Answer:
A
Explanation:
b. 200
c. 50
d. 100
e. 1000
Answer: 100
Explanation: Its 100
b) False
Answer:
Explanation:
Amount required 800000
Plan-1 9% per Annum
Year -1 800000 9% 72000
Year -2 800000 9% 72000
Total interest 144000
Plan-2
Year -1 800000 6.75% 54000
Year -2 800000 10.55% 84400
Total interest 138400
Interset cost
Plan-1 144000
Plan-2 138400
Plan 2 is more benificial because interest cost is lesser than plan-1
Answer:
Plan1=$144000 Plan2= $138400
Plan two is lower than plan 1 interest so it is the better plan
Explanation:
First option
$800000×0.09 =72000
So for two years
$72000×2=$144000
Second option
first year
800000×0.0675=$54000
second year
800000×0.1055=$84400
adding the two
$54000+$84400
=$138400
Plan two is lower than plan 1 interest so it is the better plan
Answer:
total ending WIP value 39,334.20
transferred-out 432.078.00
Explanation:
Ending work in proces inventory
we multiply the equivalent units by the cost per equivlent unit
materials 2,200 x 15.26 = 33,572
converion 940 x 6.13 = 5,762.2
then, we add them to get thetotal value of the ending WIP
total ending WIP value 39,334,2
for the transferred out, we add both equivalent cost as this are complete.
And multiply by the whole amount 20,200
trasnferred out: 20,200 x (15.26 + 6.13) = 432.078
Answer:
what is the value of a share of Gillette stock if the firm's equity cost of capital is 8.8 %?
$ 13,36
Explanation:
First it's necessary to find the present value of the annual dividend paid during the next 6 years, which is calculate by the formula of the Present Value.
PV = Dt / (1+r)^t , it means that each Dividend at the year "t" will be value with the rate r calculated a this same moment "t".
Year 1
0,61 = Div
1,09 = (1+0,88)^1
0,56 = Div/1,09
Year 2
0,69 = Div Year 1(0,61) * 1,129, because increase at 12,9% by year
1,18 = (1+0,88)^2
0,58 = Div/1,18
Year 3
0,78 = Div Year 2(0,69) * 1,129, because increase at 12,9% by year
1,29 = (1+0,88)^3
0,60 = Div/1,18
Year 4
0,88 = Div Year 3(0,78) * 1,129, because increase at 12,9% by year
1,24 = (1+0,88)^4
0,63 = Div/1,24
Year 5
0,99 = Div Year 4(0,88) * 1,129, because increase at 12,9% by year
1,52 = (1+0,88)^5
0,65 = Div/1,52
Year 6
1,12 = Div Year 5(0,99) * 1,129, because increase at 12,9% by year
1,66 = (1+0,88)^6
0,67 = Div/1,66
PV of 6 Years= 0,56 + 0,58 + 0,60 + 0,63 + 0,65 + 0,67 = $3,70
To this second part the model indicates that de dividend is calculated by = Dividend /(Rate-Growth) , which means that if a dividend grows forever, we applied the perpetuity formula where dividend growth it's applied as negative to the discount rate.
Year 6
1,14 = Div Year 6(1,12) * 1,017, thereafter will growth at 1,7% by year.
7,1% = (8,8%-1-7%) Discount rate less growth of dividend.
16,03 = Div/0,071 = In this case we use the rate not the 1+rate.
This value it's calculated at the moment of Year 7, we need to apply the Present Value to calculate the actual value, which is:
16,03 = Perpetuity calculated before until year 6.
1,66 = Discount Rate applied this year.
9,66 = Present Value of the Dividen which grows forever at 1,7%
TOTAL Value of Share = PV of 6 Years + PV Perpetuity =
$3,70 + $9,66=$13,36
Answer:
The price of the preferred stock should be $ 50.
Explanation:
Price of the issued preferred stock: semianual dividend of $2 per share.
Annual discount rate: 8%
With these details we are able to perfom the following calculations:
Annual Preferred Dividend = Semi Annual Dividend x 2
= $2.00 x 2 = $4.00 per share
Then we know that the Price of Preferred Stock = Annual Dividend per share on Preferred Stock / Discount Rate
So this is= $4.00 per share / 0.08
= $50.00 per share. Price of the preferred stock