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ivann1987 [24]
3 years ago
7

Too Young, Inc., has a bond outstanding with a coupon rate of 6.9 percent and semiannual payments. The bond currently sells for

$1,905 and matures in 15 years. The par value is $2,000. What is the company's pretax cost of debt? Multiple Choice 7.51% 7.43% 7.98% 7.72% 3.65%
Business
1 answer:
dlinn [17]3 years ago
8 0

Answer:

7.43%

Explanation:

Where the debt is publicly traded , the cost of debt is equal to the yield to maturity

Approximate yield to maturity = [coupon +(face value - market price )/ number of years to maturity ]/ [{face value + market price]/2]*100

Face value - 2000

Market price - 1905

years to maturity= 30 years

Coupon =( 6.9%*2000)/ 2 = 69

Workings

[69 + (2000-1905)/30] / [(2000+1905]/2 *100)

([69+3.17]/[(3905]/2*100)

(72.17/1952) * 100 = 3.70

Annual yield = 3.7*2= 7.4%

7.4 % being an approximate yield value , the closest option is 7.43%

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Linda is a qualifying widow in 2018. In 2018, she reports $80,000 of taxable income (all ordinary). What is her gross tax liabil
Anna71 [15]

Answer:

The correct answer to the following question is $9479 .

Explanation:

The taxable income ( ordinary ) of Linda in year 2018 is $80,000.

Now as per 2018 tax schedule Linda will have to pay $8907 and since her taxable income is above $77,400, that means she will have to pay 22% tax on the difference between $80,000 and $77,400, so therefore her tax liability would be -

$8907 + 22% x $2260 ( $80,000 - $77,400 )

= $8907 + $572

= $9479

5 0
2 years ago
Relational integrity constraints enforce business rules vital to an organization's success and often require more insight and kn
Over [174]

Answer: False

Explanation: Each company has integrity constraints unique to its business and every databases in a business contain integrity constraints that help prevent chaotic and unwanted events from happening. Business critical integrity constraints enforce business rules that are vital towards organization's goals and success and more often require more insight and in-depth knowledge than relational integrity constraints which are rules that enforce the basic and fundamental information essential to any database.

7 0
2 years ago
The passage is primarily concerned with(A) evaluating a method used to test a particular scientific hypothesis(B) discussing exp
oksian1 [2.3K]

Answer:

The correct answer is (B) discussing explanations for an unexpected scientific finding.

Explanation:

A serendipity is a discovery or a fortunate, valuable and unexpected finding that occurs accidentally, by chance or by destination, or when a different thing is being sought. It can also refer to the ability of a subject to recognize that he has made an important discovery even if it is not related to what he is looking for. Serendipities are frequent in the history of science. There are also cases of serendipity in literary works, when an author writes about something he has imagined and is not known in his time, and it is subsequently shown that this exists as defined by the writer, with the same details. It should not be confused with anticipation or science fiction, where much more generic inventions are advanced than almost everyone thinks they will probably exist one day.

6 0
3 years ago
Jim's Hardware is adding a new product to its sales lineup. Initially, the firm will stock $36,000 of the new inventory, which w
mr_godi [17]

Answer:

$13,000

Explanation:

Given that

The stock of the firm = $36,000

Invested amount in account receivable = $13,000

Invested amount in equipment = $11,000

So by considering the above information, the amount included in the initial project for net working capital is the account receivable i.e current assets minus current liabilities and the account receivable is come under the current assets so the same is to be included

7 0
3 years ago
Ruston Company had Net Income for 2020 of $6,200,000. The firm invested $4,000,000 in manufacturing equipment during 2020. The e
Aloiza [94]

Answer:

$3,000,000

Explanation:

Calculation to determine the Net Cash Flow in 2020

STATEMENT OF CASH FLOW

For the Year 2020

Cash flow from operating Activities:

Net Income $6,200,000

Add Depreciation Expense $ 800,000

Net Cash provided by operating activities $7,000,000

($6,200,000+$800,000)

Cash flow from Investing activities:

Investment in Equipment ($4,000,000)

Net Cash used in Investing activities ($4,000,000)

Net Cash flow in 2020 $3,000,000

Depreciation under Straight Line method = (Cost - Salvage Value)/Useful Life

Depreciation under Straight Line method= (4000000-0)/5

Depreciation under Straight Line method= 800,000

Therefore the Net Cash Flow in 2020 is $3,000,000

4 0
3 years ago
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