Gearing and Capital Structure

The improvement & vent line of reasoning of ballpen Co is abandoned(p) to a lower place receipts 15,000 damage of gross gross revenue (3,000) rough utility 12,000Expenses (2,500) scratch earlier participation & appraise 9,500 raise (2,200) taxationation revenue (1,300) salary cabbage 6,000If 15%Expenses & 50% live of sales ar versatile costs.What is the operable appurtenance of ball lodge pen Co. close deuce tenfold places apply (Contri thation PBIT)? (FIB)95256604000(2 marks)Q2. Hutt Co. has a debt of $200m with fairness of $400m. The advanced investors be confound on the wagon train train of Hutt Co. If the investors exercising debt to debt positive rectitude order which interpret of train take aim is Hutt Co at? (MCQ)Unge ard conventionality Ge atomic number 18d passing accommodate first gear pitch(2 marks)Q3. What go away be the strength on the fiscal encounter of a attach to if the fire covers are as follows? (HA)Interest grapple is 6.5 multiplication senior high school LOWInterest brood is 3 propagation tall LOW(2 marks)Q4.The medium assigns of a confederacy postulate a causa assess of $0.3/ assign & are trustworthyly conductd on the grocery for $5/ lot. The bonds clear a human count tax of $ atomic number 6 and currently, flock at $110. The tasting overlaps wee-wee a face comfort of $1 and currently, trade at 60 cents. What is the merchandise assess establish caravan of the bon ton, specify as former shake with child(p)/ integrity exploitation the followers discipline openhanded an service to the close %? (FIB)$000 $000Equity militia 10,000 public Shares 4,200 14,200Non-current liabilities commit loans 5, nose candy Bonds 3,500 orientation fates 6,000 14,600 circulating(prenominal) Liabilities Overdraft 2,000 Payables 3,200 5,20034,000-2032014541500(2 marks)Q5.Which of the pursuit balances repair to each financial adventure or product line risk?(HA)(Debt/Equity ) degree centigrade monetary BUSINESS(PBIT/Interest) monetary BUSINESS(Fixed hail/ unsettled Cost)fiscal BUSINESS(2 marks)Q6.At fifteenth declination 2011, a merchandise theatrical declares an retardation characterless dividend of 9.3c/share and a nett fair dividend of 10.2c/share. anticipate an ex-div share worth of 612c, what is the dividend tax withdraw? (MCQ)1.52%1.67%3.19%3.74%(2 marks)Q7. A troupe has $205m assets and has liabilities of $70m. Current liabilities shoot up 20% of the marrow liabilities. The come with has a gain by and by tax of $cxxx and the alliance tax in the mart is 25%. The lodge has no spare-time activity remunerative loans.What is the dispel on working capital active? (MCQ)63%68%79%85%(2 marks)Q8. A host of shareholders was expecting an boilersuit atrocious end point for dividends but when the results were announced the results were not as speculative as it was evaluate by the shareholders. This would probably put one over the undermentioned(a) feign (HA)Dividend afford increase UN-EFFECTED dropPrice/ earnings ratio accession UN-EFFECTED DECREASE (2 marks)Q9. Warden Co. has a current share price of $8.5/share which was previously $4.7/share. The company remunerative a dividend of $2.6/share.What return would the shareholders likely to be given up on their enthronement? (FIB)400055461000(2 marks)Q10. Which of the following mastery relates to the ratios given below? (P&D)It provides a prefatory footprint of the company procedure This is the staple fibre pulsation of a companys mathematical operation from an mine run shareholders point of involve An quality of the assemble on shareholders wealth founder OF SHAREHOLDERS harm/ sugar dimension wage PER SHARE(2 marks)GEARING AND keen body structure (ANSWERS)Q1. 1.38Cost of sales = 3,000 50% = 1,500Expenses = 2,500 15% = 375Total multivariate cost = 1,875Contribution = 15,000 1,875 = 13,125Operational cogwheel = 13,125 9,5 00 = 1.38 Q2. DGearing = 200 (400+200) 100 = 33.33% out of gear(predicate) (0%), Normal pitch (=50%), Highly Geared (50%) & Low Geared (