Answer:
the weighted average cost of capital is 11.57 % .
Explanation:
Market Value of Equity = Number of Common Shares Outstanding × Market Price per share
= 30,000 shares × $15
= $450,000
Market Value of Debt = Face Value × 82%
= $280,000 × 82%
= $229,600
WACC = Ke × (E/V) + Kd × (E/V)
= 14.00 % × ($450,000/ $679,600) + 6.80 % × ($229,600/ $679,600)
= 9.27 % + 2.30 %
= 11.57 %
Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached World Wide Cards with a special order. The Hall of Fame wants to purchase 51,000 baseball card packs for a special promotional campaign and offers $0.33 per pack, a total of $16,830. World Wide Cards's total production cost is $0.53 per pack, as follows:Variable costs: Direct materials $0.13Direct labor 0.04Variable overhead 0.11Fixed overhead 0.25Total cost $0.53World Wide Cards has enough excess capacity to handle the special order. Required:Prepare an incremental analysis to determine whether World Wide Cards should accept the special sales order assuming fixed operating income from the special order.b. Now assume that the Hall of Fame wants special hologram baseball cards. World Wide Cards will spend $5,000 to develop this hologram, which will be useless after the special order is completed. Should World Wide Cards accept the special order under these circumstances, assuming no change in the special pricing of $0.33 per pack?
Answer:
I don't no friend this type of questions
Yasmin Co. can further process Product B to produce Product C. Product B is currently selling for $33 per pound and costs $28 per pound to produce. Product C would sell for $58 per pound and would require an additional cost of $25 per pound to produce. What is the differential cost of producing Product C?
Answer:
Differential cost is $0
Explanation:
A company should process further a product if the additional revenue from the split-off point is greater than than the further processing cost.
Additional sales revenue = Sales revenue after further processing - sales revenue after split-off point
. A company should process further a product if the additional revenue from the split-off point is greater than than the further processing cost.
Also note that all cost incurred up to the split-off point are irrelevant to the decision to process further .
$
Sales after split off point (Product C) 58
Sales at the split off point (Product B) 33
Additional sales revenue 25
Further processing cost (25)
Differential cost 0
Differential cost is $0
Suppose Cho is considering emigrating from her home country.A fictional country of Flaxon has the same policies and institutions as Cho's home country, except that it has greater price stability. If Cho's decision to emigrate is based solely on the prospects for economic growth, she would
Answer: Migrate to Flaxon
Explanation:
If Flaxon country has the same policies and institutions as Cho's home country but also has greater price stability, Cho would emigrate if she wanted more economic growth because Price stability contributes to the growth of the economy.
Price stability means that the country is not going to experience inflation (deflation) that is too high (low) and lasts too long as well as one that is erratic.
This benefits the economy because;
Savings will not be easily eroded by inflation.Decisions can be made easier as inflation rates can be better predictable. For instance, people can save or invest at a particular rate that they know will bring them real return as it will be over the inflation rate. Unexpected deflation will not cause companies to make losses which can increase unemployment and company shutdowns and,Financial institutions can borrow out loans at more stable rates for investments because in a less stable market they would have to charge higher rates to ensure that they do not make losses should inflation change. These stable rates will attract companies and individuals who will use the funds for investment and improve the economy.An organizationally-driven reason for outsourcing is that it can improve effectiveness by focusing on what the firm does best.
Answer:
True
Explanation:
Outsourcing is when a company gives some of its internal activities to an external party that takes the responsibility to get things done and one of the reasons for a company to do this is to get rid of activities that have to get done but that are not part of their core operations to be able to concentrate on their main activity and get those things done by experts which can help increase productivity. According to that, the answer is that the statement is true.
On January 31, 2021, B Corp. issued $650,000 face value, 11% bonds for $650,000 cash. The bonds are dated December 31, 2020, and mature on December 31, 2030. Interest will be paid semiannually on June 30 and December 31. What amount of accrued interest payable should B report in its September 30, 2021, balance sheet
Answer:
The amount of accrued interest payable that B should report in its September 30, 2021, balance sheet is $ 23,833.
Explanation:
Prepare a Bond Amortization Schedule using the data :
Hint : First find the Yield to Maturity
N = 10
PV = $650,000
Pmt = ($650,000 × 11%) ÷ 2 = - $35,750
P/ yr = 2
FV = - $650,000
YTM = ?
Using a Financial Calculator, the YTM is 11.64%.
