BUSINESS COLLEGE

Quantitative Problem 2: Carlysle Corporation has perpetual preferred stock outstanding that pays a constant annual dividend of $1.90 at the end of each year. If investors require an 7% return on the preferred stock, what is the price of the firm's perpetual preferred stock? Do not round intermediate calculations. Round your answer to the nearest cent. $ per share

Answers

Answer 1

Answer:

$27.14

Explanation:

Calculation for the price of the firm's perpetual preferred stock

Using this formula

Price of the firm perpetual preferred stock = Annual dividend / Required return

Where,

Annual dividend =$1.90

Required return=7% or 0.07

Let plug in the formula

Price of the firm perpetual preferred stock = $1.90 / 0.07

Price of the firm perpetual preferred stock=$27.14

Therefore the Price of the firm perpetual preferred stock will be $27.14

Related Questions

The December 31, 2018, balance sheet of Whelan, Inc., showed $136,000 in the common stock account and $2,610,000 in the additional paid-in surplus account. The December 31, 2019, balance sheet showed $146,000 and $2,910,000 in the same two accounts, respectively. The company paid out $141,000 in cash dividends during 2019.Required:What was the cash flow to stockholders for the year?
Consider a firm's short-run cost curves. If average total cost is increasing as output rises, thenSelect one:a. total fixed costs must be increasingb. average variable cost must be increasing,c. marginal cost must be below average total cost.d. average fixed costs must be increasing.e, average total cost is no longer equal to the sum of average variable cost and average fixed cost.
ordan Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,200 containers follows. Unit-level materials $ 5,800 Unit-level labor 6,400 Unit-level overhead 3,900 Product-level costs* 9,600 Allocated facility-level costs 26,600 *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Jordan for $2.80 each. Required Calculate the total relevant cost. Should Jordan continue to make the containers
Calculate the current account balance if a small country exports $200 million in goods and services and imports $160 million, it receives $80 million in foreign aid and private charity (net), it pays $15 million to foreign citizens working locally, and its own citizens earn $36 million abroad.
_______ is the phenomenon of the shifting of individual management styles to become more similar to one another.

If the money supply exceeds money demand, people will ____ bonds which will cause bond prices to ____ and the nominal interest rate to _____ until money demand equals money supply. A. buy; rise; fall B. sell; fall; fall
C. sell; rise; fall
D. buy; fall; rise

Answers

Answer:

A. buy; rise; fall

Explanation:

As for the provided information, we know,

As the supply of money exceeds the demand people will have more investing power, accordingly people will buy more bonds,

as more and more people will try to buy the bonds the price for bond because of high demand will automatically due to demand and supply proportion will rise,

and then to control the demand of bond, and control the purchase of bond, the nominal interest rate provided on bonds will fall.

According to the VRIO (value, rarity, imitability, organization) criteria, which of the following marketing or supply chain activities must be avoided by companies? a. Activities that are hard to imitate
b. Activities that add value
c. Activities that contribute to organizational capabilities
d. Activities that are followed by other vendors

Answers

Answer:

Explanation:

According to VRIO there are 4 questions asked about a resource or capability to determine its competitive potential:

The Question of Value: Is the firm able to exploit an opportunity or neutralize an external threat with the resource/capability?" (can it add value? )

The Question of Rarity: "Is control of the resource/capability in the hands of a relative few?"

The Question of Imitability: "Is it difficult to imitate, and will there be significant cost disadvantage to a firm trying to obtain, develop, or duplicate the resource/capability?" (can other vendors do the same activities?)

The Question of Organization: "Is the firm organized, ready, and able to exploit the resource/capability?" "Is the firm organized to capture value?"

With those 4 questions, we analize the statements.

a. It is in accordance with the question of imitability.

b. It is in accordance with the question of value.

c. It is in accordance with the question of organization.

d. It should be avoided. We don't want our activities to be imitated.

Jensen Company uses the percentage of credit sales method for calculating Bad Debt Expense. The company reported $216,000 in total sales during the year; $178,000 of which were on credit. Jensen has experienced bad debt losses of 6% of credit sales in prior periods. What is the estimated amount of Bad Debt Expense for the year

Answers

Answer:

$10,680

Explanation:

Bad debt expense can be seen as an account receivables which are uncollectible during a period of time because of the customers inability to fulfill his /her financial obligations which therefore result into bad debt.

