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3 years ago

Feldspar Inc. is considering the capital structure for a new division. Management has been given the following cost information:

Business

1 answer:

34kurt3 years ago

8 0

Answer:

Option 4

Explanation:

In this question ,we have to compute the WACC which is shown below:

= Weightage of debt × cost of debt × ( 1- tax rate) + (Weightage of common stock) × (cost of common stock)

For Option 1, it would be

= (0.3 × 10%) × ( 1 - 40%) + (0.7 × 12.5%)

= 1.8% + 8.75%

= 10.55%

For Option 2, it would be

= (0.4 × 10.5%) × ( 1 - 40%) + (0.6 × 13%)

= 2.52% + 7.8%

= 10.32%

For Option 3, it would be

= (0.5 × 11%) × ( 1 - 40%) + (0.5 × 13.5%)

= 3.3% + 6.75%

= 10.05%

For Option 4, it would be

= (0.6 × 11.7%) × ( 1 - 40%) + (0.4 × 14.2%)

= 4.212% + 5.68%

= 9.89%

For Option 5, it would be

= (0.7 × 13%) × ( 1 - 40%) + (0.3 × 15.5%)

= 5.46% + 4.65%

= 10.11%

So based on this, the management should accept option 4 as it derives the best debt asset ratio

The weightage of equity would be come

= 1 - weightage of debt

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Wheeler’s Bike Company manufactures custom racing bicycles. The company uses a job order cost system to determine the cost of ea

kirill [66]

Answer:

predetermined overhead rate: 14.51 dollars per labor hour

applied overhead at 18,500 hours: 268,435 dollars

Explanation:

$\frac{Cost\: Of \:Manufacturing \:Overhead}{Cost \:Driver}= Overhead \:Rate$

we distribute the expected overhead over the cost dirver. In this case direct labor hour:

cost driver: labor hours:

labor cost: 231,322 / 12.71 labor rate = 18,200 labor hours

<u>expected overhead:</u>

depreciaiton 53,500

supervisor 135,000

supplies 42,900

property tax 32,750

total overhead 264,150‬

overhead rate: 264,150 / 18,200 = 14,51373626373626 = 14.51/hr.

applied: 18,500 x 14.51 = 268.435‬

3 0

3 years ago

Help me out here I got a d

Aneli [31]

Answer:

it is type and price range.

3 0

3 years ago

In response to an upturn in the economy, entrepreneurs seek to expand their businesses. a. What will happen to nominal interest

kicyunya [14]

a. Nominal interest rates Increase and Aggregate demand Decrease

b. New Fed policy Buy bonds

Explanation:

When contemplating unemployment, the nominal interest rate applies to the rate of interest. Net may, without taking into consideration any commissions or compounded interest, be related to the advertised or reported interest rate of a loan.

The aggregate demand (AD) for finished commodities and facilities in the market at a certain time is aggregated. Strong demand is often named, but this term is often used in many ways. This is the market for a country's gross national product.

When the Fed sells debt in the international market, the world economy money supply is expanded by exchanging debt for cash from the general public. Instead, when the Fed sell bonds, the supply of money is reduced by cash being pulled out of the market in return for bonds. The Fed also sells bonds.

7 0

3 years ago

Many businesses use find-a-hand, a professional staffing agency because of the employees’ expertise in recruiting and selecting

makvit [3.9K]

It is an example of Strength in SWOT Analysis.

SWOT Analysis is a strategic planning technique used for identifying and analyzing internal strengths and weaknesses in an organization includes the Strength, Weakness, Opportunities and Threat.

Professional staffing agency isused by organization to recruit qualified workers into the organization.

But, employees’ with high levels of knowledge can also perform the purpose for business client, so, this situation forms part of the Strength factor for such organization.

In conclusion, an example of the find-a-hand’s forms the Strength in the SWOT analysis of the company.

Learn more about SWOT Analysis here

<em>brainly.com/question/18068310</em>

4 0

2 years ago

Chamonix Chateau Rentals. You are planning a ski vacation to Mt. Blanc in Chamonix, France, one year from now. You are negotiati

nata0808 [166]

Answer:

The budgeted $ amount is $13,680.88

Explanation:

The purchasing power parity formula gives us an idea what an exchange spot rate would be in future period using the below formula:

Future spot rate=current spot rate*(1+US inflation)/(1+French inflation)

current spot rate=$1.3620

US inflation rate is 2.50%

French inflation is 3.50%

Future spot rate=$1.3620*(1+2.5%)/(1+3.5%)

future spot rate=$1.3488

The weekly cost of vacation would also be adjusted for inflation rate in France as follows:

Adjusted price=9800*(1+3.5%)=10143

Hence the cost of the one week rental would be 10143 multiplied by the future spot exchange rate of 1.3488 i.e $ 13,680.88 (10143*1.3488)

7 0

2 years ago