Answer: $28.57
Explanation:
The Conversion price is the price of the bond divided by the conversion ratio.
Price = $1,000
Conversion ratio = 35 shares
Conversion ratio = 1,000/35
= $28.57
During September, the capital expenditure budget indicates a $520000 purchase of equipment. The ending September cash balance from operations is budgeted to be $67000. The company wants to maintain a minimum cash balance of $35000. What is the minimum cash loan that must be planned to be borrowed from the bank during September?
Answer:
$488,000
Explanation:
He capital expenditure balance indicates a $520,000 purchase of equipment.
September ending cash balance is budgeted at $67,000
The company wants to maintain a minimum cash balance of $35,000
Therefore the minimum cash loan to be borrowed from the bank can be calculated as follows
= $520,000-$67,000+$35,000
= $488,000
Hence, the minimum cash loan that must be planned to be borrowed from the bank during September is $488,000
Answer:
the minimum cash loan that must be planned to be borrowed is $418,000.
Explanation:
The Cash Budget is prepared to highlight times for cash surpluses - allowing arrangements for investments of those surpluses to gain maximum return.
The Cash Budget also highlight times for Cash deficit - allowing for short term alternative sources of finance.
September Cash Budget Reconciliation :
Purchase of Equipment $520,000
Less Cash Balance ($67,000)
Less Minimum Cash Balance ($35,000)
Budgeted Loan Balance $418,000
Suppose Stark Ltd. just issued a dividend of $1.59 per share on its common stock. The company paid dividends of $1.25, $1.33, $1.40, and $1.51 per share in the last four years. a. If the stock currently sells for $40, what is your best estimate of the company’s cost of equity capital using the arithmetic average growth rate in dividends? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. What if you use the geometric average growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Answer:
Explanation:
arithmetic average growth rate = {[(1.33 - 1.25)/1.25] + [(1.40 - 1.33)/1.33] + [(1.51 - 1.40)/1.40] + [(1.59 - 1.51)/1.51]} / 4 = {0.064 + 0.053 + 0.079 + 0.053} / 4 = 0.06225 x 100 = 6.225%
geometric growth rate = ⁴√{0.064 x 0.053 x 0.079 x 0.053} = 0.061%
a) using arithmetic average growth rate
Div₁ = $1.59 x 1.06225 = $1.689
P₀ = $40
g = 6.225%
40 = 1.689 / (Re - 0.06225)
Re - 0.06225 = 1.689 / 40 = 0.04222
Re = 0.04222 + 0.06225 = 0.10447 = 10.45%
b) using geometric average growth rate
Div₁ = $1.59 x 1.061 = $1.68699
P₀ = $40
g = 0.061%
40 = 1.68699 / (Re - 0.061)
Re - 0.061 = 1.68699 / 40 = 0.04217
Re = 0.04217 + 0.061 = 0.103174 = 10.32%
Which of the following is an explanation of the share-the-gains share-the-pains theory?
A. People who have been in an industry are most likely to be asked to be regulators of the 11.
B. Regulators who are interested in keeping their jobs must please both the industry and co.
C. When products have too many warning labels, consumers may not read any of them.
D. In some markets, sellers have more information about products than buyers.
Answer:
B. Regulators who are interested in keeping their jobs must please both the industry and co.
Explanation:
The share-the-gains, share-the-pains theory is one that states that holds that organizations/firms must take into consideration the demands of legislators (regulators), firms in the regulated industry and consumers of the regulated products.
Therefore, in share-the-gains, share-the-pains theory, regulators who are interested in keeping their jobs must please both the industry and consumers.
Option B is the correct answer.
Using a departmental approach to overhead application results in ______ as using a plantwide rate.
Answer:
Using a departmental approach to overhead application results in ______ as using a plantwide rate.
over-applied and under-applied overheads
Explanation:
There are three methods for overhead application. One method is the use of a plantwide overhead rate, where the overhead costs are divided by the volume of plantwide consumption to obtain the rate per consumption. Two is the departmental overhead rate which restricts the calculation of the overhead rate to the department, thereby making the rate specific to each department. The third is the activity-based costing technique which assesses the level or volume of activity and uses this to determine the overhead rate.
