The applicable Make-Whole Amount that is due in connection with the prepayment is $1,316,485.95.
The Excel formula used to compute this is: =max(0, (PV((0.075/4), 274, -15000000)(0.0245+0.0075/4+1)-15000000))
To calculate the Make-Whole Amount, we need to find the present value of all remaining payments of principal and interest that would be due with regard to the amount of principal that is to be prepaid, discounted to the present date by a "Reinvestment Yield," and then subtract the amount of principal being prepaid.
First, we calculate the Reinvestment Yield, which is equal to the sum of (a) 75 basis points plus (b) the yield to maturity implied by the U.S. Treasury yields for the remaining contractual term of the principal being paid.
So, the Reinvestment Yield is:
= 0.0245 + 0.0075/4
= 0.026875
Next, we calculate the present value of all remaining payments of principal and interest using the PV function in Excel:
PV((0.075/4), 274, -15000000) = $15,869,334
Finally, we calculate the Make-Whole Amount by multiplying the present value by the Reinvestment Yield plus 1, and then subtracting the amount of principal being prepaid:
= 15,869,334 (0.026875 + 1) - 15,000,000
= $1,316,485.95
Since the Make-Whole Amount cannot be less than zero, the final formula used in Excel is =max(0, (PV((0.075/4), 274, -15000000)(0.0245+0.0075/4+1)-15000000)).
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a treasury bill has 45 days left to maturity. the bank discount yield on the bill is 2.25 percent. what is the effective annual rate? a. 2.99 percent b. 2.29 percent c. 2.88 percent d. 2.25 percent e. 2.31 percent
The effective annual rate for this Treasury bill is approximately 2.31% (Option E).
How to calculate effective annual rateTo determine the effective annual rate (EAR) for a Treasury bill with 45 days left to maturity and a bank discount yield of 2.25%, we can use the following formula:
EAR = [(1 + (Bank Discount Yield × (Days to Maturity / 360)) / (1 - Bank Discount Yield × (Days to Maturity / 360))] ^ (365 / Days to Maturity) - 1
Plugging in the values:
EAR = [(1 + (0.0225 × (45 / 360)) / (1 - 0.0225 × (45 / 360))] ^ (365 / 45) - 1
After calculating, we get:
EAR ≈ 0.0231 or 2.31%
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which form of business organization is established as a legal entity separate from its owners? multiple choice sole proprietorship partnership corporation none of these
The form of business organization that is established as a legal entity separate from its owners is the corporation, option (C) is correct.
Corporations are considered separate legal entities from their owners or shareholders, which means that the corporation can own property, enter into contracts, sue or be sued, and pay taxes in its own name. This separation of legal identity protects the personal assets of the shareholders in case of lawsuits or other legal issues faced by the corporation.
On the other hand, sole proprietorships and partnerships are not considered separate legal entities from their owners. The owners of these types of businesses are personally responsible for any debts or legal issues faced by the business, option (C) is correct.
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The complete question is :
Which form of business organization is established as a legal entity separate from its owners? multiple choice
A) sole proprietorship
B) partnership
C) corporation
D) none of these
Your examination of the records of a company that follows the cash basis of accounting tells you that the company’s reported cash-basis earnings in 2017 are $33,900. If this firm had followed accrual-basis accounting practices, it would have reported the following year-end balances.2017 2016Accounts receivable $3,300 $2,200Supplies on hand 1,360 1,530Unpaid wages owed 2,500 2,450Other unpaid expenses 1,720 1,070Determine the company’s net earnings on an accrual basis for 2017.Net earnings on an accrual basis for 2017 $
Net earnings as per accrual basis are $37,360. The calculations are shown in the below section.
The income retained by the company after meeting its operating cost, interest, taxes, and dividends is known as net earnings. It is the measure of the profitability of a company in a particular accounting period.
Calculation of net earnings:
Particulars Amount($)
Net earnings as per cash basis 36,810
Increase in accounts receivables (3,220-2,160) 1,060
Decrease in supplies (1,700-1,3200 (380)
Decrease in unpaid wages (2,330-2,320) (10)
Decrease in unpaid expenses (1,440-1,320) (120)
Net earnings as per accrual basis 37,360
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The company’s net earnings on an accrual basis for 2017 would be $32,980, which is calculated by adding the accounts receivable balance to the reported cash-basis earnings and subtracting the total expenses incurred but not yet paid.
To determine the company’s net earnings on an accrual basis for 2017, we need to consider the adjustments that would be required if the company had followed accrual-basis accounting practices. Accrual accounting recognizes revenue when it is earned and expenses when they are incurred, regardless of when cash is received or paid.
