The statement that is correct among the following given options is: In a totally efficient market every investment has a zero net present value.What is the Efficient Market Hypothesis?
Efficient Market Hypothesis (EMH) is a theory that states that the stock market is "informationally efficient," implying that investors who buy and sell stocks are rational, information-hungry, and capable of instantly analyzing new data about corporate earnings, dividend payouts, and other pertinent variables that affect stock prices.In an Efficient Market Hypothesis (EMH), it is thought that the current share price reflects all publicly available information about a company's potential for future profits.
In other words, no single party has an information advantage over another, making it difficult to profit from stock selection without assuming greater risk.
Learn more about Efficient Market Hypothesis
https://brainly.com/question/32821596
#SPJ11
Describe the objectives behind FASB ASC Topic 740, Income
Taxes, and the income tax provision process.
FASB ASC Topic 740, Income Taxes, aims to guide the accounting for income taxes and ensure proper recognition of deferred tax assets and liabilities. The income tax provision process involves calculating current and deferred income tax expense or benefit for financial reporting.
FASB ASC Topic 740, also known as the Accounting Standards Codification related to Income Taxes, aims to establish consistent guidelines for companies to account for income taxes in their financial statements. The primary objective is to provide users of financial statements with accurate and transparent information regarding the company's income tax obligations and the impact of income taxes on its financial position.
The income tax provision process involves several steps. First, companies need to calculate their current income tax expense or benefit based on the applicable tax rates and the taxable income or loss for the reporting period. This reflects the amount of income taxes payable or refundable for the current year.
Next, companies assess the timing differences between taxable income and accounting income, which give rise to deferred tax assets or liabilities. Deferred tax assets represent future tax benefits that arise from deductible temporary differences, while deferred tax liabilities arise from taxable temporary differences. These deferred tax amounts are recognized and measured in accordance with FASB ASC Topic 740.
The income tax provision process requires careful analysis of various tax laws, regulations, and interpretations to ensure compliance and accurate reporting. It involves making estimates and judgments about uncertain tax positions, assessing the realizability of deferred tax assets, and considering the impact of tax planning strategies.
By following the guidelines provided by FASB ASC Topic 740 and properly executing the income tax provision process, companies can ensure that their financial statements accurately reflect their income tax obligations and provide users with meaningful information about the company's financial performance and position.
Learn more about Income Taxes
brainly.com/question/17075354
#SPJ11
Pharoah Company took a physical inventory on December 31 and determined that goods costing $180,000 were on hand. Not included in the physical count were $22,500 of goods purchased from Pelzer Corporation, FOB, shipping point, and $19,800 of goods sold to Alvarez Company for $27,000, FOB destination. Both the Pelzer purchase and the Alvarez sale were in transit at year-end. What amount should Pharoah report as its December 31 inventory? Ending inventory
Pharoah company should report $177,300 as its december 31 inventory.
to determine the ending inventory that pharoah company should report on december 31, we need to consider the goods that were included in the physical count and adjust for any goods in transit.
included in the physical count:
cost of goods on hand = $180,000
goods in transit:
1. goods purchase from pelzer corporation, fob shipping point: these goods were not included in the physical count as they were still in transit. since the goods were shipped from the seller, pelzer corporation, and the ownership transferred to pharoah company at the shipping point (fob shipping point), they should be included in pharoah's inventory.
amount of goods purchased from pelzer corporation = $22,500
2. goods sold to alvarez company, fob destination: these goods were already sold by pharoah company, but since they were still in transit at year-end (fob destination), they should be excluded from pharoah's inventory.
amount of goods sold to alvarez company = $19,800
to calculate the ending inventory, we subtract the goods in transit from the physical count:
ending inventory = cost of goods on hand - goods in transit
ending inventory = $180,000 - ($22,500 - $19,800) = $177,300
Learn more about purchase here:
https://brainly.com/question/31035675
#SPJ11
A forward rate agreement (FRA) has a notional principal of $10 million, an FRA rate of 5% (quarterly compounded), an expiration/delivery date in 1 year and the underlying asset is a 3-month Eurodollar time deposit.
The 1 year and 1.25 year LIBOR rates are 3% and 3.5% on a continuously compounded basis.
The value of the FRA to the purchaser is closest to:
a. $12,922.00
b. -$11,965.00
c. $11,965.00
The value of the FRA to the purchaser is closest to $11,965.00. This is option C
In this case, we have t = 1 year and r* is the average of the LIBOR rates for the two future settlement periods. The LIBOR rate is continuously compounded, so we'll need to use the natural logarithm function.
Here are the calculations:
Natural log of 1.03 = 0.029559
Natural log of 1.035 = 0.034022
Average = (0.029559 + 0.034022) / 2 = 0.0317905r* = e^(0.0317905) - 1 = 0.0325057
Using these values in the formula, we get:
V = $10,000,000 * (0.05 - 0.0325057) * 1 / (1 + 0.05 * 1) ≈ $11,965.00
So, the correct Answer: c. $11,965.00
Learn more about LIBOR rate at
https://brainly.com/question/31671910
#SPJ11
Required: On February 1 , the put/call ratio was 0.625. On April 1 there are 157 put options and 244 call options outstanding on a stock. Calculate the put/call ratio for April 1. (Round your answer to 4 decimal places.)
Put/call ratio_______
The put/call ratio for April 1 is approximately 0.6434 when rounded to four decimal places. The put/call ratio is a commonly used indicator in options trading.
The put/call ratio for April 1 can be calculated by dividing the number of put options outstanding by the number of call options outstanding. In this case, there are 157 put options and 244 call options outstanding.
Put/Call Ratio = Number of Put Options / Number of Call Options
Put/Call Ratio = 157 / 244
Calculating this ratio, we get:
Put/Call Ratio = 0.6434
Therefore, the put/call ratio for April 1 is approximately 0.6434 when rounded to four decimal places.
Conversely, a lower put/call ratio indicates a more bullish sentiment, as investors are purchasing more call options to speculate on price increases. In this case, the put/call ratio for April 1 indicates that there are slightly more put options outstanding relative to call options, suggesting a slightly bearish sentiment in the market for that stock.
Learn more about stock here:
https://brainly.com/question/31940696
#SPJ11
Angela placed a stop-limit order to sell 100 shares of RST stock at $28 when the market price of RST was $31. Shortly after Angela placed her order, trading on RST was halted due to a pending news announcement. When trading re-opens RST is priced at $24 a share. Within minutes the price of RST began to drop further until it reached $19 a share. Which one of the following statements is correct concerning Angela's stop-limit order to sell?
