In March 2015, Daniela Motor Financing (DMF), offered some securities for sale to the public. Under the terms of the deal, DMF promised to repay the owner of one of these securities $2,000 in March 2040, but investors would receive nothing until then. Investors paid DMF $740 for each of these securities; so they gave up $740 in March 2015, for the promise of a $2,000 payment 25 years later.

Required:
a. Assuming you purchased the bond for $740, what rate of return would you earn if you held the bond for 25 years until it matured with a value $2,000?
b. Suppose under the terms of the bond you could redeem the bond in 2023. DMF agreed to pay an annual interest rate of 1.4 percent until that date. How much would the bond be worth at that time?
c. In 2023, instead of cashing in the bond for its then current value, you decide to hold the bond until it matures in 2040. What annual rate of return will you earn over the last 17 years?

Answers

Answer 1

Answer:

a. 4.06%

b. $827.06

c. 5.33%

Explanation:

a. Assuming you purchased the bond for $740, what rate of return would you earn if you held the bond for 25 years until it matured with a value $2,000?

Rate of return = [(Promised payment / Bond purchase price)^(1 / 25)] - 1 = [(2,000 / 740)^(1/25)] - 1 = 1.0406 = 0.0406 = 4.06%

Therefore, the rate of return that you would earn is 4.06%.

b. Suppose under the terms of the bond you could redeem the bond in 2023. DMF agreed to pay an annual interest rate of 1.4 percent until that date. How much would the bond be worth at that time?

Since 2015 to 2023 is 8 years, the worth of the bond after 8 years at 1.4 percent can be computed as follows:

Worth after 8 years = Bond purchase price * (1 + r)^n

Where;

r = annual interest rate = 1.40%, or 0.014

n = number years after = 8

Therefore, we have:

Worth after 8 years = 740 * (1 + 0.014)^8 = $827.06

c. In 2023, instead of cashing in the bond for its then current value, you decide to hold the bond until it matures in 2040. What annual rate of return will you earn over the last 17 years?

Return in last 17 years = [(Bond purchase price / Worth after 8 years)^(1/17)] - 1 = [(2,000 / 827.06)^(1/17)] - 1 = 1.0533 - 1 = 0.0533 = 5.33%


Related Questions

E-Eyes just issued some new preferred stock. The issue will pay an annual dividend of $14 in perpetuity, beginning 19 years from now. If the market requires a return of 4.4 percent on this investment, how much does a share of preferred stock cost today

Answers

Answer:

Price of stock = $181.78

Explanation:

PV of dividend in year 13

PV =A×(1- (1+r)^(-n)/r )

PV of dividend in (year 13) = 14/(0.044=318.18

PV of dividend in year 0

PV = Div× (1+r)^(-n)

Dividend in year 13, r-interest rate, n- number of years

PV in year 0 = 318.1818182 × 1.044^(-13)= 181.78

Price of stock = $181.78

You want to have $1 million in your savings account when you retire. You plan on investing a single lump sum today to fund this goal. You are planning on investing in an account which will pay 7.5 percent annual interest. Which of the following will reduce the amount that you must deposit today if you are to have your desired $1 million on the day you retire? I. Invest in a different account paying a higher rate of interest. II. Invest in a different account paying a lower rate of interest. III. Retire later. IV. Retire sooner.

Answers

Answer:bruh

Explanation:

Athena Company provides employee health insurance that costs $15,400 per month. In addition, the company contributes an amount equal to 4% of the employees' $154,000 gross salary to a retirement program. The entry to record the accrued benefits for the month would include a:

Answers

Answer:

The entry to record accrued benefits would be a Debit to Employee Benefits Expense of $21,560

Explanation:

In order to calculate The entry to record the accrued benefits for the month we would have to calculate the following formula:

Accrued Benefits=  Health Insurance Cost+  (Gross Salary × Percentage Contributable)

Accrued Benefits=$15,400+($154,000×4%)

Accrued Benefits=$15,400+$6,160

Accrued Benefits=$21,560

The entry to record accrued benefits would be a Debit to Employee Benefits Expense of $21,560

Dianna will invest $3,000 in an investment account for the next 30 years. The investment will earn 13 per cent annually. How much will she have at the end of 30 years? (Round to the nearest dollar.)

