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3 years ago

Why would banks offer lower interest rates for loans?

Business

2 answers:

pickupchik [31]3 years ago

7 0

C) to encourage people to borrow money

earnstyle [38]3 years ago

4 0

Answer:c

Explanation:

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Can someone please help me with this journal prompt

Irina-Kira [14]

Answer: Go to Microsoft edge the new one and look it up

Explanation:

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3 years ago

Johnny Cake Ltd. has 30 million shares of stock outstanding selling at $40 per share and an issue of $40 million in 8 percent, a

erma4kov [3.2K]

Answer:

WACC = 0.16637 OR 16.637%

Explanation:

WACC or weighted average cost of capital is the cost of a firm's capital structure which can comprise of debt, preferred stock and common equity. The WACC for a firm with only debt and common equity can be calculated as follows,

WACC = wD * rD * (1-tax rate) + wE * rE

Where,

w represents the weight of each component based on market value in the capital structure
r represents the cost of each component
D and E represents debt and equity respectively

To calculate WACC, we first need to calculate the Market value an cost of equity.

The market value of equity = 30 million shares * $40 per share

MV of equity = $1200 million

The cost of equity can be found using the formula for Price today (P0) under constant growth model of DDM.

P0 = D1 / (r - g)

40 = 4 / (r - 0.07)

40 * (r - 0.07) = 4

40r - 2.8 = 4

40r = 4+2.8

r = 6.8 / 40

r = 0.17 or 17%

MV of debt = 40 million * 96.5% => $38.6 million

Total MV of capital structure = 38.6 + 1200 = 1238.6 million

WACC = 38.6/1238.6 * 0.08 * (1-0.33) + 1200/1238.6 * 0.17

WACC = 0.16637 OR 16.637%

4 0

3 years ago

Sinclair Manufacturing Company experienced the following accounting events during its first year of operation. With the exceptio

matrenka [14]

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

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3 years ago

What education does a childcare director need

nexus9112 [7]

Answer:

An associate's or bachelor's degree in early childhood education is needed to work as a child care director.

Explanation:

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3 years ago

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If you perceive that the costs and rewards are balanced between you and your partner, you are more likely to be satisfied with y

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3 years ago