Looking at the provided information, the company had accounts receivable of $3,300 at the end of 2017, indicating that there was revenue earned but not yet received. We also see that the company had unpaid wages owed and other unpaid expenses totaling $4,220, indicating that there were expenses incurred but not yet paid.
To calculate the company’s net earnings on an accrual basis for 2017, we would add the accounts receivable balance of $3,300 to the reported cash-basis earnings of $33,900, giving us a total revenue of $37,200. We would then subtract the total expenses incurred but not yet paid, which is $4,220, giving us a net earnings on an accrual basis for 2017 of $32,980.
In summary, the company’s net earnings on an accrual basis for 2017 would be $32,980, which is calculated by adding the accounts receivable balance to the reported cash-basis earnings and subtracting the total expenses incurred but not yet paid.
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when a salesperson responds quickly to a service failure and delights the customer with the outcome, it is called
When a salesperson responds quickly to a service failure and delights the customer with the outcome, it is called "service recovery."
Service recovery is the process of taking action to correct a service failure and make things right with the customer. This can include apologizing for the mistake, finding a solution to the problem, and offering compensation or incentives to the customer.
Service recovery is important because it can help to restore the customer's trust in the company and improve their overall satisfaction with the service. It also provides an opportunity for the company to learn from the mistake and improve their processes to prevent similar issues from happening in the future.
Overall, effective service recovery can have a positive impact on the customer experience and the company's reputation. By responding quickly and taking the necessary steps to resolve the issue, salespeople can turn a negative situation into a positive one and create loyal customers who are more likely to recommend the company to others.
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according to classical theory, total employment and real gross domestic product (gdp) are unrelated. positively related. negatively related. inversely related.
According to classical theory, total employment and real gross domestic product (GDP) are positively related. This means that as total employment increases, real GDP also increases, and vice versa.
The reasoning behind this relationship is that when more people are employed, they have income to spend, leading to higher consumer demand and increased production, which contributes to the growth of real GDP.
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external factors that can influence the revenue cycle include ______.
External factors that can influence the revenue cycle of a business include changes in market demand, economic conditions, technological advancements, regulatory changes, competitive landscape, and customer behavior.
For example, a change in market demand can impact the pricing strategy of the business, while economic conditions can affect customer spending and purchasing power.
Technological advancements can create new revenue streams, while regulatory changes can impact the pricing and distribution of goods and services. The competitive landscape can impact market share and pricing power, and changes in customer behavior can impact sales and revenue.
To mitigate the impact of external factors on the revenue cycle, businesses can conduct market research, monitor industry trends, and develop contingency plans. They can also focus on building customer loyalty, diversifying their product portfolio, and adopting new technologies to stay competitive.
By understanding the external factors that influence the revenue cycle, businesses can make informed decisions to adapt and thrive in a dynamic business environment.
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External factors that can influence the revenue cycle include economic conditions, competition, changes in customer behavior, and government regulations.
External influences are forces that can have an effect on a company's operations and financial success. Consumer spending and overall sales can be impacted by economic situations like inflation or a recession. Lower prices and a smaller market share may result from competition from rival companies. Customer behavior modifications, such as a shift towards online buying, can have an effect on a company's sales channels and income streams. Taxes and legislation changes are examples of government restrictions that can have an impact on how businesses operate and perform financially. To sustain a healthy revenue cycle, it's critical for firms to be aware of these external forces and modify their strategy as necessary.
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Question 1 (10) In most lending organisations, credit losses occur due to lack of credit risk monitoring. You're required to identify a lending organisation of your choice (bank or retailer) and outline its periodical credit risk review process.
JPMorgan Chase & Co. has a robust credit risk review process in place to ensure that credit losses are minimized and the bank's lending activities are conducted in a safe and sound manner.
What is the credit risk review process of a lending organization?Let's take the example of a major bank like JPMorgan Chase & Co. and outline its periodical credit risk review process.
JPMorgan Chase & Co. is one of the largest banks in the world and has a well-established credit risk review process. The bank's credit risk management framework is designed to ensure that credit risk is identified, measured, monitored, and controlled on a regular basis.