Answers

Answer:

$117,347.69

Explanation:

Assuming that Diana made only one $3,000 investment, in 30 years she will have:

future value = present value x (1 + interest rate)ⁿ

present value = $3,000interest rate = 13%n = 30 years

future value = $3,000 x (1 + 0.13)³⁰ = $3,000 x 39.116 = $117,347.69

Van Frank Telecommunications has a patent on a cellular transmission process. The company has amortized the patent on a straight-line basis since 2017, when it was acquired at a cost of $10.8 million at the beginning of that year. Due to rapid technological advances in the industry, management decided that the patent would benefit the company over a total of six years rather than the nine-year life being used to amortize its cost. The decision was made at the beginning of 2021.Required:
Prepare the appropriate adjusting entry for patent amortization in 2021 to reflect the revised estimate.

Answers

Answer:

The appropriate adjusting entry for patent amortization in 2021 to reflect the revised estimate would be as follows:

Amortization Expense Dr. 3 million

                                  Patent Cr. 3 million

Explanation:

In order to Prepare the appropriate adjusting entry for patent amortization in 2021 to reflect the revised estimate we would have to make the following calculations:

Calculation after the Change:

Original Cost =$10.8 million

Annual Amortization (Old) =$10.8 million/9 = $1.2 million

Amortization till Date (2017 - 2021) = 1.2*4 = 4.8 million

Unamortized Value = 10.8 - 4.8 = 6 million

Remaining Life = 6 - 4 = 2 Years

New Amortization = Unamortized Value/Remaining Life = 6/2 = 3 million

Therefore, the appropriate adjusting entry for patent amortization in 2021 to reflect the revised estimate would be as follows:

Amortization Expense Dr. 3 million

                                  Patent Cr. 3 million

Go through the three components of democratic capitalism and picture an economy without each one. What happens to freedom, fairness, and moral and ethical behavior? Which part of the system seems weakest today? What can be done about it?

Answers

Explanation:

The three components of democratic capitalism are: private ownership of the means of production, the labor market and the exchange of products in a market whose profit is obtained.

When imagining an economic context without free companies, the scarcity would be increasing and there would be an economic slowdown that would impact the lives of thousands of people and lead to an increase in poverty, hunger and starvation.

Such problems could also happen without a freely elected government.

Therefore, ethical and moral values ​​must be considered as the basis of any economic system, so that all market mechanisms flow in order to satisfy the needs of citizens with regard to products, services, employment and dignity.

A company has net credit sales of $ 1 comma 300 comma 000​, beginning net accounts receivable of $ 270 comma 000​, and ending net accounts receivable of $ 202 comma 000. What is the​ days' sales in accounts​ receivable? (Use 365 days in calculations as needed. Round any intermediate calculations to two decimal​ places, and your final answer to the nearest whole​ day.)

Answers

Answer:

66.36 days

Explanation:

Calculation of the​ days' sales in accounts​ receivable .

Using this formula

Accounts Receivable Turnover Ratio = [Net credit sales (Beginning net account receivable +Ending net account receivable)/2)]

Let plug in the formula

[$1,300,000/($270,000 + $202,000)/2)]

$1,300,000/($472,000/2)

=$1,300,000/236,000

=$5.50 Days' sales in receivables

= 365/5.5

= 66.36 days

Therefore the days' sales in accounts​ receivable will be 66.36 days

A medical group practice is considering offering a new service with risk that is greater than the current risk of the business. When evaluating this investment, the decision maker should:

a. increase the internal rate of return of the project to reflect the greater risk
b. increase the net present value of the project to reflect the greater risk
c. reject the project because its acceptance would increase the risk of the business
d. ignore the risk differential if the project represents only a small fraction of the total assets of the firm
e. increase the cost of capital applied to the project to make it higher than the business's corporate cost of capital

Answers

Answer:

e. increase the cost of capital applied to the project to make it higher than the business's corporate cost of capital

Explanation:

When a project is more risky compared to the current risk of the business, the business shouldn't use the company's weighted average cost of capital but use a cost of capital higher than the company's wacc to reflect the riskiness of the project. .

