It is True, that both, current assets and non-current assets should be reassessed in order to determine the market value of a business.
<h3><u>What are current assets and non-current assets?</u></h3>
- Short-term assets, or those that can be swiftly sold and utilised for a company's urgent requirements, are known as current assets. Non-current Assets are long-term and have an operational life of over a year.
- Cash, marketable securities, inventories, and accounts receivable are a few examples of current assets. Long-term investments, real estate, PP&E, and trademarks are a few examples of noncurrent assets.
- Noncurrent assets are often valued at cost minus depreciation whereas current assets are frequently valued at market pricing.
- Profits from the sale of assets held for more than a year are subject to capital gains tax (noncurrent assets).
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Solution :
a). The current market value of the unlevered equity
= $ 40.45 million
b). The market value of the equity one year from now is
= $ 44.5 million - $ 18 million
= $ 26.5 million
c). The expected return on the equity without the leverage = 10%
The expected return on the equity with the leverage = 
= 0.93 %
d). The lowest possible value of equity without the leverage = $20 million - $ 18 million
= $ 2 million
The lowest return on the equity without the leverage = 10%
The lowest return on the equity with the leverage = 2 % as the equity is eroded.
Answer:
$45.99
Explanation:
Calculation for the applied factory overhead per unit for the Great P model
First step is to Calculate the total direct labour cost of High F and Great P
High F $175,200
($10,000*$17.52)
Great P $210,240
($16,000*$13.14)
Total direct labour cost $385,440
Second step is to calculate the factory overhead rate
Using this formula
Factory overhead rate=Budgeted factory Overhead cost/Allocation base
Let plug in the formula
Factory overhead rate=$1,349,040/$385,440
Factory overhead rate=350%
Now let calculate factory overhead per unit for the Great P
Direct labor cost per unit of product Great P $13.14
Great P Factory overhead per unit =$13.14*350%
Great P Factory overhead per unit =$45.99
Therefore Using the firm's volume- based costing, applied factory overhead per unit for the Great P model is $45.99