The credit risk review process at JPMorgan Chase & Co. involves the following steps:
Identification of credit risk: The bank identifies and evaluates credit risk associated with its lending activities. It considers factors such as borrower's creditworthiness, collateral, and economic conditions to assess the credit risk.Measuring credit risk: Once the credit risk is identified, JPMorgan Chase & Co. measures the potential credit loss using various methods such as credit rating, probability of default, loss given default, and exposure at default.Credit monitoring: The bank monitors the credit risk of its lending portfolio on a regular basis. This is done through ongoing credit analysis, financial statement review, and tracking of borrower's payment behavior.Credit control: Based on the credit monitoring results, JPMorgan Chase & Co. takes measures to control credit risk. This may involve restructuring of the loan, adjusting credit limits, or enforcing collateral agreements.Periodical credit risk review: JPMorgan Chase & Co. conducts a periodic credit risk review of its lending portfolio to ensure that credit risk is being managed effectively. This review includes a comprehensive evaluation of the credit risk management framework, credit risk policies, and procedures.Overall, JPMorgan Chase & Co. has a robust credit risk review process in place to ensure that credit losses are minimized and the bank's lending activities are conducted in a safe and sound manner.
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The usual retail price of an item is $123. The manufacturer's cost to produce the item is $45. Retailers take a 50 percent markup and wholesalers take a 10 percent markup. What is the retailer's markup in dollars? Enter only the value without the $ sign. The usual retail price of an item is $121. ___________The manufacturer's cost to produce the item is $44. Retailers take a 49 percent markup and wholesalers take a 10 percent markup. What is the wholesale price? Enter only the value without the $ sign. The usual retail price of an item is $123. The manufacturer's cost to produce the item is $41. Retailers take a 39 percent markup and wholesalers take a 10 percent markup. What is the manufacturer's price? Enter only the value without the $ sign. ___________Assume you are selling pizzas at $4 per pizza. Your fixed costs (rent, salaries, and utilities) are $5,289/month. The food costs and other variable costs are 50 percent of the selling price. What is your break-even point in units sold? (enter only the value) ___________Assume you are selling pizzas at $ 9 per pizza. Your fixed costs (rent, salaries, and utilities) are $5,725/month. The food costs and other variable costs are 40 percent of the selling price. What is your break-even point in units if you need to make 25% target return on the sales revenue? (enter only the value)___________
1) The retailer's markup in dollars is $48.45. 2) The wholesale price is $59.60. 3) The manufacturer's price is $41. 4) Break-even point in units sold is 2,645 pizzas. 5) Break-even point in units if you need to make 25% target return on the sales revenue is 2,163 pizzas.
1) To find the retailer's markup in dollars, first calculate the wholesale price. The manufacturer's cost is $123 and the wholesaler takes a 10% markup:
Wholesale price = $123 / (1 + 0.1) = $111.82
Next, calculate the retailer's cost:
Retailer's cost = $111.82 / (1 + 0.5) = $74.55
Finally, find the retailer's markup in dollars:
Retailer's markup = $123 - $74.55 = $48.45
2) To find the wholesale price, first calculate the retailer's cost. The manufacturer's cost is $44 and retailers take a 49% markup:
Retailer's cost = $44 * (1 + 0.49) = $65.56
Now, calculate the wholesale price, given that wholesalers take a 10% markup:
Wholesale price = $65.56 / (1 + 0.1) = $59.60
3) The manufacturer's price is given as $41.
4) To find the break-even point in units sold, first calculate the contribution margin per pizza:
Contribution margin = Selling price - Variable cost = $4 - ($4 * 0.5) = $2
Next, divide the fixed costs by the contribution margin:
Break-even point = $5,289 / $2 = 2,644.5 ≈ 2,645 pizzas
5) To find the break-even point in units, first calculate the target return:
Target return = $9 * 0.25 = $2.25
Now, calculate the contribution margin per pizza:
Contribution margin = Selling price - Variable cost - Target return = $9 - ($9 * 0.4) - $2.25 = $2.65
Finally, divide the fixed costs by the contribution margin:
Break-even point = $5,725 / $2.65 ≈ 2,162.26 ≈ 2,163 pizzas
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if a firm is producing at its minimum efficient scale, increasing its output slightly will lead to diseconomies of scale. true false
False. While a firm may be producing at its minimum efficient scale, increasing output slightly will not necessarily lead to diseconomies of scale.
Diseconomies of scale occur when a firm's average costs rise as production increases, due to inefficiencies. In some cases, a firm may be able to increase production without experiencing diseconomies of scale, as long as the firm is able to keep its costs down.
For instance, if the firm is able to invest in more efficient technology and use economies of scale to its advantage, then it may be able to increase production without experiencing diseconomies of scale. Additionally, a firm may be able to increase production without experiencing diseconomies of scale if it is able to increase its production capacity while keeping costs down.
In short, while a firm may be producing at its minimum efficient scale, increasing its output slightly will not necessarily lead to diseconomies of scale.
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A relation is in third normal form if it is in second normal form and there are no functional dependencies between two for more) non primary key attributes. Select one a. FALSE b. TRUE
Answer: b. TRUE. A relation is said to be in third normal form when it is in second normal form and there are no transitive dependencies between two or more non-primary key attributes.
