Ramos Corp

question 126

Essay

Ramos Corp.started business at the beginning of the year,with assets of $650,000 and stockholders' equity of $290,000.By the end of the year,assets increased by $80,000 and liabilities increased by $60,000.Other than net income or loss,the only change in stockholders' equity was dividends declared and paid of $55,000.
A)What was the amount of Ramos Corp.stockholders' equity at the end of the year?
B)What was the amount of Ramos Corp.net income or net loss for the year?

• A)What was the amount of Ramos Corp.stockholders' equity at the end of the year?
• B)What was the amount of Ramos Corp.net income or net loss for the year?

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Definitions:

Mutually Exclusive

This term describes scenarios or choices where the selection of one option precludes the selection of any other option, typically in decision making or project selection.

Cost Of Capital

The rate of return required by a capital provider—debt or equity—for investing in a company.

Crossover Rate

Crossover Rate is the point at which two or more investment alternatives have the same net present value, used in capital budgeting to compare the desirability of projects.

WACC

A firm’s capital expenses are determined through the Weighted Average Cost of Capital, which proportionally weighs each category of capital.