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1 year ago

Feldspar Inc. is considering the capital structure for a new division. Management has been given the following cost information:

Business

1 answer:

34kurt1 year ago

8 0

Answer:

Option 4

Explanation:

In this question ,we have to compute the WACC which is shown below:

= Weightage of debt × cost of debt × ( 1- tax rate) + (Weightage of common stock) × (cost of common stock)

For Option 1, it would be

= (0.3 × 10%) × ( 1 - 40%) + (0.7 × 12.5%)

= 1.8% + 8.75%

= 10.55%

For Option 2, it would be

= (0.4 × 10.5%) × ( 1 - 40%) + (0.6 × 13%)

= 2.52% + 7.8%

= 10.32%

For Option 3, it would be

= (0.5 × 11%) × ( 1 - 40%) + (0.5 × 13.5%)

= 3.3% + 6.75%

= 10.05%

For Option 4, it would be

= (0.6 × 11.7%) × ( 1 - 40%) + (0.4 × 14.2%)

= 4.212% + 5.68%

= 9.89%

For Option 5, it would be

= (0.7 × 13%) × ( 1 - 40%) + (0.3 × 15.5%)

= 5.46% + 4.65%

= 10.11%

So based on this, the management should accept option 4 as it derives the best debt asset ratio

The weightage of equity would be come

= 1 - weightage of debt

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Zhou owns a nonrental business with two separate departments. Department A generates net income of $70,000, and Department B gen

Margaret [11]

Answer: $58,000

Explanation:

If Zhou is allowed to treat the departments as components of a single activity then ALL the losses suffered by Department B can be offset against the Income of Department A because they will be treated as a singular business.

Seeing as Department A has a higher income of $70,000 than the loss of Department B of $58,000, all of Department B's loss can therefore be offset by Department A.

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2 years ago

Employees who have difficulty performing efficiently on the job often have poor _____ skills, are confused about their prioritie

sergeinik [125]

Answer: The correct answer is "Organizational".

Explanation: Employees who have difficulty performing efficiently on the job often have poor organizational skills, are confused about their priorities (what is most important), and may be slow in making decisions.

Organizational skills allow us to distinguish which are our priorities, short, medium and long term objectives to be met and the steps to follow to fulfill these. Once focused on that, decision-making aimed at meeting these objectives tends to be much faster, which as a result demonstrates more efficient work.

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1 year ago

Your project to obtain charitable donations is now 30 days into a planned 40-day project. The project is divided into three acti

adell [148]

Answer:

1. schedule variance = -$52,500

2. SPI = 0.65

3. CPI = 0.56

Explanation:

to get the solution, we calculate for BRWS and BRWP

first we calculate the budgeted revenue of the work scheduled for each activity using this formula:

budgeted revenue * planned completion

A = 25,000 x 100percent

= $25000

B = 150,000 x (25/30) percent

= $125000

C = 50000 x 0percent

= 0$

total = $25000+$125000+$0

= $150000

Next we calculate budgeted revenue of work performed (brwp)

calculated using this formula:

budgeted revenue x actual completion

A = 25000 x 90percent

= 22500 dollars

B = 150000 x 50percent

= $75000

C = 50000 x 0%

= $0

total = 22500 + 75000 + 0

= $97500

1. schedule variance = BRWP - BRWS

= $97500 - $150000

= -$52500

we have a negative schedule, telling us that the project is behind schedule

2. schedule performance index = revenue of work performed divided by revenue of work schedule

= 97500/150000

= 0.65

3. cost price index = revenue of work performed divided by actual revenue

= 97500/175000

= 0.56

4. how the project is going:

the schedule performance index (SPI) is 0.65 which is less than 1. this is to say that the project is doing better than planned revenue when we talk of revenue

4 0

1 year ago

Teams with high levels of ______ and ______ deal with task conflict better than those without these characteristics.A. extravers

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Teams with high levels of openness and emotional stability deal with task conflict better than those without these characteristics.

When you are able to be open about your feelings and keep them stable (emotional stability) dealing with conflict becomes easier. When you are emotionally stable, you are able to understand that emotions will arise during various activities and it's okay to experience different emotions as long as they don't derail you from what you need to accomplish.

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1 year ago

McDonald's Corp has a preferred stock paying a dividend of $19 and has a market price of $178. Calculate the cost of capital for

Iteru [2.4K]

Answer:

McDonald's Corp

The cost of capital for the preferred stock is:

10.67%

Explanation:

a) Data and Calculations:

Market price of preferred stock = $178

Preferred stock dividend = $19

Cost of capital = Preferred stock dividend/Market price of preferred stock * 100

= $19/$178 * 100

= 10.67%

b) The cost of capital for McDonald's preferred stock is the finance cost or interest cost that it must incur for financing its projects using preferred stock. This represents the 10% of the preferred stock value that is paid out to preferred stockholders.

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1 year ago