What is the eps in a recession

Assignment Help Financial Accounting
Reference no: EM132869395

Question 1: Ornaments, Inc., is an all-equity firm with a total market value of $674,000 and 33,900 shares of stock outstanding. Management believes the earnings before interest and taxes (EBIT) will be $96,800 if the economy is normal. If there is a recession, EBIT will be 30 percent lower, and if there is a boom, EBIT will be 40 percent higher. The tax rate is 35 percent. What is the EPS in a recession?

Multiple Choice

Option 1: $2.60

Option 2: $1.30

Option 3: $1.86

Option 4: $2.41

Option 5: $1.11

Reference no: EM132869395

Questions Cloud

What type of misstatement would occur : The fair value measurement using comparison method draws reference to transactions. What type of misstatement would occur
Why the scheduling process is crucial in the business : Explain why the Scheduling process is crucial in the business. How does Project Management tie all of the areas together?
How much life insurance does adriana need : If the insurance funds could be invested at 4 percent after taxes and inflation, how much life insurance does Adriana need? The approximate interest factor
How is the company culture socialized : Whole Foods is known for it's strong culture. Research (news articles, Glassdoor, company website, etc.). As part of your research:
What is the eps in a recession : EBIT will be 30 percent lower, and if there is a boom, EBIT will be 40 percent higher. The tax rate is 35 percent. What is the EPS in a recession?
Explain recommendations for nike to improve : Explain you recommendations for Nike to improve based on the 5 functions of management must do recommendations for each functions first one being
Negative results for both companies and employees : Researchers are now saying that efforts to simplify work tasks actually have negative results for both companies and their employees.
Calculate the breakeven units : The total fixed costs of production per year are $135,000. The unit variable cost is $33. Calculate the breakeven units at the following selling price: $100
Percentage of ownership receives in return : We are starting new business of laptops. You can refer to the ASUS, Acer, dell research online and than answer these questions. Thx

Reviews

Write a Review

Financial Accounting Questions & Answers

  Calculate cost of thermostats in finished goods inventory

Aker Company produces refrigerators. Each refrigerator contains a small thermostat that costs $7. During September,  Calculate the cost of thermostats in finished goods inventory at September 30. Do not use decimals in your answer.

  Unfavorable flexible-budget variance

Elgin Company's budgeted fixed factory overhead costs are $50,000 per month plus a variable factory overhead rate of $4.00 per direct labor hour. The standard direct labor hours allowed for October production were 20,000. An analysis of the factory o..

  Compute basic eps and compute diluted eps

Assume same facts as those for Part (a), except the 60 bonds were issued on September 1, 2017 (rather than in 2016), and none have been converted

  Estimate what is retailer effective cost of trade credit

Estimate What retailer effective cost of trade credit? Assume a 365-day year. Do not round intermediate calculations. Round your answer to two decimal places.

  How much cash did sutherland receive from sale of machinery

Sutherland Company purchased machinery for €320,000 on January 1, 2015. How much cash did Sutherland receive from the sale of the machinery?

  Prepare the equity section of the balance sheet

Dec 2, issue 10,000 shares of common stock for $24 value per share, Prepare the equity section of the balance sheet

  How much cash will have five years

How much (or less) cash will you have 5 years from now based upon that error if rate to invest funds is 10%? Prepare budget based upon the amount of cash flow

  Question 1 process solutions gives a computer-based

question 1 process solutions gives a computer-based document processing service. the accountant has produced the

  Find the amount of the minimum annual lease payment is

On January 1, 2020, Jeckyll Ltd. signs a 8-year, Rounded to the nearest dollar, the amount of the minimum annual lease payment is

  What are the implications of questioning a leader direction

What are the implications of questioning a leader's directions, knowing that most leaders prize unquestioning followership and loyalty?

  What is the current value of issue

A zero-coupon bond matures three years from today, has a par value of $1,000 and a yield to maturity of 8.0%. What is the current value of this issue?

  What is the irr of the project and is irr acceptable

$1,800, $2,500, and then an estimated salvage value at the end of the 3rd year of $700. What is the IRR of the project and is it acceptable, why?

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