Answer:
Cost of external equity financing 16.64%
Explanation:
Cost of external equity financing=Div*(1+g)/P (1-F) + g
F = the percentage flotation cost=4%
Div=Dividend in the current period=$3.7
g=growth=9%
P=Market price of the stock= $55
Cost of external equity financing=3.7*(1+0.09)/(55*(1-0.04))+0.09=0.166383=16.64%
Answer:
long-run average total cost decreases as output increases.
Explanation:
Answer:
$29.71
Explanation:
Value of Stock can be determine by Dividend Valuation method.
Dividend Valuation method is used to value the stock price of a company based on the dividend paid, its growth rate and rate of return. The price is determined by calculating present value of future dividend payment.
In this question the Dividend payment is $2, growth rate is 4% and required rate of return is 11%.
Formula for Valuation:
Value of Share = Dividend (1 + g) / (Rate of return - Growth rate)
Value of Share = $2.00 (1 + 4%) / (11% - 4%)
Value of Share = $2.00 (1.04) / 7%
Value of Share = $29.71
Based on the selling price of the picture frames and the unit variable costs, the break-even point is 400 picture frames.
<h3>What is the breakeven point?</h3>
This can be found by the formula:
= Fixed costs / (Selling price - Variable costs)
Solving gives:
= 32,000 / (120 - 40)
= 32,000 / 80
= 400 picture frames
Find out more on breakeven point at brainly.com/question/21137380.
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Adjusting journal entry on December 31, 2019 is as follows:
Debit - Sales Returns and allowances - 16,000.00
Credit - Accounts Receivable - 16,000.00
