Answer:
APR= 7.32%
Explanation:
The APR is computed as shown below:
Future value = Present value (1 + r/ m)^nm
Future value = 10,000
Present value= 6,000
n=7
m=12
$ 10,000 = $ 6,000 (1 + r / 12 )^12 x 7
$ 10,000 = $ 6,000 (1 + r / 12 )^84
($ 10,000 / $ 6,000)^ 1 / 84 - 1 = r / 12
1.006099786 - 1 = r / 12
0.006099786 x 12 = r
r=0.006099786 x 12
r = 7.32%
APR= 7.32%
A customer enters your facility and discusses their most recent hunt. This was strictly a friendly, non-
professional conversation. According to your book, which of the following would you consider this use of
time in your business environment as?
1
Answer: Time spent
Explanation:
From the question, we are informed that a customer enters a facility and discusses their most recent hunt. We are further informed that it was strictly a friendly, non-professional conversation.
This will be consider as time spent in a business environment. Good customers relationship is needed for the success of every organization. Therefore, in this case, it'll be termed time spent.
From the income statement, the corporation had a net income of $724 million for the year. Total dividends were $106 million. There were 400 million shares outstanding. How much is the dividends per share
Answer:
Dividend per year= $0.265 per share
Explanation:
Calculation of the dividend per year
Using this formula
Dividends per share=Total dividends/Total shares outstanding
Let plug in the formula
Dividend per share=$106/400
Dividend per share= $0.265 per share
Therefore the amount of dividend per share will be $0.265
Knowledge Check 01 On March 15, Viking Office Supply agrees to accept $1,200 in cash along with a $2,800, 60-day, 15 percent note from one of its customers to settle his $4,000 past-due account. Prepare the March 15 entry for Viking Office Supply by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Answer:
Viking Office Supply
Debit Accounts Receivable $4,000
Credit Allowance for Uncollectible Accounts $4,000
To revise the write-off of past-due account.
Debit Cash Account $1,200
Debit 15% Notes Receivable $2,800
Credit Accounts Receivable $4,000
To record the cash receipt and notes settlement.
Explanation:
Since the account is past-due, it must have been written off as uncollectible expense. To revise this entry, a credit is made to the Allowance for Uncollectible Accounts and a debit to the Accounts Receivable.
Then a debit to the Cash Account in the sum of $1,200 and a debit to the Notes Receivable account for $2,800 and a credit to the Accounts Receivable.
When comparing the weighted-average and FIFO methods of process costing, which items are the same in both methods? (
Answer:
Objectives, Concepts and Journal Entry Accounts
Explanation:
The reason is that the objective of the FIFO and Weighted average methods is the same which is to assign the costs that were incurred to convert the raw inventory into finished goods.
The underlying concept in both of the method is cost flow assumption which is the transfer of the cost that was assigned to finished goods, to cost of goods sold.
The journal entry accounts are the same accounts used for weighted average method, LIFO and FIFO methods.
So these are the similarities which are found while comparing FIFO, LIFO and weighted average methods of process costing.
On January 1, James Industries leased equipment to a customer for a four-year period, at which time possession of the leased asset will revert back to James. The equipment cost James $700,000 and has an expected useful life of six years. Its normal sales price is $700,000. The residual value after four years, guaranteed by the lessee, is $100,000. Lease payments are due on December 31 of each year, beginning with the first payment at the end of the first year. Collectibility of the remaining lease payments is reasonably assured, and there are no material cost uncertainties. The interest rate is 5%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
Calculate the amount of the annual lease payments
Guaranteed Residual Value
Table or calculator function: n=?, i=?
Amount ot be recovered (fair value) $?
Guaranteed residual value $?
Amount to be recovered through periodic lease payments $?
Lease Payment
Table or calculator function: PVAD of $1 ?
n=?, i=?
Amount of fair value recovered each lease payment (Lease Payments $?)
* I would like to make sure the answer is correct. Please provide step by step calculate and explain.
