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ioda
3 years ago
14

Tolton, Inc. is just shy of hitting its operating income target. The manager, K.T. Tolton, decides to purchase inferior material

s right before year end. The standard price for the materials is $13.00 per pound. K.T. buys 3,000 pounds of inferior product at $11.37 per pound. What is the effect on net income for the year? Please sign an increase as a positive number (e.g. 100) and a decrease as a negative number (e.g. -100).
Business
1 answer:
mario62 [17]3 years ago
6 0

Answer:

Net income increase - $4,890

Explanation:

The computation of the effect on net income is shown below:

= Number of pounds of inferior product × (standard price for the materials - inferior product price per pound)

= 3,000 pounds × ($13 - $11.37)

= 3,000 pounds × $1.63

= $4,890 increase

For determining the effect we took the difference of the prices and then multiply it with the number of pounds of the inferior product

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Stolb23 [73]

Answer:

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Explanation:

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Calculation of WACC

WACC = Cost of equity + Cost of preferred​ stock + Cost of debt

Capital Source       Market Values     Weight      Cost      Total Cost

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debt                           $ 15 ​billion         62.50%     5.2 %       3.25%

Total                          $ 24 billion                                          8.22 %

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Cost of preferred​ stock = Dividend/Market Price

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Cost of debt = interest × (1- tax rate)

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3 years ago
If a one-year bond has a face value of $5,000 and is sold for $4,500, what is the interest rate on the bond?
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Answer:

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Therefore the interest rate of this bond can be calculated as follows

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Hence the interest rate is 11.1%

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