You are trying to determine the appropriate price to pay for a share of common stock. if you purchase this stock, you plan to ho
ld it for 1 year. at the end of the year you expect to receive a dividend of $2.50 and to sell the stock for $125. the appropriate rate of return for this stock is 10 percent. what should be the current price of this stock
1 answer:
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Answer:
Please see the attached image for the Horizontal Financial Statements of Sinclair Manufacturing Company.
Explanation:
5. FURNITURE - Straight Line Method
Book Value of Furniture = Cost of Acquisition - Residual Value
Cost of Acquisition = $9,600
Residual Value = $1,600
Book Value of Furniture = $9,600 - $1,600
Book Value of Furniture = $8,000
Useful Life = 4 years
Depreciation Expense = $8,000 / 4 years
Depreciation Expense = $2,000 per year
6. EQUIPMENT - Straight Line Method
Book Value of Equipment = Cost of Acquisition - Residual Value
Cost of Acquisition = $16,000
Residual Value = $1,000
Book Value of Furniture = $16,000 - $1,000
Book Value of Furniture = $15,000
Useful Life = 5 years
Depreciation Expense = $15,000 / 5 years
Depreciation Expense = $3,000 per year
