Investors have invested $30,000in common equity in a company. Given the risk inherent in the company, the investors expect to earn a 13percent return. In addition, the investors expect the company to return all income to investors in the form of dividends. The company earns $4,500 the first year. For this company determine the following:
a. The company's required earnings
b. The company's residual earnings
$30,000*13%=$3,900
b.$4,500-$3,900=$600
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Marketing communications that increases the generic market will naturally fall mostly to ___________________________
a. All brands b. Runner Up Brands c. Category Leaders d. Mid-level brands
If it is continually stressed that all members are part of the same organization, this is an example of which method to reduce intergroup conflict?
a. Increasing intergroup contact b. Recategorizing c. Finding a common enemy d. Exchanging team members
Plummet Corporation reported the book value of its net assets at $400,000 when Zenith Corporation acquired 100 percent ownership. The fair value of Plummet's net assets was determined to be $510,000 on that date.Based on the preceding information, what amount will be recorded by Zenith as its investment in Plummet, if it paid $500,000 for the acquisition?
A. $400,000 B. $510,000 C. $610,000 D. $500,000
Bob and Mary Kay have gross household income of $7,000 per month. They both have great credit scores and the home they are interested in buying appraised higher than the selling price
They have combined monthly debt payments of $300 in student loans, $650 in car loans, and they pay their credit cards in full every month. The PITI on the new home will be $1,800 per month. Before they pay the $250 loan application fee, they are asking you for your opinion on whether they will get approved for a mortgage. What will you advise them? A) Based on the 28 percent rule they can afford the $1,800 PITI and will be approved for the mortgage. B) Based on the 28 percent rule they cannot afford the $1,800 PITI and will be denied the mortgage. C) Based on the 36 percent rule they will be approved for the mortgage. D) Based on the 36 percent rule they have too much other debt and will be denied the mortgage.