A preferred stock will pay a dividend of $3.00 in the upcoming year and every year thereafter; i.e., dividends are not expected to grow. You require a return of 9% on this stock. Use the constant growth DDM to calculate the intrinsic value of this preferred stock.
A) $33.33.
B) $0.27.
C) $31.82.
D) $56.25.
Answer:
Intrinsic value of this preferred stock. = $33.33
Explanation:
Given:
Dividend per year = $3
Required rate of return = 9%
Growth rate = 0
Find:
Intrinsic value of this preferred stock.
Computation:
Intrinsic value of this preferred stock. = D / (r - g)
Intrinsic value of this preferred stock. = $3 / (9% - 0)
Intrinsic value of this preferred stock. = $33.33
The Intrinsic value of the preferred stock is $33.33.
Given Information
Dividend per year = $3
Required rate of return = 9%
Growth rate = 0
Intrinsic value of this preferred stock. = D / (r - g)
Intrinsic value of this preferred stock. = $3 / (9% - 0)
Intrinsic value of this preferred stock. = $33.33
Hence, the Intrinsic value of the preferred stock is $33.33.
Therefore, the Option A is correct.
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A company is considering several investment opportunities. The investments have been evaluated using payback period and break-even time. Only one project will be chosen and time value of money is important. The company should choose the project which the:_______.
Answer:
Break-even time is the shortest
Explanation:
Break-even time is an investment time base measurements which is used to evaluate the amount of time required before the present value of the net cash flows from an investment equals its initial cost. Thus, in this the project, the project with shortest break even time should be chosen by the company since time value of money is considered.
In a period of falling interest rates, a bond dealer would engage in which of the following activities?I Raise prices in interdealer quote publications such as Bloomberg for municipal bondsII Place "request for bids" in services such as Bloomberg on appreciated positions where the dealer has no current interestIII Bid for bonds to cover previously established short positionsIV Buy put options on debt instruments to hedge existing short positionsA. I and II onlyB. III and IV onlyC. I, II, IIID. I, II, III, IV
Answer:
C. I, II, III
Explanation:
In a period of falling interest rates, a bond dealer would engage in all of the following activities except for IV. Therefore, a dealer would raise his quoted price in Bloomberg. If the dealer has an appreciated bond that he wishes to sell, he can place ''Request for Bids'' for those bonds in Bloomberg. The dealer may buy bond the he has previously sold short to limit losses due to rising price. To protect existing short position against the rising price, the dealer will buy call options, not put options. Put options are used in protecting existing long position from falling price.
Suppose you observe the following situation: Security Beta Expected Return Pete Corp. 1.25 .1323 Repete Co. .87 .0967 a. Assume these securities are correctly priced. Based on the CAPM, what is the expected return on the market
Answer:
The expected return on the market rate is 10.59%
Explanation:
Expected return=risk-free rate +Beta*(market rate- risk-free rate)
13.23 = Rf + 1.25*(Rm-Rf)
13.23 = 1.25Rm- 0.25Rf
Rm = (13.23 + 0.25Rf ) / 1.25 .............(equ i)
9.67 = Rf+0.87*(Rm-Rf)
9.67 = 0.13Rf+0.87Rm
Substitute (13.23+0.25Rf)/1.25 for Rm from equ (i)
9.67 = 0.13Rf+0.87*(13.23+0.25Rf)/1.25
9.67 = 0.13Rf+9.20808+0.174Rf
Rf = (9.67-9.20808)/(0.13+0.174)
Rf = 0.46192 / 0.304
Rf = 1.519474
Rf = 1.52%
Hence, Risk free rate is 1.52%
From the equ (i)
Rm = (13.23+0.25Rf)/1.25
Rm = (13.23+0.25(1.52%)/1.25
Rm = (13.23+0.003 ) /1.25
Rm = (13.23+0.003 ) /1.25
Rm = 13.233 / 1.25
Rm = 10.5864
Rm = 10.59%
Hence, expected return on Market rate is 10.59%
Predetermined overhead rates are calculated at the end of the accounting period once the actual amount of factory overhead is known
Answer:
False
Explanation:
Predetermined overhead rate is a term that describes a form of rate utilized when assigning manufacturing overhead to work-in-process supply. However, in order to derive the predetermined overhead rate, this is calculated at the inception of the term so that labors cost can be measured throughout the period instead of determining it at the end of the period.
