Answer:
Cost of external equity= 26.9%
Explanation
<em>According to the dividend valuation, the value of a stock is the present value of expected future dividends discounted at the required rate of return.</em>
The model can me modified to determined the cost of equity having flotation cost as follows:
Ke = D(1+r )/P(1-f) + g
Ke= Cost of equity
D- current dividend,
D(1+g) - dividend next year
p- price of stock - 31,00$
f - flotation cost - 14%
g- growth rate - 7%
Ke= 5.30/31× (1-0.14) + 0.07
= 0.2687997 × 100
= 26.9%
Answer:
Variable cost per unit= $7.2 per unit
Explanation:
Giving the following information:
Month Total Maintenance Costs Total Machine Hours
January: $2,590 - 330
February: $2,890 - 380
March: $3,490 - 530
April: $4,390 - 660
May: $3,090 - 530
June: $5,470 - 730
To calculate the variable cost under the high-low method, we need to use the following formula:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (5,470 - 2,590) / (730 - 330)
Variable cost per unit= $7.2 per unit
Answer:
$84,000
Explanation:
preference share dividend is at 5% on $100 par value. The number of preference shares is 12,000 shares ( non cumulative)
The year 2017 preference share dividend pay out is 5% of 100 multiplied by 12,000 = $60,000
Deduct $ 60,000 from $144,000 dividend declared in 2017 , the balance is common stockholders dividend.
144,000 minus 60,000 = $84,000
Non cumulative preference shares dividend are paid first for the year the company declares dividend. The dividend is not cumulative ( prior years dividend for which company did not declare dividend are forfeited).
The common stockholders are paid dividend after preference shares dividend are paid. The common stockholders bears the full risk of the business as seen above. In event of liquidation, they are the last to be settled from realised asset of the bankrupt company.
Search up A gardener can increase the number of dahlia plants in an annual garden by either buying new bulbs each year or dividing the existing bulbs to create new plants . The table below shows the expected number of bulbs for each method
Part A
For each method,a function to model the expected number of plants for each year
Part B
Use the Functions to Find the expected number of plants in 10 years for each method.
Part C
Answer:
$800
Explanation:
The amount of student loan interest can Zach and his spouse deduct in 2018:
Education expenses:
= Incurred expenses - Scholarship
= $10,000 - $2,000
= $8,000
⇒ 
= 80%
Interest incurred:
= Federal loan interest + Lending loan interest
= $700 + $300
= $1,000
Therefore, the amount of student loan interest can Zach and his spouse deduct in 2018 is = Interest incurred × Education expenses percent
= $1,000 × 80%
= $800