By the end of September 30, 2021, 8 months` interest will have expired.Thus the amortization schedule should accrue interest for 8 months as follows :
Interest $ 23,833 (debit)
Investment in Bond $ 23,833 (credit)
Interest Calculation = $ 35,750 × 8 / 12
= $ 23,833
According to the lecture video on building dynamic charts, which of the following Excel functions are used in the "Refers to:" formula in Name Manager?
A) SUMIF
B) COUNTIF
C) OFFSET
D) COUNT
Answer:
OFFSET
COUNT
Explanation:
two options are correct, select both.
Answer:
Option C and D are correct
Explanation:
OFFSET - From a cell or a range of cells, returns a reference to a range with a specified number of rows and columns.
COUNT - To determine the number of entries in a number field that is part of a range or array of values, use the COUNT function.
Skolits Corp. has a cost of equity of 11.1 percent and an aftertax cost of debt of 4.65 percent. The company's balance sheet lists long-term debt of $375,000 and equity of $635,000. The company's bonds sell for 105.5 percent of par and market-to-book ratio is 3.01 times. If the company's tax rate is 35 percent, what is the WACC
Answer:
The WACC is 8.71%.
Explanation:
The weighted average cost of capital (WACC) is simply the average rate a firm is expected to pay as cost financing its assets to those who hold its securities.
The WACC can be computed as follows:
Total debt and equity = Debt + Equity = $375,000 + $635,000 = $1,010,000
WE = Weight of equity = Equity / Total debt and equity = $635,000 / $1,010,000 = 0.63, or 63%
WD = Weight of equity = Debt / Total debt and equity = $375,000 / $1,010,000 = 0.37, or 37%
CE = Cost of equity = 11.1%
ACD = After tax cost of debt = 4.65%
Therefore, we have:
WACC = (WE * CE) + (WD * ACD) = (63% * 11.1%) + (37% * 4.65%) = 6.99% + 1.72% = 8.71%
Therefore, the WACC is 8.71%.
A friend wants to borrow money from you. He stated that he will pay you $2500 every 6 months for 7 years with the first payments exactly 3 years and six months from today. The interest rate is 4.8 percent compounded semiannually. What is the value of the payments today?
Answer:
The value of the payments today is $35.00.
Explanation:
The Value of Payments today is known as the Present Value (PV) and is calculated as follows :
Pmt = - $2,500
P/yr = 2
n = 7 × 2 = 14
Fv = 0
Pv = ?
Using a Financial Calculator, the Present Value (PV) of the payments would be $35.00
Pharoah Company has a factory machine with a book value of $90,800 and a remaining useful life of 7 years. It can be sold for $27,200. A new machine is available at a cost of $407,400. This machine will have a 7-year useful life with no salvage value. The new machine will lower annual variable manufacturing costs from $640,100 to $581,800. Prepare an analysis showing whether the old machine should be retained or replaced. (In the first two columns, enter costs and expenses as positive amounts, and any amounts received as negative amounts. In the third column, enter net income increases as positive amounts and decreases as negative amounts. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Answer:
Analysis of Total cost over the period of 7 years
Retain Old Buy New Total
1.Variable Operating Cost $640,100 $581,800 ($58,300)
2.Old Machine Book Value
Retain; Annual Depreciation $12,971 $0 ( $12,971)
Replace: Lump sum Written Off $0 $90,800 $90,800
3.Old Machine Disposal Value $0 ($27,200) ($27,200)
4.Initial Purchase Cost New $0 $407,400 $407,400
Total Cost $653,071 $1052,800 $399,729
Explanation:
Replacement of Machine is a Capital Investment or Long term decision.One aspect of asset replacement is how to deal with book value (written down value) of old equipment.
What is International trade also list the importance of International trade.
Answer:
International trade is buying and selling goods and services across international boundaries. International trade plays a very good role in economic activities and performance of countries around the world. International trade benefit countries in many ways: 1- increasing in production and consumption as a result of specialization, 2- greater choices for consumers due to the competition between traders to get the best choice for consumers. 3- lower prices 4- trade is great source for the flow of service and technology. International trade is the engine of growth.
A stock has an expected return of 10.8 percent, the risk-free rate is 4 percent, and the market risk premium is 5 percent. What must the beta of this stock be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Answer:
β = 1.36
Explanation:
Expected return = Rf+β×Rp
Rf is risk free return
Rp is risk premium
β is Beta
10.8% = 4%+β×5%
5*β= 10.8% - 4%
β = 6.8%/5%
β = 1.36
Hence, the Beta of this stock = 1.36
Window Dressing causes which kind of entry (may have more than one answer)? Multiple Choice Transaction Adjusting Closing
Answer:
Window Dressing causes Adjusting and Closing entries.