Answer:
- $700,000
- 82,270
- $617,730
- present value of $1: n=4, i=5%
- the present value of an ordinary annuity of $1: n=4, i=5%
Explanation:
Amount to be recovered (fair value): $700,000
Less: Present value of the residual value ($100,000 x .82270*): 82,270
Amount to be recovered through periodic lease payments: $617,730
Lease payments -: end of each of the next four years: ($617,730 ÷ 3.54595**) $174,207
* present value of $1: n=4, i=5%
** present value of an ordinary annuity of $1: n=4, i=5%
The following accounts were taken from the Adjusted Trial Balance columns of the end-of-period spreadsheet for April 30, for Finnegan Co.:
Accumulated Depreciation $32,000
Fees Earned 78,000
Depreciation Expense 7,250
Rent Expense 34,000
Prepaid Insurance 6,000
Supplies 400
Supplies Expense 1,800
Requried:
Prepare an income statement.
Answer:
Its 4oo
Explanation:
Its option C
Answer:
Fees Earned: 78,000
Expenses:
Rent Expense: (7,250)
Depreciation Expense: (34,000)
Supplies Expense: (1,000)
Total Expenses: 43,050
Net Income: 34,950
Milton Industries expects free cash flow of $5 million each year. Milton's corporate tax rate is 35%, and its unlevered cost of capital is 15%. The firm also has outstanding debt of $19.05 million, and it expects to maintain this level of debt permanently. What is the value of Milton Industries without leverage? What is the value of Milton Industries with leverage?
Answer:
1. $33.33 million
2. $40.00 million
Explanation:
The computation of the value of Milton Industries with leverage is shown below:-
Value of Milton Industries without leverage is
= Free cash flow ÷ unlevered cost of capital
= $5 million ÷ 0.15
= $33.33 million
Value of Milton Industries with leverage is
= Value of Milton Industries without leverage + Tax × Debt
= $33.33 million + 0.35 × $19.05 million
= $40.00 million
Therefore we have applied the above formula.
Assume that today is December 31, 2019, and that the following information applies to Abner Airlines: After-tax operating income [EBIT(1 - T)] for 2020 is expected to be $700 million. The depreciation expense for 2020 is expected to be $150 million. The capital expenditures for 2020 are expected to be $375 million. No change is expected in net operating working capital. The free cash flow is expected to grow at a constant rate of 7% per year. The required return on equity is 13%. The WACC is 11%. The firm has $199 million of non-operating assets. The market value of the company's debt is $3.534 billion. 120 million shares of stock are outstanding. Using the corporate valuation model approach, what should be the company's stock price today
Answer:
The company's stock price today should be $71.17 per share.
Explanation:
The corporate valuation model approach can be used to estimate this by using the following steps:
Step 1: Calculation of the free cash flow
Free cash flow is the cash a firm generates after accounting for capital expenditure. This can be estimated using the following formula:
Free Cash Flow (FCF) = After-tax operating income + Depreciation expenses - Capital expenditure
For this question, we therefore have:
Free Cash Flow (FCF) = $700 + $150 - $375 = $475 million
Step 2: Calculation of Value of operations (Vo)
Vo = FCF / (WACC - FCF growth rate) = 475 / (11% - 7%) = $11,875 million
Step 3: Calculation of the Firm value
Firm value = Vo + Non-operating assets = $11,875 + $199 = $12,074 million
Step 4: Calculation of value of equity
Value of equity = Firm value - Debt = $12,074 - $3,534 = $8,540 million
Note: The correct amount of debt is $3,534 not $3.540 as mistakenly given, may be due to typographical error, in the question.
Step 5: Calculation of stock price per share today
Stock price per share = Value of equity / Number of shares outstanding = $8,540 / 120 = $71.17 per share
Therefore, the company's stock price today should be $71.17 per share.
