Answer: $48.33
Explanation:
Using the Gordon Growth model:
Price of stock = Next year dividend / (Required return - growth rate)
Next year price of stock can be used to calculate year 2 dividend:
53.17 = D₂ / ( 16% - 10%)
53.17 * 6% = D₂
D₂ = $3.19
D₂ = D₁ * ( 1 + growth rate)
3.19 = D₁ * ( 1 + 10%)
D₁ = 3.19/ 1.1
= $2.90
Price of stock today:
= 2.90 / ( 16% - 10%)
= $48.33
Spotify just paid a cash dividend of $1 per share. Investors require a 16% return from investments such as this. If the dividend is expected to grow at a steady 6 percent per year, what is the current value of the stock
Answer:
$10.60
Explanation:
according to the constant dividend growth model
price = d1 / (r - g)
d1 = next dividend to be paid
r = cost of equity
g = growth rate
1(1.06) / 0.16 - 0.06
1.06/0.10 = 10.60
Using the data below, compute DEBT RATIO.
Using the data below, compute Return on Equity.
Accounts Payable 800
Accounts Receivable 1,100
Capital Stock 2,000
Cash 50
Cost of Goods Sold 6,000
Inventory 1,500
Long-term Debt 1,820
Net Income 950
Property, Plant, and Equipment (net) 3,000
Retained Earnings 1,030
Sales 10,000
Market value of shares 12,000
Answer:
a. Total Liabilities = Accounts Payable + Long-term Debt
Total Liabilities = 800 + 1,820
Total Liabilities = $2,620
Total Assets = Accounts Receivable + Cash + Inventory + Property, Plant, and Equipment (net)
Total Assets = 1,100 + 50 + 1,500 + 3,000
Total Assets = $5,650
Debt Ratio = Total Liabilities / Total Assets
Debt Ratio = $2,620 / $5,650
Debt Ratio = 0.463717
Debt Ratio = 46.37%
b. Return on Equity = Net Income / Shareholder Equity
Return on Equity = Net Income / (Capital Stock + Retained Earnings)
Return on Equity = $950 / ($2,000+$1,030)
Return on Equity = $950 / $3,030
Return on Equity = 0.31353135
Return on Equity = 31.35%
Calculate the real dollar rate of return on a 10,000 pound sterling deposit in a London bank in a year when the interest rate on pounds is 6 percent, the dollar/pound exchange rate moves from $1.31 per pound to $1.65 per pound, and the dollar prices increase by 9 percent. The real rate of return will be nothing percent (Enter your response as a percentage rounded to one decimal place.)
Answer:
The real rate of return is 23.0%.
Explanation:
This can be calculated as follows:
Gain due to dollar depreciation = (1.65 - 1.31) / 1.31 = 0.260, or 26.0%
Inflation rate = Increase in dollar price = 9%
Real rate of return = (Gain due to dollar depreciation + Interest rate on pounds) - Inflation rate = (26.0% + 6%) - 9% = 23.0%
Therefore, the real rate of return is 23.0%.
Nesmith Corporation's outstanding bonds have a $1,000 par value, a 7% semiannual coupon, 15 years to maturity, and an 8% YTM. What is the bond's price? Round your answer to the nearest cent.
Answer:
$913.54
Explanation:
Calculation to determine the bond's price
Using Financial calculator to solve for PV( PRESENT VALUE)
N = 2 × 15 = 30
I/YR = 8%/2 = 4%
PMT = 1,000*7%*1/2=35
FV = 1000
PV=?
Hence,
PV = $913.54
Therefore the bond's price is $913.54
Why can we be confident that the market for college education is competitive and that an increase in demand rather than the greed of college administrators is the reason for the ongoing rise in tuition? We can be confident that the market for college education is competitive and that an increase in demand rather than the greed of college administrators is the reason for the ongoing rise in tuition for all of the following reasons except _______.