A. Angela's stock was sold for $28 a share.
B. Angela's stock was sold for $24 a share.
C. Angela's stock was sold at a price between $19 and $24 a share.
D. Angela still owns her 100 shares of stock.
The answer is Option (D), Angela still owns her 100 shares of stock. Angela's stop-limit order was not executed, and she still owns her 100 shares of RST stock.
A stop-limit order is an order that combines the features of a stop order and a limit order. In this case, Angela placed a stop-limit order to sell her 100 shares of RST stock at $28. The stop price is the trigger price at which the order becomes active, and the limit price is the minimum price at which Angela is willing to sell her shares.
In the given scenario, the market price of RST was initially $31 when Angela placed her stop-limit order. However, trading was halted shortly after due to a pending news announcement. When trading re-opened, the price of RST dropped to $24 a share. Since the stop price of Angela's order was $28, which is higher than the current market price of $24, the order did not get triggered, and her shares were not sold.
Furthermore, as the price of RST continued to drop to $19 a share, it remained below Angela's stop price of $28. Therefore, her stop-limit order still remained inactive, and she continues to hold her 100 shares of stock. In summary, Angela's stop-limit order was not executed, and she still owns her 100 shares of RST stock.
To learn more about stop-limit order, visit:
https://brainly.com/question/33285300
#SPJ11
Assume the following: The price of a two-year call with the strike price of X is currently $4. The price of a two-year put with the strike price of X is currently $5. The current price per share of the stock is $28. The stock does not pay a dividend. The risk-free rate is 5% per year. Using the put-call parity, what is the strike price of the put? In other words, find X. Question 15 options:
a) $5.00
b) $29.00
c) $30.45
d) $31.97
e) $35.93
f) None of the above.
e strike price of the put is approximately $30.45, which is closest to option (c).
Put-call parity
is an important principle in options pricing first identified by Hans Stoll in his paper, The Relationship Between Put and Call Option Prices, in 1969.
It states that the
premium
of a call option suggests a fair price for the corresponding put option having the same strike price and expiration date; and vice versa.Assuming the following: The price of a two-year call with the strike price of X is currently $4. The price of a two-year put with the strike price of X is currently $5. The current price per share of the stock is $28. The stock does not pay a dividend. The risk-free rate is 5% per year.
Using the put-call
parity
, the strike price of the put can be calculated as follows:X - 28 = 4 - 5 / (1 + 0.05) ^ 2Where;X = Strike price of put28 = Current price per share of the stock4 = Price of two-year call option with the strike price of X5 = Price of two-year put option with the strike price of X0.05 =
Risk-free rate
per year2 = Two yearsTherefore, X - 28 = 0.53X = 28 + 0.53= $28.53 ≈ $30.45
Thus, the strike price of the put is approximately $30.45, which is closest to option (c).
Learn more about
strike price
https://brainly.com/question/15682316
#SPJ11
A bond is issued with a coupon of 6% paid annually, a maturity of 32 years, and a yield to maturity of 9%. What rate of return will be earned by an investor who purchases the bond for $687.81 and holds it for 1 year if the bond’s yield to maturity at the end of the year is 10%?
If an investor purchases the bond for $687.81 and holds it for one year before selling it at a yield to maturity of 10%, they will earn a rate of return of 40.9%.
Bonds are a form of fixed-income investment where the investor is effectively lending money to a corporation or government entity for a fixed period of time. Bonds usually come with a predetermined interest rate, known as the coupon rate, which is paid out annually or semi-annually. In this question, we are given a bond with a coupon rate of 6% paid annually, a maturity of 32 years, and a yield to maturity of 9%.
If an investor buys this bond for $687.81 and holds it for one year, they will receive a coupon payment of 6% of the face value of the bond, which is $1,000. This works out to $60 in coupon payments for the year. At the end of the year, the yield to maturity of the bond has increased to 10%. This means that if the investor were to sell the bond at this point, they would receive a higher price than they paid for it because the bond's yield is now lower than the current market rate.
To calculate the rate of return earned by the investor, we need to use the formula:
Rate of Return = (Coupon Payment + Sale Price - Purchase Price) / Purchase Price
The coupon payment for the year is $60. To calculate the sale price of the bond at the end of the year, we need to discount the face value of the bond using the yield to maturity of 10% for one year. The formula for this is:
Sale Price =[tex]Face Value / (1 + Yield to Maturity)^n[/tex]
Sale Price =[tex]$1,000 / (1 + 0.1)^1[/tex]
Sale Price = $909.09
Now we can calculate the rate of return:
Rate of Return = ($60 + $909.09 - $687.81) / $687.81
Rate of Return = $281.28 / $687.81
Rate of Return = 0.409 or 40.9%Therefore, if an investor purchases the bond for $687.81 and holds it for one year before selling it at a yield to maturity of 10%, they will earn a rate of return of 40.9%.
For more information on investment visit:
brainly.com/question/14921083
#SPJ11
The Hong Kong Government found that many low-income families paid a higher proportion of their limited income for the rentals of sub-divided flats.
a. The government has decided to impose a binding rental control on rental market for sub-divided flats.
Draw a supply-and-demand diagram to show the impact of this policy on the rental price and quantity of sub-divided flats rented. Is there a shortage or surplus of sub-divided flats? Explain. (5
b. In addition to rental control, to help low-income families who are waiting for public housing units for a few years, the government provides more transitional housing units to them and meanwhiles giving rental subsidies to those families who rent sub-divided flats. What are impacts of more transitional housing units and rental subsidies on the market outcomes of sub-divided flats? Explain. (
a. With the imposition of a binding rental control on sub-divided flats, the government sets a maximum limit on the rental price that landlords can charge. This creates a price ceiling in the market.
In the supply and demand diagram, the price ceiling is set below the equilibrium rental price, resulting in a gap between the demand and supply curves. The demand curve represents the willingness of low-income families to rent sub-divided flats at a lower price, while the supply curve represents the willingness of landlords to provide sub-divided flats at a higher price.
Due to the rental control policy, the rental price is constrained below the equilibrium level, reducing the incentive for landlords to supply sub-divided flats. As a result, the quantity of sub-divided flats rented decreases, leading to a shortage in the market. The shortage occurs because the quantity demanded by low-income families exceeds the quantity supplied by landlords at the controlled rental price.
b. The provision of more transitional housing units and rental subsidies to low-income families waiting for public housing units and renting sub-divided flats will have several impacts on the market outcomes:
Increase in supply: The availability of more transitional housing units increases the supply of housing options for low-income families. This can help alleviate the shortage of sub-divided flats in the market.
