Answer:
Explanation:
return on preferred stock (rp) = Dividend/ Current price
rate of return = 5.5% or 0.055 as a decimal
Dividend amount = dividend rate * par value ;
Dividend amount = 4.5% * 1000 = $45
Current price = ?
Next, plug the numbers to the formula above to find Price;
0.055 = 45/ Price
0.055Price = 45
Divide both sides by 0.055;
Price = 45/ 0.055
Price = $818.18
Answer:
The present value of the following series of cash flows discounted at 12 percent is:
$171,890
Explanation:
a) Data and Calculations:
Discount rate = 12%
$40,000 now;
$50,000 at the end of the first year;
$0 at the end of year the second year;
$60,000 at the end of the third year; and
$70,000 at the end of the fourth year
Future Value Discount Factor Present Value
$40,000 1 $40,000
$50,000 0.893 $44,650
$0 0.797 $0
$60,000 0.712 $42,720
$70,000 0.636 $44,520
Total present value $171,890
b) The present value is the discounted cash flow from series of future cash flows. The discount factor is applied to the individual cash flows, based on the number of years before the cash flow occurs.
Answer:
Total dollar Annual Cost = $300,000
Explanation:
- Total loan Commitment = 9000000
- Borrowed Fund (Used Portion) = 6000000
- Unused Portion (9000000 - 6000000) = 3000000
- Annual Commitment Fee for unused Portion = 0.50%
- Commitment Fee = 3000000 x 0.05% = 15000
- Borrowed Fund (Used Portion) = 6000000
- Interest Rate (3.25% + 1.5%) = 4.75%
- Interest Cost (6000000 x 4.75%) = 285000
Total dollar Annual Cost (15000 + 285000) = $300,000
<span>The answer for the above question is managerial. When Herbert took a new position at Galbrook Manufacturing Company, the firm was near insolvency. One of Herbert's first acts was to establish specific goals for sales growth and a strategy for achieving them. He also changed the organizational structure and developed an elaborate control system for keeping the company on track. Herbert is functioning in a(n) managerial position at Galbrook Manufacturing.</span>
