vinyl lynings, inc. contracts to resurface the insides of the pools at waterworld park. vinyl lynings knows that without the re
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Answer:
weight % of equity = 76.05%
weight % of preferred stock = 5.70%
weight % of debt = 18.25%
Explanation:
calculation for equity:
total number of equity is 100,000
market price of stock = 40
so total value of stock = 40 × 100,000 = 4,000,000
calculation for preferred stock:
total number of share is 10,000
market price of stock = 30
so total value of stock = 30 × 10,000 = 300,000
calculation for debt:
total number of bond is 1,000
market price of bonds = 960
so total value of stock = 960 × 1,000 = 960,000
total value = 4,000,000 + 300,000 + 960,000 = 5,260,000
Calculation of weight percentage
weight % of equity =
weight % of preferred stock %
weight % of debt
Answer:
Given:
Demand = 15,000
Initial investment = $256,000
Variable cost = $15
Selling price = $30
Here, we'll first compute break-even quantity :
i.e.
From above we can state that the demand is less than break-even quantity i.e. in this case the organization will not be able to recover the investment made.
<u><em>Therefore, the company's total margin will be less than its investment. </em></u>
<u><em>The correct option is (b)</em></u>