Hence, in this case, it can easily be concluded that the statement in the question is FALSE.
As the price of a product increases, the amount of the product that a producer is willing to supply increases. A. True B. False
Answer:
My answer to the question is True.
As the price of a product increases, the amount of the product that a producer is willing to supply increases. The given statement is True. According to the law of supply, producers will produce more of a good when prices are high and less of a good when prices are low.
How does an increase in price affect a producer?Prices also have an impact on manufacturers because they may decide whether or not to increase production in response to higher supply costs. However, when prices rise, less of a good is available, which has a direct impact on consumers.
According to the law of supply, producers will increase their supply to the market if the price is higher. Businesses produce more of a good or service when they anticipate paying a higher price for it because they want to increase their revenue.
Thus, the mentioned above given statement is correct or True.
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A company's income statement showed the following: net income, $134,000; depreciation expense, $30,000; and gain on sale of plant assets, $4,000. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $9400; merchandise inventory increased $18,000; prepaid expenses increased $6,200; accounts payable increased $3,400. Calculate the net cash provided or used by operating activities.
A. $141,000.
B. $96,600.
C. $156,60o.
D. $88,600.
E. $148.600.
Answer:
E. $148,600
Explanation:
Cash flow from operating activities.
Net income. $134,000
Add: Depreciation. $30,000
Less: Gain on sale ($4,000)
Changes in working
Capital
Add: decrease in
Accounts receivable $9,400
Less: increase in
Merchandise inv. ($18,000)
Less: increase in
Prepaid expenses ($6,200)
Add: increase in
Accounts payable $3,400 ($14,600)
Net cash provided used by $148,600
Operating activities
Lloyd Inc. had sales of $200,000, a net income of //415,000, and the following balance sheet: Cash $10,000 Accounts Payable $30,000 Receivables 50,000 Notes Payable To Bank 20,000 Inventories 150,000 Total Current Liabilities $50,000 Total Current Assets $210,000 Long-Term Debt 50,000 Net Fixed Assets 90,000 Common Equity 200,000 Total Assets $300,000 Total Liabilities And Equity $300,000 The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry average, 2.5x, without affecting sales or net income. If inventories are sold and not replaced (thus reducing the current ratio to 2.5x); if the funds generated are used to reduce common equity (stock can be repurchased at book value); and if no other changes occur, by how much will the ROE change? What will be the firm’s new quick ratio?
Answer:
The firm's new quick ratio is 2.9
Explanation:
The current ratio is calculated as
Current ratio = Current assets / Current liabilities
2.5 times = (Cash + receivables + Inventories ) / (Accounts payable + Other current liabilities)
2.5 = ($10,000 + $50,000 + Inventories) / $50,000
$60,000 + inventories = $125,000
Inventories = $65,000
Therefore, $85,000 worth of inventories were sold off.
If the funds generated are used to reduce the common equity that is by repurchasing the equity at book value.
Hence, the common equity amounts to $115,000
Calculating the ROE before the inventory is sold off:
ROE = Net income / Stockholder's equity
= $15,000 / $200,000
= 0.075 or 7.5%
Calculating the ROE after selling off the inventory
ROE = $15,000 / $115,000
= 0.13 or 13%
The firm's new quick ratio is
Quick ratio = (Current assets - Inventories) / Current liabilities
= ($210,000 - $65,000) / $50,000
= 2.9
The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes:Purchased $480,000 of materials.Used $434,500 of direct materials in production.Incurred $125,000 of direct labor wages.Applied factory overhead at a rate of 40% of direct labor cost.Transferred $578,000 of work in process to finished goods.Sold goods with a cost of $550,000.Revenues earned by selling bikes, $910,000.Incurred $185,000 of selling expenses.Incurred $90,000 of administrative expenses.Required:a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method.b. Determine the inventory balances on February 28, the end of the first month of operations.