Knowledge Check 01 On March 1, a designer received a check for $7,500 from a customer for services to be provided after the customer chooses a color scheme for the first floor of her house. On July 31, the designer completed the design work for this customer. Prepare the July 31 journal entry by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Answer:
The Designer Journal Entry
Date General Journal Debit Credit
July 31 Unearned Revenue $7,500
Design Services Revenue $7,500
High-Low Cost Estimation and Profit Planning Comparative 2007 and 2008 income statements for Dakota Products Inc. follow: DAKOTA PRODUCTS INC. Comparative Income Statements For Years Ending December 31, 2007 and 2008 2007 2008 Unit sales 5,000 8,000 Sales revenue $60,000 $96,000 Expenses (64,000) (76,000) Profit (loss) $(4,000) $20,000 (a) Determine the break-even point in units. Answer units (b) Determine the unit sales volume required to earn a profit of $5,000. Answer
Answer:
(a)
5,500 units
(b)
6,125 units
Explanation:
First, we need to calculate the per unit selling price.
2007 2008
Unit sales 5,000 8,000
Sales revenue $60,000 $96,000
Selling Price $12 $12
Now we need th separate the vairbale and fixed cost from total expense using high low method
Variable cost = ( Higher activity Expense - Lower activity Expense ) / ( Higher activity - Lower activity )
Variable cost = ( $76,000 - $64,000 ) / ( 8,000 units - 5,000 units )
Variable cost = $12,000 / 3,000 units = $4 per unit
Fixed cost = $76,000 - ( $4 x 8,000 units ) = $44,000
Contribution Margin = Selling Price - Variable cost = $12 - $4 = $8
(a)
Breakeven Point = Fixed Cost / Contributin margin per unit
Breakeven Point = $44,000 / $8 = 5,500 units
(b)
Target sales = ( Fixed cost + Desired Profit ) / Contribution margin per unit
Target sales = ( $44,000 + $5,000 ) / $8 = 6,125 units
Eviyan recently received a copy of his performance review report. During the review, his manager took notes regarding his performance and typed them up for the report, Eviyan was required to write a review of his own work following a questionnaire provided by the employer, and comments were solicited from other employees regarding his performance. Because he also has contact with the public, comments that were submitted to the company from the public concerning his performance were included in the report. After reading the report he received a phone call from his manager’s secretary informing him that he has been scheduled with an appointment with the manager the next day. If the manager is following good performance review policies, why has he scheduled the meeting with Eviyan? Group of answer choices The manager has scheduled him for a meeting for a performance feedback interview. The manager wants to meet with him so he can tell him about his evaluation and tell him in person that he is doing well or poorly and will then attempt to get Eviyan to agree to the performance evaluation. The manager has scheduled the meeting to solve Eviyan’s performance problems. The manager has scheduled the meeting to tell Eviyan what he has done well or poorly and give him the opportunity to defend himself.
Answer:
Eviyan's Performance Evaluation Report:
The manager has scheduled him for a meeting for a performance feedback interview.
Explanation:
Performance feedback interview is an opportunity for the employee to meet with his manager in order to iron out issues and reflect on the outcome of the evaluation. The employee will also be required at the interview to explain and defend the performance result face to face with the manager. Since there are always some differences in perception and evaluation, the interview provides that needed chance for a detailed discussion so that corrective measures will be defined and agreed upon. It is a good performance policy to schedule such an interview following a performance evaluation report.
High fixed costs and low variable costs are typical of which approach? product process mass customization repetitive product and mass customization
Answer:
Product and mass customization.
Explanation:
In Financial accounting, fixed cost can be defined as predetermined expenses in a business that remain constant for a specific period of time regardless of the quantity of production or level of outputs. Some examples of fixed costs in business are loan payments, employee salary, depreciation, rent, insurance, lease, utilities etc.
On the other hand, variable costs can be defined as expenses that are not constant and as such usually change directly and are proportional to various changes in business activities. Some examples of variable costs are taxes, direct labor, sales commissions, raw materials, operational expenses etc.
High fixed costs and low variable costs are typical of product and mass customization.
Hence, the high fixed costs are usually a determinant for pricing a product that aren't produced in mass because to break even, businesses would need to rake in more revenues to meet the the increasing (high) fixed costs.
However, when this products are manufactured in mass, this would help to cut or lower down the total cost of production.
