i Which in turn of the subsequent statements is most FALSE?
a. In general, as being a firm begins to add personal debt to their capital structure, the business's EPS will be better, but the normal deviation of EPS raises.
b. Reduce operating power generally permits a firm to use more debt in their capital structure.
c. The capital structure that boosts the firm's stock price are also the administrative centre structure that minimizes WACC.
d. A lot more debt a firm has in the capital composition, the higher that firm's economical risk will be.
e. The larger a business's tax charge, the much less attractive debts capital will be to that organization.
ii Which of the following statements is most FALSE?
a. If a business does not include any personal debt, its DFL is 1 )
b. Every time a company is usually operating hardly above the breakeven level, the degree of functioning leverage will likely be low.
c. Their education to which a good employs economical leverage will certainly affect its expected income per talk about and the riskiness of these income.
d. Business risk varies from one market to another and in addition among organizations in a provided industry.
e. The higher a firm's level of operating influence, the higher the breakeven point tends to be.
3 The Cherry wood Corporation creates tea kettles, which this sells intended for $14 every single. Fixed costs are $450, 000 for up to 400, 500 units of output. Variable costs happen to be $6 per kettle, as well as the tax rate is 45 percent. What is the company's breakeven point in conditions of sales dollars?
a. $787, 500
b. $337, 500
c. $75, 500
d. $56, 250
at the. $32, 143
iv Landua, Inc. 's operating income is $380, 000, you can actually interest expenditure is $80, 000, and its tax charge is forty five percent. In the event the company were able to increase their operating income by doze percent, what would be the percentage increase in income per reveal?
a. 13. 13 percent
b. 12-15. 20 percent
c. 17. forty one percent
deb. 19. forty-eight percent
e. None of the over.
vRush & Todd, Inc. currently provides $4 mil in product sales. Its varying costs equivalent 30 percent...