The following information was taken from last year's income statement segmented by division:

East Division West Division
Sales $3,700,000 $2,300,000
Contribution margin $1,650,000 $1,000,000
Divisional segment margin $1,100,000 $350,000

Net operating income last year for SegR-3748 Corporation was $600,000. In last year's income statement segmented by division, what were SegR-4212's total common fixed expenses?

Answers

Answer 1

Answer:

$850,000

Explanation:

Divisional Segment Margin = $1,100,000 + $350,000

Divisional Segment Margin = $1,450,000

Net Operating Income = $600,000

Common fixed expenses = Divisional Segment Margin - Net Operating Income

Common fixed expenses = $1,450,000 - $600,000

Common fixed expenses = $850,000

So, SegR-4212's total common fixed expenses will be $850,000.


Related Questions

The current assets of Sheridan Company are $292400. The current liabilities are $116960. The current ratio expressed as a proportion is

Answers

The current ratio expressed as a proportion is 2.5

Explanation:

Given :

The current assets = $292400

The current liabilities are $116960.

To find :

The current ratio

Solution :

Current Ratio =

[tex]\sf{\dfrac{Current \: Assets }{Current \: Liabilities}}[/tex]

[tex]\sf{\implies{\dfrac{292400}{116960}}}[/tex]

[tex]\implies[/tex] 2.5

Therefore, The current ratio expressed as a proportion is 2.5

Tradable permits are likely to result in less inefficiency, relative to a pollution tax, when ... a. the marginal costs of damages are steep and the marginal costs of pollution reduction are relatively stable. b. the marginal costs of damages are steep and the marginal costs of pollution reduction are steep. c. the marginal costs of damages are relatively stable and the marginal costs of pollution reduction are relatively stable. d. the marginal costs of damages are relatively stable and the marginal costs of pollution reduction are steep. e. the marginal costs of damage are elastic and the marginal costs of pollution reduction are also elastic.

Answers

Answer:

a. the marginal costs of damages are steep and the marginal costs of pollution reduction are relatively stable.

Explanation:

Pollution can be defined as the physical degradation or contamination of the environment through an emission of harmful, poisonous and toxic chemical substances.

Offset trading refers to a type of trading system that is typically designed for the realization of more efficient pollution control.

This ultimately implies that, an offset trading is a strategic program that allows emerging business firms to pay existing business firms in order to significantly reduce their emissions or pollutants below a specific standard.

Free market in tradable pollution permits simply means giving manufacturing companies and individuals the legal right to pollution of the environment. For example, XYZ company is purchasing the permit of 500 units of carbon dioxide (CO2) pollution annually, this simply means it is permitted to pollute the environment by 500 units of CO2 annually.

Additionally, a free market in tradable pollution permits has some sort of benefits as companies can resell their unused permits or devise a cheaper means of reducing pollution. It also compensate companies that significantly reduces its pollution of the environment.

A pollution tax can be defined as a type of tax imposed on business firms that causes pollution and damages to the environment. It is also referred to as Pigovian tax which is a tax on goods with negative externality.

Hence, tradable permits when compared with pollution tax are likely to result in less inefficiency, when the marginal costs of damages are steep and the marginal costs of pollution reduction are relatively stable.

You just won the lottery! As your prize you will receive $1,200 a month for 100 months starting today. If you can earn 8% on your money, what is this prize worth to you today

Answers

Answer: $87,380.23

Explanation: n = 100

I/Y = 8%/12

PMT = 1,200

AVP = 1,200 × (1-(1/(1+0.08/12)^100))/(0.08/12) = 1,200 × 72.816858 = 87,380.23

The prize worth to a person today is $87,380.23 approx, if the person wins a lottery.

What is the present value?

A financial calculation known as present value, commonly referred to as discounted value, assesses the value of a future sum of money or stream of payments in today's dollars after accounting for interest and inflation.