Question Completion:
A. if college administrators raised the tuition with no change in supply, a surplus of college places would be created at the higher tuition, and the tuition would start to fall
B. the law of demand does not hold
C. more than 4,500 public and private 2-year and 4-year schools supply college education services
D. an increase in demand raises the tuition and increases the enrollment, which accurately describes the market for college education
Answer:
We can be confident that the market for college education is competitive and that an increase in demand rather than the greed of college administrators is the reason for the ongoing rise in tuition for all of the following reasons except _______.
B. the law of demand does not hold
Explanation:
The law of demand implies that the price of a good or service responds to the level of demand. In other words, higher demand increases the price, while lower demand reduces the price. This implies that without the higher demand for college education, college administrators will not be able to sustain an increase in tuition. Therefore, an increase in the demand for college education will lead to increased enrollment, which spurs college administrators to raise tuition.
On December 31, journalize the write-offs for 2016 under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded $5,250,000 of credit sales during 2016. Based on past history and industry averages, ¾% of credit sales are expected to be uncollectible. Refer to the Chart of Accounts for exact wording of account titles.
Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of its operations ending December 31, 2016:
Customer Amount
Shawn Brooke $4,650
Eve Denton 5,180
Art Malloy 11,050
Cassie Yost 9,120
Total $30,000
Answer:
Casebolt Company
Journal Entries:
Dec. 31, 2016
Debit Allowance for Uncollectible Accounts $30,000
Credit Accounts Receivable $30,000
To write-off uncollectible accounts.
Dec. 31, 2016
Debit Bad Debts Expenses $69,375
Credit Allowance for Uncollectible Accounts $69,375
To record bad debts for the year and bring the Allowance for Uncollectibles to a credit balance of $39,375.
Explanation:
a) Data and Calculations:
Credit sales for 2016 = $5,250,000
Uncollectible allowance based on past history and industry = 3/4% = $39,375 ($5,250,000 * 3/4%)
Actual accounts written off as uncollectible = $30,000
Customer Amount
Shawn Brooke $4,650
Eve Denton 5,180
Art Malloy 11,050
Cassie Yost 9,120
Total $30,000
Analysis:
Dec. 31, 2016 Allowance for Uncollectible Accounts $30,000 Accounts Receivable $30,000
Dec. 31, 2016 Bad Debts Expenses $69,375 Allowance for Uncollectible Accounts $69,375
Burkhardt Corp. pays a constant $15.25 dividend on its stock. The company will maintain this dividend for the next 9 years and will then cease paying dividends forever. If the required return on this stock is 9.2 percent, what is the current share price
Answer:
$90.69
Explanation:
Current share price can be determined by calculating the present value of the cash flows
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow in year 1 to 9 = 15.25
I = 9.2
PV = 90.67
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
discuss how business risks are both inevitable and unavoidable
Answer:
Risk is inevitable in everything we do. ... There may be some unlikely but high impact risks, for example, the risk that the solution could cause the destruction of the organisation (see the case studies below). The good Project Manager will constantly assess the risks and take action as needed.
Charu Khanna received a Form 1099-B showing the following stock transactions and basis during 2019 Stock Date Purchased Date Sold Sales Price ($) Cost Basis ($) 4,000 shares Green Co. 06/04/07 08/05/19 12,000 3,000 500 shares Gold Co. 02/12/17 09/05/19 54,000 62,000 5,000 shares Blue Co. 02/04/08 10/08/19 18,000 22,000 100 shares Orange Co. 11/15/18 07/12/19 19,000 18,000 None of the stock is qualified small business stock. The stock basis was reported to the IRS. Calculate Charu's net capital gain or loss using Schedule D and Form 8949. (Click done and save once the forms are completed) Submit your forms below.
Answer:
Charu Khanna
The Net capital loss is:
= $2,000.
