Locomotive corporation is planning to repurchase part of its common stock by issuing corporate debt. as a result, the firm’s debt–equity ratio is expected to rise from 0.35 to 0.5. the firm currently has $3.6 million worth of debt outstanding. the cost of this debt is 8 percent per year. locomotive expects to have an ebit of $1.35 million per year in perpetuity. locomotive pays no taxes. a. what is the market value of locomotive corporation before and after the repurchase announcement? b. what is the expected return on the firm’s equity before the announcement of the stock repurchase plan? c. what is the expected return on the equity of an otherwise identical all-equity firm? d. what is the expected return on the firm’s equity after the announcement of the stock repurchase plan?

Emily bought 200 shares of abc co. stock for $29.00 per share on 60% margin. assume she holds the stock for one year and that her interest costs will be $80 over the holding period. ignoring commissions, what is her percentage return (loss) on invested capital if the stock price went down 10%?

technology is the application of knowledge and tools to solve problems and perform tasks more efficiently. t/f

Exercise 15-7 crawford corporation incurred the following transactions. 1. purchased raw materials on account $53,000. 2. raw materials of $45,200 were requisitioned to the factory. an analysis of the materials requisition slips indicated that $9,400 was classified as indirect materials. 3. factory labor costs incurred were $65,400, of which $50,200 pertained to factory wages payable and $15,200 pertained to employer payroll taxes payable. 4. time tickets indicated that $55,000 was direct labor and $10,400 was indirect labor. 5. manufacturing overhead costs incurred on account were $81,700. 6. depreciation on the company’s office building was $8,100. 7. manufacturing overhead was applied at the rate of 160% of direct labor cost. 8. goods costing $89,400 were completed and transferred to finished goods. 9. finished goods costing $76,000 to manufacture were sold on account for $105,100. journalize the transactions. (credit account titles are automatically indented when amount is entered. do not indent manually.) no. account titles and explanation debit credit (1) (2) (3) (4) (5) (6) (7) (8) (9) (to record the sale) (to record the cost of the sale) click if you would like to show work for this question: open show work