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natulia [17]
3 years ago
10

Battles, Inc. just paid an annual dividend of $1.20 a share. The dividend will not change next year and then increase by 4 perce

nt annually thereafter.
1. What is the present value of this stock at a discount rate of 9 percent?
Business
1 answer:
storchak [24]3 years ago
4 0

Answer:

The price of the stock today is $24

Explanation:

The price of the stock can be calculated using the dividend discount model. The price of the stock will include discounting back future dividends.

P0 = D0*(1+g) / 1+r  + [D*(1+g) / r-g] / 1+r

P0 = 1.2*(1+0) / 1+0.09  +  [1.2(1+0.04) / 0.09-0.04] / 1+0.09

P0 = $24

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Belltone Company made the following expenditures related to its 10-year-old manufacturing facility:
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Answer:

The journal entries are as follows:

(1) Accumulated depreciation - Building A/c Dr. $250,000

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(To record the replacement of heating system)

(2) Building A/c Dr. $750,000

          To cash                        $750,000

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(3) Maintenance expense A/c Dr. $14,000

                To cash                                       $14,000

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           To cash                          $50,000

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6 0
4 years ago
Ratios that measure the income or operating success of a company for a given period of time are.
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8 0
2 years ago
Labor is the only variable input for Elliot's dog-walking service. His labor costs are $300 a day and his service walks 25 dogs
bogdanovich [222]

Answer:

A) $15.50

Explanation:

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8 0
3 years ago
Ai​ Lun, a management trainee at a large New Yorkdashbased ​bank, is trying to estimate the real rate of return expected by inve
QveST [7]

Answer:

Ai​ Lun estimate that  real rate would be 1%

Explanation:

The Formula for the Real Rate of Return is

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Inflation rate  is given by the rising of the consumer prices =2%

So,  

Real rate of return =3% - 2%

Real rate of return=1%

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