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3 years ago

Which source of investor income is susceptible to double taxation?

1 answer:

3 0

Double taxation is occurs when income taxes are paid twice on the same source of earned income. The income can be taxed at both the corporate level and personal level.
Dividends as a source of investor income is susceptible to double taxation.

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A key determinant of the price elasticity of supply is the a. extent to which buyers alter their quantities demanded in response

inessss [21]

Answer:

d. length of the time period.

Explanation:

The price elasticity of the supply measures the percentage change in the quantity supplied with the percentage change in price

In arithmetically,

The price elasticity of the supply = (percentage change in the quantity supplied ÷ percentage change in price)

It indicates a direct relationship between the quantity supplied and the price.

Moreover, the key determinant of the price elasticity of supply is time period

6 0

4 years ago

The Two Dollar Store has a cost of equity of 11.9 percent, the YTM on the company's bonds is 6.2 percent, and the tax rate is 40

Fofino [41]

Answer: 9.03%.

Explanation:

Given: The Two Dollar Store has a cost of equity of 11.9 percent, the YTM on the company's bonds is 6.2 percent, and the tax rate is 40 percent.

Debt to equity ratio is .54

i.e. $\dfrac{debt}{equity}=\dfrac{0.54}{1}\ ...(i)$

Adding denominator to numerator on both the sides, we get,

$\dfrac{debt+equity}{equity}=\dfrac{1.54}{1}\\\\\Rightarrow\ \dfrac{equity}{debt+equity}=\dfrac{1}{1.54}$

i.e. Weighted equity = $\dfrac{1}{1.54}\ ....(ii)$

From (i)

$\dfrac{equity}{debt}=\dfrac1{0.54}\$

Adding denominator to numerator on both the sides we get,

$\dfrac{equity+debt}{debt}=\dfrac{1+0.54}{0.54}$

$\dfrac{equity+debt}{debt}=\dfrac{1.54}{0.54}$

Thus, weight of debt= $\dfrac{1.54}{0.54}$

Now,

Weighted average cost of capital=(Weight of equity) × (cost of equity)+(Weight of debt)×(Cost of debt)×(1-tax rate)

$\dfrac{1}{1.54}\times (0.119)+\dfrac{0.54}{1.54}\times(0.062)\times(1-0.40)\\\\=0.07727+0.02174(0.60)\\\\=0.07727+0.02174(0.60)\\\\=0.07727+0.013044\\\\=0.090314\approx9.03\%$

Hence, the weighted average cost of capital is 9.03%.

3 0

3 years ago

Why is high quality bond typically considered a lower risk investment than a stock

Solnce55 [7]

A bond typically pays a fixed, predictable amount of interest each year.

8 0

4 years ago

A company purchased $2,900 of merchandise on July 5 with terms 1/10, n/30. On July 7, it returned $320 worth of merchandise. On

DerKrebs [107]

Answer:

C) 2,554

Explanation:

When a company purchase a merchandise inventory on account, the journal entry to record the merchandise inventory is -

July 5 Merchandise Inventory Debit $2,900

Accounts payable Credit $2,900

After returning the merchandise of $320, the due amount = $(2,900 - 320) = $2,580

As the supplier sets the term as 1/10, n/30, it means if the buyer pays within 1 day, the purchaser will receive a 1% discount, but has to pay the amount within 30 days.

As the company pays the amount within 4 days of purchase (July 5 to July 8), the company will get the discount after the sales return.

Therefore, the company will pay cash = $2,580 - ($2,580 × 1%)

= $2,580 - 26

= $2,554

Therefore, option c is the correct answer.

8 0

3 years ago

An effective vision stretches and challenges people and can result in increased innovation as illustrated by Apple's CEO Steve J

sergey [27]

Answer:

True

Explanation:

A vision is something that can be seen so that will people can be motivated to move towards it. An effective vision is a vision that has a direction, clear, purposeful, challenging, unique and inspiring to people working towards the vision.

Important characteristics of an effective vision is that it be purposeful and challenging. An effective vision is said to be purposeful when it the organisation and its people derive a a larger sense of purpose from it making them to feel as part of something bigger. An effective vision is challenging when it challenges, stretches and sets a high standard for the company.

Therefore, an effective vision stretches and challenges people and can result in increased innovation as illustrated by Apple's CEO Steve Jobs.

6 0

4 years ago