Net present value is the present value of after tax cash flows from an investment less the amount invested.

Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested

NPV and IRR are determined by amount invested in the project, cost of capital and cash inflows. It cannot be randomly manipulated.

I hope my answer helps you

Concord Co. had sales revenue of $555,600 in 2020. Other items recorded during the year were: Cost of goods sold $320,200 Salaries and wages expense 120,100 Income tax expense 25,590 Increase in value of company reputation 15,570 Other operating expenses 11,210 Unrealized gain on value of patents 20,410 Prepare a single-step income statement for Concord for 2020. Concord has 105,600 shares of stock outstanding

Answers

Answer:

                          Concord Co.

                     Income Statement

    For the Year Ended December 31, 2020

Revenues:

Sales revenue                                          $555,600

Expenses:

Cost of goods sold                                ($320,200)

Salaries and wages expense                 ($120,100)

Other operating expenses                        ($11,210)

Income tax expense                               ($25,590)

Net income:                                               $78,500

Earnings per share:                                       $0.74

Increase in value of company reputation and unrealized gain on value of patents are not included in this income statement.

Chloe makes $500 per week and spends all her income on books and tea. Books cost $25 each, and Chloe buys 16 each week. Tea costs $5 per cup, and Chloe buys 20 cups. When Chloeâs income falls to $450 per week, she cuts her consumption of books by 3 books and purchases 5 more cups of tea. Based on these figures, indicate whether each of the following statements is true or false.

a. Books are an inferior good.

1. True
2. False

b. Tea is a necessity.

1. True
2. False

c. Books are a luxury good, and tea is an inferior good.

1. True
2. False

Answers

Answer:

hi i reallly tried but dont want to give an answer that is wrong

plz forgive me

god bless u

Explanation:

Tony saved enough money to place $125,500 in an investment generating 10% compounded monthly. He wants to collect a monthly income of $1,350, at the beginning of each month, for as long as the money lasts. How many months will Tony have this income coming to him?
A.165.
B.145.
C.192.
D.162.

Answers

Answer:

The answer is 162 months, option (D)

Explanation:

Solution

Given that:

Tony saved an amount of money =$125,500

Investment generates a =10% compounded monthly

A monthly income of =$1350

Now, we have to find How many months will Tony have this income coming to him

Thus

The current  income value will be equal to = $125,500.

So,

125,500 = 1350 + 1350/1.0077 + 1350/1.0077^2 + 1350/1.0077^3 + ... + 1350/1.0077^n

125,500 = 1350 * 1.0077 / 0.0077 * ( 1 - (1/1.0077)^n )

Therefore n= 162 months

Suppose the GDP of Australia is 100,000 AUD and the exchange rate between AUD and USD is 1.34 AUD=$1. What is the GDP of Australia when measured in USD? Round your answer to the nearest hundredth.

Answers

Answer:

The value of GDP in dollars = $74600

Explanation:

Given the GDP (gross domestic product) of Australia = 100000 AUD

Given the exchange rate, 1.34 AUD = $1.

Since we have given the total amount of GDP for Australia and exchange rate. Now we have to calculate the value of Australian GDP in the dollars. We can find this by dividing the total GDP with 1.34 AUD.

The value of GDP in dollars = 100000 / 1.34 = $74626.86 or $74600.

Assume Luis spends his entire income on X and Y, and his indifference curves have the usual convex shape. If Luis maximizes his utility, then:

a. there are other bundles that are preferred at the current price ratio.
b. the slope of his indifference curve is smaller than the slope of his budget line.
c. he spends his entire available income.
d. the slope of his indifference curve is greater than the slope of his budget line.

