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2 years ago

Question 5: Definitions and concepts

Business

2 answers:

Eddi Din [679]2 years ago

3 0

I cant see the text tru posting it again

skelet666 [1.2K]2 years ago

3 0

Answer:

Economic growth - an increase in the capacity of an economy to produce goods and services, compared from one period of time to another

Economic development - creation of wealth from which community benefits are realized, it is more than a jobs program, it's an investment in growing your economy and enchancing the prosperity and quality of life for all residents.

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Losses from ________ exposure generally reduce taxable income in the year they are realized. ________ exposure losses may reduce

VMariaS [17]

Losses from <u>transaction</u> exposure generally reduce taxable income in the year they are realized. <u>Operating </u>exposure losses may reduce taxes over a series of years.

Transaction exposure is the extent of uncertainty companies concerned in international exchange face. Specifically, it's far the chance that currency exchange quotes will fluctuate after a company has already undertaken a financial duty.

Taxable income is the part of your gross income that the IRS deems a problem with taxes. It includes each earned and unearned profit. Taxable earnings are normally less than adjusted gross income because of deductions that reduce it.

Gross profits consist of all income you obtain that is not explicitly exempt from taxation below the Internal Sales Code (IRC). Taxable profits are the portion of your gross earnings that's sincerely a problem with taxation. Deductions are subtracted from gross profits to reach your amount of taxable earnings.

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6 0

1 year ago

Mack opened a cd 10 years ago at an interest rate of 7.8%, compounded monthly. According to the rule of 72, when did he have hal

Yakvenalex [24]

72 rule says
72/rate=Time
72/7.8= 9.23 years

8 0

3 years ago

Read 2 more answers

The balance sheet of ABC reports total assets of $400,000 and $450,000 at the beginning and end of the year, respectively. The r

zimovet [89]

Answer:

ABC net income for the year is $42,500

Explanation:

Beginning total assets = $400,000

Ending total assets = $450,000

Average total assets = Beginning total assets + Ending total assets ÷ 2

= ($400,000 + $450,000) ÷ 2

= $425,000

Return on assets = 10%

Therefore,

Net income ÷ Average total assets = Return on assets

Net income = Return on assets × Average total assets

Net income = 0.1 × Average total assets

= $425,000 × 0.1

= $42,500

7 0

3 years ago

Dinklage corp. has 6 million shares of common stock outstanding. the current share price is $84, and the book value per share is

Ann [662]

The answers to the questions are given below.

A. The company's capital structure weights on a book value basis are:

Equity = 9.84%
Debt = 90.16%

B. The company's capital structure weights on a market value basis are:

Equity = 64.55%
Debt = 35.45%

<h3>What is the calculations about?</h3>

A. The company's capital structure weights on a book value basis are:

Firm's Outstanding common stock = 6 million shares

Current share price = $84

Book value per share = $5

Hence, Total equity book value = $30 million (6,000,000 x $5)

Total equity market value = $504 million (6,000,000 x $84)

First bond's face value = $145 million

Coupon rate = 5%

Selling price = 95% of par

Market value of first bond = $145 x 95%

= $137.75 million

The Second bond's face value = $130 million

Coupon rate = 4%

Market value = $130 x 107% = $139.1 million

Total market value of bonds = $276.85 million ($137.75 + $139.1)

Book value of bonds = $275 million ($145 + $130)

Therefore, the company's capital structure by book value:

Equity = $30 million

Debt = $275 million

So, Total firm's value = $305 million

Hence:

Equity = $30/$305 x 100 = 9.84%

Debt = $275/$305 x 100 = 90.16%

B. Hence company's capital structure by market value:

Equity = $504 million

Debt = $276.85 million

Total firm's value = $780.85 million

Therefore:

Equity = $504/$780.85 x 100 = 64.55%

Debt = $276.85/$780.85 x 100 = 35.45%

See full question below

Dinklage Corp. has 6 million shares of common stock outstanding. The current share price is $84, and the book value per share is $5. The company also has two bond issues outstanding. The first bond issue has a face value of $145 million, a coupon rate of 5 percent, and sells for 95 percent of par. The second issue has a face value of $130 million, a coupon rate of 4 percent, and sells for 107 percent of par. The first issue matures in 24 years, the second in 9 years. Both bonds make semiannual coupon payments.

Required:

a. What are the company's capital structure weights on a book value basis?

b. What are the company's capital structure weights on a market value basis?

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4 0

2 years ago

Garcia Co. issued bonds with detachable common stock warrants. Only the warrants had a known market value. Cash proceeds exceed

777dan777 [17]

Answer:

Discount on bond payable

Explanation:

since in the question it is mentioned that the company has issued the common stock warrants also the cash proceeds is more than the sum of the fair value + face value

So we presume that the bond are to be sold at the discount

Therefore the excess should be reported as the discount on bond payable

5 0

2 years ago