Answer:
A. hold money to transfer purchasing power into the future.
Explanation:
People use money as a store of value when they hold money to transfer purchasing power into the future.
Answer:
$33.80 per hour
Explanation:
The computation of the predetermined overhead rate is shown below:
= Estimated manufacturing overhead ÷ machine hours
= ($71,000 + $12,100 + $54,900 + $14,000 + $17,000) ÷ (5,000 machine hours)
= $169,000 ÷ 5,000 machine hours
= $33.80 per hour
Answer:
Alternatives :
1. Bank Overdraft facility
2.Suppliers Credit
Cost determination :
1. Bank Overdraft facility = Interest rate charged on the facility by the bank
2.Suppliers Credit = Opportunity cost of losing the early settlement discount.
Explanation:
If the company can not access sufficient external financing, consider internal sources such as bank overdraft or suppliers credit.
The cost of bank overdraft is evaluated based on the interest rate charged by the bank whilst the cost of the suppliers credit is determined by considering the opportunity cost of losing the cash discount available.
Answer:
7.20%
Explanation:
Given that
Coupon rate = 9%
Yield to maturity = 12%
And marginal tax rate is 40%
So by considering the above information, the after tax cost of debts is
= Yield to maturity × (1 - tax rate)
= 12% × (1 - 0.40)
= 7.20%
After considering the tax rate and then multiplying with the yield to maturity we can get the after tax cost of debt
We ignored the coupon rate