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KonstantinChe [14]
2 years ago
7

Womack Toy Company’s stock is currently trading at $25 per share. The stock’s dividend is projected to increase at a constant ra

te of 7 percent per year. The required rate of return on the stock, ks, is 10 percent. What is the expected price of the stock 4 years from today?
Business
1 answer:
Gemiola [76]2 years ago
6 0

Answer: $32.77

Explanation:

Given the following :

Current price of stock = $25

Growth rate of Dividend per annum= 7%

Required return on stock = 10%

Period = 4 years

Expected price of stock after 4 years can be calculated using the relation :

Current price × ( 1 + growth rate)^period

Expected price = $25(1 + 7%)^4

Expected price :

$25 × ( 1+ 0.07)^4 = $25 × (1.07)^4

= $25 × 1.31079601

= $32.76990025 = $32.77

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Merchant Company purchased property for a building site. The costs associated with the property were: Purchase price $ 181,000 R
Elena-2011 [213]

Answer:

<em><u>Any cost directly attributable to bring the asset into current location and condition necessary for it to be capable of operating it, in the manner intended by the management ( Para 15) 4.1.1. Clause b</u></em>

According to this the cost must be allocated to the purchase of land.

There are three scenarios.

1) if the land with a building is purchased with the intention of demolishing an old building and building a new building then selling it all the costs would be assigned to the purchase of land.

2) if the land is purchased with the building on it and that building is used for a short time and then demolished then the building demolish charges would be expense out.

3)if the land with a building is purchased with the intention of demolishing an old building and building a new building then  using it then two different costs accounts of land and building would be used. We would not demolish the old building without the new building being made so the demolish would be added in the incremental costs of the new building.

The given question is of the third scenario therefore

Costs of Land = $ 181,000 + $ 15,600 + $ 1400 + 2600= $ 200,600

Incremental Cost of new building = $ 1600

3 0
2 years ago
After spending months finalizing a marketing plan, the lead marketing manager presents it to the entire company. It soon becomes
Sauron [17]

The correct answer is A) alignment.

After spending months finalizing a marketing plan, the lead marketing manager presents it to the entire company. It soon becomes clear that the budget given in the plan is far lower than the marketing team had determined it would need. This mistake is likely a result of a lack of alignment.

This means that the marketing manager did not respect the parameters originally indicated. His numbers did not align with the necessities of the plan, which means that he did not take into consideration some important factors that at the end, affected the end result of the budget.

7 0
2 years ago
Your customer purchases FYZ 4% convertible preferred stock at $60 per share. The conversion price is $10. With the common stock
KIM [24]

Answer:

$9

Explanation:

Calculation for how much the common shares of FYZ are trading

First step is to find the conversion ratio

Using this formula

Conversion ratio =Market price of the convertible+Conversion price)/Conversion price

Let plug in the formula

Conversion ratio=$70/$10

Conversion ratio=7

Second step is to calculate for the Parity price of the common stock

Using this formula

Parity price=Market price of the convertible / conversion ratio

Let plug in the formula

Parity price=$70/7

Parity price=$10

Last step is to calculate how much the common shares of FYZ are trading

Using this formula

Common shares =Parity price-Common stock trading point

Let plug in the formula

Common shares =$10-1

Common shares=$9

Therefore the common shares of FYZ are trading at $9

6 0
2 years ago
The unemployment rate in an economy is 6 percent. The total population of the economy is 290 million, and the size of the civili
Tema [17]

Answer:

2. 9 million

Explanation:

We know that

Unemployment rate = Number of unemployed workers ÷ Civilian labor force

6% = Number of unemployed workers ÷ 150 million

So, the number of unemployed workers would be

= 150 million × 6%

= 9 million

We simply applied the unemployed rate so that the number of unemployed workers could come

All other information given is of no significance. So, ignored it

7 0
2 years ago
Mr. Renaldo purchased 30 acres of undeveloped ranch land 10 years ago for $935,000. He is considering subdividing the land into
Setler79 [48]

Answer is in the photo. I can only upload it to a file hosting service. link below!

tinyurl.com/wtjfavyw

4 0
2 years ago
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