In january 2017, domingo, inc., acquired 20 percent of the outstanding common stock of martes, inc., for $749,000. this investment gave domingo the ability to exercise significant influence over martes, whose balance sheet on that date showed total assets of $3,928,000 with liabilities of $908,000. any excess of cost over book value of the investment was attributed to a patent having a remaining useful life of 10 years. in 2017, martes reported net income of $200,000. in 2018, martes reported net income of $248,250. dividends of $95,000 were declared in each of these two years. what is the equity method balance of domingo’s investment in martes, inc., at december 31, 2018?

Which of the following statements is correct? large corporations are taxed more favorably than sole proprietorships. corporate stockholders are exposed to unlimited liability. due to limited liability, unlimited lives, and ease of ownership transfer, the vast majority of u.s. businesses (in terms of number of businesses) are organized as corporations. most businesses (by number and total dollar sales) are organized as partnerships or proprietorships because it is easier to set up and operate in one of these forms rather than as a corporation. however, if the business gets very large, it becomes advantageous to convert to a corporation, mainly because corporations have important tax advantages over proprietorships and partnerships. most business (measured by dollar sales) is conducted by corporations in spite of large corporations’ often less favorable tax treatment, due to legal considerations related to ownership transfers and limited liability.

Bond j has a coupon rate of 6 percent and bond k has a coupon rate of 12 percent. both bonds have 14 years to maturity, make semiannual payments, and have a ytm of 9 percent. a. if interest rates suddenly rise by 2 percent, what is the percentage price change of these bonds?

Your sister is thinking about starting a new business. the company would require $375,000 of assets, and it would be financed entirely with common stock. she will go forward only if she thinks the firm can provide a 13.5% return on the invested capital, which means that the firm must have an roe of 13.5%. how much net income must be expected to warrant starting the business? a. $41,234b. $43,405c. $45,689d. $48,094e. $50,625