Decrease in demand for sub-divided flats: Rental subsidies provided by the government reduce the effective rental cost for low-income families. This reduces their demand for sub-divided flats, as they have more affordable alternatives available. Consequently, the demand curve for sub-divided flats shifts to the left.
Potential decrease in rental prices: With the decrease in demand and increase in supply, there is a possibility of downward pressure on rental prices for sub-divided flats. However, the extent of the impact on rental prices would depend on the magnitude of the shift in supply and demand.
To know more about binding
Visit https://brainly.com/question/33689197
#SPJ11
Between 1980 and 2012, real GDP grew and prices increased, so. a. nominal GDP Increased less than inflation b. nominal GDP Increased less than real GDP c. nominal GDP increased more than real GDP d. nominal GDP decreased
In the given scenario, the correct answer is (b) nominal GDP increased less than real GDP. Real GDP accounts for the effects of inflation, while nominal GDP does not. Hence, nominal GDP would be inflated by the rising prices, resulting in a higher increase compared to real GDP, which is adjusted for inflation.
Between 1980 and 2012, real GDP grew and prices increased. This situation indicates that the economy experienced inflation during this period. To understand the relationship between real GDP and nominal GDP in the context of inflation, we need to consider their definitions.
Real GDP represents the total value of goods and services produced in an economy, adjusted for inflation. It is a measure of economic output that takes into account changes in price levels over time. On the other hand, nominal GDP is the total value of goods and services produced in an economy without adjusting for inflation. It reflects the current market prices.
Given that prices increased during this period, nominal GDP would naturally increase as well, reflecting the higher prices of goods and services. However, to determine the actual growth in economic output, we need to separate the effects of inflation. Real GDP accounts for inflation by adjusting the nominal GDP figure to constant price levels, providing a more accurate measure of economic growth.
Therefore, in the given scenario, the correct answer is (b) nominal GDP increased less than real GDP. Real GDP accounts for the effects of inflation, while nominal GDP does not. Hence, nominal GDP would be inflated by the rising prices, resulting in a higher increase compared to real GDP, which is adjusted for inflation.
Learn more about accounts from the link
https://brainly.com/question/26690519
#SPJ11
Mark short-sells 300 shares of Elridge Corp now selling for $70
per share. If Mark wishes to limit his loss to $3,000, how much
should Mark place a stop-buy order?
Mark should place a stop-buy order at $80 per share to limit his loss to $3,000. If the price of Elridge Corp shares reaches $80, the stop-buy order would trigger, and Mark would buy back the shares at that price to cover his short position.
\To limit his loss to $3,000, Mark would need to determine the maximum price at which he is willing to buy back the short-sold shares.
Let's assume the maximum buyback price is represented by X.
Since Mark short-sold 300 shares at $70 per share, his initial gain/loss would be (Initial Sale Price - Buyback Price) * Number of Shares.
In this case, Mark wants to limit his loss to $3,000, so we can set up the equation as follows:
($70 - X) * 300 = -$3,000
Simplifying the equation, we get:
$21,000 - 300X = -$3,000
Now, solving for X:
300X = $21,000 + $3,000
300X = $24,000
X = $24,000 / 300
X = $80
Therefore, Mark should place a stop-buy order at $80 per share to limit his loss to $3,000. If the price of Elridge Corp shares reaches $80, the stop-buy order would trigger, and Mark would buy back the shares at that price to cover his short position.
Learn more about share from
https://brainly.com/question/31600559
#SPJ11
A bond that pays interest annually yielded 7.47 percent last year. The inflation rate for the same period was 5 percent. What was the actual real rate of return on this bond for last year?
A. 2.30%
B. 2.47%
C. 3.34%
D. 1.39%
E. 2.35%
The actual real rate of return on this bond for last year is 2.
to calculate the actual real rate of return on the bond, we need to subtract the inflation rate from the nominal yield.
real rate of return = nominal yield - inflation rate
in this case, the nominal yield is given as 7.47% and the inflation rate is 5%.
real rate of return = 7.47% - 5%
real rate of return = 2.47% 47%.
b. 2.47%.
Learn more about bond here:
https://brainly.com/question/31994049
#SPJ11
What are the two methods analysts use to conduct real estate
market research, and what is the main difference between the two
approaches?
Analysts use two methods for real estate market research: the top-down approach, which examines macroeconomic factors to assess the overall market, and the bottom-up approach,
Top-down approach: In the top-down approach, analysts start by examining macroeconomic factors and trends that impact the overall real estate market.
They analyze factors such as GDP growth, population growth, interest rates, employment rates, and government policies. Based on these macro-level indicators, they make projections and assessments about the real estate market.
The main difference: The top-down approach focuses on broader economic indicators and trends to assess the overall health and direction of the real estate market.
It provides a high-level view of the market but may not capture specific nuances or details of individual properties or submarkets.
Bottom-up approach: In the bottom-up approach, analysts focus on individual properties or submarkets within the real estate market. They gather data on specific properties, such as location, size, amenities, rental rates, occupancy rates, and comparable sales.
They also examine local market conditions, such as supply and demand dynamics, demographic trends, and local regulations. By analyzing these specific factors, they form a detailed understanding of property-level or submarket-level dynamics.
The main difference: The bottom-up approach zooms in on specific properties or submarkets, providing a more granular and detailed analysis.
It focuses on the micro-level factors that drive property performance and market dynamics, allowing for more targeted insights but may not capture the broader market context.
Overall, the main difference between the two approaches lies in the level of analysis and the scope of factors considered.
The top-down approach takes a macro-level perspective, considering broad economic indicators, while the bottom-up approach focuses on individual properties or submarkets, examining specific property-level and local market factors.
Learn more about real estate from the given link
https://brainly.com/question/1534216
#SPJ11
The U.S. Treasury bond rate, often used as the risk free rate in U.S. dollars, has been abnormally low for the last 10 years, relative to the previous decade. This is because the Federal Reserve has kept it low, with its quantitative easing.
-True
-False
The FOMC/Central Bank’s (MPC) Monetary Policy Committee is meeting today to set rates. What they do will determine whether interest rates will rise or fall in the coming weeks.