It contrasts the purchasing power of one dollar today with that of one dollar in the future, present value\ is computed by the following formula:

[tex]\text{Present Value} = \rm A\times {\dfrac{1-(1+\dfrac{i}{m})^n^m}{\dfrac{i}{m}}\\[/tex]

whereas:

A= Annuity

i= Interest rate

n= Number of periods

m= Periodicity

Computation of present value of the price:

Apply the given values in (1),

[tex]\text{Present Value} = \rm A\times {\dfrac{1-(1+\dfrac{i}{m})^n^m}{\dfrac{i}{m}}\\\text{Present Value} = $1,200\times {\dfrac{1-(1+\dfrac{0.08}{12})^(8.33 \times 12)}{\dfrac{0.08}{12}}[/tex]

Present Value = $87,380.23 approx.

Therefore, the prize worth to a person today is $87,380.23 approx.

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About 5​% of hourly paid workers in a region earn the prevailing minimum wage or less. A grocery chain offers discount rates to companies that have at least 30 employees who earn the prevailing minimum wage or less. Complete parts​ (a) through​ (c) below. ​

a. Company A has 285 employees. What is the probability that Company A will get the​ discount? ​(Round to four decimal places as​ needed.)
b. Company B has 502 employees. What is the probability that Company B will get the​ discount? ​(Round to four decimal places as​ needed.)
c. Company C has 1033 employees. What is the probability that Company C will get the​ discount? ​(Round to four decimal places as​ needed.)

Answers

Answer:

a. 0.0000

b. 0.1841

c. 0.9992

Explanation:

a. n = 285

p = 5% = 0.05

μ = np = 285 x 0.05

= 14.25

we fnd the standard deviation

sd = √np(1-p)

= [tex]\sqrt{285*0.05*0.95}[/tex]

= 3.6793

we find the z score

x = 30-0.5 = 29.5

[tex]z=\frac{29.5-14.25}{3.6793} \\= 4.14[/tex]

using the microsoft excel function

1-NORMSDIST(4.14)

probability = 1 -0.999982

= 0.0000

b.

n = 502

p = 0.05

np = 502x0.05

= 25.1

sd = [tex]\sqrt{np(1-p)}[/tex]

= [tex]\sqrt{502*0.05*0.95} \\= 4.8831[/tex]

x = 29.5

[tex]z = \frac{29.5-25.1}{4.8831} \\= 0.90[/tex]

1 - NORMSDIST(0.90)

= 1 - 0.815939875

PROB = 0.1841

c. n = 1033

p = 0.05

np = 1033*0.05

= 51.65

sd  [tex]\sqrt{np(1-p)} \\= \sqrt{1033*0.05*0.95}[/tex]

= 7.0048

x = 29.5

[tex]z=\frac{29.5-51.65}{7.0048} \\= -3.16[/tex]

probability =

1 - normsdist(-3.16)

= 1 - 0.000788846

= 0.9992

Gibson Electronics identifies licensees in various countries who produce and sell the company's products in their countries in return for a royalty fee on every unit sold. Gibson Electronics’ approach is risky because of the problems associated with:_______
a. increased production costs.
b. doing business in a different culture where the rules of the game may be very different.
c. an increase in transportation costs, especially for those products that have a low value-to-weight ratio.
d. the possibility of an increase in trade barriers such as import tariffs or quotas.
e. sharing valuable technological know-how with a potential competitor.

Answers

Answer:

E) sharing valuable technological know-how with a potential competitor.

Explanation:

From the question we are informed about Gibson Electronics who identifies licensees in various countries who produce and sell the company's products in their countries in return for a royalty fee on every unit sold. Gibson Electronics’ approach is risky because of the problems associated with sharing valuable technological know-how with a potential competitor. Technological know-how in organization can be regarded as sets of knowledge as well as skills which is developed by that participants and is used to guide the acquisition as well as creation, and operation of computer-based systems which gives enablements or brings about facilitation of the performance of business processes, sharing this with competitors in business could be dangerous potential competitors can embrace it to move their business forward which will affect the owner of the Technological know how Businesses in the market.

Janine is considering what auto costs she is going to have after buying a new Honda Civic. She has budgeted enough money for the monthly auto loan payment, gas, and auto insurance. Has Janine factored in all of the costs associated with car ownership

Answers

Answer:

No. Janine has not factored in all of the costs usually associated with car ownership.

