1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Gnom [1K]
3 years ago
15

Wyatt Oil is contemplating issuing a 20-year bond with semiannual coupons, a coupon rate of 7%, and a face value of $1000. Wyatt

Oil believes it can get a BBB rating from Standard and Poor's for this bond issue. If Wyatt Oil is successful in getting a BBB rating, then the issue price for these bonds would be closest to: $800 $891 $901 $1,000 $1,107
Business
1 answer:
enyata [817]3 years ago
5 0

Complete question:

Security Term (years) Yield (%)

Treasury 2 0 5.5%

AAA Corporate 2 0 7.0%

BBB Corporate 20 8.0%

B Corporate 2 0 9.6%

Wyatt Oil is contemplating issuing a 20-year bond with semiannual coupons, a coupon rate of  7%, and a face value of $1000. Wyatt Oil believes it can get a BBB rating from Standard and  Poor's for this bond issue. If Wyatt Oil is successful in getting a BBB rating, then the issue price  for these bonds would be closest to:

A) $891 B) $901 C) $1,000 D) $800

Answer:

If Wyatt Oil is successful in getting a BBB rating, then the issue price  for these bonds would be closest to:  $901

Solution:

Given,

FV = 1000,

N = 40,

I = 4,

PMT = 35

Compute PV ,

PV = FV \frac{1}{( 1+r)^{n} }

PV = 901.04

If Wyatt Oil is successful in getting a BBB rating, then the issue price for these bonds would be closest to: $901

You might be interested in
Classify each cost as being either variable or fixed with respect to the number of units produced and sold. Also classify each c
masha68 [24]

Answer:

Explanation:

There are primarily two types of costs, i.e. variable costs and the fixed costs. The variable cost is the cost which changes when the level of production changes, whereas the fixed cost is the cost which remains constant whether the level of output changes or not.

The variable costs also include indirect products, indirect labor and manufacturing equipment, and the fixed costs include taxes and depreciation costs.

The period cost is that cost which is related to the selling and admin expenses plus it is not capitalized.

Whereas the product cost is a mix of direct labor, direct material and the manufacturing overhead

So, the categorization is shown below:

1. Hamburger buns in a Wendy's outlet. = variable and product cost

2. Advertising by a dental office. = Fixed and period cost

3. Apples processed and canned by Del Monte. =  variable and product cost

4. Shipping canned apples from a Del Monte plant to customers. = variable and period cost

5. Insurance on a Bausch & Lomb factory producing contact lenses. = fixed and product cost

6. Insurance on IBM's corporate headquarters.= fixed and period cost

7 0
3 years ago
Irma has $500 to open a checking account. She wants an account with the lowest fees. She plans to use only her bank’s ATM to dep
andre [41]

Answer:

Account A

Explanation:

Since Irma has $500 to open a checking account and She wants an account with the lowest fees.

She plans to use only her bank’s ATM to deposit her paychecks and withdraw cash.

The Bank Account Terms and Conditions that would be best for Irma is Account A.

Account A will be sufficient as there is no indication for writing of checks and issuing checks  to clients as a form of payment, including the fact that the amount Irma has to open the account is just a base amount of $500

8 0
2 years ago
Read 2 more answers
How companies can link their compensation and evaluations to organizational objectives?
kicyunya [14]

Answer:

For a company’s compensation strategy to be effective, it must be linked to the overall business strategy. Because compensation accounts for 30-60% of business costs, it is essential for organizations to identify the drivers behind pay. For this reason, the foundational step of creating any solid compensation strategy is linking it to the business strategy.

Explanation:

8 0
2 years ago
Prepare journal entries to record the declaration and payment of these stock and cash dividends. 2. Prepare the December 31, 202
erma4kov [3.2K]

Answer:

Retained Earning (Dr.) $295,000

Stock Dividend Payable (Cr.) $295,000

To record stock dividend

Retained Earnings (Dr.) $157,800

Cash (Dr.) $157,800

To record cash dividend

Explanation:

Statement of Shareholder's Equity

Retained Earnings Beginning Jan 21 $1,275,000

Net Income $2,250,000

Cash Dividend $157,800

Stock Dividend $295,000

Retained Earning Ending $3,072,200

5 0
3 years ago
Universal Mines Inc. operates three mines in West Virginia. The ore from each mine is separated into two grades before it is shi
xxMikexx [17]

Answer:

this is a cost minimization problem, but it is missing some numbers, so I looked for similar questions (see attached PDF):

minimization equation = 20x₁ + 22x₂ + 18x₃ (costs per ton)

where:

x₁ = mine I

x₂ = mine II

x₃ = mine III

the constraints are:

4x₁ + 6x₂ + x₃ ≥ 54 (high grade ore)

4x₁ + 4x₂ + 6x₃ ≥ 65 (low grade ore)

x₁, x₂, x₃ ≤ 7 (only 7 days per week)  

using solver, the optimal solution is

2x₁, 7x₂, and 5x₃

a. The number of days Mine I should operate = <u>2 days </u>

b. The number of days Mine Il should operate = <u>7 days </u>

c. The number of days Mine III should operate = <u>5 days </u>

d. The total cost of the operation for next week = <u>$284,000</u>

Download pdf
4 0
3 years ago
Other questions:
  • The tendency for people who have first agreed to a small request to comply to a larger request is called the phenomenon
    7·1 answer
  • Which of the following statements is CORRECT?
    11·1 answer
  • An investor is forming a portfolio by investing $50,000 in stock A which has a beta of 1.50, and $25,000 in stock B which has a
    13·1 answer
  • The Mobile Share Plan: $150 monthly fee for up to 10 devices, unlimited talk and text for all the lines, and data charges of $10
    5·1 answer
  • Which of the following is a con of buying a franchise?
    9·1 answer
  • Higher income taxes cause a ____________ shift of the labor supply curve, which then produces __________ Real GDP. a. leftward;
    15·1 answer
  • Assume the market for ball bearings is purely competitive. Currently, each of the firms in this market is earning positive econo
    13·1 answer
  • Na frase, "Você fez o que eu pedi pra você fazer, Zero?" Identifique um verbo no pretérito perfeito e faça sua conjugação abaixo
    5·1 answer
  • The total factory overhead for Landen Company is budgeted for the year at $675,000. Landen manufactures two drapery products: sh
    8·1 answer
  • The merger of media enterprises into powerful, synergistic combinations that can cross-market content on many different platform
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!