Answer:
<u>Hence $21,700,000 shares are to be sold to raise the needed funds.</u>
Explanation:
Per-share offer price of company = $60, which includes company's underwriter spread of 5%
So, actual realization to company on $60 per share = (1 - 0.95) * 60
Actual realization to company on $60 per share = $ 3
To raise $64 million company also needs to cover administrative expenses of $1.2 million
So,
Total number of shares sold(in million) = (64 + 1.2)/3
Total number of shares sold = 21,700,000 shares
Answer:
.66; .34
Explanation:
Calculation of weight of the stock and weight of the risk free asset
stock expected return = 17.3%
stock beta value = 1.48
risk free asset beta value is = 0
risk free asset return = 4.6
portfolio beta is = 0.98
let taken weight of the stock is X
so weight of the risk free asset is = 1-X
portfolio beta = stock weight*beta+riskfree weight*beta
0.98 = X*1.48+(1-X)*0
0.98= 1.48X+0
1.48X= 0.98
X = 0.66
66%
weight of the risk free asset is = 1-0.66
= 0.34
= 34%
Answer:
$32,419
Explanation:
I prepared an amortization schedule using an excel spreadsheet. The monthly payment is $673.32:
year beginning scheduled principal interest ending
balance payment balance
1 $33,333 $673.32 $456 $218 $32,877
.45
2 $32,877 $673.32 $459 $215 $32,418.91
The outstanding balance after the second payment = $32,418.91 ≈ $32,419
Answer:
Using the units-of-production method, the amount of depreciation expense the company would report in the income statement prepared for the year-ended October 31, 2018 would be $105,711.
Explanation:
The unit-of-production method is used when the asset value closely relates to the units of output it is able to produce. It is expressed with the formula below:
(Original Cost - Salvage value) / Estimated production capacity x Units/year
Depreciation expense (DE) is: ($520,500 - $5,500) / 28,500 operating hours x 11,700 hours = $211,421 yearly depreciation expense.
Depreciation from May 1 to October 31, 2018 (6 months): $211,421 / 2 = $105,711
