Answer: .27
Explanation:
The Debt to Equity Ratio is the amount of Debt per dollar that the company owes per dollar of Equity. It must add up to 1.
The Weighted Average Cost of Capital measures just how much a company needs to pay to it's capital holders including shareholders and debt holders.
The formula is,
WACC = (Cost of equity * Weight of equity) + (Cost of debt * Weight of debt)
Remember that Debt is tax deductible so the After tax cost of debt should be,
= 5.2% ( 1 - tax rate)
= 5.2% * ( 1 - 39%)
= 3.172%.
The debt weight is the amount of debt that the company has per dollar so that means that it is also the Debt to Equity ratio. Denote it as 'x' to find it. Remember that they must add up to one.
WACC = (Cost of equity * Weight of equity) + (Cost of debt * Weight of debt)
8.59% = 10.6% ( 1 - x) + 3.172%( x)
8.59% = 10.6% - 10.6%x + 3.172%x
8.59% = 10.6% - 7.428%x
7.428%x = 10.6% - 8.59%
7.428%x = 2.01%
x = 0.271
= 27%
Debt to Equity is 0.27.
Answer:
The answer is E. a unit of account; a medium of exchange
Explanation:
Because they allows different things to be compared against each other; for example, goods, services, assets, liabilities, labour income, expenses.
A unit of account is a monetary unit of measurement of value or cost.
And the second is a medium of exchange because $3 is being used to buy cone. It exchanged money for cone.
Answer:
D) Credit to Merchandise Inventory for $4,000
Explanation:
Date Account and Explanation Debit ($) Credit ($)
Account Receivable 5,800
Sale 5,800
(Recorded the sale on credit)
Cost of goods sold 4,000
Merchandise Inventory 4,000
(Recorded the cost of goods sold)
