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Nookie1986 [14]
4 years ago
11

The Brown Jug has paid annual dividends of $0.61, $0.64, $0.71, $0.82, and $0.88 per share over the past 5 years, respectively.

What is the geometric average dividend growth rate for this period?
Top of Form

a. 8.51 percent
b. 8.97 percent
c. 9.10 percent
d. 9.59 percent
e. 10.21 percent
Business
1 answer:
Vera_Pavlovna [14]4 years ago
6 0

Answer:

Option (d) 9.59%

Explanation:

Data provided in the question:

Annual dividends paid by the Brown jug

$0.61, $0.64, $0.71, $0.82, and $0.88 per share over the past 5 years

Now,

Present value = $0.61

Future value = $0.88

Time = 4 years                    [as there is no interest for the year 1]

Now,

Future value = Present value × (1 + r )ⁿ

here,

r is the geometric average dividend growth rate

$0.88 = $0.61 × (1 + r )⁴

or

(1 + r )⁵ = 1.4426

or

1 + r = 1.0959

or

r = 0.0959

or

r = 0.0959 × 100% = 9.59%

Hence,

Option (d) 9.59%

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Explanation:

Note: <em>Missing word has been attached</em>

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3 years ago
Harlen Company is involved in a competitive bidding situation. The following costs are anticipated for a project to be bid with
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Answer:

C. $1,370,000

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Minimum bid price $1,370,000

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Journalize the following entries on the books of Winston Co. for August 1, September 1, and November 30. (Assume a 360-day year
olasank [31]

Answer and Explanation:

The journal entries are shown below:

On Aug. 1

Merchandise Inventory $75,000  

         To Accounts Payable  $75,000

(Being the purchase of merchandise inventory is recorded)

For recording this we debited the merchandise inventory as it increased the assets and credited the account payable as it also increased the liabilities

On Sept. 1

Accounts Payable $75,000  

           To Notes Payable  $75,000

(Being the issued of note payable on the account is recorded)

For recording this we debited the account payable as it decreased the liabilities and credited the note payable as it increased the liabilities

On Nov. 30

Notes Payable $75,000  

Interest Expense $1,125  ($75,000 × 6% × 90 days ÷ 360 days)

             To Cash  $76,125

(Being cash paid is recorded)

For recording this we debited the note payable and interest expense as it decreased the liabilities and increased the expense and credited the cash as it decreased the assets

8 0
3 years ago
Say that the average worker in Canada has productivity of $33 per hour while the average worker in the United Kingdom has produc
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Answer:

The answer is: Canadian workers will still have a higher productivity, it will be $0.40 per hour higher.

Explanation:

We can elaborate the following productivity table:

Year     Canadian productivity                 British productivity

0                   $33 per hour                        $29 per hour

1                   $33.33 per hour                    $29.87 per hour

2                  $33.66 per hour                    $30.77 per hour

3                  $34 per hour                         $31.69 per hour

4                  $34.34 per hour                    $32.64 per hour

5                  $34.68 per hour                   $33.62 per hour

6                  $35.03 per hour                   $34.63 per hour

At the end of year 6, Canadian workers' productivity will be $35.03 and British workers' productivity will be $34.63 per hour (Canadian workers will be $0.40 more productive).

6 0
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