Answer:
The expected/required rate of return is 13.8125%.
Explanation:
The stock is a constant growth stock as the dividends are expected to grow constantly forever. The constant dividend growth model of DDM is used to calculate the price of such a stock today. As we already know the price, we will use the formula of the constant growth model to determine the required rate of return. The formula for constant growth model is:
P0 or Price today = D1 / r - g
Plugging in the available known values,
16 = 1.25 / (r - 0.06)
16 * (r - 0.06) = 1.25
16r - 0.96 = 1.25
16r = 1.25 + 0.96
r = 2.21 / 16
r = 0.138125 or 13.8125%
Answer:
$12,000
Explanation:
Given the above information, we will apply the formula below:
The ending balance of retained earnings = Beginning balance of retained earnings + Net income - Dividend paid
$90,000 = $65,000 + $37,000 - Dividend paid
Dividend paid = $65,000 + $37,000 - $90,000
Dividend paid = $12,000
Therefore, the above balance of $12,000 would be displayed in the retained earnings statment
Answer:
The answer is arms- length transaction
Explanation:
The price a property will bring when neither the buyer nor the seller is acting under duress and it has been on the market for a reasonable length of time is defined as arms- length transaction
Answer:
What Is Value-Added?
The term "value-added" describes the economic enhancement a company gives its products or services before offering them to customers. Value-added helps explain why companies are able to sell their goods or services for more than they cost to produce. Adding value to products and services is very important as it provides consumers with an incentive to make purchases, thus increasing a company's revenue and bottom line.
Explanation:
