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ryzh
2 months ago
11

The most recent financial statements for Minnie's Manufacturing Co. are shown below: Income Statement Balance Sheet Sales $ 95,4

00 Current assets $ 35,500 Debt $ 46,200 Costs 68,250 Fixed assets 95,300 Equity 84,600 Taxable income $ 27,150 Total $ 130,800 Total $ 130,800 Tax 6,245 Net Income $ 20,905 Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 30 percent dividend payout ratio. No external equity financing is possible. What is the sustainable growth rate
Business
1 answer:
marusya05 [3.7K]2 months ago
6 0
The sustainable growth rate is 17.30%. For the sustainable growth rate, retention ratio times return on equity, where retention ratio equals 1 minus payout ratio, giving us 1 - 0.30 = 0.7. From every dollar of net income, the company retains 70 cents for reinvestment. Return on equity is calculated as net income over equity: 20,905 / 84,600 = 0.247101. Thus, every dollar of equity yields 0.247104 cents in income. Keeping 70% of it, we find: 0.2471 times 0.7 equals 0.1729728, or a sustainable growth rate of 17.30%.
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A company has only two divisions: division a and division
stepan [3596]

Solution – Division A

Explanation:

Last year's data shows that Division A contributed 60% of total revenue.

Let total revenue for the company last year be x.

Therefore, Division A earned 0.6x.

Similarly, Division B generated 40% of total revenue last year.

This means Division B’s income was 0.4x.

For the current year, Division A’s earnings have dropped by 35%.

Since last year was 0.6x, the amount lost is 35% of 0.6x.

So this year’s revenue: 0.6x - 0.35(0.6x) = (1 - 0.35) * 0.6x = 0.65 * 0.6x = 0.39x.

Division B’s revenue declined by 5% this year.

Last year’s revenue was 0.4x, so this year it is 0.4x - 0.05(0.4x) = 0.95 * 0.4x = 0.38x.

Comparing both, Division A’s revenue (0.39x) exceeds Division B’s (0.38x) this year.

4 0
4 months ago
A marketing company wants to estimate the proportion of consumers in a certain region of the country who would react favorably t
arsen [3447]
The closest estimate for the minimum number of consumers needed for the desired precision is (b) 271. If there's no previous population proportion estimate, the formula for assessing sample size is applied. Given that the margin of error E = 5% or 0.05 and the confidence level is at 90%, the crucial z-value stands at 1.645 (as derived from the z-table). Plugging the values into the formula results in a minimum required sample size rounded to 271.
8 0
2 months ago
1. Identify and briefly discuss three factors which influence the choice of crops produced by commercial farmers?[ 2. What is th
marusya05 [3725]

Response:

1. a) Site,

    b) profits

    c) Whether it is feasible to grow the crop with available resources or not

Rationale:

Traders in farming regard the site as a vital factor for their crops, as it hinges on land quality and applicable taxes, and the site of their produce is crucial for transporting goods to ensure they reach markets in optimal condition.

Additionally, the farmer assesses the potential profit from the harvested crops, opting to grow those that yield the highest returns, and must ensure that they have sufficient labor and resources necessary for harvesting and bringing products to market.    

2. Producers of dairy must be mindful of how close their farms are to markets because these products have a short shelf life before they spoil.

Rationale:

Dairy goods are highly perishable and challenging to transport given their limited expiring time, which is a key reason why commercial farmers need to consider that their farms should not be too far from distribution points, allowing them to transport products securely and distribute without worrying about spoilage and loss of profits.

3. A commercial farmer focuses on two primary expenses, the transportation costs and the potential benefits of the crop.

Rationale:

For commercial farmers, during cultivation, there are two crucial expenses to consider: one is the cost of transporting their goods to distribution points, and they must ensure these costs remain manageable since the profit they can gain is also important; thus, farmers aim to minimize investment to enjoy substantial profits.

   

4. Von Thunen's theory posits that the distance to the market is a vital consideration for farmers. According to Von Thunen, a farmer's income is likely to diminish the further they are from the market at which their products are sold.

Rationale:

5.  1. One of the assumptions made by Von Thunen is the presence of only one single market that is self-sufficient without any external input.

    2. Another assumption is that the physical conditions are uniform, lacking rivers, mountains, etc.

    3. Lastly, it is assumed that all farmers aim to maximize their profits.

Rationale:

1. Von Thunen's initial assumption suggests only one market is available and is not influenced by outside factors, but this might not hold true since multiple markets exist due to consumer demand, as well as other farmers from various regions supply products, and cities necessitate external influences for development, which is essential for urban advancement.

2. In his hypothesis, Von Thunen indicates that the agricultural production environments are consistent, which is challenging given that land topographies influence terrain variations; this uniformity could only be realized if the lands were altered by human intervention.

3. Von Thunen's final assumption highlights an optimistic scenario wherein farmers take actions to maximize their profits, which means they will continue to strive for the best possible outcomes.

6. 1. At the core ring lies the market. This market serves as the focal point of the city, conveniently reached from nearby areas.

   2. The subsequent ring is made up of intensive farming and dairy. These items are located closer due to their higher demand and the quick spoilage of other products.

  3. Following that, the next ring is the forest. Wood was highly sought after because it was essential for heating and cooking, and its placement was determined by the fact that it was heavy and cumbersome to transport.

  4. The penultimate ring was designated for extensive crops like bread grains, which are lighter and therefore easier to transport and less costly.

  5. And ultimately, the outermost ring is used for livestock. Animals can be raised and bred farther from markets since they do not require transport expenses, thus saving money for farmers.

Rationale:

In his theory, Von Thunen discussed the significance of geographical positioning in agriculture, where commercial farmers could leverage land characteristics. For Thunen, a proper organization of land sites, from those most costly and challenging to transport to those easier, would foster the greatest yields; thus, he theorized how market rings should be established.

   

I trust this information proves useful to you.

5 0
2 months ago
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