Answer: Please find answers in the explanation column
Explanation:
Using the perpetual inventory method.
Rushmore Biking Inc
Income Statement For the Month Ended February 28
Revenue $910,000
Cost of goods sold -$550,000
Gross profit $360,000
Selling and administrative expense:
Selling expense $185,000
Administrative expense $90,000
Total Selling and administrative expense $275,000
Operating income
(Gross profit -Total Selling and administrative expense)
$85,000
b) Inventory balance on Current assets for February 28
Direct Materials inventory
Purchases of materials- direct materials used in production
= $480,000- $434, 500= $45500
Work in process inventory
direct materials used in production+Direct labor wages incurred+Factory overhead applied-Transferred to finished goods
= $434500+125000+ ($125000*40%) - 578000
= $434500+125000+$50,000 - $578000
=$31,500
Finished goods inventory
Transferred to finished goods-Cost of goods sold
= $578,000-550,000= $28000
The preparation of the income statement and the balance of the inventory should be shown below.
a. Preparation of income statement:Rushmore Biking Inc
Income Statement For the Month Ended February 28
Revenue $910,000
Less:Cost of goods sold -$550,000
Gross profit $360,000
Selling and administrative expense:
Less: Selling expense $185,000
Less: Administrative expense $90,000
Total Selling and administrative expense $275,000
Operating income $85,000
Working note:
= Gross profit -Total Selling and administrative expense
= Operating income
b) The inventory balances on February 28:
Direct Materials inventory:
= Purchases of materials- direct materials used in production
= $480,000- $434, 500= $45500
Work in process inventory
= direct materials used in production+Direct labor wages incurred+Factory overhead applied-Transferred to finished goods
= $434500+125000+ ($125000*40%) - 578000
= $434500+125000+$50,000 - $578000
=$31,500
Finished goods inventory:
=Transferred to finished goods-Cost of goods sold
= $578,000-550,000= $28000
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"What specific, direct benefits can a business get from acting in an environmentally responsible manner?"
Explanation:
It is correct to say that we live in a globalized world, where there is a lot of competition in the business market and where the flow of information occurs very quickly. Therefore, there is a greater demand from society for companies to be active promoters of practices that will lead to the development of society and the maintenance of scarce natural resources.
Companies that act in an environmentally responsible manner will obtain the benefits of certifying to their stakeholders that they are active agents of transformation and prevention of the environment, which can be accomplished through environmental certifications, environmental management systems, compliance with environmental legislation, etc. , which ensures that companies have a better positioning in the market, attracts more consumers and investors, in addition to improving production processes with environmental management systems, which promotes continuous improvement in the company, reducing costs and waste.
When nations increase production in their area of _________________ and trade with each other, both sides can benefit.
Answer:
comparative advantage
Explanation:
Comparative advantage in finance is crucial for production because it helps nation to manufacture their goods with low opportunity cost compare to their co- partner in that production line.
Production which is an essential aspect in economics is a process of turning raw materials into finished goods are very crucial in each nation of the world and for economic process to be completed.
It should be noted that When nations increase production in their area of comparative advantage and trade with each other, both sides can benefit from it.
Suppose you deposit $1,682.00 into and account 4.00 years from today into an account that earns 5.00%. How much will the account be worth 18.00 years from today
Answer:
FV= $3,330.25
Explanation:
Giving the following information:
Initial investment= $1,682.00
Number of periods= 14 years
Interest rate= 5% compounded annually
To calculate the future value, we need to use the following formula:
FV= PV*(1+i)^n
PV= present value
i= interest rate
n= number of years
FV= 1,682*(1.05^14)
FV= $3,330.25
Chik’s Chickens has accounts receivable of $6,333. Sales for the year were $9,800. What is its average collection period?
Answer:
The answer is 235 days
Explanation:
Average collection period can also be called Days' outstanding period. And it is the number of days it takes a business to collect its money or receivables from the goods or services sold on credit.
