Answer:
P₀ = $59.45
Explanation:
the numbers are missing so I looked for a similar question:
- expected EPS = $2.775
- retain 0% of earnings (years 1 - 2)
- retain 48% of earnings (years 3 - 4)
- then retain 23%
- expected return on new projects = 22.4%
- Re = 10.7%
growth rate = retention rate x return on new projects
g₁ = not given EPS₁ = $2.775
g₂ = 1 x 22.4% = 22.4% EPS₂ = $3.3966
g₃ = 1 x 22.4% = 22.4% EPS₃ = $4.1574
g₄ = 0.48 x 22.4% = 10.752% EPS₄ = $4.6044
g₅ = 0.48 x 22.4% = 10.752% EPS₅ = $5.0995
g₆ = 0.23 x 22.4% = 5.152% EPS₆ = $5.3622
dividend payout ratio expected dividend
year 1 = 0 $0
year 2 = 0 $0
year 3 = 0.52 $2.1618
year 4 = 0.52 $2.3943
year 5 = 0.77 $3.9266
year 6 = 0.77 $4.1289
since the growth rate became constant at year 6, we can find the terminal value for year 5:
terminal value year 5 = $4.1289 / (10.7 - 5.152%) = $74.4214
P₀ = $0/1.07 + $0/1.07² + $2.1618/1.07³ + $2.3943/1.07⁴ + $3.9266/1.07⁵ + $74.4214/1.07⁵ = $0 + $0 + $1.7647 + $1.8266 + $2.7996 + $53.0614 = $59.45
Answer:
5,300
Explanation:
Given that,
contribution margin per unit = $7
selling price = $45 per unit
Fixed costs = $35,000
Total fixed cost after increase:
= $35,000 + $20,650
= $55,650
contribution margin per unit after increase:
= $7 + (50% × $7)
= $7 + $3.5
= $10.5
Therefore,
New Break even point:
= Fixed cost ÷ Contribution per unit
= $55,650 ÷ $10.5
= 5,300
The answer to the question above is "a formal contract". A formal contract is a type of contract which written, valid, binding the parties, and negotiable. Durham and Estelle are bound to do the transaction of the truck with the written check form. This check form has every trait of a formal contract which is signed, valid and binding, therefore, the check for the truck payment is a formal contract<span>.</span>
Answer:
Sally (the buyer) should pay $865.58 and the seller should pay $368.42.
Explanation:
First we must determine property taxes per day = $1,234 / 365 = $3.38 per day
The seller is responsible for the property taxes until the closing date = 31 days for January + 28 days for February + 31 days for March + 19 days for April = 109 days x $3.38 per day = $368.42
Sally would be responsible for the remaining taxes = $1,234 - $368.42 = $865.58
