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3 years ago

11

g According to the CAPM, what is the expected rate of return for a stock with a beta of 1.2. when the risk-free rate is 6% and t

he market rate of return is 12%

1 answer:

lys-0071 [83]3 years ago

6 0

Answer:

20.40%

Explanation:

According to CAPM :

expected rate of return = risk free rate + (beta x market rate of return)

6% + (1.2 x 12%) = 20.40%

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You own a house that you rent for $1,675 per month. The maintenance expenses on the house average $315 per month. The house cost

Trava [24]

Answer:

The value that should be placed when analyzing the option of using the house as a professional office is $242,880

Explanation:

In calculating cash flow of a project, opportunity cost is very important hence be made part of the cash flow

Incremental cash flow = Appraisal on the house - Real estate fees

=$264,000 - $21,120

= $242,880

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3 years ago

Read 2 more answers

A__________produces finished-goods inventory in advance of customer demand using a forecast of sales.

Korolek [52]

Answer:

Push system.

Explanation:

A push system produces finished-goods inventory in advance of customer demand using a forecast of sales and as such it is categorized as a make to stock because the production of goods are not based on actual demand by the consumers.

Under a push system, manufacturing is strictly based on a projected production plan and the flow of information between the manufacturer and the market is in the same direction with those of raw materials used.

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3 years ago

Sanborn Industries has the following overhead costs and cost drivers. Direct labor hours are estimated at 100,000 for the year.

Nana76 [90]

Answer:

d) 34.17

Explanation:

we must first calculate the total overhead expenses = $120,000 (ordering and receiving) + $297,000 (machine setup) + $1,500,000 (machining) + $1,200,000 (assembly parts) + $300,000 (inspection) = $3,417,000

since overhead is applied based on direct labor hours, then the predetermined overhead rate = total overhead expenses / total direct labor hours = $3,417,000 / 100,000 labor hours = $34.17 per labor hour

8 0

3 years ago

Bramble Company uses the percentage of receivables method for recording bad debt expense. The accounts receivable balance is $59

shusha [124]

Answer and Explanation

Given:

Accounts receivable balance = $598,000

Percentage of receivables that are uncollectible = 5% or 0.05

Uncollectible receivables = 0.05 × 598,000 = $29,900

Adjusting journal entry to record bad debt expense is:

Particulars Debit Credit

Bad debts expense XXXXX

Allowance for doubtful debts XXXXX

(Being bad debts incurred)

Noe, Allowance for doubtful debts has a credit balance of $4,800.

Bad debt incurred = 29,900 - 4,800 = $25,100

So adjusting entry :

Particulars Debit Credit

Bad debts expense $25,100

Allowance for doubtful debts $25,100

(Being bad debts incurred)

7 0

4 years ago

Slaughter Industries just signed a sales contract with a new customer. What is this contract worth as of the end of year 4 if th

igor_vitrenko [27]

Answer:

$489,512.15

Explanation:

The formula for calculating future value:

FV = P (1 + r)^n

FV = Future value

P = Present value

R = interest rate

N = number of years

We are supposed to determine the present value

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow in year 1 = 84,000

Cash flow in year 2 = 113,000

Cash flow in year 3 = 125,000

Cash flow in year 4 = 130,000

I = 6%

PV = 387,739.47

387,739.47(1.06)^4 = $489,512.15

To find the PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

8 0

3 years ago