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otez555 [7]
4 years ago
7

You can estimate the value of a company’s stock using models such as the corporate valuation model and the dividend discount mod

el. Which of the following companies would you choose to evaluate if you were using the discounted dividend model to estimate the value of the company’s stock?
Business
1 answer:
sleet_krkn [62]4 years ago
3 0

Answer: Using the discounted dividend model to estimate the value of the company’s stock, I will choose to evaluate a company that is not expected to distribute any earnings to its stockholders for the next few years.

You might be interested in
Halestorm Corporation’s common stock has a beta of 1.13. Assume the risk-free rate is 4.8 percent and the expected return on the
nadezda [96]

Answer:

13.275%

Explanation:

Using Capital Asset Pricing Model we have,

Cost of equity = Risk free return + Beta (Market return - Risk free return)

Provided risk free rate of return = 4.8%

Beta = 1.13

Market rate of return = 12.3%

Therefore cost of equity = 4.8% + 1.13 (12.3 - 4.8)

= 4.8% + 8.475%

Therefore, Halestorm Corporation's cost of equity

= 13.275%

5 0
3 years ago
On May 1, 2021, Varga Tech Services signed a $126,000 consulting contract with Shaffer Holdings. The contract requires Varga to
alukav5142 [94]

Answer:

The amount of revenue recognizable in 2021 is $84000 as shown below

Explanation:

Since the revenue spans over two years,8 months in the year 2021 and the remaining 4 months relate to 2022, the revenue should be recognized on proportional basis.

The revenue in 2021 =total revenue*months in the year/12 months

                                   =$126000*8/12

                                    =$84000

This amount is recorded on monthly basis by crediting revenue with one  month sales revenue value  $10500($126,000/12) and debiting to deferred revenue.

At the end of the year four months worth of revenue amount would be left in deferred revenue account as revenue for 8 months would have been recognized.

6 0
3 years ago
Company management completes event identification and analyzes the risks. The company wishes to assess its risk after management
r-ruslan [8.4K]

Answer:

Residual risk

Explanation:

Is a type of risk whose threat(s) is not completely removed even after putting all control measures in place. It is calculated as:

Residual risk = inherent risk minus effect of risk control.

7 0
3 years ago
Llcs are mainly capitalized via _______ or through the sale of _______ ownership in the llc itself. (choose two correct answers)
Aleksandr [31]

Llcs are mainly capitalized via Equity or through the sale of Debts ownership in the llc itself.

What is Equity?

Equity is the sum of money invested in or owned by a company's owner. The difference between a firm's obligations and assets on its balance sheet indicates how much equity the company has. The equity value is calculated using the share price or a value established by valuation specialists or investors.

Therefore,

Llcs are mainly capitalized via Equity or through the sale of Debts ownership in the llc itself.

To learn more about equity from the given link:

brainly.com/question/1957305

6 0
2 years ago
What is the value of an annuity due at the end of 15 years of quarterly deposits of $2,000.00 with terms of 8 percent compounded
elena55 [62]

Explanations:

The formula for future value given

deposit amount, A = 2000

deposit interest,  i = 8% annually = 8/4 = 2%, compounded quarterly

compounding period = quarterly

number of periods, n = 15 years = 4*15 = 60 periods (quarters)

The future value is given by:

FV = A*((1+i)^n-1)/i

= 2000*(1.02^60/0.02)

= $228103.08  (rounded to the nearest cent).

The difference in the answer choice is probably due to the teacher's calculator does not have sufficient accuracy.

4 0
3 years ago
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