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sergiy2304 [10]
3 years ago
6

Tim's Tools just issued a dividend of $2.22 per share on its common stock. The company is expected to maintain a constant 2.8 pe

rcent growth rate in its dividends indefinitely. If the stock sells for $19 a share, what is the company's cost of equity?
Business
1 answer:
LekaFEV [45]3 years ago
4 0

Answer:

expected return = 12.03%

Explanation:

using the dividends growth model we can calculate the required return

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

2.22 x 1.03 = 2.2866

We must remember that the gordel model is used with next year dividends

2.2866(return - 0.023) = 19

2.2866/19      +0.023 = return

return = 12.03%

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Wells Fargo & Company, headquartered in San Francisco, is one of the nation’s largest financial institutions. Suppose it rep
andreev551 [17]

Answer:

<u>EQUITY AND LIABILITIES</u>

<u>EQUITY</u>

Retained earnings                    $ 41,563

Preferred stock                          $ 8,485

Common stock - Issued             $ 8,743

Treasury stock                           $ 2,450

Share Premium                        $ 52,878

Total Equity                                $114,119

Explanation:

The the stockholders’ equity section of the balance sheet shows the amount of capital invested by the shareholders in the business as well as the reserves that have been allocated to them.

<u />

8 0
3 years ago
Betsy Strand’s regular hourly wage rate is $24, and she receives an hourly rate of $36 for work in excess of 40 hours. During a
melamori03 [73]
<h3>Betsy’s gross earnings for January period is $1,140 </h3><h3>Betsy’s net pay for January period is $966.79 </h3>

Explanation:

  • Betsy Strand’s regular hourly wage rate = $24
  • Betsy Strand’s hourly rate for work in excess of 40 hours = $36
  • Betsy works during a January pay period = 45 hours.
  • Betsy's pay for January period = $24 * 40 + $36 * 5
  • Betsy's pay for January period = $1,140

Betsy’s gross earnings for January period is $1,140

  • Betsy’s federal income tax withholding = $86
  • FICA tax rate  = 7.65%.
  • Betsy’s FICA Taxes Payable = $1,140  * (7.65 / 100)
  • Betsy’s FICA Taxes Payable = $87.21
  • Betsy’s net pay for January period = Gross earnings - Federal income tax withholding - FICA Taxes
  • Betsy’s net pay for January period = $1,140 - $86 - $87.21
  • Betsy’s net pay for January period = $966.79

Betsy’s net pay for January period is $966.79

6 0
3 years ago
The option of sticking with the current business lineup makes sense when
worty [1.4K]

Answer:

The correct answer is the option A: the company's present business offer attractive growth opportunities and can be counted on to create economic value for shareholders.

Explanation:

To begin with, the fact that a company faces the dilemma between continue with the current business lineup or change it in order to begin producing a new one by starting from zero then a lot of variables must be taken care of and considered, that is, that at the moment of making the final decision the managers must understand the opportunity costs that can affect the organization and moreover the benefits that the actual lineup makes. That is why, that at the time of sticking with the current business lineup it makes sense to continue with the current one when the company's present business offer attractive growth opportunities and can be counted on to create economic value for shareholders.

8 0
3 years ago
Warr Company is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's pr
BartSMP [9]

Answer:

Option B, IRR is 14.42%

Explanation:

The IRR is the rate of return that equates the cost of the project to the present value of cash flows receivable from the project in future.

Using an excel approach, the formula formula IRR is given as:

=irr(values)

The values in this case are

-$1300 in  year 0

$450 in year 1

$450 in year two

$450 in year 3

$450 in year 4

The irr gives 14.42% as shown in the spreadsheet attached

The cost of the investment of the investment project of $1300 equals the present values of its cash flows at 14.42% rate of return

Download xlsx
4 0
3 years ago
Generally, a business should consider insuring against an event when the risk
posledela

Answer:

A

Explanation:

The econimac situatiom will detertoarte further.

8 0
3 years ago
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