-True
-False
1) True
2) True
!) The U.S. Treasury bond rate has been abnormally low for the last 10 years, relative to the previous decade, due to the Federal Reserve's quantitative easing. - True. The statement is true. The Federal Reserve implemented quantitative easing, a monetary policy tool, to stimulate the economy and lower long-term interest rates. This had the effect of keeping the U.S. Treasury bond rates low over the past decade.
2) The FOMC/Central Bank's Monetary Policy Committee is meeting today to set rates, and their decision will determine whether interest rates will rise or fall in the coming weeks. - True. The statement is true. The FOMC (Federal Open Market Committee) or a central bank's Monetary Policy Committee is responsible for setting key interest rates, such as the federal funds rate. Their decisions have a significant impact on interest rates in the economy, and changes in these rates can affect borrowing costs and economic activity. Therefore, the committee's meeting can influence whether interest rates will rise or fall in the future.
Learn more about U.S. Treasury bond rate here
https://brainly.com/question/33404571
#SPJ11
Usually, the Equipment maintenance Costs are considered a major operating cost of the airline where many often tend to outsource to third party rather establishes its own facilities:
a) Name with an explanation the Levels of Maintenance activities outsourcing? (8 mark)
b) What are the main available maintenance sourcing options?
a) The levels of maintenance activities outsourcing in the airline industry are Line Maintenance, Base Maintenance. b) The main available maintenance sourcing options in the airline industry include In-house Maintenance, Outsourced Maintenance, Joint Ventures, Pooling and Power-by-the-Hour Agreements.
a) The levels of maintenance activities outsourcing in the airline industry can be categorized as follows:
Line Maintenance: Line maintenance refers to routine checks and maintenance tasks performed on aircraft between flights or at regular intervals. Airlines often outsource line maintenance activities to specialized service providers who are responsible for tasks such as inspections, minor repairs, and servicing of aircraft systems. This allows airlines to ensure that their aircraft remain airworthy and comply with safety regulations without establishing their own line maintenance facilities at every airport.
Base Maintenance: Base maintenance involves more extensive inspections, repairs, and overhauls that require the aircraft to be taken out of service for an extended period. Airlines may outsource base maintenance activities to third-party maintenance, repair, and overhaul (MRO) providers. These providers have the expertise and facilities to carry out major maintenance tasks, including engine overhaul, structural repairs, and component replacements. By outsourcing base maintenance, airlines can benefit from cost efficiencies and specialized expertise without the need for large in-house maintenance facilities.
b) The main available maintenance sourcing options in the airline industry include:
In-house Maintenance: Airlines can establish their own maintenance facilities and employ their own technicians and engineers to carry out all maintenance activities. This option provides complete control and customization but can be costly and resource-intensive.
Outsourced Maintenance: Airlines can outsource maintenance activities to third-party MRO providers who specialize in aircraft maintenance. These providers offer expertise, facilities, and economies of scale, allowing airlines to reduce costs and focus on their core operations.
Joint Ventures: Airlines can form joint ventures or partnerships with other airlines or MRO providers to share maintenance facilities and resources. This option allows for cost-sharing and collaboration while maintaining some level of control over the maintenance process.
Pooling and Power-by-the-Hour Agreements: Airlines can enter into pooling agreements or power-by-the-hour contracts with MRO providers. In pooling
Learn more about Maintenance from below link
https://brainly.com/question/31369544
#SPJ11
Derek deposited $1,300 at the end of every month into an RRSP for 7 years. The interest rate earned was 5.25% compounded semiannually for the first 5 years and changed to 5.50% compounded monthly for the next 2 years. What was the accumulated value of the RRSP at the end of 7 years? Round to the nearest cent
The accumulated value of Derek's RRSP at the end of 7 years, rounded to the nearest cent, is $119,831.36.
Derek deposited $1,300 at the end of each month into an RRSP for 7 years. To calculate the accumulated value, we need to consider the interest rate and compounding frequency.
For the first 5 years, the interest rate was 5.25% compounded semiannually. To calculate the semiannual interest rate, we divide the annual interest rate by 2, giving us 2.625%. The compounding periods are 2 per year (semiannually), so we multiply the number of years by 2 to get a total of 10 compounding periods. Using the formula for compound interest, A = P(1 + r/n)⁽ⁿᵗ⁾, where A is the accumulated value, P is the principal (initial deposit), r is the interest rate, n is the compounding frequency, and t is the number of compounding periods, we can calculate the accumulated value after 5 years.
Next, for the remaining 2 years, the interest rate changed to 5.50% compounded monthly. The monthly interest rate is 5.50% divided by 12, giving us 0.4583%. The compounding periods are 12 per year (monthly), so we multiply the number of years by 12 to get a total of 24 compounding periods. Using the compound interest formula again, we can calculate the accumulated value for the last 2 years.
Finally, we add the accumulated values from both periods to find the total accumulated value at the end of 7 years. Rounding to the nearest cent gives us the final result.
Learn more About accumulated value from the given link
https://brainly.com/question/30964852
#SPJ11
Read the Vulcan Inc Case and answer:
1. Which instances do you believe laws were broken? Why?
2. Which instances do you believe ethics were violated? Why?
3. Would you expect most companies with this opportunity to act in this manner? Or differently? Explain.
4. If there was a Chief Ethics Officer at Vulcan Inc, do you believe the outcome would have been different? In what way and why?
Vulcan Inc. is a company co-founded by the late Paul Allen, a Microsoft co-founder, in 1986. Vulcan's portfolio is made up of a broad range of companies, including real estate, technology, philanthropy, and other enterprises, all of which operate with the goal of making the world a better place.
In the early 2000s, Vulcan began investing in a range of environmentally focused companies, primarily through its subsidiary Vulcan Capital. Vulcan started funding an array of companies that ranged from electric cars and alternative energy sources to green building materials and agricultural technology. However, in the pursuit of profit, Vulcan Inc. has been accused of violating laws and ethical principles.Laws that were broken are as follows:
SEC regulations were violated in Vulcan's use of complex and deceptive methods to avoid SEC regulations, as well as the company's control of some portfolio companies to execute prohibited short trades.Ethics that were violated are as follows:Many of Vulcan's portfolio firms have been criticised for failing to deliver on their promises, for example, some had significant environmental issues despite being classified as environmentally beneficial, while others had significant safety problems in their products.
To know more about Vulcan visit:-
https://brainly.com/question/33342069
#SPJ11
The cost of capital is affected by many factors. Which of the following factors can a firm control?
A. Market risk premium
B. Dividend policy
C. Tax rates
D. Credit crises
E. Interest rate
Among the factors listed, a firm can control its dividend policy and, to some extent, its tax rates.
