Oscars opportunity cost for buying the business is 50,000
Answer and Explanation:
The computation of the gain recognized and the tax that should be paid is shown below
Sale of share(10 × 8 × $22) $1,760
Less: basis (10 × 8 ×$15) $1,200
The gain realized $560
Now the tax would be
= $560 × 15% preferential rate
= $84
The price of the stock 19 years from now would be the present value of all the dividends to be paid starting year 20. Here, to compute the PV of the dividends, we can use the PV of perpetuity formula as the dividends will be paid for the infinite period of time.
Value of the stock after 19 years = Dividend year 20/ required return
= $20 / 0.0725
= $275.86
One technique in answering behavior interview questions is STAR where S makes for specific situation, T for task, A for action and R for result. SImple but efficient procedure
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Answer:
Break-even point= 948 units
Explanation:
Giving the following information:
Echo next round that can reduce their material cost of producing units from $8.13 to $7.32. Erie passes on 50% of all cost savings by cutting the current price to customers. For simplicity: Current selling price = $19.00; Use current labor costs of $4.02; Use period costs of $7,260.
Break-even point= fixed costs/ contribution margin
Unitary variable costs= 7.32 + 4.02= 11.34
Break-even point= 7260/(19-11.34)= 948 units