Answer:
is a level stream of equal payments through time.
true. The payments will remain at the same levle for the entire period of the annuity until maturity.
Explanation:
is a debt instrument that pays no interest.
FALSE the annuity does provide interest for each period when is prepared.
Has no value.
FALSE the annuity can be saled in the secondary market pretty much anitime.
is a stream of payments that varies with current market interest.
FALSE the payment will be the same regardless of the interest rate.
Answer:
$7,120
Explanation:
Given that,
Assets = $85,900
Liabilities = $13,500
Fair value of assets = $90,500
Fair value of its liabilities = $13,500
Amount paid to acquire all of its assets and liabilities = $84,120
Net assets:
= Fair value of assets - Fair value of its liabilities
= $90,500 - $13,500
= $77,000
Goodwill = Purchase consideration - Net assets
= $84,120 - $77,000
= $7,120
<span>Preferred stock which confers rights to prior periods' unpaid dividends even if they were not declared is called: </span>Cumulative preferred stock
In cumulative preferred stocks, the amount of dividend usually given on a fixed-rate annually. But, it shall always be set aside before calculating the dividend for the common stock and the amount will be accrued for the next period if the dividend is not paid on current period.
Answer:
Amount for each stock to be paid at maximum = $54
Explanation:
Using Dividend growth model, we have,
Where 
= Expected price of share today
= Dividend to be paid at this year end
= 
= Required return on investment
g = Growth rate
Therefore,
= = $3 + 8% = $3.24
= $54
Therefore, current price for this share or sock to be paid = $54 per share.
Answer:
Total cash collection= $53,000
Explanation:
Giving the following information:
Sales:
February $60,000
March $50,000.
Cash:
40% of the sales are in cash.
Credit sales:
50% in the month of sale
50% in the next month
<u>Cash receipts March:</u>
Sales in cash March= (50,000*0.4)= 20,000
Sales on account March= (50,000*0.6)*0.5= 15,000
Sales on Account February= (60,000*0.6)*0.5= 18,000
Total cash collection= $53,000