Explanation:
a) Stock Transactions and Data during 2019:
Stock Date Date Sold Sales Price ($) Cost Basis ($)
Purchased
4,000 shares Green Co. 06/04/07 08/05/19 12,000 3,000
500 shares Gold Co. 02/12/17 09/05/19 54,000 62,000
5,000 shares Blue Co. 02/04/08 10/08/19 18,000 22,000
100 shares Orange Co. 11/15/18 07/12/19 19,000 18,000
Total $103,000 $105,000
Net capital loss:
Long-term capital loss = $3,000
Short-term capital gain = $1,000
Net capital loss = $2,000 ($3,000 - $1,000)
The HR planning process should be aligned with the strategic process of the organization in general. It will show how HR will contribute to the achievement of goals and objectives the organization has determined as a whole. As part of the planning process, HR should perform a job analysis. To have a better understanding of the job analysis, you should answer all of the following questions for this assignment: Judge the job analysis process of an organization you are familiar with and indicate whether it is an effective one. Judge a job description and job specification for any job selected that was performed with that job analysis process. Indicate how you would improve it and explain its importance.
Answer:
Rating employees according to their performance against the key performance indicators.
Explanation:
HR has responsibility to hire, fire and appraise employees. An employee is appraised after his performance is analyzed. There are certain job specifications which an employee must satisfy in order to stay in the company. This is the main objectives for which a company has hired an employee. If an employee performs beyond expectation the he may qualify for promotions.
Which of the following costs is an example of a Selling & Administrative (S&A) cost rather than a product cost? Group of answer choices Depreciation on production equipment. Wages of salespersons. Wages of production machine operators. Insurance on factory equipment.
Answer:
The answer is B.
Explanation:
Option B. Wages of sales person are the example of a Selling and Administrative cost. Other examples are rents, distribution cost etc.
Option C is wrong. Wages of production machine operators is a direct wage. It will form part of cost of sales.
Option D is wrong. Insurance on factory equipment cannot be attributable to selling cost.
Aunt Gayle is the sole proprietor of a cupcake catering company. She mostly makes her cupcakes for parties, weddings, and wakes. Business has grown slowly, and her resources are fairly limited. What marketing strategy would work best for her small company
Answer: niche marketing
Explanation:
The marketing strategy that would work best for her small company is the niche marketing.
Niche marketing is a strategy whereby the company focuses on a unique target market rather than focusing on the whole market as a whole. It is regarded as a segment of a larger market that has its own preferences and needs.
Since business has grown slowly, and her resources are fairly limited, the company can focus on a particular segment in the market using the niche marketing.
The following data was identified by Raines Corp. in preparation of its bank reconciliation on October 31, 2017:
Bank statement balance $30,700
Raines' book balance (before adjustments) ?
Outstanding checks 4200
NSF checks 400
Service charge 300
Deposits in transit 3100
Interest earned on checking amount 100
Required:
What is the adjusted cash balance on October 31, 2017?
Answer:
the adjusted cash balance on October 31, 2017 is $29,600
Explanation:
The computation of the adjusted cash balance on October 31, 2017 is shown below:
Bank statement balance $30,700
Add: Deposits in transit $3,100
Less; Outstanding checks $4,200
Adjusted cash balance on October 31, 2017 $29,600
hence, the adjusted cash balance on October 31, 2017 is $29,600
Assume the following sales data for a company: 2013 $945,000 2012 877,500 2011 650,000 If 2011 is the base year, what is the percentage increase in sales from 2011 to 2012? Group of answer choices 24% 35% 76% 135%
Answer:
35%
Explanation:
percentage increase in sales from 2011 to 2012 = (sales in 2012 / sales in 2011) - 1
(877,500 / 650,000) - 1 = 0.35 = 35%
On January 1, Year 1, the City Taxi Company purchased a new taxi cab for $36,000. The cab has an expected salvage value of $2,000. The company estimates that the cab will be driven 200,000 miles over its life. It uses the units-of-production method to determine depreciation expense. The cab was driven 45,000 miles the first year and 48,000 the second year. What would be the depreciation expense reported on the Year 2 income statement and the book value of the taxi, respectively, at the end of Year 2?
