Answer: d. it is necessary to relate variable cost data to the activity index chosen
Explanation:
The activity index shows how various activities have an impact on the cost of production.
When developing a flexible budget within a relevant range of activity, ome must relate variable cost data to the activity index chosen to ensure that it is indeed variable.
Answer:
11.33%
Explanation:
The dividend valuation model will be used here to calculate the cost of equity raised which can be calculated using the following formula:
r = D1 / (Po - F) + g
Here D1, Po, F and g are given in the question so by putting the values in the equation, we have
r = $1.75 / ($42.5 - 5% of Po) + 7%
r = 11.33%
Answer:
Esmerelda did not use the reciprocal of the divisor.
Esmerelda added the numerators.
Esmerelda added the denominators.
Explanation:
Note: This question is not complete as it omitted the work of Esmerelda. Her work is therefore provide to complete the question as follows:

The explanation of the answer is now provided as follows:
Esmerelda did not use the reciprocal of the divisor
This is corrected by using the reciprocal of the divisor as follows:

Esmerelda added the numerators and Esmerelda added the denominators
These two are corrected together by multiplying the numerators separately and and multiplying the denominators separately as follows:

Based on the above, the correct answer of the work of Esmerelda can be obtained as follows:

The final answer can also be provided in 2 decimal places as follows:
