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gtnhenbr [62]
3 years ago
15

An individual purchased a taxable corporate bond at a premium. The bond has a remaining ten year maturity period. For federal in

come tax purposes, amortization of the premium:________
Business
1 answer:
EleoNora [17]3 years ago
6 0

Available Options Are:

A. Increases investment interest expense

B. Is required

C. Reduces interest income

D. Increases interest income

E. Increases the basis of the bond

Answer:

Option C. Reduces Interest Income

Explanation:

The reason is that when we amortize the premium the carrying value of the bond decreases which decreases the principal amount and thus the interest calculated will also be decreased. The decrease in principal amount is because of the difference between the coupon rate of the bond and the firm's required rate of return.

Hence the amortization of the premium reduces the interest income.

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BenchMark, Inc., just paid a dividend of $3.45 on its stock. The growth rate in dividends is expected to be a constant 5 percent
Ludmilka [50]

Answer:

BenchMark, Inc.

The current share price for the stock is:

$43.13

Explanation:

Dividend per share = $3.45

Growth rate = 5%

Investors' required rate of return = 13%

Stock value = Dividend per share / (Required Rate of Return – Dividend Growth Rate)

= $3.45/(0.13 - 0.05)

= $43.13

b) To determine BenchMark, Inc.'s current share price divide the dividend per share by the required rate of return after subtracting the growth rate from the required rate of return.

8 0
3 years ago
Assume Maine Line Railway is considering hiring a reservations agency to handle passenger reservations. The agency would charge
Keith_Richards [23]

Answer:

$214,000

Explanation:

The total reservation cost per month is given by the following expression:

R = \$14,000+\$1*n

Where 'n' is the number of monthly reservations.

If there are 200,000 reservations for passengers taking a trip next month, the reservation cost is:

R = \$14,000+\$1*200,000\\R=\$214,000

Total reservation cost is $214,000.

8 0
4 years ago
Read 2 more answers
Money is
Contact [7]

Answer:

a)

Explanation:

money is a valuable because it is backed by gold

8 0
3 years ago
When you've carefully checked all the facts and your attitudes and still find that there's "just something" about your superviso
Nataly [62]
True you should always suspect it and try to fix it

6 0
3 years ago
A sole proprietor has ______ personal liability for all business debts and obligations.
andreev551 [17]

A sole proprietor has unlimited personal liability for all business debts and obligations.

<h3>Who is a sole proprietor?</h3>

A sole proprietor is the owner of a sole proprietorship. A sole proprietorship is a type of business that is owned by one person.

A sole proprietor and the business are regarded as a single person under the law. Thus, a sole proprietor has an unlimited liability. An unlimited liability means that in event of default, both the e property of the business and the sole proprietor can be seized.

To learn more about  sole proprietorship , please check: brainly.com/question/1428023

#SPJ1

4 0
2 years ago
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