a. $8,640 and $19,260
b. $8,640 and $17,260
c. $8,160 and $20,190
d. $8,160 and $18,190
Answer:
C
Explanation:
Activity method based on output = (output produced that year / total output of the machine) x (Cost of asset - Salvage value)
year 2 = (48,000 / 200,000) x (36,000 - 2000) = 8160
book value = cost of asset - accumulated depreciation
accumulated depreciation = year 1 + year 2's depreciation
year 1 = (45,000 / 200,000) x (36,000 - 2000) =
- 200,000 - (7650 + 8160) =
For each example listed, decide if the good is a normal good or an inferior good. Make sure you answer from the perspective of the individual or individuals doing the buying or consuming. You are currently in a labeling module. Turn off browse mode or quick nav, Tab to items, Space or Enter to pick up, Tab to move, Space or Enter to drop. Billy's mom increases his weekly allowance by $ 5 . As a result, Billy increases the number of apps he downloads on his smartphone. Smartphone apps are Susan gets a 15 percent performance bonus at work. She can finally stop eating so many frozen pizzas and eat something more tasty. Frozen pizzas are Mike is an appliance salesman. Refrigerator sales in his store have fallen and so has his commission. Mike decides to switch from name brand cereal to generic cereal. Generic cereal is Hair stylist Molly loses a few of her clients. Molly cuts back on the number of smoothies she buys during the week. Smoothies are:______.
Answer and Explanation:
In the case when the income increased so the demand also increased so the goods are classified as the normal goods. Therefore the apps are normal goods
In the case when the income increased but the demand declines so it is to be considered as the inferior goods so frozen pizzas are inferior goods
In the case when there is the decline in the income due to this the income rises so the goods are inferior goods. So, the generic cereal is an inferior goods
In the case when the income declines so the demand also declines this meand the goods are normal goods. So, smoothies are normal goods
$
$
$
2,400.00
1,560.00
4,800.00
15,672.00
50,001.00
las en
50,000.00
50,001.00
(1.00)
$
Answer:
english pls
Explanation:
An investor in the 32% tax bracket is considering two investment options of equal risk: a corporate bond that yields 8.25% and a municipal (muni) bond that yields 4.75%. Assuming the investor will select the bond with the highest yield, which bond should this investor choose
Answer: Corporate bond
Explanation:
It should be noted that the municipal bond aren't taxable. Therefore, its yield will be 4.75%.
On the other hand, the After Tax Cost of the yield of the corporate bond will be:
= Yield × (1-Tax Rate)
= 8.25% × (1-35%)
= 8.25% × 65%
= 5.36%
Therefore, the Corporate Bond should be chosen since it has a higher yield.
You are considering purchasing a piece of industrial equipment that costs 30000. You decide to make a down payment in the amount of 5000 and to borrow the remainder from a local bnak at an interest rate of 9% compounded monthly, which is to be paid for 36 monthly installments. The amount of the monthly payment is nearest to:_________
a. $954
b. $833
c. S795
d. $694
Answer:
b
Explanation:
Goose Corporation, a C corporation, incurs a net capital loss of $12,000 for 2020. It also has ordinary income of $10,000 in 2020. Goose had net capital gains of $2,500 in 2016 and $5,000 in 2019.
a. Determine the amount, if any, of the net capital loss of $12,000 that is deductible in 2020.
b. Determine the amount, if any, of the net capital loss of $12,000 that is carried forward to 2017.
Answer:
a. The amount of the net capital loss of $12,000 that is deductible in 2020 is zero.
b. The amount of the net capital loss of $12,000 that is carried forward to 2021 is $7,000.
Explanation:
Sections 1211 and 1212 of the Internal Revenue Code (IRC) address capital losses of corporations and declare that:
Corporation capital losses are not allowed to be deducted from ordinary income.For that year, corporations can only deduct capital losses up to the amount of capital profits from other assets.Any capital losses that haven't been deducted because there aren't any more capital gains can be carried back three years and forward five years.As a result of the foregoing, we have:
a. Determine the amount, if any, of the net capital loss of $12,000 that is deductible in 2020.
Because there are no capital gains in 2020, no portion of the $12,000 net capital loss is deductible in 2020. It cannot be deducted from ordinary income in 2020.