Days' reveivables period or Average collection period = 365 days / reveivables turnover.
Receivables turnover = Sales/ average receivable
$9,800/$6,333
= 1.55
Average collection period=
365 days/1.55
=235 days
how would you predict the survivorship curve of a developed country would compare to that of a developing country
Answer:
The survivorship curve of a developed country would show a higher percentage of people surviving to each each group than in a developing country.
This is because in developing country life expectancy is lower than in developed countries.
The reason is that developing countries have less economic resources to invest in health systems, and also because in developing countries, many more people are poorer, and poorer people are more likely to suffer from disease.
Whereas ______________ are willing to violate procedures and operate outside normal channels, ______________ gather hard data and develop a strong case for why a project should be killed.
Answer:
Product champions
Exit champions
Explanation: A product champion is a person who who takes front lines in creating, defining, Developing etc of a product and making the product a delight to the customers, stakeholders etc product champions helps to ensure that the products are loved and valued by the customers.
Exit champions go a long way to ensure that they enough detail and information about a product with the aim of ensuring that the product is exited from the market.
A new municipal bond issue had a dated date of January 1, 2018. The first coupon was due on August 1, 2018. The customer bought for settlement on September 1, 2018. How many months of accrued interest must he pay at settlement
Answer:
1 month
Explanation:
The last coupon paid by this bond was made on August 1, 2018, and the transaction is made on September 1, 2018, therefore, only 1 month has passed since the last coupon was paid. Therefore, accrued interests will be charged for only 1 month.
When bonds are sold including accrued interests, they are said to be sold at their dirty price.
Suppose that the required reserve ratio is 8.00 %. What is the simple money (deposit) multiplier?
Answer:
12.5
Explanation:
Money multiplier gives the maximum amount money supply can increase to given the reserve ratio
Money multiplier = 1 / r = 1 / 0.08 = 12.5
When would a good’s total utility and marginal utility be the same?
Answer :
Utility is the satisfaction a person derives from the consumption of a good or service. Total utility is the total satisfaction received from consuming a given total quantity of a good or service, while marginal utility is the satisfaction gained from consuming an additional quantity of that item. Sometimes, economists like to subdivide utility into individual units that they call utils. However, because utility is subjective, meaning that it differs from person to person, and because it varies continuously, depending on the quantity consumed, an util cannot actually be measured, but is simply a heuristic device that allows economists to talk about the degree of satisfaction for a product or service.Marginal utility always declines for each successive quantity of consumption. If you like ice cream, and you eat one scoop, the first scoop will provide the greatest satisfaction. If you eat another scoop, you'll probably enjoy that also, but the satisfaction will be less than for the first. At some point, you will not want any more ice cream. The marginal utility will drop to zero and may even become negative. This illustrates the law of diminishing marginal utility. Marginal utility declines for everything, including money. Although many people want to amass great wealth, each dollar accumulated becomes worth less and less, because the marginal utility of what it can buy declines.
Declining marginal utility explains why the demand curve slopes downward as the supply quantity is increased, and why people will only consume more if the price declines, since people's willingness to pay also declines.
Marginal utility is also related to the elasticity of demand. If demand is inelastic, then the quantity demanded drops off slowly as the price increases, indicating that the marginal utility of the product or service is high; with elastic demand, demand quantity drops off sharply, indicating a low marginal utility for the product, so the consumer is not willing to pay a higher price.
Please mark me as a brainlist...... Please follow me..... ✌✌Fama and French (1992) found that the stocks of firms within the highest decile of book-to-market ratios had an average annual return of _______, while the stocks of firms within the lowest decile of book-to-market ratios had an average annual return of ________. Group of answer choices 13.2%; 16.4% 11.1%; 17.2% 15.6%; 13.1% 17.2%; 11.1%
Answer:
1. 17.2%
2. 11.1%
Explanation:
In a research study carried out by Fama and French in 1992 titled "The Cross‐Section of Expected Stock Returns." Their findings showed that the stocks of firms within the highest decile of book-to-market ratios had an average annual return of 17.2%, while the stocks of firms within the lowest decile of book-to-market ratios had an average annual return of 11.1%
Hence, the correct answer to the question is: 17.2% and 11.1% respectively.
if you start making $265 monthly contributions today and continue them for four years, what is the furture value if the compounding rate is 9.75 percent APR?
