Earnings after taxes and preference share dividends

Assignment Help Financial Management
Reference no: EM131044380

Michaels Ltd expects earnings before interest and taxes to be $40 000 for this period. Assuming an ordinary tax rate of 30%, calculate the firm’s earnings after taxes and earnings available for ordinary shareholders (earnings after taxes and preference share dividends, if any) under the following conditions: a The firm pays $10 000 in interest. b The firm pays $10 000 in preference share dividends.

expects to be $40,000

tax rate 30%—>calculate firm’s EPS & EPA (earnings after taxes and preference share dividends)

scenario 1: the firm pays 10,000 in interest

scenario 2: the firm pays 10,000 in preference share dividends

Reference no: EM131044380

Questions Cloud

Effectiveness and competitive advantage : In what ways could Nike use the change techniques to find ways to improve its effectiveness and competitive advantage.
What is the present value-assuming the interest rate : If the interest rate is 9%, the 1-year discount factor is equal to ________. If the interest rate is 9%, the 10-year discount factor is equal to ________. What is the present value (PV) of $100000 received 6 years from now, assuming the interest rate..
As a health information management manager : As a Health Information Management manager, you will manage the personnel within your department. Understanding and following the various federal laws governing employment will be your responsibility.
Total cost of labor and customer waiting : Determine the optimal number of providers (level of staffing) that minimizes the total cost of labor and customer waiting. What is the corresponding minimum total (hourly) cost?
Earnings after taxes and preference share dividends : Michaels Ltd expects earnings before interest and taxes to be $40 000 for this period. Assuming an ordinary tax rate of 30%, calculate the firm’s earnings after taxes and earnings available for ordinary shareholders (earnings after taxes and preferen..
Evaluating the capability of a process : You are evaluating the capability of a process. Standard deviation(s) is 5. Customers have said that they will acceptunits ranging between 35 and 60. Thelocation of the mean is unknown. Butyour boss wants to know if the process is capable of p..
Why did gauguin move to pont-aven : How does this work follow the Impressionist style?
What is the firms gain or loss at sales-break-even point : The weaver watch company sells watches for $25, fixed costs are $140,000, and variable costs are $15 per watch. What is the firm's gain or loss at sales of 8,000 watches? 18,000 watches? What is the break-even point?
Vapor density and vapor pressure contribute : Discuss how vapor density and vapor pressure contribute to the hazards of a spilled or released hazardous material. Provide examples that illustrate your points.

Reviews

Write a Review

Financial Management Questions & Answers

  Expect the price to increase by an average

Today, you earn a salary of $45,000 per year. What will be your annual salary 8 years from now if you earn annual raises of 3% per annum? You hope to buy your dream car 5 years from now. Today, that car costs $41,100. You expect the price to increase..

  How were capital flows between countries likely to be affect

Given the expectations for a decline in US interest rates and share prices, how were capital flows between the United States and other countries likely to be affected?

  Some of the empirical findings on capital structure

What are some of the empirical findings on capital structure and how well does Modigliani and Miller theory predict them?

  Estimated residual value

A machine cost $70,200; it has an estimated residual value of $6,000 and an expected life of 300,000 units. What would be the depreciation in year three if 60,000 units were produced?

  How many shares will you own after the split

XYZ has 400,000 shares of common stock outstanding, a P/E ratio of 8, and $500,000 in net income. The board of directors has just voted in favor of the 3-for-2 stock split. You owned 100 shares before the stock split. How many shares will you own aft..

  Expects future economic development in the community

A land broker has indicated that she expects future economic development in the community where the land is located to lead to substantial appreciation in the land’s value over the next decade. The cost of the land is $200,000. What is the NPV and is..

  Calculate the npv and irr for this project

Pappy’s Potato has come up with a new product, the Potato Pet (they are freeze-dried to last longer). Pappy’s paid $126,000 for a marketing survey to determine the viability of the product. It is felt that Potato Pet will generate sales of $581,000 p..

  Accumulate depreciation on the balance sheet

How does depreciation expense on the income statement relate to accumulate depreciation on the balance sheet?

  What will your annual loan payment be

Annuity Values Betty's Bank offers you a $7,000, six-year term loan at 10 percent annual interest. What will your annual loan payment be?

  The efficient markets hypothesis assumes

The efficient markets hypothesis assumes all of the following except:

  When computing estimated capital budgeting cash flows

When computing estimated Capital Budgeting cash flows, you want the cash flow to be ____.

  Accumulated depreciation-funded depreciation

Based upon following information, how much debt financing (as a %) would be required to finance the replacement of fully depreciated Property, Plant, and equipment (P.P.&E.)?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd