Answer:
The correct answer is letter "C": "Mission Statement".
Explanation:
A company's mission statement represents the objective that the firm must set. That objective must last and should be adaptable to the changes it could be exposed to. It clearly states the purpose of the company and why it exists and operates. The mission statement also identifies by whom the entity is formed and their respective functions.
Answer:
The required rate of return for the project will be 13.087%
Explanation:
To calculate the required rate of return for the project, we must first calculate the required rate of return for the firm's equity. The required rate of return can be calculated using the CAPM or Capital Asset Pricing Model equation. The formula for required rate of return (r) under this model is,
r = rRf + Beta * rpM
Where,
- rRF is the risk free rate
- rpM is the risk premium on market
r = 0.027 + 1.23 * 0.069
r = 0.11187 or 11.187%
The discount rate that is usually used for an all equity firm is its required rate of return. Thus, the required rate of return for the project will be,
r = 0.11187 + 0.019
r = 0.13087 or 13.087%
Answer:
$600
Explanation:
The written down amount is $725, which is bad debt and provision is not required for it.
The increase in allowance for bad debt is always Written Off by using the provision and at the year end the amount that must have been written off is $600 which is the increase in the provision. This means that the Allowance for Bad Debts is $600.
Answer:
The required rate of return is 12.2%
Explanation:
Dividend growth model is used to calculate the price of the stock based on the dividend, its growth and required rate of return.
Formula to calculate the price
Price = Dividend / ( Required rate of return - Growth rate )
P = D / ( r - g)
P = $11.54
D = $0.95
g = 4%
Now placing the given values in the formula
$11.54 = $0.95 / ( r - 4% )
r - 4% = $0.95 / $11.54
r - 4% = 8.2%
r = 8.2% + 4%
r = 12.2%
Answer:
Dr interest expense $2448
Dr interest payable $3060
Dr Notes payable $61,200
Cr cash($2448
+$3060
+$61,200) $ 66,708.00
Explanation:
The interest accrued at 31st December 2022 is interest for 5 months which is calculated thus:
interest as at 31st December=5/12*12%*61,200=$3060
On that interest expense would have been debited while interest payable is credited with $3060
On the due date, interest for another months need to computed as follows:
interest for four months=4/12*12%*61,200=$2448
