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Eva8 [605]
3 years ago
6

Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay dividends.

However, investors expect Computech to begin paying dividends, beginning with a dividend of $0.75 coming 3 years from today. The dividend should grow rapidly-at a rate of 16% per year-during Years 4 and 5; but after Year 5, growth should be a constant 8% per year. If the required return on Computech is 14%, what is the value of the stock today? Round your answer to the nearest cent. Do not round your intermediate calculations.
Business
1 answer:
sweet [91]3 years ago
5 0

Answer:

The intrinsic value of the stock is 9.76

Explanation:

We have to use the dividend growth model

It is fundamental to understand that these values are in the future so we must take them to present value, using the required return of 14%

\left[\begin{array}{ccc}-&DIVIDENDS&PRESENT VALUE\\1&0&0\\2&0&0\\3&0.75&0.506228637151512\\4&0.87&0.515109841312065\\5&1.0092&8.73578093453209\\Intrinsic&Value&9.75711941299567\\\end{array}\right]

We multiply year 3 by 1.16 to get year 4

Then we multiply year 4 by 1.16 to get year 5 dividends.

Then we use the dividend growth model to get the value ofthe future years

\frac{dividends}{return-growth} = intrinsic \: value

Again, this value is set 5 years into the future, so we have to calculate the present value

\frac{intrinsic \: value}{1.14^{5} } = Present Value

Same process is done for year 3 and 4

\frac{.75}{1.14^{3} } = PV \: Year3

\frac{.87}{1.14^{4} } = PV \: Year4

Then we add the three values to get the value of the stock today.

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Inventory on the Balance Sheet On the basis of the following data, determine the value of the inventory at the lower of cost or
Tpy6a [65]

Answer:

Total Inventory           250,590‬

Explanation:

We have to pick the lowest price between the istoric cost (FIFO method) and the market value of the goods)

                 units x lowest

Adams     100 x 125 =   12,500

Coolidge 375 x 90  =   33,750

McKinley 220 x 60  =   13,200

Garfield 900 x 115  =  103,500

Lincoln 626 x 140  = <u>    87,640</u>

Total Inventory           250,590‬

7 0
4 years ago
Olivia is willing to pay $185 a month for four years for a car payment. if the interest rate is 4.9 percent, compounded monthly,
Grace [21]
Let x = the price of the car that Olivia can afford.

Down payment = $2,500
Remaining amount to be financed is P = x - 2500.

Total payments should equal the monthly payments.
The total payment over 4 years (48 months) is
A  = $185*48 = $8,880

The rate is r = 4.9% = 0.049.
The compounding interval is n = 12.
The time is t = 4  years.
The amount financed is P = $(x - 2500).
Therefore
(x - 2500)(1 + 0.049/12)⁴⁸ = 8880
1.216(x - 2500) = 8880
x - 2500 = 7302.63
x = 9802.63
Olivia can afford a car priced at $9,802.63.

Answer: $9,802.63

4 0
3 years ago
In Japanese corporate culture, which action is most likely to constitute a typical significant impediment to averting and respon
Ilia_Sergeevich [38]

Action which is most likely to constitute a typical significant impediment to averting and responding to a crisis is (C) employees who are lower in the hierarchy find it hard to question their superiors.

<h3>What is hierarchy?</h3>
  • A hierarchy is a type of organizational system in which elements are prioritized in order of importance.
  • The majority of governments, organizations, and organized religions are hierarchical in nature.
  • So, employees who are lower in the hierarchy find it hard to question their superiors.
  • The corporate ladder is an example of hierarchy.
  • Lower-level employees find it difficult to question their supervisors.
<h3>Who are superiors?</h3>
  • In any type of hierarchy or tree structure, a superior is an individual or position higher in the hierarchy than another, and hence closer to the peak.
  • Superiors in business are supervisors, while superiors in the military are those higher in the line of command.

Since lower-level employees find it difficult to question their supervisors.

Therefore, the correct option is (C) employees who are lower in the hierarchy find it hard to question their superiors.

Know more about Japanese corporate culture here:

brainly.com/question/14243361

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Complete question:

In Japanese corporate culture, which action is most likely to constitute a typical significant impediment to averting and responding to a crisis?

a) Decisions are generally taken by lower-level employees who directly deal with the problem.

b) Negotiations are avoided at any cost.

c) Employees who are lower in the hierarchy find it hard to question their superiors.

d) The process of decision-making is extremely complex and time-consuming.

e) Employees like to work on their own rather than in a group.

6 0
2 years ago
Cost advantages that accrue for firms with larger output because they can spread fixed costs over more units and can employ tech
xeze [42]

Cost advantages that accrue for firms with larger output because they can spread fixed costs over more units and can employ technology more efficiently are called:

  • Economies of scale

<h3>What are Economies of scale?</h3>

Economies of scale is a term that is used to describe the cost advantages that a company gets because they have increased the level of production. There are different types of economies of scale.

Some of these are the financial, technical, and purchasing economies of scale. So, when the purchasing strength of the organization increases, then there is an economy of scale.

Learn more about the economies of scale here:

brainly.com/question/780900

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6 0
2 years ago
Establishing a hierarchy to let all management and employees know what is going on in a company would be an example of what elem
ZanzabumX [31]

Answer:

Information and communication

Explanation:

Internal control refers to the management procedures in place used to accomplish the objectives such as promote efficient and effective operations,  ensure the reliability and integrity of financial information, safeguard the organisation's assets, etc. A good system of internal control is essential to the availability of information and a clear and obvious strategy for communicating obligations and expectations.

3 0
4 years ago
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