Answer:
E. as current assets
Explanation:
As we know that the
Balance sheet records the total assets, total liabilities and the stockholder equity
Where
The total assets comprises of current assets, tangible assets, and the intangible assets
And, the total liabilities comprises of current liabilities and the long term liabilities
In the given scenario, the purchase of the newest Dorothy Cannell book be listed on the store's balance sheet. So here, the newest Dorothy Cannel book represent the current asset side of the balance sheet
Answer:
The correct answer is $7.94.
Explanation:
According to the scenario, the computation of the given data are as follows:
Total value of shares = ( 320,000 × $40 ) + ( 420,000 × $45) + (520,000 × $10) + 720,000 × $15)
= $12,800,000 + $18,900,000 + $5,200,000 + $10,800,000
= $47,700,000
So we can calculate the net asset value by using following method:
Net asset value = (Total value - Expenses ) ÷ Shares Outstanding
By putting the value, we get
= ( $ 47,700,000 - $ 40,000) ÷ $6,000,000
= $7.94
Answer:
the WACC is 8.65%.
Explanation:
Total firm capital = $450,000 + $150,000 + $350,000
= $950,000
Weight of debt in the capital structure = $450,000/ $950,000
= 47.37%
Weight of preferred stock in the capital structure
= $150,000/ $950,000
= 15.79%
Weight of common stock in the capital structure
= $350,000/ $950,000
= 36.84%
The weighted average cost of capital is calculated using the below formula:
WACC= Wd*Kd(1 - t) + Wps*Kps + We*Ke
where:
Wd = Percentage of debt in the capital structure.
Kd = The before tax cost of debt
Wps = Percentage of preferred stock in the capital structure
Kps = Cost of preferred stock
We = Percentage of common stock in the capital structure
Ke = The cost of common stock
T = Tax rate
WACC = 47.37%*8%*(1 – 0.30) + 0.1579*10% + 36.84%*12%
= 2.65272% + 1.5790% + 4.4208%
= 8.65252%
Therefore, the WACC is 8.65%.
The Weighted Average Cost of Capital (WACC) can be calculated by determining the weight of each component of the firm's capital structure and multiplying it by its respective cost. In this case, the WACC is 8.03%.
To calculate the Weighted Average Cost of Capital (WACC), we need to determine the weight of each component of the firm's capital structure and multiply it by its respective cost. The formula for WACC is:
WACC = (Debt / Total Capital) * Cost of Debt + (Preferred Stock / Total Capital) * Cost of Preferred Stock + (Common Stock / Total Capital) * Cost of Common Stock
Using the given information:
Debt = $450,000, Preferred Stock = $150,000, Common Stock = $350,000
Cost of Debt = 8%, Cost of Preferred Stock = 10%, Cost of Common Stock = 12%
We can substitute these values into the formula to calculate the WACC:
WACC = (450,000 / (450,000 + 150,000 + 350,000)) * 8% + (150,000 / (450,000 + 150,000 + 350,000)) * 10% + (350,000 / (450,000 + 150,000 + 350,000)) * 12%
Simplifying the equation:
WACC = 0.4 * 8% + 0.133 * 10% + 0.31 * 12%
Calculating the percentages:
WACC = 0.032 + 0.0133 + 0.0372
WACC = 8.03%
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Answer:
A profit margin of 10% indicates that:
for every $1 in net sales, the company generates $0.10 in net income.
Explanation:
Company B's profit margin measures the degree to which the company makes extra money after deducting the expenses from the sales revenue. When expressed as a percentage, it indicates how many cents of profit has been generated for each dollar of sales.
A profit margin of 10% denotes that for every $1 in net sales, the company produces $0.10 in net income. It is calculated by dividing the net income by the net sales and multiplying the result by 100.
A profit margin of 10% indicates that for every $1 in net sales, the company generates $0.10 in net income. This is because the profit margin is calculated by dividing the net income by the net sales and then multiplying the result by 100 to get a percentage. In this case, a profit margin of 10% signifies that the company is able to generate 10 cents of profit from each dollar of sales.
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Answer:
The price of the stock is $56.75.
Explanation:
This can be calculated using the following formula:
P = d /r ……………………………………… (1)
Where;
P = price of the stock = ?
d = preferred stock dividend = $4.54
r = required rate of return = 8%, or 0.08
Substituting the values into equation (1), we have:
P = $4.54 / 0.08
P = $56.75
Therefore, the price of the stock is $56.75.
Answer:
The correct answer is option (D)
Explanation:
Solution
Given that:
The present value of equity factor for 5 years at 12% discount are = 3.60478
Then,
The present value of servicing costing = -$500 * 3.60478 = -$1802.39
Thus,
The present value of cost to buy =- $18000
The total Present value = -18000 + 1802.39 = -$19802.39
So,
The equivalent annual annuity = total Present value / present value of equity factor
= -$19802.39 / 3.60478
= -$5493.37
Therefore, the equivalent annual annuity of this deal is -$5493.37
Answer:
Edwardson Corporation
Journal Entries:
February 2:
Debit Purchases $68,600
Credit Accounts Payable $68,600
To record credit purchases, net ($70,000 * 98%) with terms of 2/10, n/30.
February 26: Debit Purchases $1,400
Credit Accounts Payable $1,400
To revise the cash discounts not taken.
February 26: Debit Accounts Payable $70,000
Credit Cash $70,000
To record the full settlement for cash
April 1: Debit Truck $50,000
Credit Cash $4,000
Credit Notes Payable $46,000
To record the purchase of truck with a 12% note.
May 1: Debit Cash $83,000
Debit Interest Expense $9,000
Credit Notes Payable $92,000
To record zero-interest-bearing note due on May 1.
August 1: Debit Dividends $300,000
Credit Dividends Payable $300,000
To record the declaration of dividends.
Explanation:
a) Data and Analysis:
February 2: Purchases $68,600 Accounts Payable $68,600 ($70,000 * 98%)
February 26: Purchases $1,400 Accounts Payable $1,400
Accounts Payable $70,000 Cash $70,000
April 1: Truck $50,000 Cash $4,000 Notes Payable $46,000
May 1: Cash $83,000 Interest Expense $9,000 Notes Payable $92,000
August 1: Dividends $300,000 Dividends Payable $300,000
b) Note that the Interest Expense of $9,000 will be split between the current year and the following year. Specific information for the split is not available.
Four transactions were needed to be journalized. These include a purchase of goods with cash discount terms, a truck purchase with a down payment and a note, a borrowed amount through signing a zero-interest note, and declaring a cash dividend by the board of directors.
Edwardson Corporation's transactions can be recorded in the following way:
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