Explanation:
Window Dressing the alteration of financial performance near the year-end to appear as if performance has improved. To make the window dressing entry, some temporary and permanent accounts will be adjusted, especially Sales Revenue and costs to generate paper profits. These adjusting entries are closed to the Income Summary. The permanent accounts which are temporarily closed to the Balance Sheet for the period will also require some adjusting entries.
A company reports merchandise inventory on December 31 at $250,000 but LCM applied to items is $200,000. Record the journal entry to report merchandise inventory at the correct amount:
Answer:
The adjusting journal will be :
Loss on write down of Inventory $50,000 (debit)
Inventory $50,000 (credit)
Explanation:
The inventory must be presented at the Lower of Cost and Market Value.
The adjusting journal will be :
Loss on write down of Inventory $50,000 (debit)
Inventory $50,000 (credit)
The Loss on write down of Inventory is an expense in the trading account.
Answer:
See journal below
Explanation:
The journal entries below will be recorded in the books of account in order to report the merchandise inventory at the correct amount.
The cost of goods sold account Dr $50,000
($250,000 - $200,000)
To merchandise inventory account Cr $50,000
(Being record of inventory on LCM)
The cost of goods sold was debited with $50,000 while same amount was credited to merchandise inventory account.
Which of the following items would be a way to manipulate the cash flow from operating activities amount on the statement of cash flows?
a.
Adding depreciation back to net income to determine cash flow from operating activities.
b.
Including interest expense and tax expense in the calculation of cash flow from operating activities.
c.
Recording an item that should be recorded as an operating activity as an investing activity.
d.
The cash flow statement cannot be manipulated.
Answer:
C. Recording an item that should be recorded as an operating activity as an investing activity.
Explanation:
Hope it helped
Tony Hawk's Adventure (THA) issued callable bonds on January 1, 2021. THA's accountant has projected the following amortization schedule from issuance until maturity: Date Cash Paid Interest Expense Increase in Carrying Value Carrying Value 01/01/2021 $ 189,516 06/30/2021 $ 6,000 $ 7,581 $ 1,581 191,097 12/31/2021 6,000 7,644 1,644 192,741 06/30/2022 6,000 7,710 1,710 194,451 12/31/2022 6,000 7,778 1,778 196,229 06/30/2023 6,000 7,849 1,849 198,078 12/31/2023 6,000 7,922 1,922 200,000 What is the annual market interest rate on the bonds
Answer:
8%
Explanation:
Calculation for the annual market interest rate on the bonds
Using this formula
Annual market interest rate=(Interest expenses/Carrying value)× 2 payments per year
Where,
06/30/2021 Interest expenses=$7,581
01/01/2021 Carrying value =$189,516
Let plug in the formula
Annual market interest rate=
($7,581/ $189,516)×2 payments per year
Annual market interest rate=0.04×2 payments per year
Annual market interest rate=0.08×100
Annual market interest rate=8%
Therefore the the annual market interest rate on the bonds will be 8%
Suppose the benefit of owning a painting, in terms of your personal enjoyment, is worth 5% of the value of the painting. If the expected rate of return on stocks is 7%, then the painting should grow in value by _________ per year.
Answer:
7%
Explanation:
It would grow by 7% each year which is the rate of return on stocks
Since the expected rate of return is 7%, then, the painting should grow in value by 2% per year.
Given Information
Expected rate of return = 7%
Present rate of return = 5%
Growth rate = Expected rate of return - Present rate of return
Growth rate = 7% - 5%
Growth rate = 2%
In conclusion, the painting should grow in value by 2% per year.
Read more about expected rate of return
brainly.com/question/15050867
At what phase should security planning begin in a conceptual and proposed "from the start" international acquisition program?
Answer:
Material Solution Analysis
Explanation:
This is a phase in which potential solutions are accessed and analyzed for an Initial Capabilities Document (ICD) and to meet the criteria for the next program of the MDA.
This planning stage of MSA is necessary to choose the best available technology that would meet the needs of a client.
Therefore, the phase that security planning begins in a conceptual and proposed "from the start" international acquisition program is Material Solution Analysis.
You bought a stock one year ago for $49.52 per share and sold it today for $57.04 per share. It paid a $1.14 per share dividend today. How much of the return came from dividend yield and how much came from capital gain?
Answer:
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BPO Services is in the business of digitizing information from forms that are filled out by hand. In 2006, a big client gave BPO a distribution of the forms that it digitized in house last year, and BPO estimated how much it would cost to digitize each form.
