Question: please kindly answer all mcq please. just answer A,B,C or D, thanks in advance sir. Answer questions 4 through 8 from the information provided below:
please kindly answer all mcq please. just answer A,B,C or D, thanks in advance sir.



Answer questions 4 through 8 from the information provided below: A firm's selected information is as follows: 2020 2021 Sales $14 000 Cost of Goods Sold 10 100 Gross Profit $ 3 900 Operating Expenses 1 700 Operating Income 2 200 Interest Expense 300 Earnings before taxes 1 900 Less: Taxes 380 Earnings after taxes $ 1520 Total Assets (beginning-of-the-year) $ 20 000 Equity (beginning of the year) 12 000 Debt (beginning of the year) 5 000 Number of shares 1 000 Earnings Per Share (EPS) $ 1.52 Dividend Per Share (DPS) 20 Shareholders' required rate of return 10.0% $15 200 11 150 $ 4 050 1 800 2 250 300 1950 390 $ 1 560 $23 560 13 520 6 000 1 000 $ 1.56 250 10.00% 4. What is the firm's residual earnings in 2020? A. $1.52 C. 32 B. $1.20 D. - 32 5. What is the firm's residual earnings in 2021? A. $1.56 C. 1150 B. 20.8 D. - $9.3 6. What is the firm's Abnormal Earnings Growth (AEG) in 2021? A. 11.26 C. SO B. $ - 11.20 D. not calculable 7. What is the value of the firm at the beginning of 2020 under the RE model if the RE of 2021 is expected to grow at a constant rate of 4% for an indefinite period? Answer: 8. What is the value of the firm at the beginning of 2020 under the AEG model if the AEG of 2021 is expected to grow at a constant rate of 4% for an indefinite period? Answer: 9. Which of the following statements is true? A. Positive earnings is a sufficient condition to yield positive residual earnings: B. If ROCE >r, residual earnings will be positive. C. If residual earnings grow, abnormal earnings growth (AEG) will be zero or positive. D. A positive AEG means Price-to-Book (P/B) ratio > 1. 10. Which of the following statements is true? A. AEG =Cum-Dividend Earnings - Normal Earnings B. The AEG model prices book values. C. If residual earnings grow at a certain rate, the AEG will also grow at the same rate. D. Cum-Dividend earnings = Earnings + Earnings from prior period earnings
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