1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Pie
4 years ago
12

Credenza Industries is expected to pay a dividend of $ 1.25 at the end of the coming year. It is expected to sell for $ 70 at th

e end of the year. If its equity cost of capital is 9​%, what is the expected capital gain from the sale of this stock at the end of the coming​ year?
Business
1 answer:
Setler [38]4 years ago
6 0

Answer:

$4.64

Explanation:

The total gains for a stock can be broadly classified as both capital gains and dividend gains The capital gain depends on the price of market of the stock prevailing at the time the stock is purchased and the time of the stock sales. For a given firm, dividend gain depends on the dividend policy  

From the question given, let us analyze the following,

the expected capital gain value calculated from the sale of the given stock is   The current stock value is given by:

(price of the stock after a year + the expected dividend) / capital equity cost

($70 + $1.25) / (1+9%)

= $71.25/1.09 = 65.36  

Then,

The capital gain expected from the sale of the stock is given by:

 Expected selling price after a year -the stock current value

 $70 - $65.36

= $4.64

You might be interested in
Adamdata, a cell phone brand, is planning to collaborate with a few companies that create software for cell phones. It wants to
liubo4ka [24]

Answer:

B) options-based planning

Explanation:

Software development life cycle (SDLC) can be defined as a strategic process or methodology that defines the key steps or stages for creating and implementing high quality software applications.

Some of the models used in the software development life cycle (SDLC) are;

I. A waterfall model.

II. An incremental model.

III. A spiral model.

An options-based planning can be defined as a strategic management process which typically involves the maintenance of flexibility by investing simultaneously in a little amount (manner) in various alternative plans.

In this scenario, Adamdata, a cell phone brand, is planning to collaborate with a few companies that create software for cell phones. It wants to try different operating system software for its phones and then buy the company that manufactures the software that is most compatible with its phones. Therefore, Adamdata is most likely using options-based planning.

4 0
3 years ago
The logistics/supply chain network transformation team _____________________________. a. must be aware of the firm's overall bus
valina [46]

Answer:

a. must be aware of the firm's overall business and corporate strategies and the supply chain in which it participates.

Explanation:

A logistics/supply chain network transformation team should not only be knowledgeable about the specifics of the supply chain of the firm, but also about the firm's overal business strategy, in order to devise its own logistics/supply chain network transormation strategy, that is coherent with the general corporate strategy, and that improves upon it at the same time.

6 0
3 years ago
Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $70,000 cash immediately
Setler [38]

Answer:

The net present value for each option is given below.

(1) $70,000 cash immediately

NPV = 70,000 * 1 = $ 70,000

(2) $24,000 cash immediately and a six-period annuity of $8,100 beginning one year from today, or

NPV = (24,000*1) + (8,100 *(1-((1+7%)^-6)/7%)) = $ 62,609

(3) a six-period annuity of $14,500 beginning one year from today

NPV = (14,500 *(1-((1+7%)^-6)/7%)) = $ 69,115

8 0
3 years ago
StoryBook Company provided services to several customers during the month of December. These services have not yet been paid by
timofeeve [1]

Answer:

                                                             Debit                Credit

Accounts Receivable                           xxx

Revenue                                                                        xxx

Explanation:

Since the services to the customers has been provided by the StoryBook Company  for the month of the December, therefore,the revenue shall be credited in the accounts of the StoryBook Company but since the customer has not paid for the services provided, therefore the accounts receivable shall be debited and accordingly the following journal entry shall be recorded in the accounts by the StoryBook Company:

                                                             Debit                Credit

Accounts Receivable                           xxx

Revenue                                                                        xxx

6 0
4 years ago
Greenleaf Manufacturers, Inc. projected sales of 86,000 machines for 2022. The estimated January 1, 2022, inventory is 7,500 uni
Burka [1]

the budgeted production (in units) for 2022 will be 98,100

Production + opening stock= sales+ closing stock

Production + 7,500= 86000 + 19600

Production = 98,100

What do you mean by production budget?

The sales forecast and the anticipated amount of finished goods inventory to be on hand are combined to create the production budget, which determines the number of products that must be made (usually as safety stock to cover for unexpected increases in demand).

How important budgeting is in production process?

A production budget aids the business in planning output levels for varying demand times. A corporation can use the downtime to make an extra products to have on hand for a future period when demand increases if it anticipates that demand and production levels will be low in a month.

Learn more about production budget: brainly.com/question/18803390

#SPJ4

3 0
2 years ago
Other questions:
  • The countries of mimbo, juwan, and ninot agreed to remove all barriers to the trade of goods and services among each other. howe
    14·2 answers
  • The Saunders carry a property insurance policy which covers 78% of the replacement cost of their insurable property, valued at $
    14·1 answer
  • What need theory would explain why lemuel greene was unhappy despite his high income
    5·1 answer
  • You currently have $3,400 in an investment account that returns 11% per year. How long will you have to wait until you can make
    13·1 answer
  • The Shoe Exchange issues 3,000 shares of its $1 par value common stock to provide funds for further expansion. The issue price i
    5·1 answer
  • PLEASE HELP!!Carl is balancing his checking account. After comparing the bank statement to his register, he notices an outstandi
    9·1 answer
  • Marketing is defined as an organizational function and a set of processes for creating, communicating, and delivering _____ to c
    9·1 answer
  • Which practice will help prevent data loss in case of a computer malfunction?
    5·2 answers
  • Burgundy, Inc., and Violet Gomez are equal partners in the calendar year BV LLC. Burgundy uses a fiscal year ending April 30, an
    14·1 answer
  • When negotiators have an audience watching their progress in the negotiations, the audience's negotiator: is more likely to give
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!