Why should I choose AnalystNotes?
Simply put: AnalystNotes offers the best value and the best product available to help you pass your exams.
Basic Question 0 of 3
In 2012 a firm achieved a net income of $50 million on total assets of $500 million. Half of its assets were financed with debt. Its cost of equity is 15%. Calculate residual income.
User Contributed Comments 1
| User | Comment |
|---|---|
| danlan2 | RI=EBIT(1-t)-WACC*Assets =EBIT(1-t)-(Kd*Wd*(1-t)+Ke*We)*Assets We know that Kd*Wd*Assets=interest and Ke*We*Assets=Bv*Ke, then RI=EBIT(1-t)-interest(1-t)-Bv*Ke =NI-Bv*Ke RI=NI-BV*Ke |
You have a wonderful website and definitely should take some credit for your members' outstanding grades.
Colin Sampaleanu
Learning Outcome Statements
construct hypothesis tests and determine their statistical significance, the associated Type I and Type II errors, and power of the test given a significance level
CFA® 2025 Level I Curriculum, Volume 1, Module 8.