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3 years ago

Using a company's cost of capital to evaluate a project is:

Business

1 answer:

yaroslaw [1]3 years ago

6 0

Answer: Option C

Explanation: In simple words, cost of capital refers to the amount of return that the investor are expecting for tasking the risk of investing in the company. In other words, it is the amount the company has to offer in return to the investors for attaining the capital from the market.

Often the cost of capital is used to evaluate the profitability of the project, that is, if the return in project is higher than the cost of financing it should be taken by the company.

However there are other component while evaluating a project that is risks associated with it. Risk of every projects is different from the other and hence only those project should be evaluated on the basis of cost of capital that is similar to the company's average.

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douglas pays selena $43,300 for her 30% interest in a partnership with net assets of $127,900. following this transaction, dougl

Katarina [22]

Selena receives $43,300 from Douglas for her 30% stake in a partnership with $127,900 in net assets. After this transaction, the capital account of Douglas should have a account balance of $38,370.

Douglas's Capital account balance

= Net assets x30%

= $127,900 x 30%

= $31,875

Therefore, Douglas's capital account should have a credit balance of $38,370

A financial repository's account balance represents the amount of money there is at the end of the current accounting period. It is the sum net assets of the balance carried over from the previous month and the net difference between the credits and debits that have been recorded during any given accounting cycle.

The amount due or the net debt may be shown in an account balance. The former is frequently depicted in financial accounts that include net assets recurring bills, like those for utilities or gym memberships. The latter, on the other hand, is reflected in accounts with negative cash balances, such as bank overdrafts.

Learn more about account balance here

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4 0

1 year ago

Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $300,000, total variable expenses were $234,000, an

Stolb23 [73]

Answer:

See below

Explanation:

1. Contribution margin ratio

= (Sales - Variable cost) / Sales

Sales = $300,000

Variable cost = $234,000

Contribution margin = ($300,000 - $234,000) / $300,000

= 0.22

= 22%

Hence, contribution margin ratio is 22%

2. Change in the net operating income if it can increase total sales by $2,500

Contribution margin of $2,300 = $2,300 × 22%

= $506

Operating income for $300,000 sales is

= Sales - total variable expenses - fixed expenses

= $300,000 - $234,000 - $38,700

= $27,300

If sales is $302,500 the net operating income would be

= $27,300 + $506

= $27,806

• It therefore means that the net operating income will increase by $506

3 0

3 years ago

Identify the type of data (qualitative/quantitative) and the level of measurement for the following variable. Explain your choic

zubka84 [21]

Answer: Temperature is a quantitative data.

Explanation:

A quantitative data deals with number and object that can b e measured objectively. Temperature is a quantitative data because it can be measured in numbers. Numerical values that are countable are assigned to it. Temperature is a quantitative data because numerical values, found by either measuring or counting are used to describe the data. Monthly temperatures are assign ed numerical and countable values which can be measured objectively.

8 0

4 years ago

When Whitney took over her father's sporting goods store, she evaluated some of her father's vendor relationships. She found tha

kolezko [41]

Answer:

The answer is D. Open communication is key in building lasting relationships whether in business or in personal relationships.

Explanation:

For two companies to maintain a strategic relationship, there must be open communication. Whitney displayed correct understanding of this ingredient for strategic relationships.

That was why she was open enough to work out a more amicable relationship with Rodney. She discussed her sales goals and new ideas for the business. On Rodney's part, he showed no interest. He was not ready to discuss his own sales goals.

Rodney lost a golden opportunity offered by Whitney by opening up communication. He should have embraced the chance to bring up his concerns and discuss his goals openly, unless he is hiding something. He could be deliberately overcharging on price. These comments remain mere guesses as Rodney failed to open up.

7 0

3 years ago

You would like to bake a special birthday cake for a friend who has celiac disease. the original cake recipe is made with eggs,

andre [41]

Substitute GLUTEN FREE RICE FLOUR or GLUTEN FREE ALMOND FLOUR for the FLOUR in the recipe.

Celiac disease is triggered by consuming gluten, a protein. It can be found in wheat which is the primary source of flour in baking and cooking. Other food that contains gluten are barley, rye, triticale and oats.

Since Celiac disease is a serious genetic autoimmune disease, it can be deadly when one consumes food that is rich in gluten. Thus, gluten free food are used to substitute food that contains gluten.

5 0

4 years ago

Read 2 more answers