Answer:
1.17%
Explanation:
Expected return is 15.1 %
Risk free rate is 5.95 %
Market risk premium is 7.8%
Therefore the beta can be calculated as follows
Expected return= risk free rate + (beta×market risk premium)
15.1%= 5.95% + (beta × 7.8%)
15.1%-5.95%= 7.8% beta
9.15%= 7.8% beta
beta= 9.15%/7.8%
beta= 1.17%
Answer:
The total amount of assets is 15,750.
Explanation:
Reproducing the trial balance below for clarity:
Account Title Debit Credit
Cash 12,500
Accounts Receivable 3,250
Accounts Payable 2,800
Common Stock 6,600
Retained Earnings 4,500
Service Revenue 7,450
Operating Expenses 5,100
Dividends 500
Total 21,350 21,350
Calculation of Total Assets:
Total assets = Cash + Accounts Receivable
= 12,500 + 3,250
= 15,750
Note that among the given accounts, accounts cash and accounts receivable are assets; accounts payable is a liability; common stock and retained earnings are part of the capital; service revenue is a form of revenue; while operating expenses and dividends are expenses.
Answer: c. $94,240
Explanation:
On December 31, 2005, one payment has already been made which would mean that only 7 payments are left. As the first of these remaining 7 will be paid the year after, this is an ordinary annuity.
Note payable value = Present value of seven $20,000 payments
= 20,000 * Present value of ordinary annuity of 1 at 11% for 7 years.
= 20,000 * 4.712
= $94,240
Answer:
c. Its low barriers to entry expose Northern to increased risk of competition, which could negatively affect the predictability of its expected future sales revenues.
Answer: The effect will be that the results will be distorted by registering a gain in the incorrect period, since 3 months correspond to the current year, from October-December and the rest corresponds from January-March of the following year.
The correct way to record these 3 months is as a liability (deferred income) when the income is realized they are taken to the income statement.
