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17 the management of melanie corporation is preparing

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17.The management of Melanie Corporation is preparing its plans for the year 2020. Theaverage assets to be employed for the year are estimated at P2,600,000 with 20% of thisamount borrowed at no interest cost. Materials and labor cost for the year is budgeted atP4,000,000, while operating costs is estimated at P1,500,000. All sales are to be billed at162.5% of materials and labor cost. Income taxes are at an average of 35% of profit beforetax. The expected asset turnover for 2020 is?a.1.5 timesb.2.5 timesc.3.36 timesd. 3.75 times
18.Par Co. has total debt of P420,000 and shareholders’ equity of P700,000. Par is seekingcapital to fund an expansion. Par is planning to issue an additional P300,000 in ordinaryshares and is negotiating with a bank to borrow additional funds. The bank requires a debt-to-equity of 0.75. What is the maximum additional amount Par will able to borrow?
19.A company has 100,000 outstanding ordinary shares with a market value of P20 per share.Dividends of P2 per share were paid in the current year, and the company has a dividend-payout ratio of 40%. The price-to-earnings (P-E) ratio of the company isd.50
20.Quezon Company had net profit for 2020 of P2,650,000 and earnings per share onordinary share of P1.25. Included in the net profit was P250,000 of bond interestrelated to its long-term debt. The income tax rate for 2016 was 50%. Dividends onpreference share were P150,000. The dividend-payout ratio on ordinary share was 40%.What were the dividends on ordinary share in 2020?
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Term
Spring
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N/A
Tags
Balance Sheet, Generally Accepted Accounting Principles

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