A firm has control over its dividend policy, which determines how much of its earnings are distributed to shareholders as dividends. By adjusting its dividend policy, a firm can influence its cost of capital to some extent. While tax rates are primarily determined by government regulations, firms may have some control over their tax liability through various tax planning strategies and decisions.
The market risk premium represents the additional return investors expect to earn over the risk-free rate. This is determined by market conditions and investor sentiment, which are beyond the firm's control. Credit crises are external events that impact the overall market and credit conditions. Firms have limited control over credit crises and their impact on the cost of capital.
Interest rates are determined by market forces and central bank policies. Firms have limited control over interest rates, although they can make financial decisions that are sensitive to interest rate fluctuations. The market risk premium, credit crises, and interest rates are external factors that are influenced by market conditions and economic factors beyond the firm's control.
Learn more about dividend here:
https://brainly.com/question/33428821
#SPJ11
Have you used NPV analysis in your work? How does/did your
company approach capital expenditures - using NPV or otherwise?
Have you seen projects that have positive economic profit not be
pursued? If
Net Present Value (NPV) analysis is a widely used financial tool for evaluating capital expenditures. It measures the profitability of an investment by calculating the present value of expected cash flows and comparing it to the initial investment cost. A positive NPV indicates that the project is expected to generate more value than its cost and is generally considered favorable.
In practice, companies often use NPV analysis as one of the primary methods to assess the feasibility of capital expenditures. They estimate the future cash flows associated with the project, determine the appropriate discount rate, and calculate the NPV. If the NPV is positive, it suggests that the investment is expected to add value to the company and may be worth pursuing.
However, the decision-making process for capital expenditures is not solely based on NPV analysis. Companies consider various factors such as strategic alignment, risk assessment, market conditions, competition, and internal resources. Other financial metrics like internal rate of return (IRR), payback period, and profitability index may also be considered in conjunction with NPV analysis.
In some cases, projects with positive economic profit (positive NPV) may not be pursued due to factors such as limited resources, strategic priorities, or risk considerations. Companies need to prioritize and allocate their capital to projects that align with their long-term objectives and provide the highest potential returns within their risk tolerance.
It's important to note that the decision-making process for capital expenditures can vary among companies and industries based on their specific circumstances, financial goals, and risk appetite.
Learn more about investment from
https://brainly.com/question/29547577
#SPJ11
Global Stores is downsizing and must let some employees go. Employees volunteering to leave are being offered a severance package of $118,000 cash, another $129,000 to be paid in one year, and an annuity of $27,500 to be paid each year for six years with the first payment coming at the end of this year. (FV of $1, PV of $1, FVA of $1, and PVA of $1 ) (Use the appropriate factor(s) from the tables provided. Round your answer to the nearest whole dollar.) What is the present value of the total severance package, assuming an annual interest rate of 5% ?
The present value of the total severance package is $374,489.
The question asks for the present value of a severance package offered by Global Stores to employees who volunteer to leave.
The package includes a cash payment of $118,000, a payment of $129,000 to be made in one year, and an annuity of $27,500 to be paid annually for six years, with the first payment at the end of this year.
The annual interest rate used for discounting is 5%.
To calculate the present value of the severance package, we need to determine the present values of each cash flow and then sum them up.
The present value of the cash payment of $118,000 is $118,000.
The present value of the payment to be made in one year, $129,000, can be calculated using the present value factor for a single amount. Using the appropriate factor from the present value of $1 table and an interest rate of 5%, the present value is $123,428.
The present value of the annuity of $27,500 per year for six years can be calculated using the present value factor for an annuity. Using the appropriate factor from the present value of an annuity of $1 table and an interest rate of 5%, the present value is $133,061.
Adding up the present values of all the cash flows, we get:
Present value of cash payment: $118,000
Present value of payment in one year: $123,428
Present value of annuity: $133,061
Total present value of the severance package: $118,000 + $123,428 + $133,061 = $374,489
Therefore, the present value of the total severance package is $374,489.
Learn more about present value from the given link:
https://brainly.com/question/28304447
#SPJ11
An automotive dealer borrowed $9000.00 from the Bank of Montreal on a demand note on May 15. Interest on the loan, calculated on the daily balance, is charged to the dealer's current account on the 15th of each month. The automotive dealer made a payment of $1800 on July 20, a payment of $4400 on October 1, and repaid the balance on December 1. The rate of interest on the loan on May 15 was 5% per annum. The rate was changed to 5.4% on August 1 and to 5.9% on October 1. What was the total interest cost for the loan?
The total interest cost for the loan is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
The total interest cost for the loan can be calculated, we need to determine the interest charged for each period based on the respective interest rates and payment dates. Here's the calculation:
1. Calculate the interest for the period from May 15 to August 1 (48 days) at 5% per annum:
Interest = Principal * Rate * Time
Interest = $9,000 * (0.05/365) * 48
2. Calculate the interest for the period from August 1 to October 1 (61 days) at 5.4% per annum:
Interest = Principal * Rate * Time
Interest = $9,000 * (0.054/365) * 61
3. Calculate the interest for the period from October 1 to December 1 (61 days) at 5.9% per annum:
Interest = Principal * Rate * Time
Interest = $9,000 * (0.059/365) * 61
4. Calculate the interest for the remaining period from December 1 to December 1 (0 days) at the final interest rate of 5.9% per annum:
Interest = Principal * Rate * Time
Interest = $0
5. Add up the interest for each period to find the total interest cost:
Total Interest Cost = Interest from May 15 to August 1 + Interest from August 1 to October 1 + Interest from October 1 to December 1
Calculating the individual interest amounts and summing them up:
Interest from May 15 to August 1 = $9,000 * (0.05/365) * 48
Interest from August 1 to October 1 = $9,000 * (0.054/365) * 61
Interest from October 1 to December 1 = $9,000 * (0.059/365) * 61
Interest from December 1 to December 1 = $0Total Interest Cost = Interest from May 15 to August 1 + Interest from August 1 to October 1 + Interest from October 1 to December 1 + Interest from December 1 to December 1Performing the calculations:Interest from May 15 to August 1 = $9,000 * (0.05/365) * 48
Interest from August 1 to October 1 = $9,000 * (0.054/365) * 61
Interest from October 1 to December 1 = $9,000 * (0.059/365) * 61
Interest from December 1 to December 1 = $0
Total Interest Cost = Interest from May 15 to August 1 + Interest from August 1 to October 1 + Interest from October 1 to December 1 + Interest from December 1 to December 1
Calculating the total interest cost based on the given information:
Total Interest Cost = $9,000 * (0.05/365) * 48 + $9,000 * (0.054/365) * 61 + $9,000 * (0.059/365) * 61 + $0
The total interest cost =$220.86
To know more about Total Interest Cost visit:
https://brainly.com/question/31799250
#SPJ11
You were recently asked to identify one employee you manage as a top performer to align with a new company program offering top performers intensive management skills training. The employee you identified for this role is unaware of the program. This morning, she confided in you that she just applied for graduate school and will find out if she has been accepted five months from now, with the intent to start the program one month after that. Would you change the identification of who was the top performer in your team based on this information? Why or why not?
