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3 years ago

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The Holmes Company's currently outstanding bonds have an 8% coupon and a 10% yield to maturity. Holmes believes it could issue n

ew bonds at par that would provide a similar yield to maturity. If the marginal tax rate is 40%, what is Holmes' after-tax cost of debt?

1 answer:

malfutka [58]3 years ago

6 0

Gghh Rey hhrbbwb Holmes

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The maintenance expenses on a rental house you own average $200 a month. The house cost $219,000 when you purchased it four year

Serhud [2]

Answer:

value we place on this house when analyzing the option of using it as a professional office is $225000

Explanation:

Given data

house cost 4 year ago = $219,000

house valued = $239,000

real estate fees = $14000

property taxes = $4,000

to find out

What value should you place on this house

solution

we know if we sell house we should pay real estate fee

so we get need money to place is present cost - real estate fees

so cost will be

cost = house valued - real estate fees

cost = 239000 - 14000

cost = 225,000

so value we place on this house when analyzing the option of using it as a professional office is $225000

0 0

4 years ago

A project has a cash flow of -$161,900, $70,800, $62,300, and $75,000 for years 0 to 3, respectively. The required rate of retur

zepelin [54]

Answer:

IRR = 13.55%

Accept

Explanation:

Here is the complete question:

A project has a cash flow of -$161,900, $70,800, $62,300, and $75,000 for years 0 to 3, respectively. The required rate of return is 13 percent. Based on the internal rate of return of _____ percent for this project, you should _____ the project.

The internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.

IRR can be calculated using a financial calculator:

Cash flow in year 0 = -$161,900

Cash flow in year 1 =$70,800

Cash flow in year 2 = $62,300

Cash flow in year 3 =$75,000

IRR = 13.55%

A project should be accepted if its IRR is greater than the internal rate of return. Because 13.55 is greater than 13 percent the project should be accepted.

To find the IRR using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.

I hope my answer helps you

6 0

3 years ago

Corcoran Corp. pays a constant $7.10 dividend on its stock. The company will maintain this dividend for the next 10 years and wi

raketka [301]

Answer:

Explanation:

Corcoran Corp. pays a constant $7.10 dividend on its stock. The company will maintain this dividend for the next 10 years and will then cease paying dividends forever. If the required return on this stock is 11 percent, what is the current share price

Given that:

Dividend = $7.10 dividend on its stock

Rate r = 11 percent

The company will maintain this dividend for the next 10 years

$\texttt {Current share price}=\texttt {Dividend}\times(\frac{1-(1+r)^{-r}}{r} )$

$=\$ 7.10\times(\frac{1-(1+0.11)^{-10}}{0.11} )\\\\=\$7.10\times(\frac{1-(1.11)^{-10}}{0.11} )\\\\=\$7.10\times\frac{(1-0.3522)}{0.11}\\\\=\$7.10\times\frac{0.6478}{0.11}\\\\=\$ 7.10 \times5.889\\\\=\$41.81$

6 0

3 years ago

uppose you are interested in selling your home and would like to clear a net value of $300,000. If you have agreed to pay your b

Art [367]

Answer:

Price to sell the house = $317,460.32

Explanation:

Total net profit required = $300,000

Provided commission to broker = 5.5% on selling value.

Therefore Net profit = 100 - 5.5 = 94.5% as this is net of commission.

Now we have Net Selling Price = $300,000/94.5% = $317,460.32

Note: Let us cross check

Commission on sales = $317,460.32 X 5.5% = $17,460.32

Therefore Net profit in hand = $317,460.32 - Commission $17,460.32 = $300,000

Final Answer

Price to sell the house = $317,460.32

3 0

3 years ago

When a calendar is made public, then anybody with the calendar's URL can: A. Modify the calendar. B. Delete the calendar. C. Cha

Mamont248 [21]

Answer:

edit

Explanation:

8 0

4 years ago