The main disadvantage of the valuation method is that the terminal value tends to dominate the total value in many cases.
In a free cash flow valuation, the intrinsic value equals present value of its free cash flow and thus, the net cash flow is left over for distribution to stockholders and debt-holders in each period.
- So, the disadvantage of the free cash flow valuation method is that the terminal value tends to dominate the total value in many cases.
Hence, the Option B is correct.
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The correct answer is 2.2 hours.
I<span>f Eva uses the earliest due date priority rule, the order of the dresses will be as follows: W (1 hour processing time, 1 hour due); Y (2 hrs processing time, 3 hrs due); V (3 hrs processing time, 5 hrs due); Z (5 hrs processing time, 7 hrs due); X (4 hrs processing time, 9 hrs due).</span>
It's easier to do the next step using real numbers. For example, if it's 11am now and W is due in 1 hour, then W is due at noon. If Y is due in 3 hours, then Y is due at 2pm, etc. Then, you need to use the processing time to see how long it will take to make the dresses. For example, since W takes one hour to process, it will be done by noon, its due date.
This means that W and Y will be altered on time, V will be 1 hour late, Z will be 4 hours late, and X will be 6 hours late. To find the average tardiness, add these extra hours (1+4+6) = 11, and divide by the total number of dresses (even the ones that weren't late) 5: 11/5 = 2.2 hours.
Answer:
Keep the cattle and recover the contract price from Esau
Explanation:
Since in the question it is given that the Double D Ranch and Esau enter into a contract on August 1 for selling of 200 cattle.
But Esau cancels the contract after 10 days. Now the Double D Ranch is not able to sell the cattle to the another buyer so in this case , the Double D Ranch should keep the cattle and get back the price of the contract from the another party i.e Esau as he cancels the contract
Answer:
You need to write a check for $167.50 from your checking account, which has a balance of $1,725.25. What percent of your balance will remain?
The percent balance will remain 90%
Explanation:
$1725.25 - $167.50= $1557.75
percentage left= 1557.75/1725.25 X 100
percentage left= 90.291= 90.30%
Answer:
Re = 16.02%
Explanation:
current stock price 36 x 7,660,000 = 275,760,000
cost of equity = 17.5%
current short term debt = 141,600,000
cost of short term debt = 8.5%
current long term debt = 210,600,000
cost of long term debt = 10.5%
total financing = 627,960,000
- equity = 275,760,000 / 627,960,000 = 0.4391
- short term debt = 141,600,000 / 627,960,000 = 0.2255
- long term debt = 210,600,000 / 627,960,000 = 0.3354
WACC = (0.4391 x 0.175) + (0.2255 x 0.085 x 0.75) + (0.3354 x 0.105 x 0.75) = 0.0768 + 0.0144 + 0.0264 = 0.1176 or 11.76%
under the new structure:
total financing = 627,960,000
- equity = 325,760,000 / 627,960,000 = 0.5188
- short term debt = 141,600,000 / 627,960,000 = 0.2255
- long term debt = 160,600,000 / 627,960,000 = 0.2557
assuming WACC remains unchanged:
0.1176 = (0.5188 x Re) + (0.2255 x 0.085 x 0.75) + (0.2557 x 0.105 x 0.75) = (0.5188 x Re) + 0.0144 + 0.0201 = (0.5188 x Re) + 0.0345
0.5188 x Re = 0.1176 - 0.0345 = 0.0831
Re = 0.0831 / 0.5188 = 0.1602 or 16.02%