Answers

Answer:

c. he spends his entire available income.

Explanation:

If Luis wants to maximize his utility, he will need to spend all his money and locate himself in the point of the curve that is tangent to his personal budget line. At this point, the curve's slope is equal to the price ratio of the goods.

The marginal rate of substitution at this point is equal to the slope of the curve, i.e. how much of a product you have to give up in order to gain more utility from another product.

Jane, Joseph and John are supporting their father who lives in a separate apartment. Their contribution towards his support is 10%, 35% and 55%, respectively. In a multiple support agreement, who would be entitled to claim the father as a dependent?

Answers

Answer:

Joseph or John

Explanation:

In order to claim a person as a dependent in order to be eligible for tax benefits, one must contribute with more than 10% of the person's support.

In this case, only Joseph and John contribute with more than 10% and therefore only Joseph or John would be entitled to claim their father as a dependent.

Suppose your friend is a music major who sings at weddings. She has no fixed or marginal costs for singing and has two types of customers: 20 customers think it is worth paying $200 to have her sing at their wedding, whereas 10 customers think her singing services are worth only $100. Il earn S if she can charge only one price to:________.
(a) If your friend is able to sing at each wedding and maximizes profits all customers.
(b) She will earn S If she can perfectly price discriminate.

Answers

Answer: a. $4,000

b. $5,000

Explanation:

a. If she can sing at each wedding but decides to maximise profits, she will only sing at the weddings of those paying her $200 as it is the higher of the two payment options.

Should she sing at the $200 customer weddings, she would make;

= 20 people * $200

= $4,000

b. Price Discrimination is the charging of different types of customers different prices for the same or similar goods.

If your friend knows how to perfectly charge the two different groups the different prices that they value her at then she will be able to attend and sing at both weddings making her revenue;

= (10* $100) + (20 * $200)

= 1,000 + 4,000

= $5,000

April 5 $10 April 10 $12 April 15 $14 April 20 $16 April 22 $17 One unit is sold on April 25. The company uses the weighted average inventory costing method. Identify the cost of the ending inventory on the balance sheet. (Round your answer to 2 decimal places.)

Answers

Answer: $55.20

Explanation:

The Weighted Average Cost method of valuing inventory averages the cost of the entire inventory in stock and then uses the resultant cost to value all of the inventory.

As it is an average, it works by adding up all the costs and dividing by the number of units.

1 unit of each good costing the prices listed were purchased so,

= $10 + $12 + $14 + $16 + $17

= $69

5 units were purchased so the average is,

= 69/5

= $13.80 is the cost per inventory unit.

One unit was sold on April 25

4 units therefore remain.

Cost of ending inventory is,

= 13.80 * 4

= $55.20

I have attached the complete question below.

Statements in an employee handbook:Group of answer choices may be interpreted as being part of the employment contract.are merely statements of existing policies and cannot form part of the employment contract.are always part of the employment contract.are not part of the employment contract unless the employee handbook is clipped to the contract.

Answers

Answer:

None of these

Explanation:

In simple words, Employee handbook refers to the elaborate affirmation of the employees ' private initiatives. It can be seen as part of an agreement for array of high-will job opportunities.

Such a document can be seen as a valuable tool for every employer as well as employee communications. In a prescribed document it provides advice and direction regarding the history, mission , values, policies , procedures and productivity of the company.

Hancock Medical Supply Co., earned $85,000 of revenue on account during Year 1, its first year of operation. During Year 1, Hancock collected $67,600 of cash from its receivables accounts. The company did not write-off any uncollectible accounts. It estimates that it will be unable to collect 1% of revenue on account. What is the net realizable value of receivables that will be reported on the balance sheet at December 31, Year 1

Answers

Answer:

realizable value of the receivable = $16,550

Explanation:

First of all let us lay out the important information to be used in calculation clearly:

earnings = $85,000

receivables collected = $67,600

uncollectible amount = 1% of $85,000 =  0.01 × 85,000 = $850

Net realizable value of receivables is the total amount to be received, but that has not yet been received, and is not classified as uncollectible amount. This is calculated thus:

Net value of receivable = earnings - uncollectible amount - receivable collected.