The specifications for a plastic liner for a concrete highway project calls for thickness of 4.0 mmplus or minus0.08 mm. The standard deviation of the process is estimated to be 0.02 mm.
a) The standard deviation of the process is estimated to be 0.02 mm.
b) The upper specification limit for this product = ? mm (round your response to three decimal places).
c) The lower specification limit for this product = ? mm (round to three decimal places)
d) The process capability index (CPk) = ? (round to three decimal places)
e) The upper specification lies about ? standard deviations from the centerline (mean thickness)
Answer and Explanation:
The computation is shown below:
b. The upper specification limit is
= 4 + 0.08
= 4.080 mm
c. The Lower specification limit is
= 4 - 0.08
= 3.920 mm
d. The process capability index is
= min ((Upper specification limit - Mean) ÷ (3 × Standard deviation)), ((Mean - Lower specification limit)÷ (3 × Standard deviation))
= min (0.08 ÷ (3 × 0.02)), (0.08 ÷ (3 × 0.02))
= min (1.333, 1.333)
So it would be 1.333
e. Upper specification = 4.08 mm
Mean line = 4.0 mm
Now,
The upper specification lies at a distance = Upper specification - Mean line
= 4.08 mm - 4.0 mm
= 0.08 mm
upper specification =Upper specification lies ÷ One standard deviation
= 0.08 mm ÷ 0.02 mm
= 4 mm which is standard deviations from the mean
Holdup Bank has an issue of preferred stock with a $6 stated dividend that just sold for $93 per share. What is the bank's cost of preferred stock
Answer:
6.45%
Explanation:
Calculation for bank's cost of preferred stock
Using this formula
Cost of preferred stock = Dividend / Price of Stock * 100
Where,
Dividend $6
Price of Stock 93 per share
Let plug in the formula
Cost of preferred stock =6/93*100
Cost of preferred stock= 0.0645*100
Cost of preferred stock=6.45 %
Therefore the bank's cost of preferred stock will be 6.45%
Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing on July 31, the end of the current year:
Common Stock, $10 par $440,000
Paid-In Capital from Sale of Treasury Stock-Common 33,200
Paid-In Capital in Excess of Par-Common Stock 132,000
Paid-In Capital in Excess of Par-Preferred Stock 61,200
Preferred 4% Stock, $50 par 1,020,000
Retained Earnings 2,057,400
Treasury Stock-Common 38,500
Fifty thousand shares of preferred and 200,000 shares of common stock are authorized. There are 3,500 shares of common stock held as treasury stock.
Required:
Prepare the Stockholders' Equity section of the balance sheet as of July 31, the end of the current year.
Answer:
Specialty Auto Racing Inc.Stockholders' Equity section of the balance sheet as at July 31:
Authorized Share Capital:
Common Stock, 200,000 $10 par
Preferred 4% Stock, 50,000 $50 par
Common Stock, Issued share capital, $10 par $440,000
Paid-In Capital in Excess of Par-Common
Stock (132,000 + 33,200) 165,200
Treasury Stock-Common, 3,500 shares (38,500)
Preferred 4% Stock, $50 par 1,020,000
Paid-In Capital in Excess of Par-Preferred Stock 61,200
Retained Earnings 2,057,400
Total Equity $3,705,300
Explanation:
The Stockholders equity section of the balance reports the Preferred stock, common stock, additional paid‐in‐capital, retained earnings, and treasury stock. It also discloses information regarding the par value, authorized shares, issued shares, and outstanding shares for each type of stock.
The Paid-in Capital from sale of Treasury stock- common of $33,200 is added to the Paid-in Capital in Excess of Par- Common Stock as there is no separate account for it.
Milar Corporation makes a product with the following standard costs:
Standard Quantity or Hours Standard Price or Rate
Direct materials 7.7 pounds $ 4 per pound
Direct labor 0.1 hours $ 20 per hour
Variable overhead 0.1 hours $ 4 per hour
In January the company produced 2,000 units using 16,060 pounds of the direct material and 210 direct labor-hours. During the month, the company purchased 16,900 pounds of the direct material at a cost of $65,910. The actual direct labor cost was $4,473 and the actual variable overhead cost was $756. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The materials price variance for January is:
a. $1,690 U
b. $1,540 F
c. $1,540 U
d. $1,690 F
Answer:
Direct material price variance= $1,690 favorable
Explanation:
Giving the following information:
Direct materials 7.7 pounds $ 4 per pound
During the month, the company purchased 16,900 pounds of the direct material at a cost of $65,910.
