What is the minimum level of ebit the company

Assignment Help Finance Basics
Reference no: EM132674830

The National Powerhouse Company currently has no debt in its capital structure. The company has decided to restructure, raising $5 million debt at 12 per cent. ABC currently has 500 000 shares on issue at a price of $200 per share. As a result of the restructure, what is the minimum level of EBIT the company needs to maintain EPS (the break-even EBIT)? Ignore taxes

Reference no: EM132674830

Questions Cloud

What happens to the interest rate : Explain what happens to the interest rate if the money demand increases or decreases and the money supply remains unchanged.
Respective perspective and level of analysis : Explain the authors' logic for choosing their respective perspective and level of analysis, examine the strengths and weaknesses of their respective explanation
What can written in conclusion for topic global citizen : What points can written in the conclusion for topic Global Citizen Education (GCED) benefited the society in resolving environmental issues (Air pollution)?
Origins and foundations of the world economy. : Describe the key institutions of the Bretton Woods system. How did they evolve over time?
What is the minimum level of ebit the company : As a result of the restructure, what is the minimum level of EBIT the company needs to maintain EPS (the break-even EBIT)? Ignore taxes
What role can the accounting profession play in the context : What role can the accounting profession play in this context? Using at least two academic research articles to support your background research
Compute the anticipated value of the dividends : A firm paid a $4 dividend last year. The dividend is expected to grow at a constant rate of 6 % over the next four years. The required rate of return is 13 %
What are the effects of the accounting equation : What are the effects of the accounting equation? Aug. 1 Opens an office as a financial advisor, investing $9,000 in cash. 27 Pays secretary $1,000 salary.
Find value of a share of common stock-nabisco corporation : Suppose Nabisco Corporation just issued a dividend of $1.78 per share yesterday. Subsequent dividends will grow at a constant rate of 05.80% indefinitely.

Reviews

Write a Review

Finance Basics Questions & Answers

  Clculate the current market value of a share of celtic

celtic jewelry designs has experienced recent growth which is expected to continue at a 6 rate per year forever. next

  Explain how the break-even point can fluctuate

Explain how the break-even point can fluctuate. As the financial manager of your business, discuss why it is important to monitor the break-even point?

  United states department of agriculture

According to the dietary guidelines from the United States Department of Agriculture, a healthful diet consists of fruits, vegetables, whole grains, lean protein, and dairy.

  Find total mortgage-backed security fee

Do you expect any changes in mortgage-backed security pricing if the pass-through security was not fully amortised? What is the present value of a twelve millio

  Calculate a budgeting system at any governmental level

Evaluate a budgeting system at any governmental level. Analyze the scope and sequence of budgeting in terms of sources of revenues, purpose of government expenditures, budget preparation, and debt administration.

  How earnings management has been viewed negatively

Explain how earnings management has been viewed negatively and provide an example.

  Midland utilities has outstanding a bond

Midland Utilities has outstanding a bond

  Calculate sustainable growth

Construct pro-forma statements using the % of Sales Method (costs, all assets, and current liabilities rise with sales) assuming the dividend payout rate

  Dell is selling 30,000 units in europe at an average price

Dell is selling 30,000 units in Europe at an average price of euro1500 per unit. Both the spot and forward exchange rate are $1.20/euro. The cost of each unit in dollars is $1300 per unit. The elasticity of demand for dell computers in Europe ..

  Show the marginal cost of capital schedule

Explain how many break points are thre in the marginal cost of capital schedule

  What is the true value of the lottery

Mark Young has just won the state lottery, paying $50,000 a year for 20 years. He is to receive his first payment a year from now.

  Withdraw funds from the account

She wants to withdraw $45,000 at the beginning of each year, beginning immediately. She also wants to have $50,000 left to give you when she ceases to withdraw funds from the account. For how many years can she make the $45,000 withdrawals and sti..

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