Answer: shown in the attachment
Explanation: also shown in the attachment
Answer:
$42,000
Explanation:
Data provided
Bonds at a discount = $49,000
Sold bonds at a premium = $12,000
Discount amount = $19,000
The computation of the sale of bonds is shown below:-
Cost + Premium - (Cost - Carrying value cost)
Carrying cost = $49,000 - $19,000
= $30,000
Sale of bonds = (Bonds at a discount + Sold bonds at a premium) - (Bonds at a discount - Carrying cost)
($49,000 + $12,000) - ($49,000 - $30,000)
= $42,000
Answer:
b.0.22
Explanation:
Return on investment (ROI) = Operating income/ Beginning Operating Asset = $ 92,000/ $440,000 = 0.22
Answer:
The projects which maximize Vanguard's shareholder wealth are Project A; Project B; Project D.
Explanation:
Projects which maximize the shareholder value are projects delivering Expected Returns which are higher than its risk-adjusted weighted average cost of capital (WACC).
As a result, Project A with Expected return of 15% and risk adjusted WACC of 12%; Project B with Expected return of 12% and risk adjusted WACC of 10%; Project D with Expected return of 9% and risk adjusted WACC of 8%; are the projects that maximize the shareholder's value.
On the other hand, Project C with Expected return of 11% and risk adjusted WACC of 12% is harmful to shareholder value.
Answer:
D. Inflation factors to actual costs incurred by the contractor
Explanation:
The effect of inflation on the profitability of a product cannot be overemphasized. At the time of inflation the profitability of a project will be reduced and the cost of capital will increase. The effect of inflation on a project can be determined by applying inflation factor.
Inflation impacts on the cash flow from a project, especially a project with a long life span.