To calculate the direct material price variance, we need to use the following formula:
Direct material price variance= (standard price - actual price)*actual quantity
actual price= 65,910/16,900= $3.9
Direct material price variance= (4 - 3.9)*16,900
Direct material price variance= $1,690 favorable
Assume that both firm A and firm B formally agree to each put up $10 million to form firm C. The operations of firm C are restricted to conducting research and development activities for the benefit of firms A and B. Firm C is a _____ of firms A and B.
Answer: a. joint venture.
Explanation:
A Joint Venture refers to when 2 or more entities come together and put up resources necessary to accomplish a certain task or venture that will be beneficial to all of them.
For example, BMW and Toyota jointly started research into utilizing hydrogen fuels and Google cooperated with NASA to create Google Earth.
Firm C is a Joint venture between Firms A and B.
At the beginning of the year, Ann and Becky own equally all of the stock of Whitman, Inc., an S corporation. Whitman generates a $120,000 loss for the year. On the 189th day of the year, Ann sells her half of the Whitman stock to her son, Scott. Becky's stock basis is $41,300. How much of the Whitman loss belongs to Ann and Becky
Answer:
Becky's loss = $60,000
Ann's loss = $31,068
Explanation:
Assuming a 365 day year, the loss allocation should be as follows:
Ann (then Scott) 50% x $120,000 = $60,000Becky 50% x $120,000 = $60,000From the 50% that corresponds to Ann:
Ann = 189/365 x $60,000 = $31,068.49 = $31,068Scott = $60,000 - $31,068 = $28,932The following transactions are for Kingbird Company.1. On December 3, Kingbird Company sold $450,000 of merchandise to Blossom Co., on account, terms 1/10, n/30. The cost of the merchandise sold was $310,000.2. On December 8, Blossom Co. was granted an allowance of $22,000 for merchandise purchased on December 3.3. On December 13, Kingbird Company received the balance due from Blossom Co.Instruction:Prepare the journal entries to record these transactions on the books of Mack Company. Mack uses a perpetual inventory system.
Answer:
Kingbird Company or Mack Company
Journal Entries:
Dec. 3:
Debit Accounts Receivable (Blossom Co.) $450,000
Credit Sales Revenue $450,000
To record the sale of goods on account, terms 1/10, n/30.
Debit Cost of Goods Sold $310,000
Credit Inventory Account $310,000
To record the cost of goods sold.
Dec. 8:
Debit Sales Allowance $22,000
Credit Accounts Receivable (Blossom Co.) $22,000
To record the allowance granted.
Dec. 13:
Debit Cash Account $423,720
Debit Cash Discount $4,280
Credit Accounts Receivable (Blossom Co.) $428,000
To record the settlement of account.
Explanation:
Journal entries are used to record transactions that occur on a daily basis. They are usually the first set of records made in the accounting books. They show the accounts to be debited and the accounts to be credited. Each transaction is usually debited in one account and credited in another to reflect the double entry system of accounting and to keep the accounting equation in balance.
Sarasota Corporation had the following activities in 2017
1. Payment of accounts payable $817,000
2. Issuance of common stock $230,000
3. Payment of dividends $377,000
4. Collection of note receivable $97,000
5. Issuance of bonds payable $545,000
6. Purchase of treasury stock $42,000
Compute the amount Sarasota should report as net cash provided (used) by financing activities in its 2017 statement of cash flows. (Show amounts that decrease cash flow with either a -sign e.g.-15,000 or in parenthesis e.g. (15,000).,)
Net cash __________ by financing activitiess _________.
Answer:
Net Cash provided in financing activities is $356,000
Explanation:
The cash flow from financing activities are the funds that the business took in or paid to finance its activities. These involve long term liability, issuance of stock, short term borrowing etc.
The financing activities in Sarasota Corporation report include; Issuance of common stock, Issuance of bonds payable, Payment of dividends, Purchase of treasury stock.
