Answer:
Yield to Maturity(YTM) = 3.47%
Explanation:
<em>The yield to maturity is the required rate of return (discount rate) that would equate the price of the bond and cash outflow expected from the bond. The yield on the bond can be determined as follows using the formula below: </em>
YTM = C + F-P/n) ÷ 1/2 (F+P)
YTM-Yield to maturity-
C- coupon
F- Face Value
P- Current Price
DATA
Coupon = coupon rate × Nominal value = 1,000 × 8%× 1/2=40(note we divide by 2 because interest is paid semi-annually)
n= 4×2 = 8 (note there 2 half months in a year)
Face Value = 1000
YM-?, C-40, Face Value - 1,000, P-103.75/100× 1000 = 1037.5
YM = (40 + (1000-1037)/8) ÷ ( 1/2× (1000 + 1037.5 ) ) =0.0347
YM = 0.0347
× 100 = 3.47%
Yield to Maturity = 3.47%
Answer:
Ending cash balance = $13,000
Explanation:
<em>A cash budget is statement that shows the estimated cash receipts and the estimated cash payments for a forth coming accounting period. In addition, it provides information about the expected cash balance for the period to which it relates.</em>
With help of a cash budget, a business can plan ahead for the usage of its surplus funds and how to finance its deficit cash position
Ending cash balance = Beginning cash balance + cash receipts - cash payment
= 3,000 + 50,000 - 40,000
Ending cash balance = $13,000
Answer:
Pretax income= $28,000
Explanation:
Giving the following information:
A company produces a product with a contribution margin per unit of $36. The company incurs $62,000 in total fixed costs and expects to sell 2,500 units.
The pretax income is calculated by deducting from the total contribution margin the fixed costs.
Pretax income= 2,500*36 - 62,000= $28,000
Answer:
Residual income will be $13200
So option (c) will be correct answer
Explanation:
We have given Sales = $840000
Average operating assets = $340000
Desired ROI = 12%
Net income = $54000
We have to find the residual income
Residual income is given by
Residual income = Net income - ( Average operating assets× desired ROI )
= $54000 - ( $340000 ×0.12 ) = $13200
So option (c) will be correct answer
Answer:
6%
Explanation:
Implied interest rate = (Future value / present value)^(1/n) - 1
n = number of years
($15,036.30 / $10,000) ^(1/7) - 1
1.503630^(1/7) - 1
= 1.06 - 1 = 0.06 = 6%
