Answer:
The cost of equity for Neal Enterprises is 5%
Explanation:
In order to calculate the cost of equity for Neal Enterprises we would have to make the following calculation:
cost of equity=((Do(1+g)/Po)+g
According to givn data we have the following:
Do=$1.20
Po=$36.80
g=2%
cost of equity=((1.20(1+0.02)/36.80-1.20)+0.02
cost of equity=((1.20(1+0.02)/35.60)+0.02
cost of equity=0.05
The cost of equity for Neal Enterprises is 5%
Answer:
Ranking from Most to least
(i) 1%,
1. 135 in 10 years = 122.21
2. 120 in 5 years = 114.18
3. 105 in one year = 103.96
(ii) 3%
1. 120 in 5 years = 103.51
2. 105 in one year = 101.94
3. 135 in 10 years = 100.45
(iii) 5%
1. 105 in one year = 100.00
2. 120 in 5 years = 94.02
3. 135 in 10 years = 82.88
Explanation:
(i) 1%,
105 in one year
PV = 105 x ((1+0.01)^-1) = 103.96
120 in 5 years
PV = 120 x ((1+0.01)^-5) = 114.18
135 in 10 years
PV = 135 x ((1+0.01)^-10) = 122.21
(ii) 3%
105 in one year
PV = 105 x ((1+0.03)^-1) = 101.94
120 in 5 years
PV = 120 x ((1+0.03)^-5) = 103.51
135 in 10 years
PV = 135 x ((1+0.03)^-10) = 100.45
(iii) 5%
105 in one year
PV = 105 x ((1+0.05)^-1) = 100.00
120 in 5 years
PV = 120 x ((1+0.05)^-5) = 94.02
135 in 10 years
PV = 135 x ((1+0.05)^-10) = 82.88
Answer:
The IRS requires employers to report wage and salary information for employees on Form W-2. Your W-2 also reports the amount of federal, state and other taxes withheld from your paycheck. As an employee, the information on your W-2 is extremely important when preparing your tax return.
Answer: D. Since Hiro’s economic profit is negative, he would be better off if he didn’t operate the consulting business and taught economics instead.
Explanation:
Economic Cost is calculated by taking into account all costs, both Implicit and Explicit. Implicit Costs are also known as Opportunity costs and are referred to as the income you could be earning if you were doing the alternative.
Hiro's Economic Cost can hence be calculated by,
Economic Cost = Implicit costs + Explicit Costs
= (50,000 + 100) + 57,000
= <em>$107,000</em>
Subtracting that from his Revenue per year gives,
= 100,000 - 107,000
= -<em>$7,000</em>
Hiro is experiencing an Economic Loss by operating his business and would be better off Teaching Economics at the small local college.
Answer:
New evidence of processing
more extensive testing of records
separation of duties
reduced processing errors