Form Type Mix of Forms Form Cost
A 0.2 $0.40
B 0.2 $0.20
C 0.2 $0.20
D 0.2 $0.80
E 0.2 $0.40
a. The expected cost of digitizing a form is $_______ .
b. Suppose that after the agreement, the client sends an equal mix of forms of types D and E only. The expected digitization cost per form of the forms sent by the client is $________ . This leads to an expected loss of $_______ per form for BPO.
A monopolist's maximized rate of economic profits is $1500 per week. Its weekly output is 500 units, and at this output rate, the firm's marginal cost is $32 per unit. The price at which it sells each unit is $42 per unit. At these profit and output rates, what are the firm's average total cost and marginal revenue?
Answer:
Average total cost = $39
Marginal revenue = $32 per unit
Explanation:
The computation of average total cost and marginal revenue is shown below:-
Average total cost = Selling price - (Economic profit ÷ Weekly output)
= $42 - ($1,500 ÷ 500)
= $42 - 3
= $39
Marginal revenue = Marginal cost
So,
Marginal revenue = $32 per unit
Therefore for computing the average total cost and marginal revenue we simply applied the above formula.
I enjoy working with this team because we all trust each other and respect what each person brings to the team. Which characteristic of team excellence am I displaying
Answer: Collaborative climate
Explanation:
When an individual enjoys working with this team because they all trust each other and respect what each person brings to the team, the characteristic of team excellence displayed is referred to as collaborative climate.
Collaborative teams come together and work together in order to achieve the aims and objectives of the organization. A collaborative team bonds and trust each other.
IP Company pays for purchases of materials in full in the month following the purchase. During the previous month, IP had purchases of $25,000. During the current month, IP had purchases of $30,000. The amount that I will pay during the current month for purchases is:________
Answer:
The correct answer is "$25,000".
Explanation:
The given values are:
IP purchase during the previous month
= $25,000
IP purchases during the current month
= $30,000
As the sum is charged in the corresponding sales month, IP must compensate for the transaction made mostly during the reporting period throughout the previous quarter.
Therefore the quantity IP will be paying for purchasing mostly during the reporting period seems to be $25,000.
Company A has 800 employees, and it decides to grant each of the employees 50 share options as part of its new rewards plan. The options are exercisable over 5 years and subject to a 3-year service condition. The fair value of each option at the grant date is $16. The company estimates that 80% of its employees will meet the service condition required for receiving the options. Calculate the total share-based payment expense for Company A assuming that 80% of the employees actually meet the service condition.
Review Later
$853,333
$170,667
$512,000
$341,333
Answer:
$512,000
Explanation:
Because the service condition is 3 years, the total share-based payment expense will be recognized over 3 years. The expense recognized in each year is calculated as:
Year 1 = 50 options x 800 employees x 80% x $16 x 1/3 years = $170,667
Year 2 = 50 options x 800 employees x 80% x $16 x 2/3 years - $170,667 = $170,667
Year 3 = 50 options x 800 employees x 80% x $16 x 3/3 years - $170,667 x 2 = $170,667
Total share-based payment expense = $170,667 + $170,667 + $170,667 = $512,000
Given the following data: Average operating assets $ 504,000 Total liabilities $ 23,520 Sales $ 168,000 Contribution margin $ 85,680 Net operating income $ 45,360 Return on investment (ROI) is:
Answer:
9%
Explanation:
According to the given situation, the solution of return on investment is shown below:-
Return on investment = (Net operating income ÷ Average operating assets) × 100
now, we will put the values into the above formula
= ($45,360 ÷ $504,000) × 100
= 0.09 × 100
= 9%
Therefore for computing the return on investment we simply applied the above formula.
Using the following accounts and balances, prepare the "Stockholders’ Equity" section of the balance sheet using 20,000 shares of common stock authorized, and 1,000 shares have been reacquired.
Common Stock, $ 120 par $48,000,000
Paid In Capital from Sale of Treasury Stock 45,00,000
Paid In Capital in Excess of Par—Common Stock 64,00,000
Retained Earnings 63,680,000
Treasury Stock 5,200,000
Answer and Explanation:
The preparation of the stockholder equity of the balance sheet is presented below:
Shares issued $48,000,000
Add: Paid-In Capital in Excess of Par $6,400,000
Add: Paid in Capital from Sale of Treasury Stock $4,500,000
Add: Retained Earnings $63,680,000
Less: Treasury Stock, 40,000 shares -$5,200,000
Total stockholders' equity $117,380,000
In the long run, when the government does nothing, the output in the economy will be $ billion and the price level will be________-
Harris Co. is considering a 12-year project that is estimated to cost $900,000 and has no residual value. Harris seeks to earn an average rate of return of 15% on all capital projects. Determine the necessary average annual income (using straight-line depreciation) that must be achieved on this project for it to be acceptable to Harris Co.