Explanation:

Other costs associated with the ownership of a car like a new Honda Civic that Janine is considering buying are: maintenance, license and registration, loan finance charges, and depreciation costs.  These costs can drastically reduce Janine's monthly purchasing power and ability to save.  The costs of owning a new Honda Civic should be compared to the cost of not owning one now vis-a-vis Janine income.

Assume US GAAP to answer this question. In 2017, $2 million in wages were earned and no cash wages were paid. In 2018, $8 million in wages were earned and $9 million in cash wages were paid. Cash wages were used to first pay wages earned in 2017 with the remainder used to pay wages earned in 2018. Any earned but unpaid wages will be paid during the first quarter of 2019. Using only the information provided, which of the following statements is most accurate?

a. Liabilities increased by $1.0 million in 2018
b. Liabilities increased by $3.0 million in 2018
c. Assets decreased by $5.0 million in 2018
d. Retained earnings decreased by $10.0 million in 2018
e. Retained earnings decreased by $7.0 million in 2018

Answers

Answer: a. Liabilities increased by $1.0 million in 2018

Explanation:

In 2018, $9 million was used to settle the wage debt of 2017 and the remainder was used to settle the wages in 2018.

The money remaining in cash after the wage settlement was:

= 9,000,000 - 2,000,000 - 8,000,000

= -$1,000,000

This means that $1,000,000 of wages was not settled in 2018 which means that this would have to go to the Wages Payable account to signify that the company owes wages.

This account is a liability account so liabilities in 2018 would increase by $1,000,000.

Paraguay Pipes Inc. has a cost of equity of 11.1 percent, the YTM on the company's bonds is 5.7 percent, and the tax rate is 35 percent. The company's bonds sell for 93.1 percent of par. The debt has a book value of $393,000 and total assets have a book value of $947,000. If the market-to-book ratio is 2.59 times, what is the company's WACC?

Answers

Answer: 9.5978%

Explanation:

Firstly, we should note that the total book value of equity will be the difference between the total assets book value and the total debt book value which will be:

= $947,000 - $393,000

= $554,000

Then, we'll calculate the market value which will be:

= market-to-book ratio × book value

= 2.59 × $554,000

= $1,434,860

Then, the after tax cost of debt will be:

= 5.7(1 - Tax rate)

= 5.7(1 - 35%)

= 5.7(1 - 0.35)

= 5.7(0.65)

= 3.705%

Equity = $1,434,860

Debt = $393,000 × 93.1%

= $365883

Total market value = $1,800,743

WACC = Respective costs × Respective weights

= ($1,434,860/$1,800,743 × 11.1%) + ($365883/$1,800,743 × 3.705%)

= 0.08845 + 0.007528

= 0.095978

= 9.5978%

Poole Co. acquired 100% of Mullen Inc. on January 3, 2021. During 2021, Poole sold goods to Mullen for $2,500,000 that cost Poole $1,850,000. Mullen still owned 30% of the goods at the end of the year. Cost of goods sold was $11,200,000 for Poole and $6,600,000 for Mullen. What was consolidated cost of goods sold?
a) $15,105,000.
b) $15,300,000.
c) $15,495,000.
d) $17,800,000.

Answers

Answer:

c) $15,495,000.

Explanation:

Calculation to determine the consolidated cost of goods sold

First step is to calculate the Intra-Entity Gross Profit Deferred

Intra-Entity Gross Profit Deferred =($2,500,000 − $1,850,000)*30%

Intra-Entity Gross Profit Deferred =$650,000 × (30%)

Intra-Entity Gross Profit Deferred =$195,000

Now let calculate the Consolidated COGS

Using this formula

Consolidated COGS = Parent's COGS+Subsidiary's COGS -COGS in Intra-Entity Transfer+Intra-Entity Gross Profit Deferred

Let plug in the formula

Consolidated COGS=$11,200,000+ $6,600,000− $2,500,000+ $195,000

Consolidated COGS= $15,495,000

Therefore the consolidated cost of goods sold is

$15,495,000

Suppose a three-factor model is appropriate to describe the returns of a stock. Information about those three factors is presented in the following chart: What is the systematic risk of the stock return

Answers

Answer:

The answer is "[tex]6.33\%[/tex]"

Explanation:

The systematic portion of the return can be defined as follows:

