Answer:
A) Joint Venture
Explanation:
Based on the scenario being described within the question it can be said that in this context, Cream Bite Inc. is a Joint Venture. This is a business term that refers to an arrangement between two parties in which both combine their resources in order to meet an agreed upon goal in a more efficient manner and in a much smaller time-frame than if they were to do it separately.
Answer:
Specifically perform the contract
Explanation:
When a contract is made and one of the parties does not perform his own part. During a dispute the court will first ask the erring party to perform their duties in the contract.
In this scenario Terry was to supply 18 th century artifacts to Martha for the play she was directing, and Martha was ready to pay $50,000 for this. Another director needed the same artifacts and was ready to pay $60,000. Terry decided not to sell the artifacts to Martha.
Terry has breached his contract with Martha, and will now be compelled to sell the painting to Martha at $50,000.
Answer:
A. $162,500
B. $17,500
Explanation:
Data
EBIT = $25,000
Tax rate = T = 35%
Discount Rate = r = 10%
Requirement A: Market Value
The Market value of the firm can be calculated by using the following formula
Market Value = 
Market Value = 
Market Value = $162,500
Requirement B: Total value of firm If issues $50,000 of debt paying 6% interest
The market value of the firm increases by the present value of the Interest tax shield
The present value of tax shield = Amount of debt x Tax Rate
The present value of tax shield = $50,000 x 35%
The present value of tax shield = $17,500
The market value of the firm will be increased by $17,500
Answer:
See the explanation box
Explanation:
See the image to get the answer:
Answer:
11.13%
Explanation:
Calculation to determine the required rate of return on the stock
Using this formula
Required rate of return=Last EPS*Payout*(1+RoE*(1-payout rate))/Current Price+RoE*(1-payout rate)
Let plug in the formula
Required rate of return=29/2.6*30%*(1+11%*(1-30%))/105+11%*(1-30%)
Required rate of return=11.13%
Therefore the required rate of return on the stock will be 11.13%