Answer: B - The interest rate may increase after an inductor period.
A because gas is needed for the truck to deliver
Answer:
Non equity Strategic Alliance
Explanation:
It would have been an equity strategic alliance if one company had bought shares in the other company, but that is not the case in the scenario
A Non Strategic Alliance is one where both companies agree contractually to combine their capabilities and/or resources together for the purpose of achieving a common goal, which describes the situation in the scenario.
Answer:
$696400
Explanation:
The values given are as follows:
Tax rate= 21%, 21/100= 0.21
Equity cost= 11.1%
Value of Unlevered Firm= $625,000
Rate at which Tantum can borrow=6.7%, 6.7/100=0.067
Amount of value if the company ends up borrowing=$340,000
Value of levered Firm =?
The formular for finding the value of levered Firm is:
Value of Unlevered Firm + Tax Rate * Debt
=$625,000 + 0.21 *$340,000
= $625,000 + $ 71,400
= $ 696,400
Thus, the value of levered firm is $696,400.
Answer:
$0
Explanation:
Since 100% of Cooper Corporation's stock were owned by Carole and Chris (who are siblings), then no one can recognize any loss or gain from the contribution of property (nor the distribution of property). Under section 351, no gain or loss can be recognized for the contribution of property in exchange for stocks in a controlled corporation.
Since the contribution was made through a carryover basis transaction less than 5 years before the liquidation, the distribution is carried out in the same way.