[tex]\to 0.0000734(\$17,863?\$17,034)?0.90(2.60\%?2.80\%)?0.32(3.50\%?3.70\%)[/tex]

[tex]= 0.0000734 (829) - .90 (-.002) - .32(-.002)\\\\= 0.0608486 + 0.0018 + 0.00064\\\\= 0.0633 \\\\ = 6.33\%[/tex]

Fortune, Inc., is preparing its master budget for the first quarter. The company sells a single product at a price of $25 per unit. Sales (in units) are forecasted at 45,000 for January, 55,000 for February, and 50,000 for March. Cost of goods sold is $14 per unit. Other expense information for the first quarter follows. Commissions 8 % of sales dollars Rent $ 14,000 per month Advertising 15 % of sales dollars Office salaries $ 75,000 per month Depreciation $ 40,000 per month Interest 5 % annually on a $250,000 note payable Tax rate 30 % Prepare a budgeted income statement for this first quarter. (Round your final answers to the nearest whole dollar.)

Answers

Answer:

Fortune, Inc.

Budgeted Income Statement for the first quarter

Sales Revenue                    $3,750,000

Cost of goods sold                2,100,000

Gross profit                         $1,650,000

Expenses

Sales commission                   300,000

Rent                                           42,000

Advertising                             562,250

Office salaries                        225,000

Depreciation                           120,000

Interest                                        3,125

Total expenses                 $1,252,375

Income before tax              $397,625

Tax (30%)                                119,288

Net income                         $278,337

Explanation:

a) Data and Calculations:

Selling price per unit = $25

                                       January       February         March          Total

Sales (in units)                 45,000        55,000         50,000       150,000

Sales revenue           $1,125,000 $1,375,000  $1,250,000  $3,750,000

Cost of goods sold       630,000     770,000       700,000     2,100,000

Gross profit                $495,000   $605,000    $550,000  $1,650,000

Expenses:

Sales commission        $90,000    $110,000     $100,000    $300,000

Rent expense                  14,000        14,000         14,000         42,000

Advertising expense    168,750     206,250       187,500      562,250

Office salaries                75,000       75,000        75,000      225,000

Depreciation                  40,000       40,000        40,000       120,000

Interest expense                                                                           3,125

Total expenses                                                                   $1,252,375

Income before tax                                                                $397,625

Tax (30%)                                                                                  119,288

Net income                                                                           $278,337

g If a stock consistently goes down (up) by 1.31% when the market portfolio goes down (up) by 1.05%, then its beta equals:

Answers

Answer:

1.25

Explanation:

The stock consistently goes down by 1.31%

The market portfolio goes up by 1.05%

The beta can be calculated as follows

1.31/1.05

= 1.25

Hence the beta is 1.25

BMW and United Airlines cannot be considered in the same industry analysis because they compete in different industries.

a. True
b. False

Answers

Answer: False

Explanation:

The statement that "BMW and United Airlines cannot be considered in the same industry analysis because they compete in different industries" is wrong.

It should be noted that both of them are in the mobility industry. The mobility industry refers to the industry which covers the broad range of the organisations which provide products and services thar are used to support domestic and international relocations and assignments.

Millington Materials is a leading supplier of building equipment, building products, materials, and timber for sale, with over 200 branches across the Mid-South. On January 1, 2021, management decided to change from the average inventory costing method to the FIFO inventory costing method at each of its outlets. The following table presents information concerning the change. The income tax rate for all years is 40%.

Income before Income Tax
FIFO Average Cost Difference
Before 2015 $35 million $28 million $7 million
2015 48 million 25 million 23 million
2016 30 million 29 million 1 million

Requied:
a. Prepare the journal entry to record the change in accounting principle.
b. Determine the net income to be reported in the 2016–2015 comparative income statements.

Answers

Answer:

A. Dr Inventory $30

Cr Income tax payable $12

Cr Retained earnings $18

B. 2016 Net income $18

2015 Net income $28.80

Explanation:

a. Preparation of the journal entry to record the change in accounting principle.