= 85,000 - 850 - 67,600 = $16,550.

Note that the receivable collected is subtracted from the total earnings because it is no longer classified as receivable, once it has been received, hence whatever remains of the total earnings that has not bee received make up receivables.

Everett, Miguel, and Ramona are partners, sharing income 1:2:3. After selling all of the assets for cash, dividing losses on realization, and paying liabilities, the balances in the capital accounts are as follows: Everett, $52,800 Cr.; Miguel, $47,500 Dr.; and Ramona, $37,400 Cr. How much cash is available for distribution to the partners

Answers

Answer:

$42,700 cash is available for distribution

Explanation:

In order to calculate the cash available for sharing, we will first identify the debit and credit transactions. Debit transactions are expenditures, while credit transactions are incomes, hence we need to calculate the difference between the income and the expenditure.

Available cash = Everett (credit) - Miguel (debit) + Ramona (credit)

Available cash = 52,800 - 47,500 + 37,400 = $42,700

Therefore $42,700 is available in cash for distribution to the partners

A magazine subscription is running out and you can renew it by sending $10 a year (the regular rate) or get a lifetime subscription to the magazine for $100. Your cost of capital is 7%. How many years would you have to live to make the lifetime subscription the better buy

Answers

Answer:

15.7 years

Explanation:

We employ a mathematical approach to solve this;

Present value (PV) of $10 per year at start of year, for n years = $100 (lifetime subscription, life = n years)

Now, we need to get the equivalent amount at the end of each year. This is obtainable from the cost of capital. Which is 7% and that is same as 0.07.

Therefore, we are expecting a value of 1+0.07 = 1.07 and this brings the equivalent amount at the end of each year = 10*1.07

Now, this equivalent amount at the end of each year will give;

(10*1.07)(1.07^n - 1)/(0.07*1.07^n) = 100

Where n is the number of years

n = 15.7 years

Consider Derek's budget information:
materials to be used totals $64,100; direct labor totals $198,100; factory overhead totals $394,200; work in process inventory January 1 is $186,700; and work in progress inventory on December 31 is $192,200. The budgeted cost of goods manufactured for the year is:_________.
a. $649,450.
b. $657,950.
c. $197,600.
d. $1,044,650.

Answers

Answer:

650,900 is the answer to this question.

Explanation:

$64,100 + $198,100 + $394,200 = $656400

Now costs of goods manufactured = Opening Work in process + Manufacturing expenses for the year - Closing work in process

$186,700 + $656400 - $192,200

= $650,900

cost of goods manufactured is cost for completed goods, opening work in process would be completed during the year and cost incurred during the year is also for completed units except that incurred on closing work in process as it is incomplete.

Stilley Corporation had earnings after taxes of $438,000 in 20X2 with 200,000 shares outstanding. The stock price was $42.10. In 20X3, earnings after taxes declined to $208,000 with the same 200,000 shares outstanding. The stock price declined to $28.30. a. Compute earnings per share and the P/E ratio for 20X2. (Do not round intermediate calculations. Round your final answers to 2 decimal places.) b. Compute earnings per share and the P/E ratio for 20X3. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)\

Answers

Answer:

a) Earnings Per Share for 20X2 = 2.19

P/E ratio for 20X2 = 19.22

b) Earnings Per Share for 20X3 = 1.04

P/E ratio for 20X3 = 27.21

Explanation:

a) Compute earnings per share and the P/E ratio for 20X2.

