A purchasing department may have difficulty getting a product quickly as it may not be readily available so may have to wait for it and also, there may be a problem getting a product at a reasonable price which means the purchaser would have to search elsewhere for it which could take time.
Answer:
The company's WACC is <u>9.71%</u>.
Explanation:
Note: See the attached excel file for the computation of company's Weighted Average Cost of Capital (WACC).
The weighted average cost of capital (WACC) can be described as the rate that is expected to be paid on average by a company to all holders of its securities to finance the assets of the company.
The following formula are used in the excel file to compute the WACC of the company.
Cost of debt = Type this function that is used in the excel sheet “=Rate(Number of years * 2,((Coupon rate/2)*Par value),-Selling price),Par value)*2*(1 - Tax rate)”. That is, type “=RATE(27*2,((6.5%/2)*1000),-1080,1000)*2*(1-21%)” in the excel file and press enter. This gives 4.83420280657156%
Note: Make sure you note all the commas and signs in the cost of debt function.
Cost of Common stock/equity using CAMP = Risk-free rate + (Beta * Market risk premium) = 5.4% + (1.18 * 6%) = 12.48%
Cost of preferred stock = (Par value * Dividend rate) / Current price = ($100 * 4.3%) / 88 = 0.0488636363636364’ or 4.88636363636364%
Answer:
The complete questions is
Molly is celebrating her exciting new career and wants to upgrade her junky old car for a shiny new Jeep
Patriot. She heads to Jeep’s website and sees the following financing deals:
Remember that Molly has a $2500 down payment saved for this purchase. The dealer will take the $500 Cash Allowance straight off her total. How much loan does Molly need?
Explanation:
Answer:
$4,000
Explanation:
The operating activities is the activities which records day to day activities i.e change in working capital, loss or profit on sale of long term assets, depreciation expense etc
In the given situation, there is a loss of $4,000 on the sale of equipment and the same is recorded under the operating activity in a positive sign
The sale of an equipment and the purchase of an equipment would be shown in the investing activity . Hence, we do not considered here