Cash provided by financing activities for the year 2017
Issuance of common stock = $230,000
Issuance of bonds payable. = $545,000
Payment of dividends = - $377,000
Purchase of treasury stock = -$42,000
Net Cash provided in financing activities = $356000
Assume that demand increases from D1to D2; in the new long run equilibrium, price settles at a level between P1and P2This means that the industry in question is a(n) __________-cost industry.a. decreasingb. increasingc. constantd. marginale. low
Answer:
The answer is B. Increasing
Explanation:
An increasing-cost industry is an industry whose costs for production increase as more companies compete.
Why is this so? - This is because each new company in the industry increases its demand for supplies and factors needed for production.
A decreasing‐cost industry is one where costs of production reduces as the industry expands.
Magic Realm, Inc., has developed a new fantasy board game. The company sold 48,500 games last year at a selling price of $61 per game. Fixed expenses associated with the game total $873,000 per year, and variable expenses are $41 per game. Production of the game is entrusted to a printing contractor. Variable expenses consist mostly of payments to this contractor. Required: 1-a. Prepare a contribution format income statement for the game last year. 1-b. Compute the degree of operating leverage. 2. Management is confident that the company can sell 60,625 games next year (an increase of 12,125 games, or 25%, over last year). Given this assumption: a. What is the expected percentage increase in net operating income for next year? b. What is the expected amount of net operating income for next year? (Do not prepare an income statement; use the degree of operating leverage to compute your answer.)
Answer:
1a.
Contribution format income statement for the game last year
Sales ( 48,500 games × $61) $2,958,500
Less Variable Expenses ( 48,500 games × $41) ($1,988,500)
Contribution $970,000
Less Fixed Costs ($873,000)
Net Income / (loss) $97,000
1b. 10.00
2a. 250%
2b. $339,500
Explanation:
Contribution Income Statement : Shows Separately the Variable Costs and Fixed Cost
Degree of operating leverage = Contribution / EBIT
= $970,000 / $97,000
= 10.00
Increase in net operating income = Degree of operating leverage × Percentage Increase in Sales
= 10.00 × 25%
= 250%
Expected amount of net operating income = Last Year`s net operating income × 3.5
= $97,000 × 3.5
= $339,500
Information related to Harwick Co. is presented below.
1. On April 5, purchased merchandise on account from Botham Company for $23,000, terms 2/10, net/30, FOB shipping point.
2. On April 6, paid freight costs of $900 on merchandise purchased from Botham.
3. On April 7, purchased equipment on account for $26,000.
4. On April 8, returned damaged merchandise to Botham Company and was granted a $3,000 credit for returned merchandise.
5. On April 15, paid the amount due to Botham Company in full.
Required:
Prepare the journal entries to record these transactions on the books of Harwick Co. under a perpetual inventory system.
No. Date Account Titles and Explanation Debit Credit
1.
2.
3.
4.
5.
Answer:
1.
Apr 5
DR Merchandise inventory $23,000
CR Account payable $23,000
(To record Merchandise Purchased)
2.
Apr 6
DR Merchandise inventory $900
CR Cash $900
(To record payment of Freight Costs for Purchases)
3.
Apr 7
DR Equipment $26,000
CR Account payable $26,000
(To record purchase of Equipment)
4.
Apr 8
DR Account payable $3,000
CR Merchandise inventory $3,000
(To record return of damaged Merchandise)
5.