Therefore, the amount of the net capital loss of $12,000 that is deductible in 2020 is zero.
b. Determine the amount, if any, of the net capital loss of $12,000 that is carried forward to 2017.
Note: This question b is not correct because the 2017 is used instead of 2021 as the year. It therefore correctly stated before answering the question as follows:
Determine the amount, if any, of the net capital loss of $12,000 that is carried forward to 2021.
The explanation of the answer is now given as follows:
Because businesses can carry back three years and forward five years, the amount to carry forward to 2021 will be the difference of $12,000 in capital losses for 2020 and $5,000 in capital gains for 2019, which is $7,000 (i.e. $12,000 - $5,000 = $7,000).
Therefore, the amount of the net capital loss of $12,000 that is carried forward to 2021 is $7,000.
The manufacture of a popular mouthwash liquid brand is losing sales to a competitor who has been able touse bulk purchasing of its main ingredients from its wholesalers to receive a substantial price break in materials. Which IT management challenge is addressed in this scenario?
Answer:
Develop strong relationship with supplier
Explanation:
A good relationship with the supplier would provide the business the needed support just as it does to the competitor. This would make business to come to the way of the supplier.
Buying in bulks is a good way of making purchases because it is a way to get products at a cheaper rate
Effects of recognizing accrued interest on financial statements LO 9-1
Bill Darby started Darby Company on January 1, Year 1. The company experienced the following events during its first year of operation:
1. Earned $1,300 of cash revenue.
2. Borrowed $2,400 cash from the bank.
3. Adjusted the accounting records to recognize accrued interest expense on the bank note. The note, issued on September 1, Year 1, had a one-year term and an 10 percent annual interest rate.
Required:
a. What is the amount of interest payable at December 31, Year 12?
b. What is the amount of interest expense in Year?
c. What is the amount of interest paid in Year?
d. Use a horizontal statements model to show how each event affects the balance sheet income statement, and statement of cash flows.
Answer:
Darby Company
a. The amount of the interest payable at December 31, Year 1 is $80.
b. The amount of the interest expense in Year 1 is $80.
c. The amount of interest paid in Year 1 is $0.
d. Horizontal Statements Model:
Balance Sheet Income Statement Statement of
Cash Flows
Assets = Liabilities + Equity Income = Revenue - Expenses
1. +$1,300 = 0 + $1,300 $1,300 = $1,300 OA cash inflow
2. +$2,400 = $2,400+ 0 FA cash inflow
3. 0 = $80 + ($80) ($80) = 0 - ($80) None
$3,700 = $2,480 + $1,220 $1,220 = $1,300 - $80
Explanation:
a) Data and Calculations:
1. Cash $1,300 Revenue $1,300
2. Cash$2,400 10% Bank Note Payable $2,400
3. Interest Expense $80 Interest Payable $80 )$2,400 * 10% * 4/12)
"On April 3, Erin Garnder received her bank statement showing a balance of $2,087.93 Her checkbook showed a balance of $1,493.90. Outstanding check were $224.15, $327.80, $88.10, $122.42, and $202.67. There was an $8.00 service charge, and the deposits in transit amounted to $813.11. There was an electronic payroll deposit of $450.00. The reconciled balance is:"
Answer:
$1,935.90
Explanation:
We prepare a Bank Reconciliation Statement to determine the reconciled balance as follows :
Erin Garnder
Bank Reconciliation Statement
Balance as per Bank Statement $2,087.93
Add Outstanding Lodgments $813.11
Less Unpresented checks
($224.15 + $327.80 + $88.10 + $122.42 + $202.67) ($965.14)
Balance as per Cash Book $1,935.90
Therefore,
The reconciled balance is: $1,935.90
The CPA Practice Advisor reports that the mean preparation fee for 2017 federal income tax returns was $273. Use this price as the population mean and assume the population standard deviation of preparation fees is $100. Use z-table.
a. What is the probability that the mean price for a sample of 30 federal income tax returns is within $16 of the population mean?