Answer:
annual income = $70,292.52
Explanation:
initial outlay $900,000
in order to determine the net cash flows per year we can use the present value of an ordinary annuity:
PV = annual cash flow x annuity factor
PV = $900,000 annuity factor, 15%, 12 years = 6.1944annual cash flow = $900,000 / 6.1944 = $145,292.52
annual cash flow = [(revenue - operating costs - depreciation) x (1 - tax rate)] + depreciation
revenue - operating costs - depreciation = annual incometax rate = 0?depreciation = $900,000 / 12 = $75,000$145,292.52 = annual income + $75,000
annual income = $145,292.52 - $75,000 = $70,292.52
The'Great Deregulation Experiment is something that has characterized USA markets for many decades now. It is a response to a period of significant price regulation. But, there was a recognition that markets were stalling and markets need to be deregulated.
Review the selections below and choose the one which does not characterize an effect of the Great Deregulation Experiment.
a) Deregulation had very little impact on entries and exits in the industry market.
b) It involved the airline, railroad, trucking, bus travel, natural gas, and banking industries.
c) The government removed government controls over prices and quantities produced in a variety of industries.
d) Deregulation is the removal of government controls over prices and quantities produced
Answer:
Correct Answer:
a) Deregulation had very little impact on entries and exits in the industry market.
Explanation:
In the 1970's, it became clear to policymakers of all political leanings that the existing price regulation on goods and services in United States of America was not working well. And to solve this problem, The United States carried out a great policy experiment—the deregulation, which is the removal of government controls over prices and quantities produced in airlines, railroads, trucking, intercity bus travel, natural gas, and bank interest rates. One of the effect was its great impact on the entry and exits in industry markets.
On January 1, 2017, Crane Company decided to begin accumulating a fund for asset replacement five years later. The company plans to make five annual deposits of $64000 at 10% each January 1 beginning in 2017. What will be the balance in the fund, on January 1, 2022 (one year after the last deposit)
Answer:
Balance in the account on January 1, 2022 =$820,525.44
Explanation:
Ordinary annuity is that in which the annual cash flow occurs at the end of each year for certain number of years.
Where the cash flow occurs at the beginning of the period, it is known as annuity due. The deposit scheme decided by Crane Company is annuity due, so we would need to work out the future value of an annuity due as follows:
Future Value of Annuity Due (FVAD): This represents the total sum that would accrue where the annual cash flow( each occurring at the beginning of the year) is compounded at a particular rate. It can be determined as
FV = A×( (1+r)^n - 1)/r)× (1+r)
This is the same formula as the ordinary annuity but with an additional provision for the the first cash flow to earn interest. This is effected by multiplying the ordinary annuity formula with (1+r)
Now, we can apply this formula to our question:
DATA
A-cash flow- 64,000
r- discount rate-10%
n-number of years- 5
FV = 64,000 × ( 1.1^5 - 1)/0.05 × 1.05 = 820,525.44
FV = 820,525.44
Balance in the account on January 1, 2022 =820,525.44
Byrd Company produces one product, a putter called GO-Putter. Byrd uses a standard cost system and determines that it should take one hour of direct labor to produce one GO-Putter. The normal production capacity for this putter is 135,000 units per year. The total budgeted overhead at normal capacity is $877,500 comprised of $337,500 of variable costs and $540,000 of fixed costs. Byrd applies overhead on the basis of direct labor hours.
During the current year, Byrd produced 78,100 putters, worked 87,600 direct labor hours, and incurred variable overhead costs of $152,295 and fixed overhead costs of $452,650.
Required:
Compute the predetermined variable overhead rate and the predetermined fixed overhead rate.
Answer:
Results are below.
Explanation:
Giving the following information:
Estimated direct labor hours= 135,000
Estimated varaible overhead= $337,500
Estimated fixed overhead= $540,000
To calculate the predetermined overhead rate, we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Variable:
Predetermined manufacturing overhead rate= 337,500/135,000= $2.5 per direct labor hour
Fixed:
Predetermined manufacturing overhead rate= 540,000/135,000= $4 per direct labor hour