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3 years ago

Equipment with a cost of $150,000 has an accumulated depreciation of $50,000. what is the historical cost of the equipment?

1 answer:

4 0

Historical cost refers to the original cost of the equipment, which is shown as an asset in on the balance sheet. Whenever the company purchased the equipment, that price is what stays. In this case, the original cost of the equipment is $150,000, so the historical cost is $150,000.

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The most recent financial statements for Schenkel Co. are shown here: Income Statement Balance Sheet Sales $ 14,500 Current asse

Katena32 [7]

Answer:

0.1046 or 10.46%

Explanation:

The computation of the sustainable growth rate is shown below:

The Sustainable growth rate of the firm is

= Return on Equity × ( 1 - Dividend Payout Ratio )

where,

Dividend Payout Ratio = 30%

And,

Return on equity is

= Net Income ÷ Shareholder 's equity

= $3660 ÷ $ 24,500

= 0.14938

So,

Sustainable growth rate is

= 0.14938 × (1 - 30%)

= 0.1046 or 10.46%

8 0

3 years ago

For most companies, the web ______ the threat that new competitors will enter the market by ______ traditional barriers to entry

Andrei [34K]

Answer: b. Increases, decreasing

Explanation: For most companies, the web increases the threat that new competitors will enter the market by decreasing traditional barriers to entry. Traditional barriers to entry include

a. Economies of scale

b. Product differentiation

c. Capital requirements

d. Switching costs

e. Access to distribution channels

f. Cost disadvantages

g. Government policy

thus, by reducing some of these barriers to entry the Web increases the threat of new competition.

7 0

3 years ago

Biden Resorts Company currently has 0.2 million common shares of stock outstanding and the stock has a beta of 2.2. It also has

frutty [35]

Answer:

Hence, the weighted average cost of capital is 15.87%.

Explanation:

We have to find current weights,

Value of equity = Shares x Share price = 0.2 x 10 = $2 million

Face Value of Bonds FV = $1 million

Semi annual coupon P = 1 x 8% / 2 = $0.04 million

Number of coupons remaining n = 5 x 2 = 10

Semi annual yield r = 13.65% / 2 = 6.825%

Value of Debt = Px [1 - (1 + r)-n] / r + FV / (1 + r)n

= 0.04 x [1 - (1 + 0.06825)-10] / 0.06825 + 1 / (1 + 0.06825)10

= $0.8 million

Total Value = 2 + 0.8 = $2.8 million

Weight of Debt = 0.8 / 2.8 = 28.57%

Weight of Equity = 2 / 2.8 = 71.45%

Amount of Debt to be raised = Weight of debt x Capital

= 0.2857 x 7.5

= $2.14 million

Since the amount of debt to be raised is less than $2.5 million, the yield will be 13.65%

Cost of Equity = Risk Free Rate + Beta x (Market Return - Risk Free Rate)

= 3% + 2.2 x (10 - 3)

= 18.4%

The weighted average cost of capital:-

WACC = Weight of Debt x Cost of Debt x (1 -Tax Rate) + Weight of Equity x Cost of Equity

= 0.2857 x 13.65% x (1 - 0.3) + 0.7145 x 18.4%

= 15.87%

8 0

3 years ago

Ethical formalists maintain that

andrew-mc [135]

Ethical formalists maintain that moral judgement should be based on logical form,that is,like laws that should be obeyed,rather then by their content,that is,judgement about activities or people.

3 0

3 years ago

If 25% of the common stock of an investee company is purchased long term investment the appropriate method of accounting for the

Lina20 [59]

Answer:

b. the equity method.

Explanation:

The equity method is used when the investor company will own approximately 20% to 50% of the common stock of the investee company. This method is used because the investor company will have significant influence over the actions taken by the investee company. The investee company will generally be considered an affiliate company, but not a subsidiary.

8 0

3 years ago

Equipment with a cost of​ $150,000 has an accumulated depreciation of​ $50,000. what is the historical cost of the​ equipment?

Equipment with a cost of $150,000 has an accumulated depreciation of $50,000. what is the historical cost of the equipment?