(Bad Debt Expense = Net credit sales × Bad debt loss rate )

= $178,000 × 0.06 = $10,680

Therefore the estimated amount of Bad Debt Expense for the year is $10,680

Which relationship BEST illustrates a comparison of absolute advantage and comparative advantage? A) A country with an absolute advantage will always have a comparative advantage in producing products. B) A country with a comparative advantage can produce a greater output of a products than a country with an absolute advantage. C) A country with an absolute advantage can produce a product at a lower opportunity cost than a country with a comparative advantage in producing all products. D) A country with a comparative advantage can produce a product at a lower opportunity cost, even if another country has an absolute advantage in the production of all goods.

Answers

Answer:

D) A country with a comparative advantage can produce a product at a lower opportunity cost, even if another country has an absolute advantage in the production of all goods.

Explanation:

Comparative advantage is when a country produces a product at a lower opportunity cost when compared with a country.

An absolute advantage is when a country produces greater quantities of a product when compared with another country.

I hope my answer helps you

Answer: D

Explanation: UsaTestPrep

Decision Making Mystic Bottling Company bottles popular beverages in the Bottling Department. The beverages are produced by blending concentrate with water and sugar. The concentrate is purchased from a concentrate producer. The concentrate producer sets higher prices for the more popular concentrate flavors. A simplified Bottling Department cost of production report separating the cost of bottling the four flavors follows: A B C D E
1 Orange Cola Lemon-Lime Root Beer
2 Concentrate $ 4,625 $129,000 $ 105,000 $ 7,600
3 Water 1,250 30,000 25,000 2,000
4 Sugar 3,000 72,000 60,000 4,800
5 Bottles 5,500 132,000 110,000 8,800
6 Flavor changeover 3,000 4,800 4,000 10,000
7 Conversion cost 1,750 24,000 20,000 2,800
8 Total cost transferred to finished goods $19,125 $391,800 $324,000 $36,000
9 Number of cases 2,500 60,000 50,000 4,000
10 Beginning and ending work in process inventories are negligible, so they are omitted from the cost of production report. The flavor changeover cost represents the cost of cleaning the bottling machines between production runs of different flavors.
Determine the cost per case for each of the four flavors. Round your answers to two decimal places
Orange Cola Lemon-Lime Root Beer
per case $_____ $_____ $_____ $_____

Answers

Answer and Explanation:

As per the scenario the solution of cost per case for each of the four flavors is shown below:-

Particulars Orange Cola Lemon Lime Root Beer

Total Cost

transferred to

finished goods a $19,125 $391,800 $324,000 $36,000

Number of cases b 2,500 60,000 50,000 4,000

Cost Per Case $7.65 $6.53 $6.48 $9

(c = a ÷ b)

Therefore we divide the total cost transferred to finished out by number of cases to figure out the cost per case.

At the end of the current year, Newsmax Inc. has $400,000 of subscriptions received in advance included in its balance sheet. A disclosure note reveals that the entire $400,000 will be recognized in the income statement in the next year. In the absence of other temporary differences, in the balance sheet one would also expect to find a:

Answers

Question Completion with answer options:

a- Current deferred tax asset

b- Non-current deferred tax asset

c- Current deferred tax liability

d- Non-current deferred tax liability

Answer:

Newsmax Inc.

In the absence of other temporary differences, in the balance sheet one would also expect to find a:

a- Current deferred tax asset

Explanation:

When Newsmax Inc. received the subscriptions of $400,000 in advance, a deferred tax asset will arise on its balance sheet. This deferred tax asset results from the overpayment or advance payment of taxes on the $400,000 taxed because cash has been received, although, the associated costs have not been recorded. Deferred tax asset is the opposite of a deferred tax liability as the latter represents income taxes owed to the IRS, which will be settled in the coming period(s).

Other Questions

Coronado Inc. had beginning inventory of $12700 at cost and $20900 at retail. Net purchases were $113930 at cost and $158500 at retail. Net markups were $9600, net markdowns were $7400, and sales revenue was $151100. Compute ending inventory at cost using the conventional retail method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)

Megan and Susan are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Megan takes 3 hours to brew a gallon of root beer and 2 hours to make a pizza. Susan takes 7 hours to brew a gallon of root beer and 5 hours to make a pizza.Megan's opportunity cost of making a pizza is ?a. 2/3 gallonb. 5/7 gallonc. 1 1/2 gallonsd. 1 2/5 gallonsof root beer, and Susan's opportunity cost of making a pizza is ?a. 2/3 gallonb. 5/7 gallonc. 1 1/2 gallonsd. 1 2/5 gallonsof root beer.Who has an absolute advantage in making pizza, and who has a comparative advantage in making pizza?

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