Dr Inventory $30

Cr Income tax payable $12

Cr Retained earnings $18

b. Calculation to Determine the net income to be reported in the 2016–2015 comparative income statements

Balance at Jan ,2015 $21.00 millions

[35 millions- (35 millions* 40%)]

NET INCOME $28.80 millions

Cash dividends ($4.20) millions

Balance At December 31,2015 $45.60 millions

NET INCOME $18 millions

Cash dividends ($4.20) millions

BALANCE AT DECEMBER 31,2016 $59.40 millions

Therefore the net income to be reported in the 2016–2015 comparative income statements will be:

2016 Net income $18

2015 Net income $28.80

The journal entry to record the change in accounting principle will be:

Debit Inventory $30 million

Credit Income tax $12 million

Credit Retained earnings $18 million

(To record error correction)

It should be noted that the income tax will be credited in the amount below:

= 40% × ($7 million + $23 million)

= 40% × $30 million.

= 0.4 × $30 million

= $12 million

The retained earnings will be:

= $30 million - $12 million

= $18 million

The net income to be reported in the 2016–2015 comparative income statements will be $18 million and $28.8 million.

The net income for 2016 will be:

= $30 million - $12 million

= $18 million

The net income for 2015 will be:

= $48 million - (40% × $48 million)

= $45 million - $19.2 million

= $25.8 million

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a sale is made at a lumber company for goods costing a total of $13,359 (which includes 9.5% sales tax). in the books of the lumber company revenue should be credited for what amount

Answers

Answer:

$12,200

Explanation:

Sales including sales tax = $13,359

Sales tax rate = 9.5%

Let the sales be = $X

Sales tax payable = Sales * Sales tax rate

Sales tax payable = X * 9.5%

Sales tax payable = 0.095X

Sales + Sales tax = Sales including sales tax

X + 0.095X = 13,359

1.095X = 13,359

X = 13,359/1.095

X = $12,200

So, Sales = $12,200. Thus, in the books of the lumber company, Revenue should be credited for $12,200

if potential output declines while actual output remains unchanged, what does the Taylor rule imply that policymakers should do to the fed funds rate

Answers

Answer:

Increased

Explanation:

In the case when there is a fall in the potential output and at the same time the actual output remains the same so here the fund rate should be increased as per the taylor rule as it decrease the output that result in the output gap to fall

So as per the given situation, the fed fund rate should be increased

Hence, the same is to be increased

Chin purchases five protein bars at a price of $3 each. The marginal benefit he receives from each bar is $5 for the first bar, $4.50 for the second bar, $4 for the third bar, $3.50 for the fourth bar, and $3 for the fifth bar. The marginal cost of producing the bars is $2 each. What is Chin's total consumer surplus from the five bars that he purchased

Answers

Answer:

$5

Explanation:

Several artists in Charleston, South Carolina, show and sell their work in an art gallery downtown. The gallery is owned by an art lover who does not buy the paintings but displays the work of various artists. She collects a percentage on each piece sold. In terms of the marketing channel, the gallery is Multiple Choice an ultimate consumer. a manufacturer. a wholesaler. an agent. a clearinghouse.

Answers

I’d believe an agent. Have an amazing dog sorry if it’s wrong

A major U.S. manufacturer of children's toys believes its main competitive advantage lies in its continuing the creation of innovative toys and games. The company is facing increasing competition on price, and it is strongly considering outsourcing to offshore firms as a means of reducing costs. The LAST function this firm should consider outsourcing is: Group of answer choices research and development. operations. supply-chain management. distribution.

Answers

Answer:

research and development

Explanation:

Since in the given situation, it is mentioned that the company faced the increased in the competition and also it considered an outsourcing in order to offshore the firm so that the cost can be minimized so here the last function the firm should considered outsourcing is the research and development as there is the outsourcing so there would be the research and development also it deals with innovation & introduction of new products & services

1. Why are fewer customers entering local bank branches?(Select all that apply)
Mobile phone apps
Online banking
Due to the sophistication of ATM machines
Limited branch hours


2. What type of business are banks relying on to maintain the “brick-and-mortar” branches.
A. New accounts and loans
B. Account transfers
C. Cash withdrawals
D. Check deposits


3. What is the primary reason a consumer needs to walk into a bank branch?
A. Withdraw funds
B. Make a deposit
C. Open a new account
D. Transfer funds


Answers

Answer:

2.a. new account and loans, 3. b. make a deposit

What is the purpose of using predetermined overhead rates: Variation in cost assignment due to short-term variations in volume can be prevented Delays in product costing can be avoided Variation in cost assignment due to seasonality can be prevented. All of the answers are correct.