Based on the information provided, it would be prudent to reconsider the identification of the employee as a top performer in the team.
team. The employee's application for graduate school and their intention to start the program in six months' time may significantly impact their availability and commitment to the intensive management skills training offered by the company.
To determine the top performers, it is important to consider various factors, including their current performance, potential for growth, and commitment to the organization's goals. While the employee may have demonstrated exceptional performance up until now, their upcoming plans for graduate school could potentially affect their ability to fully participate in and benefit from the intensive management skills training.
It would be advisable to have a conversation with the employee to gather more information and discuss their long-term career goals and how their plans align with the company's program. This conversation would provide an opportunity to understand the employee's availability, level of commitment, and willingness to participate in the training program despite their impending graduate school plans.
Ultimately, the decision to change the identification of the top performer should be based on a careful evaluation of all relevant factors, including the employee's long-term potential within the organization, their ability to balance graduate school commitments with work responsibilities, and their enthusiasm and commitment to professional development opportunities. The goal is to select an employee who is not only a top performer but also has the availability and dedication to fully engage in the management skills training program and maximize its benefits.
Learn more about Company here:
https://brainly.com/question/30532251
#SPJ11
Rida Incorporated is preparing its direct materials budget for the second quarter. It budgets production of 275,000 units in the second quarter and 61,500 units in the third quarter. Each unit requires 0.40 pound of direct material, priced at $184 per pound. Starting with the second quarter, the company plans to end each quarter with an ending inventory of materials equal to 50% of next quarter’s budgeted direct materials required. Raw material inventory is 55,000 pounds at the beginning of the second quarter. Prepare a direct materials budget for the second quarter. (Enter "per unit" answers in two decimal places.)
Direct Materials Budget
Second Quarter
Units to produce 275,000 units
Materials required per unitselected answer correct pounds
Materials needed for production (pounds) not attempted Add: Desired ending materials inventoryselected answer correct not attempted Total materials required Less: Beginning materials inventoryselected answer correct not attempted Materials to purchase (pounds) pounds
Materials cost per poundselected answer correct not attempted Cost of direct materials purchases
Direct Materials Budget:
The direct materials budget calculates the amount of raw materials that are required to fulfill the production budget and the desired ending inventory for the budget period.
Direct Materials Budget for the Second Quarter:
Units to produce: 275,000 units
Materials required per unit: 0.40 pounds
Materials needed for production (pounds): 110,000 pounds
Add: Desired ending materials inventory: 68,750 pounds (50% of the third quarter's required materials)
Total materials required: 178,750 pounds
Less: Beginning materials inventory: 55,000 pounds
Materials to purchase (pounds): 123,750 pounds
Materials cost per pound: $184
Cost of direct materials purchases: $22,755,000
The direct materials budget of Rida Incorporated is as follows:
Units to produce: 275,000 units
Materials required per unit: 0.40 pounds
Materials needed for production (pounds): 110,000 pounds
Desired ending materials inventory: The company plans to end each quarter with an ending inventory of materials equal to 50% of next quarter's budgeted direct materials required.
Therefore, the desired ending materials inventory for the second quarter will be 50% of the third quarter's materials required i.e. 61,500*0.40*0.50 = 12,300 pounds. (Answer = 68,750 pounds)
Total materials required:
Materials needed for production (pounds) + Desired ending materials inventory = 110,000 + 68,750 = 178,750 pounds.
Beginning materials inventory: 55,000 pounds.
Materials to purchase (pounds): Total materials required – Beginning materials inventory = 178,750 – 55,000 = 123,750 pounds.
Materials cost per pound: $184.
Cost of direct materials purchases: Materials to purchase (pounds) * Materials cost per pound = 123,750 * $184 = $22,755,000.
Learn more about Direct Materials Budget: https://brainly.com/question/29237234
#SPJ11
TRUE OR FALSE. GIVE EXPLANATION.
a. Holding period return is equal to the price change relative to the initial price.
b. Normally, the effective annual rate (EAR) is greater than the annual percentage rate (APR).
c. Between two investment opportunities, we choose the one with a higher APR.
d. Between two risky assets, the one with a higher risk premium is better.
e. An asset’s risk premium is determined by the amount of nonsystematic risk it carries.
f. If a market is efficient in the strong form, it must be efficient in the weak form.
(a). True, holding period return is equal to the price change relative to the initial price.
(b). True, normally, the effective annual rate (EAR) is greater than the annual percentage rate (APR).
(c). True, between two investment opportunities, we choose the one with a higher APR.
(d). False, between two risky assets, the one with a higher risk premium is better.
(e). False, an asset’s risk premium is determined by the amount of non-systematic risk it carries.
(f). False, if a market is efficient in the strong form, it must be efficient in the weak form.
(a). True:
Holding period return is equal to the price change relative to the initial price. This statement is correct.
(b). True:
Normally, the effective annual rate (EAR) is greater than the annual percentage rate (APR). This statement is correct.
(c). True:
Between two investment opportunities, we choose the one with a higher APR. This statement is correct.
(d). False:
Between two risky assets, the one with a higher risk premium is not always better. The risk premium is the excess return earned from investing in a risky asset instead of a risk-free asset.
Investors choose to invest in risky assets to earn higher returns. Risky assets with higher risk premiums offer higher returns but also pose a higher risk.
Therefore, choosing the investment option with a higher risk premium is subject to the individual's risk appetite and investment objectives.
(e). False:
An asset’s risk premium is not determined by the amount of non-systematic risk it carries. The amount of non-systematic risk does not determine the asset's risk premium.
The risk premium is the additional return that investors demand for bearing risk. The risk premium of an asset reflects the extra return investors demand for holding a risky asset instead of a risk-free asset.
The risk premium of an asset depends on the asset's systematic risk, which is the portion of the risk that cannot be diversified away.
