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Moline Manufacturing Corporation reported the following items:




Moline Manufacturing Corporation reported the following items: Sales = $5,000,000?, variable costs of production = $2,000,000, variable selling and administrative expenses = $250,000, fixed costs = $1,600,000, EBIT = $1,100,000, and the marginal tax rate =40%. Moline?s break-even pint in sales dollars is;$3,900,000;$3,750,000;$3,000,000;$2,340,000;All of the following are likely to result in the use of less debt in a company?s capital structure expect;Desire to maintain financial flexibility;Desire to maintain a high credit rating;Insufficient internal funds;An increase in a company?s marginal tax rate;Benkart?s Tie Store has fixed costs of $180,000. Tires sell for $75 each and have a unit variable cost of $30. What is Benkart?s break-even point in units?;4,000;6,000;7,200;8,500;Assume Harris, Inc. Has 10,000,000 common shares outstanding that have a par value of $2 per share. The stock is currently trading for $30 per share. The firm reported a net profit after-tax of $25,000,000. All else equal, what will happen to earnings per share if the company issues a 10 % stock dividend?;Earnings per share will remain the same since a stock dividend does not create an expense.;Earnings per share will increase because the dividend increases the value of the company.;Earnings per share will decrease because the number of shares outstanding will go up.;The impact cannot be determined without additional information on the new price per share.;Low dividends may increase stock value according to the;Bird in the hand theory;Information effect;Impact of agency costs;Tax bias in favor of capital gains;Dividends generally;Are paid as a fixed percentage of earnings.;Fluctuate more than earnings.;Are guaranteed by the SEC.;Are more stable than earnings.


Paper#33163 | Written in 18-Jul-2015

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