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Kamila [148]
4 years ago
13

Mooradian Corporation's free cash flow during the just-ended year (t = 0) was $150 million, and its FCF is expected to grow at a

constant rate of 5.0% in the future. If the weighted average cost of capital is 12.5%, what is the firm's value of operations, in millions?
Business
1 answer:
Savatey [412]4 years ago
8 0

Answer:

Firm's value of operations = $2,100 million

Explanation:

Using the growth model we have

Free cash flow at t=1 = $150 million + 5% expected growth = $157.5 million

Weighted average cost of capital = 12.5%

Therefore with growth rate = 5%

We have present value of firm's operations = \frac{157.5 million}{0.125 - 0.05} = \frac{157.5 million}{0.075} = $2,100 million

Firm's value of operations = $2,100 million

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Hyu Corporation bases its predetermined overhead rate on the estimated labor-hours for the upcoming year. At the beginning of th
Juliette [100K]

Answer:

The predetermined overhead rate for the recently completed year would be $25.66

Explanation:

The predetermined overhead rate is computed as;

= Total estimated manufacturing overhead / estimated direct labor

Where;

Total estimated manufacturing overhead = Estimated total fixed manufacturing overhead + estimated variable manufacturing overhead rate × estimated labor hours

= $1,196,840 + $2.82 × 52,400

= $1,196,840 + $147,768

= $1,344,608

Therefore,

Predetermined rate = $1,344,608 / 52,400 hours

Predetermined rate = $25.66

5 0
3 years ago
The standard quantity allowed for the units produced was 4,500 pounds, the standard price was $2.50 per pound, and the materials
Firdavs [7]

Answer:

Actual pounds used =4,350

Explanation:

<em>T</em><em>he material quantity variance</em><em> is the difference between the actual quantity of material used and the standard quantity and the difference multiplied by the standard price per quantity.  </em>

<em>                                                                                             Pound</em>

Standard quantity                                                              4500

Actual quantity                                                                 ___y___

Quantity variance (                                                           <u>4,500 - y favourable</u>

Variance in ($) = (4500 -y ) ×  $2.50

                  375 = 11,250  - 2.50y

                2.50y = 11,250 - 375

                            = (11,250-375)/2.50

                            = 4,350

Actual pounds used =4,350

5 0
3 years ago
Paris operates a talent agency as a sole proprietorship, and this year she incurred the following expenses in operating her tale
Marrrta [24]

Answer:

The total deductible amount of these expenditures is $450.

Explanation:

Half of any cost of meals and entertainment to which business discussion is associated and appropriate records kept is allowed to be deducted.

Since it is only tickets to the opera with a client following a business meeting that meet this condition, 50% of the total amount of $900 which is $450 is deductible.

3 0
4 years ago
To purchase a home, a buyer obtained a $42,500 mortgage loan at 9 3/4% interest for 25 years. The mortgage loan closed on June 1
WINSTONCH [101]

Answer: A. $184.17

Explanation:

$42,500 x 9.75% = $4,143.75

$4,143.75 ÷360 = $11.51

$11.51 x 16 days = $184.17

A. The buyer paid $184.17 in interest

8 0
4 years ago
A correlation coefficient shows that alcohol consumption and driving accidents are indeed related. as a result, a researcher cou
weeeeeb [17]

I believe the answer is: the number of driving accidents a person has will go up or down based on the number of  alcoholic drinks consumed

Consuming alcohol would impair the overall function of your brain. This would make your reflex time become significantly slower compared to your capability before consuming the alcohol. Because of this slower reaction, the risk of being involved in driving accidents would also be increased.

5 0
3 years ago
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