Answers

Answer:

All of the answers are correct.

Explanation:

At the beginning of the accounting period a pre-determined overhead is computed by dividing the estimated overhead production by the estimated basis of operations. The default overhead rate is then applied to manufacturing, so that the standard cost for a product may be calculated

The purpose of using pretermined overhead rates are

Delays in product costing can be avoided

Variation in cost assignment due to seasonality can be prevented

Variation in cost assignment due to short-term variations in volume can be prevented

The Use of predetermined overhead rates serves all the above purposes

Hence, all answers are correct.

The per-unit standards for direct labor are 2 direct labor hours at $15 per hour. If in producing 2800 units, the actual direct labor cost was $83200 for 5200 direct labor hours worked, the total direct labor variance is $2800 unfavorable. $800 favorable. $800 unfavorable. $500 unfavorable.

Answers

Answer:

$800 favorable

Explanation:

Calculation to determine what the total direct labor variance is

Using this formula

Total Direct Labor Variance=(Standard Direct Labor Cost - Actual Direct Labor Cost

Let plug in the formula

Total Direct Labor Variance=[(2800 × 2) × $15]- $83200

Total Direct Labor Variance=$84000 - $83200

Total Direct Labor Variance = $800 favorable

Therefore the total direct labor variance is$800 favorable

- True or False: Professional shoplifters steal primarily for the excitement.

Answers

False, professional shoplifters steal to resell items

On February 5, McCracken Co. purchases 25 percent of Bradley Company common stock at a total cost of $90,000. Write the necessary adjusting entry.

Answers

Answer:

February 5

Dr Investment in Equity Shares $90,000

Cr Cash $90,000

Explanation:

Preparation of the necessary adjusting entries

Based on the information given we were told that the Company common stock was purchased at a total cost of $90,000 which means that the appropriate adjusting journal entry will be:

February 5

Dr Investment in Equity Shares $90,000

Cr Cash $90,000

:

Assume the total cost of a college education will be $184,061 when your child enters college in 19 years. You presently have $49,327 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child's college education? Enter answer as 3 decimal places (e.g. 0.123)

Answers

Answer:

Interest rate = 0.9313

Explanation:

Future value or the cost of edcuation after 19 years = $184061

Present value, money in hand at present = $49327

Time period, n = 19

Future value = Present value (1 + r)²

184061 = 49327 (1 + r )²

(1 + r )² = 184061 ÷ 49327

(1 + r )² = 3.73

(1 + r) = √3.73

(1 + r) = 1.9313

r = 1.9313 - 1

r = 0.9313

Or Interest rate = 0.9313

You have deposited $1,200 into an account that will earn an interest rate of 8% compounded semiannually. How much will you have in this account at the end of 10 years

Answers

Answer:

$2,629.35

Explanation:

The amount in future for the dollar invested today is known as the Future Value (FV)

We can simply calculate the Future Value using a Financial Calculator as follows :

PV = - $1,200

PMT = $0

P/YR = 2

I = 8 %

N = 10 x 2 = 20

FV = ??

Therefore,

The Future Value (FV) will be $2,629.35

You will have $2,629.35 in this account at the end of 10 years.

Consider the bond (newly issued, issued on Nov 2013) for a country A: Face value $10 million Coupon rate 4.3% If this bond is purchased (in April 2014) at $9.02 million, instead of $10 million, the yield would be: Group of answer choices same as 4.3% greater than 4.3% less than 4.3%

Answers

Answer: greater than 4.3%

Explanation:

Given that

Face Value = $10 million

Current Price = $9.02 million

Coupon Rate = 4.3%

Coupon Payment  per annum = $10million  x 4.3% = $430,000 annually

Current yield = Annual Coupon Payment ÷ Current price of the bond

Current Yield = $430,000 ÷ 9,020,000 = 0.0476 =4.76% which is greater than 4.3%

Gross domestic product understates the total production of final goods and services because of the omission of inflation. intermediate goods. exports. the underground economy.

