Answer:
Cash increases by $500,000
Equipment decreases by $300,000
Profit increases by $200,000
Explanation:
Cash increases by $500,000 because the equipment was exchanged for cash.
The equipment (property,plant and equipment account) decreases by $300,000 because this particular equipment will be removed from PPE account.
Equity increases by $200,000 because there is a profit of $200,000 from the sale.
Answer:
(a) 8.90%
(b) 3.00%
Explanation:
(b) After tax cost of debt:
= pretax cost of debt (1 - relevant tax rate)
= 5% × (1 - 0.4)
= 3.00%
(a)
Equity:
Market value = 65
weight = 0.65
WACC = weight × cost of equity
= 0.65 × 0.12
= 7.80%
Preferred stock:
Market value = 5
weight = 0.05
WACC = weight × cost of equity
= 0.05 × 0.04
= 0.20%
Debt:
Market value = 30
weight = 0.30
WACC = weight × cost of equity (after tax)
= 0.30 × 0.03
= 0.90%
Therefore,
Mullineaux’s WACC:
= 7.80% + 0.20% + 0.90%
= 8.90%
Answer:
B) Objectives 2 and 3
Explanation:
Accounting controls are procedures that help a company ensure the validity and accuracy of its financial statements.
Therefore, one of the main priorities of accounting controls would be to make sure that accounting records are correct. By ensuring the validity of accounting records, the company's assets are safeguarded, since the possibility of something missing or being incorrectly recorded diminishes.
Answer:
Find the answer in the file attached.
Answer: risk avoidance
Explanation:
Risk avoidance is simply defined as the process by which safeguards are applied in order to avoid a negative impact. It should be noted that a risk avoidance strategy helps to eliminate all risk and organizations apply safeguards to both potential threats and vulnerabilities.
Risk avoidance helps to remove hazards, and the activities that'll have a negative impact on the business.