Since there is no debt, all the capital that the company raises is in the form of common equity.
Since there is only equity (meaning the firm is a fully equity firm), the weighted average cost of capital (WACC) is nothing but the cost of equity
In this case the WACC represents the cost of equity
Therefore, cost of equity = WACC = 8%
Answer:
Part a
Debit : Cash $1,680
Debit : Accounts receivable $3,360
Debit : Inventories $6,720
Debit : PPE, net $16,800
Credit : Accounts payable $3,360
Credit : Accrued liabilities $5,040
Credit : Long-term liabilities $6,720
Credit : Cash $13,440
Part b
Debit : Investment in Subsidiary $13,440
Credit : Cash $13,440
Explanation:
Part a
A transaction or event where investor only purchases the assets and assumes the liabilities of the investee is called an Asset Acquisition. No Group Statements are prepared.
Part b
A transaction or event in which an Investor obtains CONTROL of one or more businesses is called a Business Combination. Investee becomes a subsidiary and continues to exist. Investor must prepare Group Statements.
When it comes to the best operating level, all of the above are correct.
The <u>best operating level</u> is where all resources are being utilized effectively and marginal revenue is equal to marginal cost. If there resources are not being utilized effectively, the following will happen:
- Average unit cost increases as a result of underutilization - the units available are not being utilized effectively which means that the company is incurring more cost than it should per good produced.
- Average unit cost increases as a result of overutilization - units are being overused which is forcing the company to incur expenses to replace the overused resources.
At the <u>best operating level</u> however, average cost will be at a minimum because the goods are being used effectively and efficiently.
In conclusion, it is best for a business when they operate at an efficient operating level.
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Answer:
Check the following explanation
Explanation:
-1, the lowest possible correlation
.
The correlation between the activity of two stocks, or between a stock and the performance of a given index, sector or industry, can be a very important factor in developing a prudent investing strategy.
<u>A brand can be one of a company's most </u><u>valuable </u><u>assets</u>, this is the correct statements regarding the concept of branding.
What is branding?
A brand is any characteristic that sets one seller's good or service apart from that of other sellers. It can be a name, a term, a design, a symbol, or anything else. Businesses, marketers, and advertisers use brands to build and preserve brand equity for the product or service they are promoting, which benefits the brand's consumers, owners, and shareholders. Sometimes generic or store brands can be distinguished from brand names. It is believed that the ancient Egyptians, who are known to be have engaged in livestock branding as slightly earlier as 2,700 BCE, are the originators of the practise of branding, which is defined in its original literal sense as marking by burning. By using a hot branding iron to burn a distinctive symbol into the animal's skin, branding was used to distinguish one person's cattle from another.
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