Apr 15
DR Account payable $20,000
CR Cash $19,600
CR Merchandise inventory $200
(To record payment for Merchandise bought on account)
Working
Terms of purchase 2/10 indicate that discount of 2% is warranted if goods paid for in 10 days which they were;
= 20,000 * ( 1 - 2%)
= $19,600
Gross Profit MethodBased on the following data, estimate the cost of the ending merchandise inventory: Sales (net) $9,250,000 Estimated gross profit rate 36% Beginning merchandise inventory $180,000 Purchases (net) 5,945,000 Merchandise available for sale $6,125,000
Answer:
$205,000
Explanation:
The computation of the cost of the ending merchandise inventory is shown below:-
Cost of the ending merchandise inventory = Merchandise available for sale - (Net Sales - Gross profit)
= $6,125,000 - ($9,250,000 - $9,250,000 × 36%)
= $6,125,000 - ($9,250,000 - $3,330,000)
= $205,000
Therefore we applied the above formula so that the cost of ending merchandise inventory could come
For the past year, Momsen, Ltd., had sales of $46,967, interest expense of $4,088, cost of goods sold of $17,184, selling and administrative expense of $12,051, and depreciation of $6,850. If the tax rate was 35 percent, what was the company's net income
Answer:
The Net Income is $4416.1
Explanation:
The net income is calculated as follows,
Sales $46967
Less:Cost of sales (17184)
Gross Profit 29783
Less:Expenses
Selling & Admin exp (12051)
Depreciation exp (6850)
Interest exp (4088)
Net income before ta 6794
tax expense (2377.9)
Net Income 4416.1
What is the coupon rate for a bond with 3 years until maturity, a price of $1,053.46, and a yield to maturity of 6%? Interest is paid annually.
Answer:
Coupon rate is 8%
Explanation:
We can ascertain the coupon rate by first of all determine the amount of coupon with pmt excel function below:
=pmt(rate,nper,-pv,fv)
rate is yield to maturity of 6%
nper is the number of coupons before maturity i.e 3 annual coupons in three years
pv is the current market price of $1,053.46
fv is the par value of $1,000
=pmt(6%,3,-1053.46,1000)=80
Coupon rate=pmt/face value=80/1000=8%
A stock just paid a dividend of $3. The stock is expected to increase its dividend payment by 30% per year for the next 3 years. After that, dividends will grow at a rate of 8% forever. If the required rate of return is 10%, what is the price of the stock today?
Answer:
Price of stock today = $334.56
Explanation:
The Dividend Valuation Model(DVM) is a technique used to value the worth of an asset. According to this model, the value of an asset is the sum of the present values of the future cash flows would that arise from the asset discounted at the required rate of return.
This model would be applied as follows:
Year Present Value ( PV)
1 3 × 1.3 × 1.1^(-1) = 3.5454
2 3 × 1.3^2 × 1.1^(-2) = 4.1900
3 3 × 1.3^3 × 1.1^(-3) = 4.9519
Total 12.6874
Year 4 and beyond
This will be done in two steps
Step 1
D× (1+g)/k-g
3 × 1.3^4/(0.1-0.08)
=428.415
Step 2
Present Value in year 0
=428.415 × 1.1^(-3) = 321.87
Total present value = 12.6874 + 321.87 = 334.56
Price of stock today = $334.56
" Frequently, beer manufacturers run television ads showing attractive, young people having fun and, of course, drinking their beer. These ads are designed primarily to create: "
Answer: To create interest in the youths that it's actually for them mostly.
Explanation:
The way an advert is carried out or planned describes who they are communicating to. The content of the advert targets about 80% of it's market by the content it uses when carrying out the advert. When as advert uses young people frequently, it is primarily targeting the young people to build interest in it's product. So the content of an advert describes the market it wants to sell to.
If beer companies makes use of young people for their adverts then it is known that they simply want more patronize and interest from those young people.
Ace Industries has current assets equal to $3 million. The company's current ratio is 1.5, and its quick ratio is 1.1. What is the firm's level of current liabilities? What is the firm's level of inventories? Do not round intermediate calculations. Round your answers to the nearest dollar.
Answer:
a
Explanation:
I have no clue but good luck on test
Complete the following matrix to analyze the human factors that influence organizational change. Write 1 or 2 complete sentences to explain your rationale for each factor. An example has been provided. Human Factors That Influence Organizational Change Example: Resistance Influence on Organizational Change Example of Global Influence (if any) Example of National Influence (if any) Example: Causes delay in implementing change Example: Workers resist change to avoid outsourcing Example: Workers do not know position of the company in the marketplace Organizational Cause of Factor Example: Occurs because of how change is implemented by leadership 1. Loss of control 2. Uncertainty about future 3. Loss of face 4. Concern about competence 5. Fear of more work 6. Past resentments 7. Feeling threatened References