The compute the earnings per share use the following:

Earnings Per Share for 20X2 = (Earnings after tax-Preference Dividend) / shares outstanding

[tex] = \frac{438,000 - 0}{200,000} = 2.19 [/tex]

Earnings Per Share for 20X2 = 2.19

Then find P/E ratio:

P/E ratio for 20X2 = Market Price per share / Earnings Per Share

[tex] \frac{42.10}{2.19} = 19.224 [/tex]

P/E ratio for 20X2 = 19.22

b) Compute earnings per share and the P/E ratio for 20X3.

The compute the earnings per share use the following:

Earnings Per Share for 20X3 =(Earnings after tax-Preference Dividend) / shares outstanding

[tex] = \frac{208,000 - 0}{200,000} = 1.04 [/tex]

Earnings Per Share for 20X3 = 1.04

Then find P/E ratio:

P/E ratio for 20X3 = Market Price per share / Earnings Per Share

[tex] \frac{28.30}{1.04} = 27.21 [/tex]

P/E ratio for 20X3 = 27.21

important changes are occurring on your team as task agendas become clarified and members begin to understand one another personal styles. Attention is beginning to shift toward obstacles that may stand in the way of task accomplishment. Efforts are being made to find ways to meet team goals while also satisfying individual needs. Failure in this stage can be a lasting liability whereas success here can set a strong foundation for later team effectiveness. What stage of team development is your team in?

Answers

Answer:

Storming stage.

Explanation:

The storming stage usually begins with the appearance of conflicts between the different styles that each member of the team performs the work.

It is natural for each individual to have their own style of carrying out their tasks, and this is natural in a team with different people profiles, so if the style of a member working causes some type of unforeseen problem for the team, conflicts and frustrations can happen that will negatively impact the workflow and the achievement of objectives and goals.

The storming also happens for other reasons, such as position disputes, lack of information and direction of the functions of each team member, work overload, disagreements, resistance, etc.

Therefore, it is important that at this stage of team development, there is a leadership aimed at establishing direct communication with the members and aimed at correcting their behaviors without overcoming the personality of each member. It is also essential to have a review of the rules, individual check-ins and a culture based on integration and motivation, where each member feels equally important to the team's success.

Exercise 9-6 Percent of sales method; write-off LO P3 At year-end (December 31), Chan Company estimates its bad debts as 0.30% of its annual credit sales of $931,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $466 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries for the transactions.

Answers

Answer:

Refer to the below for explanation.

Explanation:

December 31,

Amount estimated = Annual credit sales × 0.30.%

= $931,000 × 0.30%

= $2,793

Please see journal entries below;

December 31, Bad debts expense A/c ....................Dr. $2,793

To allowance for doubtful accounts .......Cr $2,793

February 1, Allowance for doubtful A/c........ Dr. $466

To accounts receivable P.Park..........Cr $466

June 5, Accounts receivable P. Park account......... Dr $466

To allowance for doubtful accounts......... Cr $466

June 5,. Cash A/c..... Dr $466

To accounts receivable P.Park.............Cr $466

Provide the names of two (a) asset accounts, (b) liability accounts, and (c) equity accounts.

Answers

Answer:

two (a) asset accounts

Cash and cash equivalents, which is the most liquid asset.Inventory, which are the goods that the company buys or produces, to sell later on, and make a profit.

two libability accounts

Acconts payable, which is the money that the company owes.Unearned revenue, which are revenues for goods or services that have not been delived yet.

two equity accounts

Common stock, the most typical form of equity.Retained earnings, income that is left after paying dividends.

Explanation:

etermine Due Date and Interest on Notes Determine the due date and the amount of interest due at maturity on the following notes. When calculating interest amounts, assume there are 360 days in a year. Round intermediate calculations to 4 decimal places, and round your final answers to the nearest whole dollar. Date of Note Face Amount Interest Rate Term of Note a. January 15 $51,690 10 % 30 days b. April 1 16,370 9 90 days c. June 22 23,700 7 45 days d. August 30 23,265 12 120 days e. October 16 20,795 8 50 days

Answers

Answer:

Determination of the Due Date and the Amount of Interest due at Maturity:

