BUSINESS COLLEGE

Suppose a foreign investor who holds tax-exempt Eurobonds paying 10.50% is considering investing in an equivalent-risk domestic bond in a country with a 28% withholding tax on interest paid to foreigners. If 10.50% after-tax is the investor's required return, what before-tax rate would the domestic bond need to pay to provide the required after-tax return

Answers

Answer 1
Answer:

Options:

a. 14.58%  

b. 12.83%  

c. 15.46%  

d. 16.33%  

e. 16.92%

Answer:

Correct option is A.

14.58%

Explanation:

After-tax yield = pre-tax yield x (1- marginal rate)

and Taxable-equivalent yield = tax-exempt yield / (1- marginal tax rate)

Hence Taxable-equivalent yield =.105/(1-.28)  

=.105/.72=.14583333

=14.58 %

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Last year, Dora, Inc. produced 70,000 widgets and incurred $210,000 of variable costs and $196,000 of fixed costs. Dora has received a special order from a foreign customer for 3,000 widgets. Dora has sufficient capacity to fill the order without jeopardizing regular sales. Dora would incur $3,150 in additional shipping charges to fulfill this special order. If Dora wants to break even on this order, what should the unit selling price be:A : $4.05B : $6.85C : $5.80D : $3.00

Payments made to an insurance company in return for a policy of insurance are called :A. risk expenses
B. premiums
C. risk expenditures
D. deductibles

Answers

Answer:

The answer is B.

Explanation:

A premium is the money a business or an individual pays for an insurance policy or it is the price of an insurance policy. They are many policies individuals or businesses can buy and they include healthcare insurance, home insurance, auto insurance, life etc.

Premium can be paid monthly, quarterly, semi-annually or yearly.

The premium paid by a business or an individual is income for the insurance company. Businesses or individuals pay premium in advance. While premium paid in advance is an asset to the business or individual at initiation, it is a liability to the insurance company.

Answer:

The correct answer is letter "B": premiums.

Explanation:

Insurance premiums are the payments individuals make to companies providing policies for the coverage of health care, vehicles, and home. Once an individual enrolls for insurance earns the obligation of making payments to the insurance company so they can render the services agreed on the policy. Premiums are calculated according to the risk of the insured in using the coverage and are paid on a regular basis or in a lump sum.

Robert House believed that a leader cannot move back and forth among the four leadership styles: directive, supportive, achievement-oriented, and participative. a) True
b) False

Answers

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Suppose two paper plants dump industrial waste into a river. The EPA decides pollution concentration is too high at a receptor site down river from the paper plants. The two firms have identical marginal cost of pollution abatement, but firm 1 has a transfer coefficient of 0.8 and firm 2 has a transfer coefficient of 0.3. To reduce pollution concentration at a receptor site, who should reduce dumping more? Select one: a. Firm 1 b. Firm 2 c. Both should reduce the same d. No way to tell

Answers

Answer:

a. Firm 1

Explanation:

from the information, firm 1 has a higher transfer coefficient of 0.8 compared to that of the firm 2, so to reduce pollution concentration at a recepto site, the firm with the higher transfer coefficient will have to decrease its dumping, in this case firm 1 should reduce dumping.

On December 31, 2016, the manager of Jordan Creek Apartments noticed that four tenants had not paid their December rent amounting to $500 each. The manager spoke to each tenant individually and was promised by all 4 that the rent would be paid by January 15, 2017. Assuming the tenants follow through and make their payments by January 15, 2017, Jordan Creek should make the following entry as of December 31, 2016:______. Cash (dr) $2,000
Rental Receivable (cr) $2,000
A. True
B. False

Answers

Answer:

B. False

The business should not make this entry on 31 December.

Explanation:

The accounting principle of prudence states that profits should not be overstated and losses should not be understated. This means that any profit should not be recorded until it is realized while any losses should be recorded as soon as they are anticipated. As the business has not received cash from tenants on 31 December 2016, it should not make any entry debiting cash and crediting the rent receivable.

The business should let the rent receivable balance intact until the rent is received on 15 January and till then record no entry to such as the above.

The asset's book value is $64,800 on June 1, Year 3. On that date, management determines that the asset's salvage value should be $6,400 rather than the original estimate of $11,400. Based on this information, the amount of depreciation expense the company should recognize during the last six months of Year 3 would be:a. $2,366.37
b. $4,866.67
c. $1,958.33
d. $2,433.33
e. $2,700.00

Answers

Answer:

$2,316.67

Explanation:

From the question we know that the asset is depreciated in 3 years

The monthly depreciation expenses before re-determine savage value

= ($64,800-$11,400)/36 = $1,483.33

Because management determine to reduce $5,000 in salvage value (=$11,400-$6,400) just before 6 months ending depreciation period, then we have to allocate $5,000 in next 6 months.

The depreciation expense during the last six months of Year 3 would be:

= current depreciation expense $1,483.33 + $5,000/6

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Writing a check on an account with insufficient funds is allowed under certain conditions.

Answers

Answer:

True

Explanation: If you have overdraft protection your account
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