Answers

Answer:

the underground economy

Explanation:

Gross domestic product is defined as the monetary value of all goods and services that a country produces within a given period.

It is estimated by using income, expenditure, and production in markets.

However GDP does not consider the underground economy.

The underground economy is made up of transactions that are considered illegal or that do not meet up to the reporting requirements of the government.

In effect these are not reported in GDP so GDP is understated.

"Stock in Daenerys Industries has a beta of 0.73. The market risk premium is 10 percent, and T-bills are currently yielding 5 percent. The company's most recent dividend was $1.6 per share, and dividends are expected to grow at a 5.5 percent annual rate indefinitely. If the stock sells for $35 per share, what is your best estimate of the company's cost of equity? Use the average from CAPM and Dividend Growth Model calculations."

Answers

Answer:

CAPM = 12.30%

Dividend Growth Model=  10.32%

Explanation:

According to the capital asset price model: Expected rate of return = risk free + beta x (market premium)

5% + (0.73 x 10%) = 12.30%

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid

r = cost of equity

g = growth rate

$35 = $1.6 x (1.055) / (r - 0.055)

r = 1.688 / 35 + 0.055 = 0.1032 = 10.32%

Finance


Walter and Gordon model analyse the impact of distribution of dividends on the valuation of the firm but the formula used in both the cases are different. Company

ABC Ltd wanted to evaluate the price of the share in both cases. The company earns ₹ 50 per share and expects the same for the next year. The cost of capital to the firm is 11%. The company earns return on investment of 15% and the firm 8is planning dividend payout ratio of 60%. Calculate:

a. Price of the share using Walter Model. Comment on the relationship between return on investment and cost of capital in the case above and decision of the firm whether dividend is to be declared or not.

b. Price of the share using Gordon model. Comment on the relationship between return on investment and cost of capital in the case above and decisionm

[2] R6 386,16.

[3] R1 930,43.

[4] R3 897,29.

[5] none of the above

Checking answer$1

Financial Math

Q198898

 Deadline passed

Mr Mahlangu invests R20000 to play lobola. After 48 months he receives 65000. The interest on the investment is compounded quarterly. Determine the yearly interest rate at which money was invested. Give your answer as a percentage rounded to two decimal places.

Checking answer$1

Archive Tasks & Questions are stored in archive for 14 days

Biochemistry

Q198087

 Deadline passed

11. Indicate which type of bonds are involved in the following

a. Formation of the primary structure of a protein

b. Stabilization of the alpha helix and beta pleated sheet structures of proteins

12.Identify the biomolecular composition of the following cells

a.Endoplasmic reticulum

b.Mitochondria

c.Cytoskeleton

d. Nucleus

13 Under aerobic catabolism of glucose ,in which compartment of the eukaryotic cell does the following reaction occurs?

a conversion of pyruvate to acetyl CoA

b.conversion of succinyl -CoA to succinate

c.conversion ofNADH to ATP.

d.conversion of phosphologlycerate to phosphoenolpyruvate.

14. Briefly outline how ATP is generated from glucose in the absence of oxygen. What is the importance of this pathway?

15. Briefly explain the process by which excess dietary carbohydrates and lipids are stored in the human body

Answer approved2$1

Finance

Q199880

 Deadline: 28.05.21, 18:48

Walter and Gordon model analyse the impact of distribution of dividends on the valuation of the firm but the formula used in both the cases are different. Company

ABC Ltd wanted to evaluate the price of the share in both cases. The company earns ₹ 50 per share and expects the same for the next year. The cost of capital to the firm is 11%. The company earns return on investment of 15% and the firm is planning dividend payout ratio of 60%. Calculate:

a. Price of the share using Walter Model. Comment on the relationship between return on investment and cost of capital in the case above and decision of the firm whether dividend is to be declared or not.

b. Price of the share using Gordon model. Comment on the relationship between return on investment and cost of capital in the case above and decision of the firm whether

dividend is to be declared or not.​

Answers

Answer:

An apple, potato, and onion all taste the same if you eat them with your nose plugged≡⇵∠⊅↓⇆°∞∴∴∵∵∵∴∴∵∵∴∴∵∴

∴∴≈↓∴↔∪∪∩⇄

Explanation:

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