I believe the answer is: Speculation helped many low-income people move to the middle class.
Due to the early development of industrial economy in the 1920s, the stock market experienced a period where most of company's value keep increasing over several years forward. This make a lot of people manage to grow their investment very quickly and obtain a lot of wealth.
Answer:
The correct answer to the problem is 7.728%
Explanation:
Lucas marginal tax rate = 32 percent
Tax rate on dividends = 16 percent
Dividend yield of a dividend-paying stock (with no growth potential) = 9.20 percent.
To determine the interest rate a municipal bond have to offer for Lucas to be indifferent between the two investments from a cash flow perspective =
Dividend yield multiplied by ( 1- tax rate on dividends)
= 9.20% × (1 - 16%)
= 0.092 × (1 - 0.16)
= 0.092 × 0.84
= 7.728%
Answer:
The amount credited to common stock upon conversion of the bonds is $101000
Explanation:
When the bond was issued there would been a debit of $102000($100000*$102/$100) to cash account and credit of $102000 to liabilities split into $100000 bonds payable and $2000 bond premium.
However, on conversion to common stock with premium of $1000 outstanding in the books,the amount to be credited into common stock account is the issue value less outstanding premium.
The amount credited to common stock=$102000-$1000=$101000
This can be shown with entries below:
Dr Bond payable $100000
Dr Bond premium $1000
Cr Common stock $101000
Answer:
General overhead= $3.81 per direct labor hour
Explanation:
Given the following information:
General Overhead $80,000 Number of direct labor hours
Number of direct labor hours 9,000 12,000= 21,000
<u>To calculate the activity rate, we need to use the following formula:</u>
Activity rate= estimated costs / total amount of allocation rate
General Overhead= 80,000 / 21,000
General overhead= $3.81 per direct labor hour
An augmented product is something that has physical and non-physical attributes that add to the value of the product itself.
