets 14% Fixed asset turnover 2 Interest rate 3.5% Total asset turnover 0.7 Debt/Total assets 45% Tax rate 36% In addition, a regression analysis indicates the following relationship between growth in sales per share for MacLog, and GDP growth is %Δ Sales per share = 0.015 + 0.75(%Δ GDP) Refer to Exhibit 9.6. Calculate the firm's level of Total Assets per share for the year 2020. a. $1,385.77 b. $1,113.58 c. $1,050.65 d. $1,065.67 e. $1,190.06
calculate the efficiency ratios, liquidity ratios, leverage ratios, and profitability ratios for KPC Corporation for this year. Where data is available, also calculate ratios for last year. Use a 360-day year. All sales are on credit to business customers. Assume an income tax rate of 30 percent.
A company is thinking in investing in one of two potential new products for sale. The projections are as follows: year Revenue/cost £ (Product S) Revenue/cost £ (Product V) 0 (150,000) outlay (150,000) outlay 1 14000 15000 2 24000 25333 3 44000 52000 4 84000 63333 a) Calculate the payback period for both products in years and months, not as a decimal. Please present answer to nearest month.b) Calculate NPV of both products (to 1 d.p.) assuming a discount rate of 7%.c) Which product should be chosen and why?d) Calculate the IRR for Product V only using 1% and 17% to 2 d.p.e) Outline the advantages and disadvantages of the IRR and payback using appropriate academic sources.
calculate the • efficiency ratios, • liquidity ratios, • leverage ratios, and • profitability ratios for KPC Corporation for this year. Where data is available, also calculate ratios for last year. Use a 360-day year. All sales are on credit to business customers. Assume an income tax rate of 30 percent.
What's the rate of return you would earn if you paid $2,880 for a perpetuity that pays $65 per year? X-1 Corp's total assets at the end of last year were $425,000 and its EBIT was $52,500. What was its basic earning power (BEP) ratio?
You have the following data for a company. What is the return on assets (ROA)? Return on equity = 15%; Earnings before taxes = $150,000; Total asset turnover = 1.8; Profit margin = 10.5%; Tax rate = 30%.
Company A showed a profit of $1.9 million last year. The CEO of the company expects the profit to increase by 8% each year over the next 5 years and the profits will be continuously invested in an account bearing a 4.5% APR compounded continuously. (a) Write the flow rate, R, of the income stream. (Let t represent the number of years after the company showed a profit of $1.9 million.) R(t) = 1.9(1.08)' million dollars per year (b) Calculate the 5-year future value. (Round your answer to three decimal places.) $ 218.544 x million (c) Calculate the 5-year present value. (Round your answer to three decimal places.) $ 265.686 x million
1.2. What Is the internlal growth ate (IGR)? interpret. 2) The net income is RO 25,000. Last year's sales were RO 180,000. The total assets represent half (50%) of total sales. The accounts payables represent 10% of total assets. The accruals is RO 2,000 and the notes payables is RO 3,000. The assets and costs vary directly with sales. The firm distributes RO 15,000 dividends. The firm operates at full capacity. If the sales growth rate is 15%, how much external financing is needed? Interpret.
Suppose that Wall-E Corp. currently has the balance sheet shown below, and that sales for the year just ended were $7.4 million. The firm also has a profit margin of 20 percent, a retention ratio of 25 percent, and expects sales of $9.4 million next year. Fixed assets are currently fully utilized, and the nature of Wall-E's fixed assets is such that they must be added in $1 million increments. Assets Current $2,294,000 Current liabilities Long-term debt Equity assets Fixed assets 5,402,000 Liabilities and Equity Total assets $7,696,000 Total liabilities and equity $2,368,000 1,700,000 3,628,000 $7,696,000 If current assets and current liabilities are expected to grow with sales, what amount of additional funds will Wall-E need from external sources to fund the expected growth? (Enter your answer in dollars not in millions.) Additional funds needed
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%
Digital Technology wishes to determine its coefficient of variation as a company over time. The firm projects the following data (in millions of dollars): Year Profits: Expected Value Standard Deviation 1 $ 99 $ 37 3 125 52 6 181 100 9 249 150 Compute the coefficient of variation (V) for each time period. Note: Round your answers to 3 decimal places. year cofficient of variation 1 3 6 9
Using the AFN formula approach, calculate the total assets of Harmon Photo Company given the following information: Sales this year = $3,000; increase in sales projected for next year = 20%; net income this year = $250; dividend payout ratio = 40%; projected excess funds available next year = $100; accounts payable = $600; notes payable = $100; and accrued wages and taxes = $200. Except for the accounts noted, there were no other current liabilities. Assume that the firm’s profit margin remains constant and that the firm is operating at full capacity. $3,000 $2,200 $2,000 $1,200 $1,000

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS