Answer:
1) Book Value= $16,464,000
2) Market Value = $19,080,000
Explanation:
The first question is to determine the book value of Klingon's assets today. Book value is the carrying value of the business in its balance sheet.
Book Value = Net working Capital + Current Liabilities + Net Fixed Assets
Net working Capital= $226,000
Current Liabilities= $700,000
Net Fixed Assets= $15,500,000
Book Value = $226,000+ $700,000+$15,500,000= $16,464,000
2) Calculate the market value
The formula for market value = How much the machinery was sold to Romulans today+ today's value of the current assets if they are liquidated
The market value of assets is a function of the current market price they can be sold for and received on the day of the valuation
Market Value= $18,000,000 + $1,080,000= $19,080,000
<span>Family A: marginal rate 20%, average rate 10%</span><span>
Family B: marginal rate 40%, average rate 23% </span><span>
The marginal tax rate is the rate paid on the last dollar of income; this would be whatever tax bracket the family is in. The average price is the total tax divided by the total revenue. </span><span>
Family A: </span><span>
</span><span>
total income $40,000: this includes $10,000 at 0%, $20,000 at 10% (tax of $2,000), and $10,000 at 20% (tax of $2,000). The last rate paid is 20% so that is the marginal rate; the total tax paid is $4,000, divide that by $40,000 total income, that is the average rate. </span><span>
Family B: </span><span>
</span><span>
total income $100,000: this includes $10,000 at 0%, $20,000 at 10% (tax of $2,000), $20,000 at 20% (tax of $4,000), $30,000 at 30% (tax of $9,000), and $20,000 at 40% (tax of $8,000). The last rate paid is 40% so that is the marginal rate; the total tax paid is $23,000, divide that by $100,000 total income, that is the average rate.</span>
Answer:
when valuing companies with temporarily high growth rates.
Explanation:
Discounted dividend models are methods to assess a company's share price based on the dividends that company will distribute in the future. Also known by its name in English dividend discount model (DDM).
These models are based on the theory that the price of a share must be equal to the price of the dividends that the company will deliver, discounted at its net present value.
If the price of the share in the market is lower than the result obtained by the discounted dividend model, the share is undervalued and therefore it is advisable to buy. If, on the contrary, the market price is higher than the model, it is understood that the share price is too high.
Multistage dividend growth models
It is very difficult for a company to experience the same growth every year as the Gordon model assumes, so multistage models assume different growths for each period.
The most common is to use two or three stage growths, where at first the growths are higher but then tend to stabilize at a smaller constant growth. As for example in early stage companies.
Answer:
financial freedom
Explanation:
the reasons people start their own business is usually because they desire financial freedom meaning they would like have more disposable resources for themselves.
Answer:
The question is meant to compare the original ROI and RI before the investment compared to the new investment is ROI and RI
The new investment has a lower return on investment of 11% compared to original 14%
However,the project should be considered since it has $3000 residual income in additional to the original residual income
Explanation:
The return on investment and residual income before the new investment are computed thus:
return on investment=operating income/total assets=$64,000/$400,000=16%
residual income=operating income-(total assets*rate of return)
=$64,000-($400,000*11%)=$20,000
Thereafter,the return on investment and residual income on the new investment are computed thus:
return on investment=operating income/total assets=$14,000/$100,000=14%
residual income=operating income-(total assets*rate of return)
=$14,000-($100,000*11%)=$3,000