Answer:
FV= $15,482.98
Explanation:
Giving the following information:
Monthly investment= $265
Number of periods= 12*4= 48
Interest rate= 0.0975/12= 0.00813
To calculate the future value, we need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= monthly deposit
FV= {265*[(1.00813^48) - 1]} / 0.00813
FV= $15,482.98
According to the text, several new technologies are expected to have dramatic impacts on marketing. Among those cited are
Answer:
Internet of Things, autonomous vehicles, wearable technology, and artificial intelligence.
Explanation:
Among those cited are the Internet of Things, autonomous vehicles, wearable technology, and artificial intelligence. All of these are innovations that work together to make smart technology, these are technologies that use artificial intelligence and interconnect between one another and the internet in order to communicate, share, analyze, and store valuable information while at the same time learning and adapting.
What would be the future value of $15,555 invested now if it earns interest at 14.5 percent for seven years
Answer:
$40,133.63
Explanation:
we can use the future value formula:
future value = present value x (1 + interest rate)ⁿ
present value = $15,555interest rate = 14.5%n = 7 yearsfuture value = $15,555 x (1 + 14.5%)⁷ = $15,555 x 1.145⁷ = $15,555 x 2.580111097 = $40,133.63
Students submitting initial CPT applications should allow at least ____ business days for their CPT application to be reviewed.
Answer:
30 business days
Explanation:
Students submitting initial CPT applications should allow at least 30 business days for their CPT application to be reviewed.
The Curricular Practical Training (CPT) is an off-campus work/internship which is usually tied to the student's area of study. It's always open for students who are still studying in a particular program.
Graduate students can actually apply for CPT in first semester because it's actually an integral part of the student's graduate studies.
It takes 30 business days to review their applications.
Preferences are characterized generally by: A. income. B. consumption bundles. C. indifference curves. D. budget constraints.
Answer:
B. consumption bundles
Explanation:
Customer preference is defined as the likes and dislikes that a customer has that determines his choice in making purchases.
For exams a customer may want to buy shoes that are black in colour, but shoes that are yellow in colour are ignored.
Preferences of buyers are independent not prices and income level.
Rather it is dependent on consumption bundle. That is the set of goods that will give highest satisfaction to the buyer.
The defect rate for data entry of insurance claims at Sadegh Kazemi Insurance Co. has historically been about 1.50%. This exercise contains only parts a, b, c, d, and e. a) If you wish to use a sample size of 200, the 3-sigma control limits are:
Answer and Explanation:
Data provided in the question
defect rate i.e. [tex]\bar p[/tex] = 1.50%
the sample size = n = 200
Now
[tex]S_p = \sqrt{\frac{\bar p (1 - \bar p)}{n} } \\\\= \sqrt{\frac{1.50\% (1 - 1.50\%)}{200} }[/tex]
= 0.008595057
Now the 3 sigma control limits is
UCL_p = [tex]\bar p[/tex] + 35p
= 0.015 + 3 (0.008595057 )
= 0.04078517
LCL_p = [tex]\bar p[/tex] - 35p
= 0.015 - 3 (0.008595057 )
= 0
hence, the 3 sigma control limits are UCL 0.04078517 and LCL 0 respectively
The calculation for annual depreciation using the units-of-output method is:________
a. (Initial cost Estimated output) × Actual yearly output
b. (Depreciable cost Yearly output) × Estimated output
c. Depreciable cost Yearly output
d. (Depreciable cost Estimated output) × Actual yearly output
Answer:
d. (Depreciable cost Estimated output) × Actual yearly output
Explanation:
Units of Output depreciation = Cost - Residual Value × Period`s Production / Total Expected Production.
Note : Depreciation is dependable on depreciable cost (Cost less Residual Value)
The Option that is close to this formula is d.