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alexira [117]
2 years ago
15

A firm has the balance sheet accounts, Common Stock and Paid-in Capital in Excess of Par, with values of $40,000 and $500,000, r

espectively. The firm has 40,000 common shares outstanding. If the firm had a par value of $1, the stock originally sold for ________.
Business
1 answer:
Mrac [35]2 years ago
8 0

Answer:

$13.50/share

Explanation:

500000/40000=12.5$

was purchased for 1$

total=1+12.5$

$13.50/share

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A company looking to expand internationally with little risk would choose?
leva [86]

Answer:

  • Licensing
  • Franchising

Explanation:

There are no options but Licensing as well as Franchising are some of the least riskiest ways to expand internationally.

With Licensing, the company looking to expand simply sells licenses to various companies in different countries giving them the right to use their image. Basically, the company the license is sold to gets access to the seller's intellectual property but then can run their business with a significant degree of autonomy.

Franchising represents another way to expand with little risk. It involves a company giving a license to another company to sell and sometimes produce their products as well as image rights. The company will give the franchisee (company that gets the license) the knowledge and training required to maintain the franchise and in exchange, franchisee pays a fee.

Both of these methods ensure that the name and brand of a company spread internationally whilst making money from it. Risk is minimized because the investment in other countries is low to nothing.

3 0
3 years ago
American​ Exploration, Inc., a natural gas​ producer, is trying to decide whether to revise its target capital structure. Curren
Marat540 [252]

Answer:

a) 9.00 %

b) 7.80 %

c) yes the weight of the debt increases here is more risk in the investment as the debt payment are mandatory and failing to do so result in bankruptcy while the stock can wait to receive dividends if the income statement are good enough

d) 9.00  %

e) The increase in debt may lñead to an increase in return of the stockholders if they consider the stock riskier than before and will raise their return until the WACC equalize at the initial point beforethe trade-off occurs

Explanation:

a)

WACC = K_e(\frac{E}{E+D}) + K_d(1-t)(\frac{D}{E+D})

Ke 0.12

Equity weight 0.5

Kd(1-t) = after tax cost of debt = 0.06

Debt Weight = 0.5

WACC = 0.12(0.5) + 0.06(0.5)

WACC 9.00000%

c)

WACC = K_e(\frac{E}{E+D}) + K_d(1-t)(\frac{D}{E+D})

Ke 0.12

Equity weight 0.3

Kd(1-t) = after tax cost of debt = 0.06

Debt Weight 0.7

WACC = 0.12(0.3) + 0.06(0.7)

WACC 7.80000%

d)

WACC = K_e(\frac{E}{E+D}) + K_d(1-t)(\frac{D}{E+D})

<em>Ke 0.16</em>

Equity weight 0.3

Kd(1-t) = after tax cost of debt = 0.06

Debt Weight 0.7

WACC = 0.16(0.3) + 0.06(0.7)

WACC 9.00000%

3 0
3 years ago
If we want to use a measure of inflation that foreshadows price changes before they affect prices at the retail level, we would
Elza [17]

Answer: Producer price index

Explanation:

The producer price index is used to know the average differences in prices that are received by local producers for their output.

To calculate the producer price index, the current prices gotten by the sellers of a good or service is divided by the prices of the good or service using a base year and multiplying the result by 100. The producer price index is also a measure of inflation in an economy.

4 0
3 years ago
Stadford Inc. is financed with 40 percent debt and 60 percent equity. This mixture of debt and equity is referred to as the firm
lesya692 [45]

Answer: Capital structure                            

Explanation: In simple words, capital structure refers to the proportion of different securities that an organisation uses as a combination to fund its operations. In other words, the amount of debt and equity in total capital in hand of the business is termed as capital structure.

Capital structure is of high importance to the investors as it directly impacts the liquidity and profitability of the organisation.

The ability of a company to bear its short term obligation is called liquidity and the ability to generate profit with given amount of resources is called profitability.

8 0
3 years ago
Scenario planning is a useful technique for firms competing in industries characterized by __________ and ____________.
Gnom [1K]
The blank spaces will be filled by these words:
1) U<span>npredictability
2) Change

Scenario planning or as is alternatively called Scenario thinking, is a vital planning strategy which is used by some associations to make adaptable long term plans. It is an adjustment and adaption of classical techniques used by military intelligence.
</span>
6 0
3 years ago
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