Answer:
The answer is setup cost (option C)
Explanation:
Setup cost is simply the cost that comes with the setting up or configuration of production equipment, tools or machines that are needed to produce an item.
This kind of costs are often incurred when assembly or production lines of a factory have been changed. Thus, there is a need to spend money on securing the services of a setup mechanic as well as testing the first output in order to be sure that the equipment, tools or machines have been set up properly.
Answer:
the government's sovereign immunity
Explanation:
In the US, the federal and state governments have sovereign immunity which means that they cannot be sued unless they agree to it. In the US, the federal government waived their immunity protection from a series of possible torts through the Federal Tort Claims Act. But that law does not include litter or accidents occurring in highways.
Sovereign immunity basically states that the federal government cannot be sued for its actions unless those actions are included in the Federal Tort Claims Act. To be able to sue a state government other rules apply, specially regarding the circumstances around the reason for the claim.
Answer:
a. Ke = Rf + β(Rm – Rf)
Ke = 6 + 1.25(14-6)
Ke = 6 + 10
Ke = 16%
b = 2/3
Do = 1/3 x $3 = $1
g = b x r
g = 2/3 x 9
g = 6%
Po = Do(1+g)/ke - g
Po = $1(1+0.06)/0.16-0.06
Po = $10.60
b. P/E ratio = Market price per share/Earnings per share
P/E ratio = $10.60/$3
P/R ratio = 3.53
c. Present value of growth opportunities = Market price - Value without growth
Present value of growth opportunities = $10.60 - $6.25
Present value of growth opportunities = $4.35
Value without growth = Do/Ke
= $1/0.16
= $6.25
d. b = 1/3
Do = 2/3 x $3 = $2
g = 1/3 x 9
g = 3%
Intrinsic value = Do(1+g)/Ke-g
= 2(1+0.03)/0.16-0.03
= $15.85
Explanation:
In this scenario, we need to determine cost of equity based on capital asset pricing model. Then, we will calculate the growth rate by multiplying the plow-back ratio by return on equity. Thereafter, the price of the stock will be computed based on dividend growth model as shown above. P/E ratio is the ratio of market price per share to earnings per share.
The present value of growth opportunities is the difference between market price and the value without growth as calculated above.
Answer: $33,000
Explanation:
The Raw Materials balance included both direct and indirect materials so the ending raw material inventory balance would be;
= Beginning balance + Raw materials purchased - direct materials used - indirect materials used
= 22,000 + 165,000 - 141,000 - 13,000
= $33,000
Answer:
8.8%
Explanation:
Given:
Excess return = 6% = 0.06
Return respond factor = 1.2
Expected higher percent = 1.5% = 0.015
Increase growth (stock price) = 1% = 0.01
Actual excess return = ?
Computation of actual excess return:
Actual excess return = Excess return + Increase growth (stock price) + [Expected higher percent × Return respond factor]
= 0.06 + 0.01 + [0.015 × 1.2]
= 0.07 + [0.018]
= 0.088
= 8.8%