Answer:
The CPA Practice Advisor
The probability that the mean price for a sample of 30 federal income tax returns is within $16 of the population mean is:
= 56%
Explanation:
a) Data and Calculations:
Population mean (preparation fee for 2017 federal income tax returns) = $273
Population standard deviation of preparation fees = $100
Mean price for a sample of 30 federal income tax returns = $257 (which is within $16 of the population mean)
z = (x-μ)/σ
z = standard score
x = observed value
μ = mean of the sample
σ = standard deviation of the sample
Z = ($273 - $257)/$100
= 0.16
Using the z-table
P = 0.5636
The owner of a factory regularly requests a graphical summary of all employees' salaries. The graphical summary of salaries is an example of
Answer: descriptive statistics
Explanation:
The owner of a factory regularly requests a graphical summary of all employees' salaries. The graphical summary of salaries is an example of the descriptive statistics.
Descriptive statistics refers to the branch of statistics that describes features of a data that are involved in a study. The main idea behind the descriptive statistics is simply to provide a summary of the samples that are done on a certain study.
In economics, the cost of production is defined as the expenditures incurred to
obtain the factors of production such as labor, land, and capital that are
needed in the production process of a product. Explain the following in relation
the total cost in economics
i. A firm pays its accountant an annual allowance of $10,000. Is this an
economic cost? Explain AN, 5MARKS
Answer:
12
Explanation:
i know it
Bramble Corp. borrowed $870000 from Liber Bank on January 1, 2019 in order to expand its mining capabilities. The note required annual payments of $220776 and carried an annual interest rate of 8.5%. What is the balance in the notes payable account at December 31, 2020 if payments are made at the end of each year
Answer:
$563,867.79
Explanation:
Notes annual payments = $220,776
Notes payable January 1, 2019 = $870,000
Interest for the year 2019 = $870,000*8.5% = $73,950
Principal payment for 2019 = $220,776 - $73,950 = $146,826
Notes payable at the end of year 2019 = $870,000 - $146,826 = $723,174
Interest for the year 2020 = $723,174 * 8.5% = $61,469.79
Principal payment for 2020 = $220,776 - $61,469.79 = $159,306.21
Notes payable at the end of year 2021 = $723,174 - $159,306.21 = $563,867.79
Sandra is purchasing a home with a first mortgage loan for $548,250, which is the conforming loan limit for the area where she lives at the time that she secures approval. Her interest rate is not a prime rate, and in order to determine if it triggers the threshold for higher-priced mortgage loans, her creditor must determine if the APR for the loan exceeds the average prime offer rate by:
Question Completion with Options:
2.5 percentage points
1.5 percentage points
3.5 percentage points
6.5 percentage points
Answer:
Sandra's creditor must determine if the APR for the loan exceeds the average prime offer rate by:
1.5 percentage points
Explanation:
The first mortgage loan principal should not exceed the conforming loan limit for the area where Sandra lives at the time that she secures the loan approval. It behooves on Sandra’s creditor to determine if the annual percentage rate (APR) for the mortgage loan exceeds the average prime offer rate (or the sample rate that is a representative of the APRs charged by creditors for mortgage loans that have low-risk pricing characteristics) by 1.5 percentage points.
In analyzing company operations, the controller of the corporation found a $250,000 favorable flexible-budget revenue variance. The variance was calculated by comparing the actual results with the flexible budget. This variance can be wholly explained by
Answer: C. changes in unit selling prices.
Explanation:
The options given are:
a. the total flexible budget variance
b. the total static budget variance
c. changes in unit selling prices
d. changes in the number of units sold
Based on the information given, the variance can be wholly explained by changes in unit selling prices.
This is due to the fact that the flexible budget revenue variance is calculated and gotten as the difference between the budgeted revenue and the actual revenue at thesame activity level.
Therefore, the number of units will be thesame in both the actual results and the flexble budget. Then, the difference will be as a result of the change in the unit selling price.
the process of providing focus for employees and motivating them to achieve organizational gool's. Select one a. Effective b. Directing c.Controlling d. Planning
Answer:
directing
Explanation:
with directing you instruct your employees on what to do thus providing focus