a house, duh, clothing can be hung and stored, potato chips are bagged, a magazine is almost useless, but a house needs plants trimmmed and rooms cleaned and taking care of bugs and such
Answer:
WACC is 9%
Explanation:
WACC is the average cost of capital of the firm based on the weightage of the debt and weightage of the equity multiplied to their respective costs.
According to WACC formula
WACC = ( Cost of equity x Weightage of equity ) + ( Cost of debt ( 1- t) x Weightage of debt ) + ( Cost of Preferred equity x Weightage of Preferred equity )
As per given data
Market Values
Equity = $7 billion,
Preferred stock = $2 billion
Debt = $13 billion
Cost
Equity
Capital asset pricing model measure the expected return on an asset or investment. it is considered as the cost of common stock.
Formula for CAPM
Cost of Equity = Risk free rate + beta ( market return - risk free rate )
Cost of Equity = Rf + β ( Mrp )
Cost of Equity = 3% + 1.6 ( 8% ) = 15.8%
Preferred stock = $2 / $26 = 0.077 = 7.7%
Debt = 8%
Placing values in the formula
WACC = ( 15.8% x $7 billion / $22 billion ) + ( 8% ( 1- 0.3) x $13 billion / $22 billion ) + ( 7.7% x $2 billion / $22 billion )
WACC = 5.03% + 3.31% + 0.7% = 9.04%
you've been meaning to fix those rotted boards on your porch for years. finally, last week the deck gave way. No, you will not be able to recover the cost of replacement. This is further explained below.
<h3>What is the cost?</h3>
Generally, the cost; In order to get or carry out (something), one must first spend (a certain quantity of money).
In conclusion, You've been looking at the rotten planks on your porch for years and know you need to do something about it. The deck ultimately collapsed last week. The cost of replacement cannot be recouped, unfortunately.
Read more about the cost
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Answer:
C. Mortgage bond rated AAA is the correct answer.
Explanation:
Answer:
1. Periodicity assumption.
2. Going concern assumption.
3. Historical cost principle.
4. Economic entity assumption.
5. Full disclosure principle.
6. Monetary unit assumption.
Explanation:
1. <u><em>Periodicity assumption</em></u>: The economic life of a business can be divided into artificial time periods. It is also known as the Time period assumption.
2. <em><u>Going concern assumption</u></em>: The business will continue in operation long enough to carry out its existing objectives.
3. <em><u>Historical cost principle</u></em>: Assets should be recorded at their acquisition cost.
4. <em><u>Economic entity assumption</u></em>: Economic events can be identified with a particular unit of accountability.
5. <em><u>Full disclosure principle</u></em>: Circumstances and events that could make a difference to financial statement users should be disclosed.
6. <em><u>Monetary unit assumption</u></em>: Only transaction data that can be expressed in terms of money should be included in the accounting records.
