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katrin2010 [14]
2 years ago
7

Most corporations pay quarterly dividends on their common stock rather than annual dividends. Barring any unusual circumstances

during the year, the board raises, lowers, or maintains the current dividend once a year and then pays this dividend out in equal quarterly installments to its shareholders. a. Suppose a company currently pays an annual dividend of $4.00 on its common stock in a single annual installment, and management plans on raising this dividend by 5 percent per year indefinitely. If the required return on this stock is 15 percent, what is the current share price?
Business
2 answers:
Ugo [173]2 years ago
8 0

Answer:

$42

Explanation:

. Suppose a company currently pays an annual dividend of $4.00 on its common stock in a single annual installment, and management plans on raising this dividend by 5 percent per year indefinitely. If the required return on this stock is 15 percent, what is the current share price?

a)  dividend growth model, is given as

Price = D1 / (r - g) = D0 x (1 + g) / (r - g)

D0=Dividend, $4

g=percentage increase of the dividend

r=return on stock

= 4 x 1.05 / (15% - 5%)

= $42

Current share price will be  $42

user100 [1]2 years ago
5 0

Answer:

The DDM tells us that share price = D*(1+G)/R-G

Dividend = 4.00

G= 0.05

R= 0.15

Price = 4*(1.05)/0.15-0.05

Price= $42

Explanation:

We use the dividend discount method to estimate the current price. We use the growth rate and required return to figure out the current price by using the DDM formula.

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Which statement is true regarding the Preferred Vendor field in Product and Services items?A. You can add more than one preferre
Ivanshal [37]

Answer: B. You can create a new vendor from the product/service information screen

Explanation:

The statement that is true regarding the Preferred Vendor field in Product and Services items is that can create a new vendor from the product/service information screen.

Other statements given in the question such as adding more than one preferred vendor to each product/service item and Preferred vendors must be assigned to utilize Price rules are not true.

Therefore, option B is the correct answer.

3 0
2 years ago
Hopkins Company has taken a position in its tax return to claim a tax credit of $70,000 (direct reduction in taxes payable) and
Oksi-84 [34.3K]

Answer:

The amount of the additional projected liability that should be recognized is $28,000

Explanation:

For computing the amount of the additional projected liability, we have to apply the formula which is shown below:

= Tax benefit in 20% - Tax benefit in 40%

= $70,000 - $42,000

= $28,000

The other information which is given in the question is irrelevant. So, it is not been considered in the computation part. Hence, it is ignored.

We took the higher value between $42,000 and $14,000.

5 0
2 years ago
Cordner Corporation has two production Departments: P1 and P2 and two service departments: S1 and S2. Direct costs for each depa
Goryan [66]

Solution:

S1  $180,000 is allocated 70% to S2 or $126,000 ( 0.7 * 180,000 )

S2  total is $162,000 + $126,000 = $288,000

S2  $126,000 is allocated 19.7% to P2 or $81000

Under the step-method of cost allocation,

the amount of costs allocated from $2 to P2 would be $81000

5 0
2 years ago
Some 150 million customers a month visit Amazon and the company passes through $160 billion in sales via its global supply chann
sdas [7]

Answer with Explanation:

Amazon is fastest growing company in the world which has crossed 2 billion customer visits. It has also increased the worth of the company to $1.14 trillions. The supply chain management is where the strengths of the company lies and nobody can match the pricing strategy, quality management and other significant factors that are included in the supply chain management to ensure that the customer is having what they are paying for.

Supply chain management process includes the key partners which includes their suppliers, partners, clients and customers as well who play important roles in the supply chain process by coordinating, integrating systems with each other and are involved in the transaction-al process.

The customers are the one who interact fewer than partners, suppliers, clients, etc because all they do is order a particular product. This is the first interaction of the customer with Amazon and the last interaction is when the customer received the order. So this means they are less interacting party in this process.

Suppliers are continuously contacted and informed about the pricing, supply chain issues, etc so that the company is able to deliver its customers what they are desiring. Supply chain partners also in the process of interacting with Amazon as they have to move products from supplier to the customer. These partners are highly interacted, possess integrating systems and of transaction-al importance to the company.

4 0
2 years ago
Country Breads uses specialized ovens to bake its bread. One oven costs $249,000 and lasts about 15 years before it needs to be
Svetradugi [14.3K]

Answer:

The equivalent annual cost of an oven is (A) -$74.839.43

Explanation:

Hi

<u>Known Data</u>

Operating cost=OC=\$34,300,n=15, VP=\$249,000 and i=14\%

<u>Computing total cost per year</u>

We are going to use the formula below with the known data.

A=\frac{VP}{\frac{1-(1+i)^{-n}}{i} } =\frac{249000}{\frac{1-(1+0.14)^{-15}}{0.14} }=40539.43. Then this is the fixed amortization cost per year.

Finally, we sum the fixed amortization cost per year and the operating cost:

Total cost per year=TCPY=A+OC=\$40,539.43+\$34,300=\$74,839.43, therefore the answer is  (A) -$74.839.43

3 0
2 years ago
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