Garrison holds a controlling interest in Robertson's outstanding stock. For the current year, the following information has been gathered about these two companies: Separate operating income Garrison $ 300,000 Robertson $ 200,000 (includes $50,000 intra-entity gross profit in ending inventory) Dividends paid Tax rate 32,000 21% 50,000 21% Garrison uses the initial value method to account for the investment in Robertson. Garrison's separate operating income figure does not include dividend income for the current year. a. Assume that Garrison owns 80 percent of Robertson's voting stock. On a consolidated tax return, what amount of income tax is paid? b. Assume that Garrison owns 80 percent of Robertson's voting stock. On separate tax returns, what total amount of income tax is paid? c. Assume that Garrison owns 70 percent of Robertson's voting stock. What total amount of income tax expense does a consolidated income statement recognize? (Round your Intermediate calculations and final answer to nearest whole dollar amount.) d. Assume that Garrison holds 60 percent of Robertson's voting stock. On a separate income tax return, what amount of income tax does Garrison have to pay? a. Taxes to be paid b. Total taxes to be paid C. Total expense to be reported d. Total income taxes payable Amount

In an official announcement to the stock market, ABC Ltd noted that the corporation expects its "underlyingprofit before tax" to fall below the range previously forecasted and announced to the equity market.Please read below:"ABC Ltd on Wednesday said the subdued trading conditions had coincided with a period of "significantdisruption" for the company including introducing a new wage model for its front-end sales staff, an ongoingreview of its shop network and putting in new sales systems. ABC Ltd managing director said the overall resultswould be disappointing. Although the company's corporate results were strong especially in the United States,United Kingdom and Asia, the sluggish regional result means ABC Ltd now expects its underlying profit beforetax for the 12 months to June 30 to fall to between $535 million and $560 million, below the $590 million to$620 million range it initially targeted. The mid-point in this new range, $547.5 million, represents a 10 percent decrease on the…

Apex is a media company that is considering expanding into streaming services.  Apex has a levered beta of 0.80 and a debt to capital ratio (D/(D+E)) of 20%. The unlevered beta for streaming service companies is 1.10 and Apex plans to use its existing debt ratio in funding the business. Apex’s effective tax rate is 30% but the marginal tax rate is 40%. Apex is rated A, and the default spread for A rated firms is 2%. You can assume that the riskfree rate is 3% and the equity risk premium is 6% Estimate the cost of capital you would use in doing a project analysis of the streaming service investment

Ultra Petroleum (UPL) has earnings per share of $1.56 and a P/E ratio of 32.48.What’s the stock price? (Round your answer to 2 decimal places.)

The Pyro Corporation has outstanding twenty thousandshares of common stock, of which nineteen thousandare owned by Peter B. Arson; five hundred shares areowned by Elizabeth Arson, his wife; and five hundredshares are owned by Joseph Q. Arson, his brother. Thesethree individuals are the officers and directors of thecorporation. The Pyro Corporation obtained a $750,000fire insurance policy to cover a certain building itowned. Thereafter, Peter B. Arson set fire to the building, and it was totally destroyed. Can the corporationrecover from the fire insurance company on the$750,000 fire insurance policy? Why or why not?

Sunland Incorporated management is considering investing in two alternative production systems. The systems are mutually exclusive, and the cost of the new equipment and the resulting cash flows are shown in the accompanying table. The firm uses a 8 percent discount rate for production system projects. Year 0 1 2 3 System 1 -$13,900 13,900 13,900 13,900 System 2 NPV of System 1 is $ -$45,200 32,100 32,100 32,100 Calculate NPV. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Do not round discount factors. Round other intermediate calculations and final answers to 2 decimal places, e.g. 15.25.) 19,585.72 and NPV of System 2 is $ In which system should the firm invest? The firm should invest in System 2 34,649.07

A disadvantage of a statutory close corporation is that: a) it cannot distribute dividends to members. b) not all states allow formation of this type of corporation. C) it must keep accurate records and file paperwork to document tax-exempt status. d) it can have no more than 100 stockholders.