Case Studie:Yell PLC is a telephone directory company who are looking to grow their business by buying more equipment and taking over a rival. The company currently have £4.5 million in retained profit but in two years’ time should have an extra £1 million. Yell PLC operates in a competitive market. They currently have 1 year to pay off their existing loan which they’re paying back in 12 equal instalments with interest. Yell PLC hope to please their shareholders by paying a significant dividend.

Question:
1.d.). Yell PLC wants to grow its business and need to raise money to help pay for more equipment and the £5millon needed to complete a takeover. Recommend if they should use retained profit or issue more shares (9 marks)

Answers

Answer 1
Answer: They should try to issue more shares because they get money because people are buying shares and they are also getting rid of how much they get from profits. Hope this helped.
Answer 2
Answer: they should issue more shares to retain the profit


Related Questions

Discuss how poverty can be a challenge to social responsibility
If you want to know whether a company had a profit or a loss during a specific period of time, which financial statement would be most helpful?A.Statement of owners' equityB.Cash flow statementC.Balance sheetD.Income statement
The management of Won League Lotteries was planning to shut down one of its offices. This shutdown was going to result in layoffs, and the employees were not happy. The employees stopped picking up client calls and started leaving work before completing their eight-hour shifts. In the context of scientific management, this behavior of the employees is known as _____.
What is the meaning of cash in the balance sheet?
Locate and correct the circular reference for the balance in cell i5. the balance should be calculated as the difference between total due and the down payment.

As Prepaid Rent is used, the asset becomes a/ana. liability.
b. expense.
c. contra-asset.
d. revenue.

Answers

As prepaid rent is used, the asset becomes a liability.
Liability because it becomes the responsibility of someone who uses the prepaid. Since the prepaid rent was used, it needs money to be able to pay them. It becomes the responsibility for someone to be able to use his money to pay the prepaid rent that was used.
The correct answer is the letter B. Expense

Last week Paul, CEO of Quality Furniture in South Carolina, traveled to Europe to visit customers. While overseas, Paul checked his e-mail daily and showed his company's website to customers, explaining how the website will help them place orders and receive merchandise more quickly. After visiting the last customer Friday morning, Paul was able to return to the corporate office in South Carolina to meet with his board of directors that night. ________ is the "shrinking" of time and space with air travel and electronic media.

Answers

Answer:

the global village

Explanation:

Global village is a term used to describe how communication between parties that are far apart is done as a result of interconnectivity and advanced media technology.

An individual does not need to travel from New York for example for a meeting, rather meetings can now be done online.

In this scenario Paul checked his e-mail daily and showed his company's website to customers, explaining how the website will help them place orders and receive merchandise more quickly.

He was able to work with his office and the customers he visited through the use of media.

This shrinking of time and space by use of media is referred to as the global village.

When a ________________ exists in a competitive market, buyers want to purchase more of a good or service than is supplied.

Answers

Answer:

excess demand or shortage

Explanation:

this is called excess demand or a shortage. Remember, when excess demand exists, buyers compete more intensely for the amount available

Final answer:

The term that completes the sentence is 'shortage'. In a competitive market, a shortage occurs when the demand for a good or service surpasses its supply. This scenario can materialize due to various causes such as increased demand, production issues or limitations in the market.

Explanation:

When a shortage exists in a competitive market, buyers want to purchase more of a good or service than is supplied. A shortage occurs when the demand for a product exceeds the supply. This condition can be due to various factors such as production problems, increased demand, or market restrictions. An example of this may be the shortage of a popular toy during the holiday season. Manufacturers may not be able to keep up with the increased demand, leading to a scarcity of the toy in the market. As a result, buyers are willing to purchase more than what is available, creating a shortage.

Learn more about Shortage here:

brainly.com/question/32824966

#SPJ11

You are evaluating a project that will cost $500,000, but is expected to produce cash flows of $125,000 per year for 10 years, with the first cash flow in one year. Your cost of capital is 11% and your company’s preferred payback period is three years or less. 1. What is the payback period of this project?
2. Should you take the project if you want to increase the value of the company?

Answers

Answer:

1. 4 years

2. No

Explanation:

Payback period calculates the amount of time to recoup the total investment made on a project. It calculates how long the cash flows generated from a project would cover the cost of the project.

The cost of the project is $500,000

Cash flows are $125,000 per year for 10 years.

In the first year, the cost of the project is reduced by $125,000 and becomes $375,000.

In the second year, the cost of the project is reduced by $125,000 and becomes $250,000.

In the third year, the cost of the project is reduced by $125,000 and becomes $125,000.

In the fourth year, the cost of the project is reduced by $125,000 and becomes $0.

The cost of the project is totally recouped in the 4th year. therefore, the payback period is 4 years.

But the company has a preferred payback period of 3 years ,therefore , the firm won't undertake the project because the payback period is more than 3 years.

Which of the following is a type of savings vehicle?

Answers

what are your choices /:

A) Theft of an Automobile  

B) Assault on a Peace Officer  

C) Conspiracy to Commit Fraud  

D) Armed Robbery With a Firearm

The duty of a broker-dealer firm and its individual brokers to ensure that investment recommendations made to customers are suitable based on a specific customer's investment profile includes all of the following except: (A) Have a reasonable basis for the belief that the recommendation is suitable (B) The belief is based on customer-specific information (C) The size of the recommended trade must not be excessive (D) Refrain from making an investment recommendation if the customer refuses to provide certain customer specific information.

Answers

Answer:

The answer is option "D"

Explanation:

The suitability condition that broker-dealer firms have to adopt includes making investment recommendations on the basis of their applicability in terms of what the customer's profile is. To do this, the firm needs to have adequate and reasonable understanding of the customer, their needs, their risk profile, details of their other investments and their age among several other factors. Firms use these details and then perform their own research, or 'due diligence' to ensure that the recommendations made are appropriate in the customer's context. Options A and B pertain to this criteria and are therefore correct. Option C is also correct since, even if the investment recommendation is in line with the customer's profile, firms must still refrain from making trade recommendations that are excessive in size because they can, among other issues, raise the risk profile of the trade.

Now lets look at option D. Broker-dealers do rely on the customers providing customer specific information so that they can plan investment recommendations accordingly, however, this is not the only practice that is required. Firms need to conduct their own research and due diligence as well. Furthermore, customers may be unwilling to disclose certain information, for example, details of their other investments. In this case, firms need to be cautious and carefully analyse whether they have 'enough' customer specific information to be reasonably certain that the investment recommendation is appropriate. As long as enough information exists to form the reasonable basis, firms do not need to refrain from making recommendations.

Therefore, the correct option is D.