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1 year ago

QUESTION 1

Business

1 answer:

babunello [35]1 year ago

5 0

1.) A
2.) True
3.) False
4.) C
5.) C
6.) True
7.) True
8.) C
9.) True
10.) True

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Peter's Audio has a yield to maturity on its debt of 7.8 percent, a cost of equity of 12.4 percent, and a cost of preferred stoc

nadezda [96]

Answer:

WACC = 9.22%

Explanation:

after tax cost of debt = 7.8% x (1 - 34%) = 5.148%

Re = 12.4%

cost of preferred stock = 8%

total value:

105,000 common stocks x $22 = $2,310,000

25,000 preferred stocks x $45 = $1,125,00

$1,500,000 bonds x 0.98 = $1,470,000

total value = $4,905,000

capital structure:

common stocks = $2,310 / $4,905 = 47.09%

preferred stocks = $1,125,00 / $4,905 = 22.94%

debt = $1,470,00 / $4,905 = 29.97%

WACC = (47.09% x 0.124) + (22.94% x 0.08) + (29.97% x 0.05148) = 9.22%

8 0

2 years ago

Imagine two cities, Hometown and Visitorsville, where the rich, middle, and poor income recipients in one city have annual incom

Grace [21]

Answer:

The answer is letter A.

Explanation:

The true statement is Annual data on the distribution of income will indicate that the degree of income inequality in the two cities is identical.

6 0

2 years ago

The following is TRUE about Inventory:________.A. Firms decrease inventory because there is a risk of significant and unpredicta

Aleks [24]

Answer:

The correct answer is option (c).

Explanation:

Solution

From the question sated above the answer is, Firms or organisation decrease inventory because the more we spend on inventory, the more we will need to spend on the other related inventory expenditures.

The reason is because if the inventory is kept full or complete, then the cost related or connected with the maintenance of the inventory increases or goes up and it is not beneficial for the company itself.

7 0

2 years ago

Denmark Corporation's variance report for the purchasing department reports 1,000 units of material A purchased and 2,400 units

Nadusha1986 [10]

Answer:

Total material price variance= $380 favorable

Explanation:

Giving the following information:

Material A:

Purchase= 1,000 units

Purchase price= $2.1

Standard price= $2

Material B:

Purchase= 2,400 units

Purchase price= $2.8

Standard price= $3

To calculate the total material price variance, we need to use the following formula on each material:

Direct material price variance= (standard price - actual price)*actual quantity

Material A:

Direct material price variance= (2 -2.1)*1,000

Direct material price variance= $100 unfavorable

Material B:

Direct material price variance= (3 - 2.8)*2,400

Direct material price variance= $480 favorable

Total material price variance= -100 + 480

Total material price variance= $380 favorable

3 0

2 years ago

ASSETS Cash $ 20,000 Accounts receivable 80,000 Inventory 50,000 Net plant and equipment 250,000 Total assets $ 400,000 LIABILIT

Dahasolnce [82]

Answer:

The firm's receivable turnover is 20 times

Explanation:

The computation is shown below:

Accounts receivable turnover ratio = (Credit sales ÷ average accounts) receivable

where,

Average accounts receivable = (Opening balance of Accounts receivable + ending balance of Accounts receivable) ÷ 2

= ($0 + $50,000) ÷ 2

= $25,000

And, the net credit sale is $500,000

Now put these values to the above formula

So, the answer would be equal to

= ($500,000 ÷ $25,000)

= 20 times

And, the average collection period in days = Total number of days in a year ÷ accounts receivable turnover ratio

= 360 days ÷ 20

= 18 days

7 0

1 year ago