(f). False:
If a market is efficient in the strong form, it is not necessary that it must be efficient in the weak form. The strong-form efficiency implies that all information, including insider information, is reflected in the current stock prices.
The weak-form efficiency implies that the current stock prices reflect only the past stock prices and do not reflect any other information. A market that is efficient in the strong-form is also efficient in the semi-strong-form and weak-form.
However, a market that is efficient in the weak-form is not necessarily efficient in the semi-strong-form and strong-form.
To learn more about effective annual rate from the given link.
https://brainly.com/question/13024233
#SPJ11
"Employee First, Customer Second" Vineet Nayar Transforms HCL Technologies.
Are Nayars ideas about people alignment transferable to other industries and other countries? Can anyone briefly answer this question within 500 words.
Yes, Vineet Nayar's ideas about people alignment, as showcased in his book "Employees First, Customers Second".
Shifting the focus to internal customers: Nayar's approach challenges the traditional notion of prioritizing external customers over internal employees. By recognizing and valuing the contributions of internal employees, organizations can create a positive work environment, enhance teamwork, and ultimately deliver better products or services to external customers. This concept is applicable across industries and countries, as every organization relies on the efforts and expertise of its internal workforce to meet customer needs and achieve business goals.
Embracing change and innovation: Nayar's transformation at HCL Technologies involved embracing change and encouraging innovation at all levels of the organization. This emphasis on continuous improvement, adaptability, and a willingness to challenge the status quo is relevant to industries globally. In today's rapidly evolving business landscape, organizations must foster a culture of innovation and agility to stay competitive, regardless of their industry or country of operation.
Learn more about business here:
https://brainly.com/question/15826604
#SPJ11
9) Guadclupe cnjoys cating churros (a fricd dough treat) and hot chocolate together. For cvery churro that she eats, she must also consume a cup of hot chocolate. They are perfect complements and everyone has the same preference. a) When Guadelupe goes to the store, she notices that the equilibrium price of churros and the equilibrium quantity of hot chocolate have declined. She wonders what could be responsible for this occurrence - a rise in the price of milk (an ingredient for hot chocolate) or a rise in the price of flour (an ingredient for churros). Provide your answer and illustrate with supply and demand graphs. b) Suppose instead that the equilibrium price of hot chocolate has increased but the equilibrium quantity of churros has fallen. What could be responsible for this occurrence - an increase in the price of milk or an increase in the price of flour? c) If Guadelupe has two cups of hot chocolate with every churro, she gets no additional utility compared to eating just one cup of hot chocolate and one churro. Similarly, if she eats two churros and one hot chocolate, she gets no additional utility than eating just one churro and one hot chocolate. On the other hand, if she does eat two churros each with its own cup of hot chocolate, then her utility increases. Sketch out Guadelupe's indifference curves over churros and hot chocolate.
a) If the equilibrium price of churros and the equilibrium quantity of hot chocolate have declined, then the rise in the price of flour (an ingredient for churros) could be responsible for this occurrence.
The decrease in the supply of churros would increase the price, and decrease the quantity consumed. A graphical illustration of the supply and demand curves for churros and hot chocolate are shown below. The curves for churros have shifted to the left, which would raise the price of churros, and decrease the quantity consumed. A graphical illustration of the supply and demand curves for churros and hot chocolate are shown below. The curves for hot chocolate have shifted to the right, which would raise the price of hot chocolate, and increase the quantity consumed. c) Indifference curves are a way of representing the relationship between two goods.
In this case, we can sketch out Guadalupe's indifference curves over churros and hot chocolate. The curve slopes downward because the more hot chocolate she consumes, the fewer churros she can consume while maintaining the same level of satisfaction. Similarly, the more churros she consumes, the fewer hot chocolate she can consume while maintaining the same level of satisfaction.
To know more about churros visit :
brainly.com/question/17778274
#SPJ11
( 1 point) Find the value today of an annuity-immediate, where the payments are 1020 per month over 6 years. The first payment occurs exactly one month from today, and the interest rate is a nominal \
the present value of the annuity-immediate is approximately $749,351.35.
To find the present value of an annuity-immediate, we can use the formula:
PV = PMT * (1 - (1 + r)^(-n)) / r
Where:
PV = Present value
PMT = Payment amount
r = Interest rate per period
n = Number of periods
In this case, the payment amount (PMT) is $1020 per month, the interest rate (r) is a nominal rate per year, and the number of periods (n) is 6 years * 12 months = 72 months.
If the interest rate is given as a nominal rate per year, we need to convert it to a periodic rate per month. Let's assume the nominal rate is 6% per year.
Periodic interest rate = Nominal interest rate / Number of periods per year
Monthly interest rate = 6% / 12 = 0.005 (or 0.5%)
Now we can plug in the values and calculate the present value:
PV = 1020 * (1 - (1 + 0.005)^(-72)) / 0.005
PV ≈ 1020 * (1 - (1.005)^(-72)) / 0.005
PV ≈ 1020 * (1 - 0.629730) / 0.005
PV ≈ 1020 * 0.370270 / 0.005
PV ≈ 749,351.35
To know more about annuity visit
https://brainly.com/question/33493095
#SPJ11
You invest $2,402.00 at the beginning of every year and your friend invests $2,402.00 at the end of every year. If you both earn an annual rate of return of 14.86%, how much more money will you have after 39.0 years?
You will have approximately $33,196.10 more money than your friend after 39.0 years.
To calculate the difference in the amount of money you will have compared to your friend after 39.0 years, we need to consider the timing of the investments.
For you, the investment is made at the beginning of each year, so it has one additional year to grow compared to your friend's investment made at the end of each year.
Future Value = Payment * [(1 + interest rate)^n - 1] / interest rate
Payment = $2,402.00
Interest rate = 14.86% or 0.1486 (decimal form)
n = 39.0 years
Future Value = $2,402.00 * [(1 + 0.1486)^39 - 1] / 0.1486
Future Value = $2,402.00 * [36.71964808] / 0.1486
Future Value ≈ $599,743.37
Future Value (Friend) = $2,402.00 * [(1 + 0.1486)^38 - 1] / 0.1486
Future Value (Friend) ≈ $566,547.27
The difference in the amount of money you will have compared to your friend after 39.0 years is:
Difference = Future Value - Future Value (Friend)
Difference ≈ $599,743.37 - $566,547.27
Difference ≈ $33,196.10
Learn more about investment here:
brainly.com/question/14921083
#SPJ11
What are apple's sustainable logistics practices?
