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NEW QUESTION: 1
Howell Enterprises is forecasting EPS of $4.00 per share for next year. The firm has 10,000 shares outstanding, it pays 12 percent interest on its debt, and it faces a 40 percent marginal tax rate. Its estimated fixed costs are $80,000 while its variable costs are estimated at 40 percent of revenue. The firm's target capital structure is 40 percent equity and 60 percent debt and it has total assets of $400,000.
On what level of sales is Howell basing its EPS forecast?
A. $292,444
B. $480,400
C. $1,000,000
D. $316,722
E. $105,280
Answer: A
Explanation:
Explanation/Reference:
Explanation:
EPS = (Sales - Fixed costs- Variable costs - Interest)(1 - T)/Shares outstanding.
Step 1 Calculate interest expense
Debt = 0.60 x $400,000 = $240,000.
Interest = 0.12 x $240,000 = $28,800.
Step 2 Solve for Sales (S)
EPS = $4.00 = (S - 0.40S - $80,000 - $28,800) x (1 - 0.40)/10,000
= (0.60S - $108,800)(0.6)/10,000
$4.00 = (0.36S - $65,280)/10,000
$105,280 = 0.36S
Sales = $292,444.44.
Alternative method
EPS = (EBIT - Interest)(1 - T)/Shares outstanding.
Solve for EBIT
Net Income = EPS x Shares outstanding = $4.00 x 10,000 = $40,000.
EBT = NI/(1 - T) = $40,000/(0.6) = $66,667.
Interest (from above) = $28,800.
EBIT = EBT + Interest = $66,667 + $28,800 = $95,467.
S = 0.40S + $95,467 + $80,000
0.6S = $175,467
S = $175,467/0.6 = $292,445.

NEW QUESTION: 2
You have a Microsoft Exchange Online tenant.
You enable hierarchical address books (HABs).
You create a new distribution group named Contoso.
You need to configure the Contoso group as the root of the hierarchy. The members of the group must appear in the hierarchy.
How should you complete the PowerShell commands?

Answer:
Explanation:

Explanation:
https://docs.microsoft.com/en-us/exchange/address-books/hierarchical-address-books/enable-or-disable-hierarchical-address-books

NEW QUESTION: 3
To configure a storage system as a member of a Windows active directory domain, the time on the storage system must be set to be within plus or minus five minutes of the time on the domain controller.
A. True
B. False
Answer: A