Current information for the Stellar Corporation follows: Beginning work in process inventory $ 29,900 Ending work in process inv
2 answers:
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Answer:
a. $49.83 (+ or - $0.05).
Explanation:
Given that :
Dividend of the first three years and the terminal value at the end of the year 2, that is the price at the end of year 2.
We know that the price of the share is the preset value of all the future dividends.
So we have to present price at the year 2 which is at present value for the end of the year 2 of the dividends beyond year 2.
To calculate the price of the stocks at present, we :
1. The present value for the price of the year 2 that is pv at the end of the year 2 of the dividend to be received beyond the year 2.
2. The present value of the dividend of the year 1 as well as year 2.
3. Then we add the steps 1 and 2 to get the present value of all the dividends.
Therefore,
The present value of the price at nth year with r rate of return is given by :
Hence, the present value of the price at the year 2 with 15.20% rate of return is =
= $ 41.28
Now present value of dividend of the first 2 years :
Dividend received at the end of the nth year with rate of return r is
=
Therefore the present value of the dividend of the first two years is
=
= 2.10 + 6.45
= $ 8.55
Now , $ 41.45 + $ 8.55
= $ 49.83
Thus, the current price of one share of the XYZ stock is $ 49.83
Answer:
The annual worth of the overhead costs for 7 year-period is
A = $389743.42.
<em>Then the time value of the annual worth is discounted by 8%</em>
∴ $389743.42 x 0.08 = $31179.47.
Explanation:
Using the formula
A = P(1 + r/n)
Where:
A = ?
t = 7
P = $200,000.00
r = 10%
n= 1
TVM =8%
∴ A = $200,000.00(1 + 0.10/1)
A = $200,000.00(1.10)
A = $200,000.00(1.9487171)
A = $389743.42
<em>Then the time value of the annual worth is discounted by 8%</em>
∴ $389743.42 x 0.08 = $31179.47
Answer:
(a) 1,078.12 copies
(b) 6.68 runs per year
(c) 37.43 days
(d) 10.78 days
(e) 767.62 copies
(f) $2,003.48
(g) 432 copies
Explanation:
Given that,
Annual demand (D) = 7200 copies
Cost of the book (C) = $14.50
Holding cost (H) = 18% of cost of book = 18% of $14.50
= $2.61
Setup costs (S) = $150
Annual production volume = 25,000 copies
Number of working days = 250
Lead time (L) = 15 days
Daily demand (d) = Annual demand ÷ Number of working days
= 7200 ÷ 250
= 28.8 copies
Daily production (p) = Annual production ÷ Number of working days
= 25000 ÷ 250
= 100 copies
(a) Minimum cost production lot size (Q):
Q = 1,078.12 copies
(b) Number of production runs:
= Annual demand (D) ÷ Production quantity (Q)
= 7,200 ÷ 1,078.12
= 6.68 runs per year
(c) Cycle time:
= Production quantity (Q) ÷ Daily demand (d)
= 1,078.12 ÷ 28.8
= 37.43 days
(d) Length of a production run:
= Production quantity (Q) ÷ Daily production (p)
= 1,078.12 ÷ 100
= 10.78 days
(e) Maximum inventory (Imax):
= Q × (1 - d÷p)
= 1,078.12 × (1 - 28.8 ÷ 100)
= 767.62 copies
(f) Total annual cost:
= Annual holding cost + Annual setup cost
= [(Q ÷ 2) × H × (1 - d÷ p)] + [(D ÷ Q) × S]
= [(1,078.12 ÷ 2) × $2.61 × (1 - 28.8 ÷ 100)] + [(7,200 ÷ 1,078.12) × $150]
= $1,001.74 + $1,001.74
= $2,003.48
(g) Reorder point:
= Daily demand × Lead time
= 28.8 × 15
= 432 copies