     Due Date            Interest at Maturity

a)   February 15        $431 ($51,690 x 10% x 30/360)

b)   July 1                   $368  ($16,370 x 9% x 90/360)

c) August 7               $207 ($23,700 x 7% x 45/360)

d) December 30      $931 ($23,265 x 12% x 120/360)

e) December 6        $231 ($20,795 x 8% x 50/360)

Explanation:

a) Schedule of

Date of Note          Face Amount        Interest Rate        Term of Note

a. January 15             $51,690                   10 %                    30 days

b. April 1                       16,370                     9                        90 days

c. June 22                  23,700                     7                        45 days

d. August 30              23,265                    12                      120 days

e. October 16             20,795                     8                        50 days

b. Interest on Notes is calculated using the annual rate of interest.  To arrive at the interest amount, the period of use of the notes would be applied in order to annualize the rate.

c. To get the maturity date, the period of the note is added to the date on which the note was dated.

Sunland Company had the following account balances at year-end: Cost of Goods Sold $60,410; Inventory $15,010; Operating Expenses $29,380; Sales Revenue $126,580; Sales Discounts $1,340; and Sales Returns and Allowances $2,090. A physical count of inventory determines that merchandise inventory on hand is $12,360.Prepare the adjusting entry necessary as a result of the physical count.
1. Account Titles and Explanation
Debit Credit
2. Account Tiles and Explanation
Debit Credit

Answers

Answer and Explanation:

The journal entry is shown below:

Cost of goods sold Dr $2,650   ($15,010 - $12,360)

           To Inventory $2,650

(Being the cost of goods sold)

By recording this we debited the cost of good sold as it increased the expenses and credited the inventory as it decreased the assets so that the correct recording and posting could be done

Similar to stock prices, bond values are derived as the discounted value of all cash flows received from bond ownership in exchange for the bond's price. The two main cash flows an investor receives in exchange for purchasing a bond are:

Answers

Answer: b. Interest or Coupon Payments (PMT) throughout the bond's life expand and the repayment of the principal or Face Value at the bond's maturity (FV).

Explanation:

For most bonds, a bond holder receives interest payments from the bond issuer in terms of coupon payments for the duration of the life of the bond. The coupon payment is a steady payment based on the par value of the bond.

When the bond matures, the bond holder receives the Principal/Face Value of the bond back. This value of usually the Par value of the bond regardless of how much the bond holder bought the bond for.

To test whether a particular diversification move has good prospects for creating added shareholder value, corporate strategists should use the A. profit test, the competitive strength test, and the industry attractiveness test B. strategic fit test, the industry attractiveness test, and the dividend effect test C. barrier to entry test, the competitive advantage test, and the stock price effect test D. the industry attractiveness test, the cost-of-entry test, and the better-off test E. better-off test, the competitive advantage test, and the profit expectations test g

Answers

Answer:

The answer is option (d) the industry attractiveness test, the cost-of-entry test, and the better-off test.

Explanation:

Solution

The better-off test is important for diversification decisions. Better off test tells whether their is one time or continuous competitive advantage in some form due to diversification.

Industry attractiveness is important to access profitability and ability to win in the industry .

Cost to entry is important to access whether the firm has resources to invest in diversification .

Answer:

option D

Explanation:

Thornton, Inc., had taxable income of $128,267 for the year. The company's marginal tax rate was 35 percent and its average tax rate was 24 percent. How much did the company have to pay in taxes for the year?

Answers

Answer:

$30784.08

Explanation:

Taxable income can be refer to as the amount of income used to calculate how much tax an  organisation owes to the government in a particular tax year.

Thornton Inc. had taxable income of $128,267 for the year

The company's marginal tax rate is 35 percent

The company's average tax rate is 24 percent

To know how much did the company have to pay in taxes for the year, we multiply the Taxable income by the Company Average tax rate for the year.

=$128,267 * 24%

=$128,267 * 0.24

=$30784.08

Thornton Inc will pay $30784.08 for the year.

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