Which of the following statements is CORRECT?
A. Increasing its use of financial leverage is one way to increase a firm's return on investors' capital (ROIC).
B. If a firm lowered its fixed costs but increased its variable costs by just enough to hold total costs at the present level of sales constant, this would increase its operating leverage.
C. The debt ratio that maximizes expected EPS generally exceeds the debt ratio that maximizes share price.
D. If a company were to issue debt and use the money to repurchase common stock, this would reduce its return on investors' capital (ROIC). (Assume that the repurchase has no impact on the company's operating income.)
E. If a change in the bankruptcy code made bankruptcy less costly to corporations, this would tend to reduce corporations' debt ratios.
Answer: C
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Which of the following statements about fair value is true?
A) ?Level 1 inputs should be used to determine fair value only when Level 2 and Level 3 inputs are not available. B) ?Level 3 inputs are observable market prices for similar assets in active markets. C) ?Fair value accounting is also known as "mark-to-market" accounting. D) ?Fair value is a measure of market-based entry value.
Yield management systems are used to:
a. determine the availability of product substitutes in industries that are experiencing rapid change. b. profitably fill unused capacity by using complex mathematical systems. c. predict necessary service levels required to achieve revenue goals. d. determine whether it is financially more feasible to buy a new product or repair a broken one.
Select the statement that is not true regarding the B2B purchasing process.
A. The B2B purchasing process requires standardized procedures. B. The B2B purchasing process is often far longer than the consumer decision-making process. C. The B2B purchasing process may require the use of RFPs and contract negotiations. D. The B2B purchasing process is less complex than the consumer decision-making process. E. The B2B purchasing process typically involves professional purchasing managers.
The following labor standards have been established for a particular product: Standard labor-hours per unit of output 9.0hoursStandard labor rate$15.10per hourThe following data pertain to operations concerning the product for the last month: Actual hours worked 8,100hoursActual total labor cost$119,880 Actual output 800units?What is the labor rate variance for the month?
A. $13,320 U B. $11,160 U C. $2,430 F D. $11,160 F