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viktelen [127]
2 years ago
15

justify your answer by explaining how the weighted average cost of capital for the company would change if clark uses bank debt

to finance all or a portion of the building purchase.
Business
1 answer:
DochEvi [55]2 years ago
4 0

Justify your response by describing how using bank debt to finance all or part of the building purchase would affect the company's weighted average cost of capital.

What is WACC?

The weighted average cost of capital (WACC), which includes common stock, preferred stock, bonds, and other types of debt, is the average after-tax cost of capital for a company. WACC is the typical interest rate a business anticipates paying to finance its assets. Because it expresses the return that both bondholders and shareholders require in order to provide the company with capital in a single value, the weighted average cost of capital is a popular method for calculating the required rate of return.

She mostly used her own money to launch the company, demonstrating that she started with equity rather than debt. She isn't starting out with a lot of debt, therefore the needed rate of return would be below the average. She may now concentrate on growing the business rather than making ongoing debt payments. Due to decreased investment, the total rate of return ought should be lower. To be able to market what they produce, all they truly needed was indeed a retail location. This was not there in their prior store facility, which doubled as their kitchen.

Because they truly lack any debt to begin with, Clark can utilize some bank debt. She can then experience failing(defaulting) on the loan she obtained. This would be primarily caused by her not having enough money to be able to pay down the debt effectively

To learn more about WACC, click on the link below –

brainly.com/question/28042295

#SPJ4

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Debbie Brooks and Martha Tingstrom lived together. Tingstrom handled their finances. For five years, Brooks did not look at any
GaryK [48]

Answer:

Forgery refers to the crime pertaining to, alternation of legal obligation or rights in writing of another person. It is the production of the spurious work which is being considered to be genuine such as a painting, and coin. It is the action underlying imitation or forging a copy of the document, banknote, work of art and signature.

In the case, Debbie Brooks is solely responsible for the loss caused to her by the forged transaction. The fraud took place due to the recklessness of Debbie Brooks as she allowed Martha Tingstrom to handle her financial resources and accounts which in itself is a mistake. She failed to notice the transaction details promptly issued to her periodically  by her bank and provided the details of such transaction to the bank within a period of 30 days. The bank is not liable as it has perform its obligation to the fullest. Therefore, it is ascertained that Debbie Brooks is solely responsible for the loss caused to her by the forged transaction made by Martha Tingstrom.

Explanation:

4 0
3 years ago
Read 2 more answers
The __________ assures the payment of otherwise non-collectable court judgments against licensees who have committed fraud, misr
Finger [1]

The SAFE act assures the payment of otherwise non-collectable court judgments against licensees who have committed fraud, misrepresentation, deceit, or conversion of trust funds in a transaction.

<h3>What is the SAFE act?</h3>

This was the act in the United States that made it mandatory for houses to be registered and licensed.

The act is based on houses that are used as residences. The full meaning of the act is the  Secure and Fair Enforcement for Mortgage Licensing Act.

The main purpose of the SAFE act is to try to ensure that consumers are protected and also help in the reduction of fraud. This would be done by setting a standard for licensing and the originators of mortgage loans.

Hence the correct answer to the question is the SAFE act.

Read more on court judgement here; brainly.com/question/14077067

#SPJ1

4 0
2 years ago
Jansen Company’s general ledger showed a checking account balance of $25,120 at the end of May 2021. The May 31 cash receipts of
Alexxandr [17]

Answer:

$2,000

Explanation:

Use the format

Jansen Company’s

Bank reconciliation as of May 31, 2013.

Balance as per Bank Statement

Add Outstanding Checks

Less Unpresented Checks

Balance as per Cash Book

5 0
3 years ago
The perfect tender rule required that the seller __________________________________. reject the goods in part if they are not a
Hitman42 [59]

Answer:

The correct answer is letter "E": deliver goods in conformity with the contract.

Explanation:

The perfect tender rule states that in a sales contract of goods, the seller must provide the buyer with the products that match perfectly the buyer's need. This rule is opposed to the <em>substantial performance</em> that states that at least part of the contract agreed must be fulfilled so that it can be considered legit.

6 0
3 years ago
Dividends paid to a company's own stockholders of $80,000 would be shown on the company's statement of cash flows prepared under
7nadin3 [17]

Answer: d. a deduction of $80,000 under financing activities.

Explanation:

Under the indirect method of showing cashflows, there are 3 sections being the Operating section, the investing section and the financing section.

The relevant section is the financing section. Financing activities are those transactions that relate to the business raising capital to fund their operations. They do this through long term debt and equity.

Dividends is a payment to shareholders and so falls under equity so by extension falls under the financing section. As dividends reduce the amount of money the company has, it is also a deduction.

6 0
3 years ago
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