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aleksklad [387]
4 years ago
11

P7-47. Interpreting Debt Footnotes on Interest Rates and Interest Expense. Boston Scientific discloses the following as part of

its long-term debt footnote in its December 31, 2018 10-K. Borrowings and Credits Agreements As of December 31, In millions, except interest rates Issuance Date Maturity Date 2018 2017 Semi-annual coupon rate January 2020 Note ............. Dec. 2009 Jan. 2020 $850 $850 6.000% May 2020 Notes May. 2015 May. 2020 $600 $600 2.850% May 2020 Notes May. 2015 May. 2022 $500 $500 3.375% October 2023 Notes Aug. 2013 Oct. 2023 $450 $450 4.125% May 2025 Notes May. 2015 May. 2025 $750 $750 3.850% March 2028 Noes Feb. 2018 March. 2026 $1,000 $- 4.000% November 2035 Notes(1) Nov. 2005 Nov. 2035 $350 $350 7.000% January 2040 Notes Dec. 2009 Jan. 2040 $300 $300 7.375% Unamortized debt insurance discount and deferred finance cost 2020-2040 $(29) $(24) Unamortized gain on fair value hedge 2020-2025 $26 $38 Capital lease obligation Various $6 $1 Long term debt $4,803 $3,815 (1) Corporate credit rating improvements may result in a decrease in the adjusted interest rate on our November 2035 Notes to extent that our lowest credit rating is above BBB- OR Baa3. The interest rates on our November 2035 notes will be permanently re-instated to the issuance rate if the lowest credit ratings assigned to these senior notes is either A- or A3 or higher. Boston Scientific discloses its required principal debt repayments due during each of the next five years (In millions) 2019 $2,248 2020 $1,540 2021 $- 2022 $500 2023 $450 Thereafter $2,400 Boston Scientific also discloses the following information. Interest Expense The following table provides a summary of our interest expense and average borrowing rate: Year Ended December 31 (in millions) 2018 2017 2016 Interest expense $(241) $(229) $(233) Weighted average borrowing rate 3.6% 3.8% 4.0% Cash paid for interest $(262.00) $(235.00) $(233.00) The price of the Boston Scientific's bonds in February 2019 follows. Maturity date Coupon Current Price Current Yield Moody's Rating(02/21/2019) 2028 4.00% 109.35 $2.80 Baa2 2023 4.13% 101.57 2.41% Baa2 REQUIRED a. What amount of Boston Scientific's long-term debt is due in 2019? b. What is the total amount of Boston Scientific's long-term debt at December 31, 2018, including the current maturities? c. The company's balance sheet reports short term debt including current liabilities of $2,253 million and $1,801 millinon in 2018 and 2017, respectively. Compute the average effective interest rate on the company's total debt for fiscal 2018. Compare this to the average interest rate the company reports. d. Explain how the amount of cash paid for interest can differ from the amount of interest expense recorded in the income statement. e. The 1,000 million 4.00% note due in 2028 is priced at 109.35 (109.35% of face value, or or $1093.50 million) as of early 2019, resulting in a current yield of 2.8%. Adssuming that the company's credit rating has not changed since the bond was issued, what does the pricing of thie 4.00% bond imply about interest rate changes since Boston Scientific issued the bond? f. Compare the bonds that mature in 2023 and 2028. Explain why the bond with the higher coupon rate (4.125%) has the lower yield (2.41%).
Business
1 answer:
Zigmanuir [339]4 years ago
7 0
To go if do he go he do he do he do he
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A real estate salesperson brings a buyer to a For-Sale-By-Owner transaction. The home sells for $120,000, and the seller agrees
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Solution:

The home sells for = $120000

The commission that is paid by the seller is 3 percent

Therefore, commission = 3% of $120000 = $3600

The sales-person is on a 65 percent commission schedule with her broker which means that the saleperson gets the 65 percent amount of the commission.

Thus, the amount which is received by the salesperson from the given transaction is = 65% of $3600 = $2340

Therefore, the salesperson receives $2340 amount from the said transaction.

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3 years ago
Aden is a small engine mechanic who earns a regular hourly rate of $15.68. For overtime, he earns time and a half on Saturdays a
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Total pay is : $909.44

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3 years ago
The Hawthorne studies began as the type of experiment recommended by Scientific Management. Researchers were trying to find the
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George Elton Mayo

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A plant asset acquired on October 1, 2018, at a cost of $400,000 has an estimated useful life of 10 years. The salvage value is
melamori03 [73]

Answer:

The depreciation expense for the first two years is $72,000.

Explanation:

Under straight-line method, depreciation expense is (Cost - Residual value) / No of years = ($400,000 - $40,000) / 10 years = $36,000 yearly depreciation expense.

Using this method, the depreciation expense for the first two years is $36,000 x 2 years = $72,000. This amount is regarded as the accumulated depreciation at the end of Year 2 while the net book value would be $400,000 - $72,000 = $328,000.

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3 years ago
As would-be Entrepreneur, you are tasked to identify your dreamed business,
steposvetlana [31]

Answer:

My dream business is organic poultry farming.

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It is my hobby to have different types of hen breeds. So I would like to invest in my hobby. I would like to have breeds of organic hens that will lay more eggs. I will also invest in fancy chickens which are widely used as pet in backyards.

It has great potential for growth, as people are nowadays moving towards organic foods. The organic poultry market has grown from $7.5 billions to $7.7 billions from 2019 to 2020. The growth recorded is almost 2% despite the breakout of virus. People would like to buy fancy chickens as pets because they lay eggs and look cute in the backyards.

The return on fancy chicken breed is much higher than an ordinary chicken breed that only lays egg. I will start from 1500 baby chickens and will around 50 chicken tractors in a large 8 kanal area. This chicken tractors will help me to keep the death rate of the chickens low and are helpful in lowering the spread of diseases. Furthermore, it is moveable which means my chickens will have fresh grass to eat.

I will buy a small van that will be helpful in managing the delivery of food requirement and egg supply to my customers. To lower the cost of organic feed I will grow many types of plants, herbs, grass, etc in the 8 kanal area that will meet the protien requirements of the chickens. I will also water the land daily so that the waste of the chickens are accessed very quickly to plants.

Their many other tactics that could be used like leasing the land for 2 years because it will lower the investment required, plantation of plants that will grow its value over time, use of thick sheets that will protect chickens from and use of thin sheet that will protect them from mosquitos, etc.

<em>Note:</em> <u>I wasn't able to access complete questions so I think the above explanation of business idea will be very helpful for you to construct a business plan.</u>

If you find the answer very helpful then don't forget to rate it. Thanks

6 0
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