Transitive dependencies are those where one non-primary key attribute determines another non-primary key attribute, which in turn determines another non-primary key attribute. This means that the non-primary key attributes are not functionally dependent on the primary key.
That is, any non-primary key attribute should not be able to be determined by any other non-primary key attribute. Third normal form helps to reduce data redundancy and improve data integrity. It ensures that data is stored in the most efficient and effective way.
It also ensures the data is stored in a way that allows for the most efficient retrieval of data. In summary, third normal form is essential for ensuring data accuracy and avoiding data redundancy.
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1what are the benefits of corporate governance at the
corporate level in the local context?
2-what are The benefits of corporate governance at the level of the
economy in the local context?
Corporate governance refers to the system of rules, practices, and processes by which a company is directed and controlled.
It involves balancing the interests of stakeholders, such as shareholders, management, customers, suppliers, financiers, government, and the community.
The benefit of corporate governanceThe benefits of corporate governance at the organizational level include improved decision-making, better resource allocation, reduced risk of financial scandals, enhanced transparency, and increased investor confidence.
At the level of the economy in the local context, corporate governance contributes to several positive outcomes.
These benefits include fostering a business environment that encourages investment and economic growth, promoting fair competition and reducing corruption, supporting the development of local businesses, and enhancing overall social and environmental responsibility.
As a result, effective corporate governance can contribute significantly to the sustainable development of a local economy, benefiting all stakeholders and the community as a whole.
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equipment cost $36,000 and is expected to be useful for 5 years and have no salvage value. under the straight-line method, monthly depreciation will be:
The equipment costs $36,000 and is expected to be useful for 5 years with no salvage value. To calculate the monthly depreciation using the straight-line method, follow these steps:
1. Determine the total depreciation: Equipment cost - Salvage value = $36,000 - $0 = $36,000
2. Calculate the annual depreciation: Total depreciation / Useful life in years = $36,000 / 5 = $7,200 per year
3. Calculate the monthly depreciation: Annual depreciation / 12 months = $7,200 / 12 = $600 per month
Under the straight-line method, the monthly depreciation for the equipment will be $600.
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sheridan co expects to produce 114000 products in the coming year and has invested 22800000 in production equipment. sheridan requires a return on investment 20%. what is sheridans roi per unit
Sheridan's ROI per unit is $40.
Sheridan Co anticipates producing 114,000 products in the upcoming year and has invested $22,800,000 in production equipment. They require a 20% return on investment (ROI). To calculate Sheridan's ROI per unit, follow these steps:
1. Determine the total ROI required: Multiply the investment amount by the required ROI percentage.
In this case, $22,800,000 * 20% = $4,560,000.
2. Calculate the ROI per unit: Divide the total ROI required by the number of units produced.
For Sheridan Co, $4,560,000 / 114,000 units = $40 per unit.
So, Sheridan's ROI per unit is $40. This means that, on average, each product sold must generate a profit of $40 to achieve the company's desired 20% return on investment. This figure helps Sheridan Co to set appropriate pricing strategies and make informed decisions about production and sales efforts.
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mad corp. has 20-year bonds with an 8% coupon rate and a 10% yield to maturity. what would be mad's appropriate after-tax cost of debt if their tax rate is 40%? group of answer choices 4.8% 6.0% 8.0% 10.0%
Mad's appropriate after-tax cost of debt if their tax rate is 40% is B. 6.0%.
To find Mad Corp.'s appropriate after-tax cost of debt, we first need to calculate the before-tax cost of debt, which is the yield to maturity (YTM). In this case, the YTM is given as 10%. Next, we need to consider the tax rate, which is 40%.
The after-tax cost of debt is calculated by multiplying the before-tax cost of debt (YTM) by the difference between 1 and the tax rate. In this case, it can be calculated as follows:
After-tax cost of debt = YTM × (1 - tax rate)
After-tax cost of debt = 10% × (1 - 0.4)
After-tax cost of debt = 10% × 0.6
After-tax cost of debt = 6.0%
Therefore, the appropriate after-tax cost of debt for Mad Corp. is 6.0%. The correct answer from the given choices is B. 6.0%.
The question was incomplete, Find the full content below:
mad corp. has 20-year bonds with an 8% coupon rate and a 10% yield to maturity. what would be mad's appropriate after-tax cost of debt if their tax rate is 40%? group of answer choices
A. 4.8%
B. 6.0%
C. 8.0%
D. 10.0%
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Ma&Son Company is expected to pay a dividend of $2.60 one year from today (i.e., D = 2.60). The company's required rate of return is 11%. If the market expects that the dividend will grow at a constant rate of 4% per year forever, Ma&Son's stock should sell for $ today.
