Assume perfect capital markets except that taxes DO exist. Why does the value of the interest tax shield accrue entirely to the shareholders and none of the value goes to the bondholders?
What will be an ideal response?
The value of the firm increases by the value of the interest tax shield which is the present value of the reduction in taxes paid. The tax shield does not impact the cash flows contracted to bondholders thus the entire value must go to the shareholders.
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If a new payroll system is installed for the employees of plant 1 at time A, followed by plant 2 at time B, and finally plant 3 at time C, this is an example of the ____ approach to systems implementation
a. parallel b. direct c. modular d. indirect
According to the text, categories are ________ if every response fits into one of the assigned category codes
A) dependent B) mutually inclusive C) collectively exhaustive D) mutually exclusive E) uniform
Answer the following statements true (T) or false (F)
1. The PERT/CPM planning technique is most useful for visualizing and illustrating everyday operations of an organization, but not for one-time projects. 2. The PERT/CPM planning technique utilizes the concept of a critical path to identify where there is no slack time within a sequence of activities regarding an organizational project. 3. Learning Objective: LO 10.3 Demonstrate how to design a delivery system using several methods, such as flow-charting, blueprinting, the universal service map, and PERT/CPM. 4. Simulations are only utilized by larger organizations because their service delivery systems are more complex.
During 2010, Heckart Corporation had sales of $250,000, net income of $25,000, average total assets of $350,000, dividend payments of $17,500, net cash flows from operating activities of $43,000, purchases of plant assets of $37,500, and sales of plant assets of $45,000 . Cash flows to sales equals (Round amounts to one decimal place)
a. 12.3 percent. b. 14.3 percent. c. 21.5 percent. d. 17.2 percent.