1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
notsponge [240]
3 years ago
6

Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. Land A and Buildin

g A were acquired from a predecessor corporation. Thompson paid $732,500 for the land and building together. At the time of acquisition, the land had a fair value of $65,600 and the building had a fair value of $754,400. Land B was acquired on October 2, 2019, in exchange for 2,200 newly issued shares of Thompson’s common stock. At the date of acquisition, the stock had a par value of $5 per share and a fair value of $17 per share. During October 2019, Thompson paid
Business
1 answer:
frozen [14]3 years ago
7 0

Answer:

He will not pay any depreciation during October.

Explanation:

Depreciation is charged only on building equipment and machinery. It is not accounted for land as land is an asset whose value does not depreciate over the years.

Depreciation for Building A would be zero  for the month of october as depreciation is computed from the first of the month of acquisition to the first of the month of disposition.

The depreciation expense will be computed on 1st of November.

You might be interested in
Suppose C1 and C2 form a partition of sample space S. Suppose A and B are two events such that the following statements are true
kirza4 [7]

Answer:

Option b. A and B are conditionally independent given C2.

Explanation:

The conditional probability of an event is the probability that a given event will occur given that another event, say A has already occurred.

In a case where events A and B are independent (in this case, where the probability of A has no  effect on the probability of B occurring), the conditional probability of an event B given that A has taken place is simply the probability of the event A.

If the two events are not independent, then the probability of an event occurs as an intersection of set A and B.

6 0
3 years ago
R.S. Green has 250,000 shares of common stock outstanding at a market price of $28 a share. Next year’s annual dividend is expec
zhannawk [14.2K]

Answer:

WACC 6.18%

Explanation:

to get the cost of capital we solve using the gordon model:

\frac{divends}{return-growth} = Intrinsic \: Value

\frac{divends}{Price} = return-growth

\frac{divends}{Price} + growth = return

$Cost of Equity =\frac{D_1}{P)} +g

D1 1.55

P 28

f 0.00

g 0.02

$Cost of Equity =\frac{1.55}{28} +0.02

Ke 0.075357143

Then for the cost of debt, we need to calculate the YTM of the bonds:

which is the rate at which the present value of the coupon payment and maturity equals the market price:

For the complexity this is done with excel or a financial calculator there is also an approximation formula

YTM with excel: 0.073516565

now that we good this we need to determinate the weigth of equity and debt:

250,00 shares x 28 dollars each = 7,000,000

1,500 bonds of $1,000 each at 98% = 7,350,000

value of the company: 7,000,000 + 7,350,000 = 14,350,000

Ew: 7,000,000 / 14,350,000 = 0.487804878

Dw: 7,350,000 / 14,350,000 =0.512195122

Now we got all values and we can determinate the WACC:

WACC = K_e(\frac{E}{E+D}) + K_d(1-t)(\frac{D}{E+D})

Ke 0.075357143

Equity weight 0.487804878

Kd 0.074

Debt Weight 0.512195122

t 0.34

WACC = 0.075357143(0.48780487804878) + 0.074(1-0.34)(0.51219512195122)

WACC 0.0617752 = 6.18%

7 0
3 years ago
Define the following terms: a. Cost of debt b. Cost of equity c. After-tax WACC d. Equity beta e. Asset beta f. Pure-play compar
gtnhenbr [62]

Answer: The answers are explained below.

Explanation:

• Cost of debt: The cost of debt is the interest rate that a company is charged on its debts. It is the interest paid on bonds, loans etc. The cost of debt is usually the before-tax cost of a debt.

• Cost of equity: The cost of equity is the return a firm pays to its equity investors e.g shareholders in order to reward them for the risk taken by investing their capital. Companies need capital to operate and grow hence, individuals and organizations who provide funds to such companies are rewarded.

• After tax WACC: The Weighted Average Cost of Capital (WACC) is a firm's combined cost of capital including preferred shares, common shares, and debt after the deduction of tax.

• Equity Beta: It measures the sensitivity of the stock price to changes in market. Equity Beta is also called levered beta.

• Asset beta: It is the beta of a firm without the effect of debt. It is a company's volatility of returns without its indebtedness.

• Pure play comparable: The pure play comparable is the taking of the beta estimate of another company that is comparable and in same line of business.

• Certainty equivalent: It is the guaranteed return that an individual would take now, rather than awaiting a higher but uncertain return later in the future.

3 0
3 years ago
Read 2 more answers
"Makers Corp. had additions to retained earnings for the year just ended of $213,000. The firm paid out $183,000 in cash dividen
yuradex [85]

Answer:

Dividends per share is $1.66

Book value per share is $44.36

Market-to-book ratio is 1.42

Price-earnings ratio is 32.54

Price-sales ratio is 1.97

Explanation:

1 ) What are dividends per share?

Dividends per share = cash dividends/ number of shares = $183,000/ 110,000 = $1.66

2) What is the book value per share?

Book value per share = total equity/ number of shares = $4,880,000 / 110,000 = $44.36

3) If the stock currently sells for $63 per share, what is the market-to-book ratio?

Market-to-book ratio = $63/ $44.36 = 1.42

4) What is the price-earnings ratio?

The price of Makers Corp. = market price * number of shares = $63* 110,000 = $6,930,000

Price-earnings ratio = $693,000/ $213,000 = 32.54

5) If the company had sales of $3.52 million, what is the price-sales ratio?

Price-sales ratio = market price/ sales = $6,930,000/ $3,520,000 = 1.97

6 0
3 years ago
A graduated commission employee makes 3. 5% interest on the first $50,000 in sales and 6. 5% interest on all sales over $50,000.
Harman [31]

The correct form of expression to express the context earning on the sales of the products is  (0. 035)(50,000) (0. 065)(81,500).

The context is about a graduate who earns on the basis of commission on the fixed amount of stock. On the sale of the first $ 50,000, he is getting 3.5% and the sales above $50,000 he is getting a commission of 6.5%.

Thus, the rate of 3.5% will be multiplied with the sales of %50,000, and the rate of 6.5% will be multiplied by the number of sales above $50,000 that is $81,500.

Therefore, the correct option is a.

To know more about the expressions that express the total earning of the employee, refer to the link below:

brainly.com/question/2337923

8 0
2 years ago
Other questions:
  • Anheuser-Busch InBev SA/NV (BUD) reported the following operating information for a recent year (in millions):
    9·1 answer
  • BE22-4 Gundy Company expects to produce 1,200,000 units of Product XX in 2017. Monthly production is expected to range from 80,0
    15·1 answer
  • Quantas Industries sold $300,000 of consumer electronics during January under a one-year warranty. The cost to repair defects un
    10·1 answer
  • Which of the following headings should be included in your résumé?
    11·2 answers
  • Specialization of labor results in the production of large quantities of a product.a. trueb. false
    10·1 answer
  • A division is considering the acquisition of a new asset that will cost $2,520,000 and have a cash flow of $700,000 per year for
    12·1 answer
  • ___ are a payment mechanism that are similar to regular bank checks but are transmitted electronically, with a signature in digi
    8·1 answer
  • ____________________ is leveraging cross-border differences in needs and wants of the firm's target customers.
    14·1 answer
  • es $ 160,000 Accounts receivable increase $ 10,000 Expenses: Inventory decrease 16,000 Cost of goods sold 100,000 Salaries payab
    11·1 answer
  • atman Corporation uses an activity-based costing system with the following three activity cost pools: Activity Cost Pool Total A
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!