Ma&Son Company's stock should sell for $35.00 today given the dividend of $2.60 and a required rate of return of 11%.
The stock price is determined by the present value of an infinite series of future cash flows (dividends). The expected dividend growth rate of 4% is used to discount the future dividends back to the present.
By discounting the future dividends at the required rate of return, we can calculate the present value of the stock and arrive at the current stock price of $35.00.
This price is the market's expectation of what the investor will receive in total return over the life of the investment. Therefore, it is the amount the investor is willing to pay to purchase a share of Ma&Son's stock today.
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A restaurant chain is thinking about opening up a pop-up restaurant that it will run for two years. For both years, the restaurant will generate incremental net income (after depreciation and taxes) of $625k per year (assume these cash flows take place after exactly one year and after exactly two years). The restaurant will require a new temporary building structure that costs $359k and that will be straight-line depreciated to a salvage value of 0 over two years. This project will also require an upfront investment working capital of $273k, which will be returned at the end of the two-year project. The opportunity cost of capital is 9% and the tax rate is 27%. What is the NPV for this project?
The NPV for this project is $359.83k, which is positive, indicating that this project is expected to generate value for the company and should be undertaken.
To calculate the net present value (NPV) of this project, we need to discount the future cash flows to their present values and then sum them up.
Here's how we can calculate the NPV of the project:
Calculate the annual incremental net income after depreciation and taxes:
Annual incremental net income = $625k
Calculate the initial investment:
Initial investment = Building cost - accumulated depreciation + working capital
= $359k - ($359k/2) + $273k
= $426.5k
Calculate the cash flows for each year of the project:
Year 0: -$426.5k (initial investment)
Year 1: $625k - $102.33k (depreciation) = $522.67k (after-tax cash flow)
Year 2: $625k - $256.67k (depreciation) = $368.33k (after-tax cash flow)
Year 2: $273k (after-tax cash flow from working capital recovery)
Calculate the discount factor for each year using the opportunity cost of capital (9%) and the tax rate (27%):
Year 0: 1 / (1 + 0.09) = 1.000
Year 1: 1 / (1 + 0.09) * (1 - 0.27) = 0.773
Year 2: 1 / (1 + 0.09)* (1 - 0.27) = 0.595
Year 2: 1 / (1 + 0.09) * (1 - 0.27) = 0.595
Calculate the present value of each cash flow:
Year 0: -$426.5k * 1.000 = -$426.5k
Year 1: $522.67k * 0.773 = $404.23k
Year 2: $368.33k * 0.595 = $219.36k
Year 2: $273k * 0.595 = $162.74k
Sum up the present values of all cash flows to get the NPV:
NPV = -$426.5k + $404.23k + $219.36k + $162.74k = $359.83k
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AssignmentInformation ResourcesResearch examples of what is the appropriatesources of Information for customer service
There are several appropriate sources of information for customer service that can help businesses provide effective and efficient support to their customers.
Customer feedback: Analyzing customer feedback can provide valuable insights into their needs, preferences, and pain points, which can help businesses improve their products and services and provide better customer support.
Knowledge base: A knowledge base is a centralized repository of information that provides answers to frequently asked questions, troubleshooting tips, and other relevant information. This can help customers find answers to their questions quickly and easily.
Product documentation: Product manuals, user guides, and other documentation can provide customers with detailed information about how to use a product, its features, and its specifications. This can help customers resolve issues on their own and reduce the need for customer support.
Training materials: Providing training materials, such as videos, tutorials, and webinars, can help customers learn how to use a product or service effectively. This can help reduce the number of support requests and improve customer satisfaction.
Overall, using a combination of these sources of information can help businesses provide effective and efficient customer support, improving customer satisfaction and loyalty.
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Paola has little choice in how to accomplish her work tasks—her company employs strict process control.
-Skill variety
-Task Significance
-Task Identity
-Feedback
-Autonomy
Paola's work situation involves strict process control, which means her autonomy is limited. This can affect her skill variety, as she may not have the opportunity to use a diverse range of skills.
Autonomy refers to the degree to which an employee has control over how they perform their work tasks. If Paola's company employs strict process control, she likely has little choice in how to accomplish her work tasks, which suggests a low level of autonomy.Skill variety refers to the degree to which a job requires a variety of different skills and abilities. Task significance refers to the degree to which a job has a meaningful impact on the lives or work of others. Task identity refers to the degree to which a job involves completing a whole, identifiable piece of work. Feedback refers to the degree to which employees receive clear and direct feedback on the effectiveness of their performance.Based on the information provided, it is not clear whether Paola's job involves high or low levels of skill variety, task significance, task identity, or feedback.
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A firm issues a 20-year semi-annual payment bond, which is priced at $1213.55. The coupon rate of the bond is 9.00%. The tax rate is 37 percent. What is the after-tax cost of debt? % (to two decimal places)
The after-tax cost of debt is the cost of debt adjusted for the tax savings due to the tax-deductibility of interest payments. The after-tax cost of debt is 4.41%.
The formula for after-tax cost of debt is: After-tax cost of debt = pre-tax cost of debt × (1 - tax rate). First, we need to calculate the pre-tax cost of debt, which can be found using the bond pricing formula:
Bond price = [tex](C × [1 - (1 + r)^(-n)] / r) + (M / (1 + r)^n)[/tex] Where: C = coupon payment, r = semi-annual yield to maturity, n = number of semi-annual periods, M = par value of the bond, Substituting the given values into the formula, we get: $1213.55 = [tex]($45 × [1 - (1 + r)^(-40)] / r) + ($1000 / (1 + r)^40)[/tex]
Solving for r using a financial calculator or spreadsheet software, we get a semi-annual yield to maturity of 3.50%. Next, we can calculate the pre-tax cost of debt: Pre-tax cost of debt = semi-annual yield to maturity × 2, Pre-tax cost of debt = 3.50% × 2 = 7.00%
Finally, we can calculate the after-tax cost of debt: After-tax cost of debt = pre-tax cost of debt × (1 - tax rate) After-tax cost of debt = 7.00% × (1 - 0.37) = 4.41%. Therefore, the after-tax cost of debt is 4.41%.
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sally wanted to replace the old carpet in her home. she entered into a contract with good carpet co. (gcc) for the purchase and installation of new carpet. the price of the carpet was $3,000 and the labor to install it was $150. later dissatisfied, sally sued under several theories. sally wants to apply the ucc contract rules, but gcc argues that common law contract rules apply. which source of contract law should govern the case, the ucc or common law?
It is more likely that the UCC contract rules would apply in this case, as opposed to common law. This would benefit Sally, who wants to apply the UCC rules in her dispute with GCC.
Understanding UCC rules and common lawSally entered into a contract with Good Carpet Co. (GCC) to purchase and install new carpet in her home.
The total cost of the project was $3,150, which included $3,000 for the carpet and $150 for labor.
Later, Sally became dissatisfied and sued GCC under several theories.
In determining which source of contract law should govern the case, we need to consider the Uniform Commercial Code (UCC) and common law. The UCC generally applies to transactions involving the sale of goods, while common law governs contracts related to services.
In this situation, the contract involved both goods (the carpet) and services (installation). However, the primary purpose of the contract appears to be the purchase of the carpet, as it constitutes a larger portion of the contract's value.
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(Holding-period dollar gain and return) Suppose you purchased 15 shares of Disney stock for $28.22 per share on May 1, 2012. On September 1 of the same year, you sold 13 shares of the stock for $30.00. Calculate the holding-period dollar gain for the shares you sold, assuming no dividend was distributed, and the holding-period rate of return. . a. The holding-period dollar gain for the shares you sold is $. Enter a negative number if it is a loss. (Round to the nearest cent.)
The holding period gain for the shares you sold, assuming no dividend was distributed is $23.14.
The profit made from the investment is referred to as the return. The profit made by investors by purchasing and selling stocks is known as the return on a stock.
A holding period return is this kind of return. It can figure out by deducting the stock's buying price from its selling price. By subtracting the residual from the stock's purchase price, one can calculate the net return.
The given information for the holding period return is as follows:
Purchase price for 13 stocks on May 1, 2012: $28.22 per stock
Selling price for 13 stocks on September, 2012: $30 per stock
Now, the holding period return in dollar terms is as follows:
Holding price gain = selling price- purchase price
=30 -28.22 =$ 1.78/share
Holding period gain for 13 shares = $ 23.14
Holding return rate = (Net holding gain/ purchase price) * 100 = 6.31%
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in a manufacturing arrangement, a franchisor transmits to a franchisee the essential ingredients or formula to make a particular product. true false
The given statement "in a manufacturing arrangement, a franchisor does indeed transmit to a franchisee the essential ingredients or formula to make a particular product" is true, because it allows the franchisee to manufacture and distribute the product under the franchisor's brand
In this type of arrangement, the franchisor grants the franchisee the rights to produce and distribute their product using the specific formula, ingredients, and production methods that have been established by the franchisor.
The franchisee is typically responsible for the manufacturing and distribution process, while the franchisor provides the necessary know-how, expertise, and support to ensure the product meets the required quality standards.
This type of relationship can be advantageous for both parties, as the franchisor can expand their brand presence without having to manage the production facilities themselves, and the franchisee can benefit from the established reputation and customer base of the franchisor's product.
Additionally, the franchisee receives ongoing support and guidance from the franchisor, which can help to ensure the success of the business.
In summary, it is true that in a manufacturing arrangement, a franchisor provides the essential ingredients or formula to a franchisee for the production of a specific product. This allows the franchisee to manufacture and distribute the product under the franchisor's brand, benefiting both parties in the process.
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Calculate the amount of monthly payments on a $25,000 loan payable over 5 years at 12% annual interest, computed monthly.
The amount of monthly payments on a $25,000 loan payable over 5 years at 12% annual interest, computed monthly, is $555.06.
To calculate the monthly payments on the loan, we first need to convert the annual interest rate to a monthly rate by dividing it by 12. So the monthly interest rate is 1% (12% divided by 12). We can then use the formula for calculating the monthly payment on a loan, which is:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
where M is the monthly payment, P is the loan amount, i is the monthly interest rate, and n is the number of months over which the loan is repaid. Plugging in the given values, we get:
M = $25,000 [ 0.01(1 + 0.01)^60 ] / [ (1 + 0.01)^60 - 1 ] = $555.06
Therefore, the amount of monthly payments on the loan is $555.06.
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which variable or variables has research results confirmed to be the most powerful in predicting profitability for an organization?
The most powerful variables in predicting profitability for an organization are revenue growth, cost control, operating efficiency, market share.
These variables are:
1. Revenue growth
2. Cost control
3. Operating efficiency
4. Market share
These variables have been confirmed to be the most powerful in predicting profitability for an organization, as they directly impact the financial performance and competitiveness of a company. By focusing on these factors, businesses can optimize their operations and maximize profits.
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The Treasury had a $0.9 trillion dollar deficit in Fiscal 2019 so the US government was issuing new long-term securities (borrowing to cover the deficit) at an average rate of $75 billion per month. This decreases the money supply which should increase interest rates and lower the price of bonds, yet long-term interest rates were relatively stable. Why?
The reason long-term interest rates were relatively stable despite the US government issuing new long-term securities at an average rate of $75 billion per month is because the Federal Reserve was also conducting monetary policy to offset the effects of the deficit.
The Federal Reserve was purchasing government bonds and mortgage-backed securities at a rate of $60 billion per month. This increase in the money supply more than offset the decrease caused by the new long-term securities, and resulted in the long-term interest rates remaining relatively stable.
In addition, the Federal Reserve also announced that it would keep the federal funds rate at near zero, which also contributed to the stability in long-term rates.
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There are a number of reasons why a firm might want to repurchase its own stock. Read the statement and then answer the corresponding question about the company's motivation for the stock repurchase: Smith and Martin Co. 's board of directors has decided to repurchase some of its stock on the open market because the company has received a large, one-time cash flow, and it believes that the company's stock is undervalued.
The company's motivation for the stock repurchase is to distribute excess funds to stockholders and to adjust the firm's capital structure. Advantages of stock repurchase include: Minimizing dilution effect and Changing the firm's capital structure
Smith and Martin Co. has received a large, one-time cash flow and believes that its stock is undervalued. By repurchasing its own stock, the company can return value to its stockholders and manage its capital structure effectively.
Advantages of stock repurchase include:1. Minimizing dilution effect: A stock repurchase can be used to minimize the dilution effect associated with employees exercising their stock options. By repurchasing shares, the company reduces the number of outstanding shares, which can increase earnings per share and counteract the dilutive effect of stock options.
2. Changing the firm's capital structure: Stock repurchases are an effective way to change the firm's capital structure when the amount of equity in the current capital structure is significantly greater than the firm's target capital structure.
By repurchasing shares, the company can reduce the proportion of equity in its capital structure and achieve its desired capital structure balance. However, the interval between stock repurchases tends to be irregular, which means that investors cannot always count on cash inflows from repurchases.
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Complete Question:
There are a number of reasons why a firm might want to repurchase its own stock. Read the statement and then answer the corresponding question about the company's motivation for the stock repurchase:
"Smith and Martin Co.'s board of directors has decided to repurchase some of its stock on the open market because the company has received a large, one-time cash flow, and it believes that the company's stock is undervalued".
What is the company’s motivation for the stock repurchase? Explain in 150 words.