Answer:
Explanation:
Renewable energy
Energy-efficient transportation
Making packaging more efficient
Recycling
Suppose that the inverse demand curve is given by P=50−Q,Q=q 1+q 2
Where q i is the output of firm i=1,2. The marginal cost of firm 1 is c 1 =15 and the marginal cost of firm 2 is c 2=25. (a) Derive each firm's best response function and illustrate on a graph. Hilustrate the Nash equllibrium on your graph: (b) Determine the quantities that firm 1 and 2 produce in the Nash equilibrium and the assoclated payoffs (profits). (c) Do firms 1 and 2 have incentives to merge and produce using the more efficiont technology (the one with the lowest marginai costt? Justify your answer.
a. To illustrate this on a graph, we can plot the inverse demand curve (P = 50 - Q) and the best response functions for each firm.
b. The quantities that firm 1 and 2 produce in the Nash equilibrium and the assoclated payoffs (profits) are For Firm 1: Profit (π1) = (50 - Q1) * Q1 - 15 * Q1
Profit (π1) = (50 - 17.5) * 17.5 - 15 * 17.5. For Firm 2: Profit (π2) = (50 - Q2) * Q2 - 25 * Q2. Profit (π2) = (50 - 12.5) * 12.5 - 25 * 12.5.
c. We can say that if the merged firm's total costs are lower than the sum of individual firms' costs in the Nash equilibrium, it would generally be more efficient
(a) To derive each firm's best response function, we need to find the quantity that maximizes their profits given the inverse demand curve and their respective marginal costs.
For Firm 1:
Profit (π1) = Revenue - Cost
Revenue = Price * Quantity = (50 - Q) * Q1
Cost = Marginal Cost * Quantity = 15 * Q1
To maximize profits, we differentiate the profit function with respect to Q1 and set it equal to zero:
dπ1/dQ1 = d((50 - Q) * Q1 - 15 * Q1)/dQ1 = 0
Simplifying, we get:
50 - 2Q1 - 15 = 0
35 - 2Q1 = 0
2Q1 = 35
Q1 = 35/2
Q1 = 17.5
So the best response function for Firm 1 is Q1 = 17.5.
For Firm 2:
Profit (π2) = Revenue - Cost
Revenue = Price * Quantity = (50 - Q) * Q2
Cost = Marginal Cost * Quantity = 25 * Q2
To maximize profits, we differentiate the profit function with respect to Q2 and set it equal to zero:
dπ2/dQ2 = d((50 - Q) * Q2 - 25 * Q2)/dQ2 = 0
Simplifying, we get:
50 - 2Q2 - 25 = 0
25 - 2Q2 = 0
2Q2 = 25
Q2 = 25/2
Q2 = 12.5
So the best response function for Firm 2 is Q2 = 12.5.
To illustrate this on a graph, we can plot the inverse demand curve (P = 50 - Q) and the best response functions for each firm.
(b) In the Nash equilibrium, each firm's quantity produced should be their respective best response to the other firm's quantity. Therefore, in the Nash equilibrium:
Firm 1: Q1 = 17.5
Firm 2: Q2 = 12.5
To find the associated payoffs (profits), we can substitute these quantities into the profit function for each firm.
For Firm 1:
Profit (π1) = (50 - Q1) * Q1 - 15 * Q1
Profit (π1) = (50 - 17.5) * 17.5 - 15 * 17.5
For Firm 2:
Profit (π2) = (50 - Q2) * Q2 - 25 * Q2
Profit (π2) = (50 - 12.5) * 12.5 - 25 * 12.5
(c) To determine if firms 1 and 2 have incentives to merge and produce using the more efficient technology (lower marginal cost), we need to compare their profits in the Nash equilibrium with their potential profits if they merged.
If firms 1 and 2 were to merge, they would produce at the minimum of their combined marginal costs, which is the more efficient technology (lowest marginal cost). If the merged firm's profits exceed the sum of their individual profits in the Nash equilibrium, then there would be an incentive to merge.
To justify this mathematically, we would need information about the marginal costs of the merged firm. Without that information, we cannot determine if there is an incentive to merge based solely on the given information.
However, we can say that if the merged firm's total costs are lower than the sum of individual firms' costs in the Nash equilibrium, it would generally be more efficient
Learn more about graph from the given link
https://brainly.com/question/19040584
#SPJ11
Anton Alby lives in Sydney, Australia. In October 2022, he accepts a job offer to work as freelance photographer in Los Angeles for the next 3 years.
Prior to moving, Anton decides to dispose of the following assets (sells them by 1 November 2022):
His investment property which he sells to his sister for $700,000 (the market value however was $900,000). The cost of constructing his investment property was $200,000 (which he completed on 1 September 2010) and was on a block of land which he purchased on 1 June 1984. The land value at the time of completing the construction of the investment property was $100,000. Anton incurred legal fees of $1,200 and $4,000 in advertising fees to sell the entire property. You do not need to consider any Division 43 calculations in working out the cost base for this investment property.
His main residence, where he makes a capital gain of $60,000 and purchased in 2015. He used 15% of the property to operate his photography business.
His cello, which was purchased on 1 September 2010 for $7,000 and sold for $9,000.
His bank shares, which were bought on 1 December 2018 for $20,000 and sold for $15,000.
Anton also had capital losses from a previous year for the sale of jewellery for $2,000.
Required: Calculate Anton Alby’s net capital gain for the year ending 30 June 2023. You must support your answer with relevant legislation and show full calculations. You must not provide your answer in a table format - full sentences are expected to explain your analysis.
You do not need to write more than 400 words.
Anton Alby, a resident of Sydney, Australia, accepted a job offer in Los Angeles in October 2022 to work as a freelance photographer for the next three years. He sold the following assets before moving (by November 1, 2022):an investment property, his main residence, his cello, and bank shares.
Calculate Anton Alby's net capital gain for the year ending June 30, 2023.Legislation: Section 118-10 of the ITAA 1997 deals with the Capital Gains Tax (CGT) exemption on the sale of a main residence. Section 104-10 of the ITAA 1997 outlines the process of calculating net capital gain.
Calculation of the net capital gain: Capital gain on the main residence = $60,000 x 15/100 = $9,000Net capital gain = Capital gain on the investment property + Capital gain on the cello - Capital loss on bank shares = $394,800 + $2,000 - $5,000 = $391,800.Anton's net capital gain for the year ending June 30, 2023 is $391,800.
To know more about investment property visit:-
https://brainly.com/question/32564353
#SPJ11
