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Nat2105 [25]
3 years ago
14

Hampton Corporation has a beta of 1.3 and a marginal tax rate of 34%. The expected return on the market is 11% and the risk-free

interest rate is 6%. Estimate the firm’s cost of internal equity.
Business
1 answer:
Maurinko [17]3 years ago
6 0

Answer: 12.5%

Explanation:

Given the following :

Beta (B) = 1.3

Marginal tax rate = 34%

Risk free interest rate = 6%

Market rate of return = 11%

The cost of equity is calculated using the relation:

Risk free rate of return + Beta(market rate of return - risk free rate of return)

Cost of equity = 6% + 1.3(11% - 6%)

Cost of equity = 6% + 1.3(5%)

Cost of equity = 6% + 6.5%

Cost of equity = 12.5%

Therefore, the firm's cost of internal equity is 12.5%

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John and his wife Martha get a divorce. Per the divorce settlement contract, Martha agrees to pay John alimony in the amount of
OleMash [197]

Answer:

c) the condition subsequent has occurred;

Explanation:

Since in the question it is given that the John and his wife Martha get a divorce and according to the  divorce settlement contract she agrees to pay the alimony to John for $5,000 per month for his lifetime or until that time when he should remarry

If John remarries after three years, so the alimony benefits is ceased because the subsequent condition has occurred due to which he will not get the amount further in the future

7 0
3 years ago
LO 2.1Explain how the income statement of a manufacturing company differs from the income statement of a merchandising company.
marshall27 [118]

Answer:

Revenue: The revenue of Manufacturing company comes from the sale of the products that they manufacture. However the merchandising company purchases goods from manufacturing companies and distribute them to make it easier for the customer to access the product and earn a profit on it which increases the cost of the product to end consumer. The contract between the manufacturing and merchandising company can be an agreement of principal and agent. In this case, the revenue for the merchandising company would be commission earned from manufacturing company. This commission paid to merchandising company will be cost to manufacturing company.

Cost of Sale: Now the raw material costs plus depreciation of production machinery plus direct labour plus variable Overhead cost plus if their is any commission paid for sale of finished goods will be the cost of sale for manufacturing  company. Whereas in the case of Merchandising company, the cost of sale will be only the cost of goods they sold in the year. The depreciation charge will be minor in merchandising company as they don't have any production machineries.

These the are major difference between manufacturing and merchandising company.

Explanation:

7 0
3 years ago
WV Construction has two divisions: Remodeling and New Home Construction. Each division has an on-site supervisor who is paid a s
timofeeve [1]

Answer:

$258,000

Explanation:

Data given in the question

Salary paid on annual basis to onsite supervisor = $94,000

Salary paid on annual basis to one salaried estimator = $52,000

Two administrative assistant salaries $56,000 and $40,000

Salary of the president = $162,000

So, by considering the above information, the common fixed expense is

= Administrative salaries for one + administrative salaries for another + president salary

= $56,000 + $40,000 + $162,000

= $258,000

6 0
3 years ago
Karishma and Stephen, co-owners of Roundtree Corporation, are discussing a new benefits package they are considering for their e
nalin [4]

Stephen should be more concerned with the shareholder management theory and Karishma should be more concerned with the stakeholder management theory.

The following information should be considered:

For shareholder:

  • It is the owners of the company,
  • It could be equity or preference shareholder.
  • It should be considered when they are limited by shares.

For stakeholder:

  • They are not the owners but have an interest in the company.
  • Each company contains the stakeholder.
  • It includes the creditors, government, etc.
  • It should be considered for the performance of the company.

Therefore we can conclude that Stephen should be more concerned with the shareholder management theory and Karishma should be more concerned with the stakeholder management theory.

Learn more about the management here: brainly.com/question/14874943

6 0
3 years ago
Sb-44 what should you do to avoid capsizing or swamping?
MA_775_DIABLO [31]
A boat become swapped when excessive water enter it through the holes in the bottom. Swapping can lead very quickly to capsizing. The leading causes of swamping include: overloading, improper load distribution in the vessel, free-boards that are unsuitable for sea condition, improper towing, operator errors and mechanical failure. Boat swamping and capsizing can be prevented by avoiding the errors listed above and by checking vessels very well for mechanical faults before using them. 
8 0
3 years ago
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