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2 years ago

Rebert Inc. showed the following balances for last year:

Business

1 answer:

Gekata [30.6K]2 years ago

8 0

Answer:

1.Dollar amount of preferred dividends $320,000

2. Number of common stock 1,000,000

3. Earnings per share 2.86

4. Price-earnings ratio 18.01

Explanation:

Rebert Inc

1.Preferred stock (dollar amount) $4,000,000

Dividend percentage 8%

Hence:

O.08×$4,000,000

=Preferred dividends $320,000

Common stock (dollar amount) $3,000,000

÷Par value per share $3

= Number of common shares 1,000,000

Net Income -Preferred dividends

÷Number of common shares

$3,182,000-$320,000/1,000,000

=$2,862,000/1,000,000

Earnings per share $2.86

Market price per share /Earnings per share

$51.50/$2.86

=Price-earnings ratio $18.01

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Protec Company, whose target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is

taurus [48]

Answer:

The correct answer is 8.23%.

Explanation:

According to the scenario, the computation can be done as:

WACC of debt = Respective costs of debt× Respective weight of debt

= (0.4 × 5)

= 2

WACC of preferred = Respective costs of preferred × Respective weight of preferred

= (0.15 × 7)

= 1.05

WACC of common equity = Respective costs of common equity × Respective weight of retained earning

= (0.45 × 11.5)

= 5.175

So, Total WACC = WACC of debt + WACC of preferred + WACC of common equity

= 2 + 1.05 + 5.175

= 8.225 or 8.23 (approx.)

3 0

2 years ago

The ledger of Tamarisk, Inc. at the end of the current year shows Accounts Receivable $109,000; Sales Revenue $830,000; and Sale

Rashid [163]

Answer:

(A)

bad debt expense 1,500 debit

account receivable 1,500 credit

(B)

bad debt expense 9,490

allowance for doubtful accounts 9,490

(C)

bad debt expense 10,015

allowance for doubtful accounts 10,015

Explanation:

(A)

Direct write-off doesn't use allowance,

bad debt is done directly to account receivable.

(B)

allowance = 11% of AR = 11% of 109,000 = 11,990

balance (2,500 credit)

11,990 - 2,500 = 9,490

(C)

allowance = 9% of AR = 9% of 109,000 = 9810

balance 205 debit

9,810 + 205 = 10,015

Comments: the allowance is expected to be 9% or 11% of AR

so the goal for B and C is to reach a final balance of 9% or 11% of AR

so we have to subtract the balance from the expected allowance to knwo the adjustment.

5 0

2 years ago

Dan purchases a 1000 par value 10-year bond with 9% semiannual couponsfor 925. He is able to reinvest his coupon payments at a n

damaskus [11]

Answer:

9.2%

Explanation:

Missing word "Calculate his nominal annual yield rate convertible semiannually over the ten-year period"

Semi annual coupon payments = 9% / 2 = 4.5%

Par value = 4.5% * 1,000 = $45

interest rate per period = r = 7% / 2 = 3.5%

Number of periods, n = 2 x 10 = 20

FV of all the coupons reinvested = 45 / r * [(1 + r)^n - 1]

FV of all the coupons reinvested = 45 / 3.5% * [(1 + 3.5%)^20 - 1]

FV of all the coupons reinvested = $1,272.59

Receipt of par value at the end of the 10 years = par value = 1,000

Total accumulated value at the end of 10 years = $1,272.59 + 1,000

Total accumulated value at the end of 10 years = $2,272.59

Invested amount = $925

i = nominal interest convertible semi annually.

$925 * (1 + i / 2)^n = 2,272.59

925 * (1 + i / 2)^20 = 2,272.59

i = 2 * [(2,272.59 / 925)^1/20 - 1]

I = 9.19%

I = 9.2%

So, his nominal annual yield rate convertible semiannually over the ten-year period is 9.2%

7 0

1 year ago

On May 31 of the current year, the assets and liabilities of Riser, Inc. are as follows: Cash $20,500; Accounts Receivable, $7,2

Svetradugi [14.3K]

Answer:

$31,100

Explanation:

On May 31 of the current year, the assets and liabilities of Riser, Inc. are as follows: Cash $20,500; Accounts Receivable, $7,250; Supplies, $650; Equipment, $12,000; Accounts Payable, $9,300.

Therefore the amount of stockholders’ equity as of May 31 of the current year can be derived by the formula : Capital = Assets - Liabilities

Assets

Cash $20,500;

Accounts Receivable, $7,250;

Supplies, $650;

Equipment, $12,000

TOTAL = 40,400

Liabilities

Accounts Payable, $9,300.

Therefore stockholders’ equity = 40,400 - 9,300 = $31,100

7 0

2 years ago

2. What type of market is Huy Fong targeting with its sriracha sauce?

Luda [366]

Answers with Explanations:

1. What type of market is Huy Fong targeting with its Sriracha sauce?

"Huy Fong's Food Inc." is a company that sells Sriracha sauce made in California. It has also partnered with several companies in order to provide variety of products based on its official flavor.

Since Huy Fong is open to competition with other rivals, it is clear that the company is using the "monopolistic competition" type of market. Hung Fung is not the only company that sells sriracha sauce, other companies like Heinz and Tabasco are also selling the same sauce.

However, it has been branded as the most authentic and original of all. Such uniqueness of the Huy Fung Sriracha sauce makes it stand out from the rest. In this aspect, the company is monopolizing the competition.

2. Of the four categories of segmentation variables, which is most important to Huy Fong's segmentation strategy, and why?

Of the four categories of segmentation variables, "demographic" is the most important to Huy Fung's segmentation strategy. The company's target market are men and women who belong to the age range of 20-30 in the United States.

This is the specific population that the company is focusing on. These people are considered to be budgeting their money and in that sense, they'd be able to afford the sriracha sauce.

4 0

2 years ago