To protect against a takeover attemptTo distribute excess funds to stockholdersTo adjust the firm's capital structureTo acquire shares needed for employee options or compensationWhich of the following statements would be considered advantages of stock repurchase? Check all that apply. Explain in 150 words.
The interval between stock repurchases tends to be irregular, which means that investors cannot always count on cash inflows from repurchases.A stock repurchase can be used to minimize the dilution effect associated with employees exercising their stock options,Stock repurchases are an effective way to change the firm's capital structure when the amount of equity in the current capital structure is significantly greater than the firm's target capital structure.The ______ hypnotized by Enron's success missed a critical wake up call with the Skilling resignation. financial press.
The financial press reported that many individuals were hypnotized by Enron's seemingly endless success and missed a critical wake-up call when Jeff Skilling resigned.
Skilling was a key figure in Enron's financial operations, and his departure should have signaled to investors and analysts alike that something was amiss. Unfortunately, many were so mesmerized by Enron's financial performance that they failed to see the warning signs until it was too late.
The financial press, hypnotized by Enron's success, missed a critical wake-up call with the Skilling resignation.
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orange, inc., a c corporation for federal tax purposes, owns 82% of citrus corporation common stock, a c corporation for federal tax purposes. this year, orange generated $825,000 operating income (not including dividends). it also received $165,000 dividends from citrus corporation. orange's taxable income is:
Orange Inc.'s taxable income for the year is $207,900 in the given case
To calculate Orange Inc.'s taxable income, we need to first calculate its total income for the year, which includes both operating income and dividend income. Then, we can apply the corporate tax rate to determine the taxable income.
Total income = Operating income + Dividend income
Total income = $825,000 + $165,000
Total income = $990,000
Next, we need to apply the corporate tax rate to the total income. The corporate tax rate is a flat rate of 21% for C corporations for tax year 2023.
Taxable income = Total income x Tax rate
Taxable income = $990,000 x 0.21
Taxable income = $207,900
Therefore, Orange Inc.'s taxable income for the year is $207,900.
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Douglas Keel, a financial analyst for Orange Industries, wishes to estimate the rate of return for two similar-risk investments, X and Y. Douglas's research indicates that the immediate past returns will serve as reasonable estimates of future returns. A year earlier, investment X had a market value of $20,000; investment Y had a market value of $55,000. During the year, investment X generated cash flow of $1,500 and investment Y generated cash flow of $6,800. The current market values of investments X and Y are $21,000 and $55,000, respectively. a. Calculate the expected rate of return on investments X and Y using the most recent years data. b. Assuming that the two investments are equally risky, which one should Douglas recommend? Why?
The expected rate of return for investment Y is 12.4%.
a. To calculate the expected rate of return for investments X and Y, we need to use the following formula:
Expected Rate of Return = (Cash Flow / Beginning Market Value) + (Ending Market Value - Beginning Market Value) / Beginning Market Value
Using this formula, we can calculate the expected rate of return for investment X as:
(1,500 / 20,000) + (21,000 - 20,000) / 20,000 = 0.155 or 15.5%
Similarly, we can calculate the expected rate of return for investment Y as:
(6,800 / 55,000) + (55,000 - 55,000) / 55,000 = 0.124 or 12.4%
b. Assuming that the two investments are equally risky, Douglas should recommend investment X as it has a higher expected rate of return (15.5%) compared to investment Y (12.4%). This means that investment X is expected to provide a better return on investment than investment Y, given the same level of risk.
However, it is important to note that past performance is not always an accurate indicator of future performance and other factors should also be considered before making any investment decisions.
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Suppose you want to buy a $1,000 par value bond that pays $27 interest each quarter and with a maturity of 7 years from now. If you require 10% rate of return with quarterly compounding, how much should you be willing to pay for this bond? (Round your answer to two decimal point)
You should be willing to pay $1,124.25 for this bond.
To calculate the present value of the $1,000 par value bond that pays $27 interest each quarter and matures in 7 years, with a required 10% rate of return compounded quarterly, follow these steps:
1. Determine the total number of periods (quarters) until the bond matures: 7 years × 4 quarters = 28 quarters
2. Calculate the required quarterly rate of return: 10% annual rate / 4 quarters = 2.5% per quarter or 0.025 in decimal form
3. Calculate the present value of the bond's interest payments (also known as the annuity portion): PV(Annuity) = $27 × (1 - (1 + 0.025)⁻²⁸)) / 0.025 ≈ $551.63
4. Calculate the present value of the bond's par value at maturity: PV(Par Value) = $1,000 × (1 + 0.025)⁻²⁸ ≈ $572.62
5. Add the present values of the annuity and par value portions to determine the total present value of the bond: $551.63 + $572.62 ≈ $1,124.25
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