Answer:
5.80%
Explanation:
Computation of after-tax return
Based on the information given the total before-tax income will be $3.
Since the firm is in the 30% tax bracket this means that the taxable income will be calculated as:
Taxable income =(0.30 ×$3)
Taxable income = $0.9
The next step is to calculate for the Taxes
The taxes will be = (0.30 ×$0.9) = $0.27
Now let calculate for the After-tax income
After-tax income = ($3 - $0.27) = 2.73
The last step is to find the After-tax rate of return using this formula
After-tax rate of return =After-tax income/Share of preferred stock
Let plug in the formula
After-tax rate of return = ($2.73/$47)
After-tax rate of return=0.058×100
After-tax rate of return = 5.80%
Therefore After-tax rate of return will be 5.80%
Answer:
Accrued revenues for the first year: $ 454.5
Explanation:
1,818 is the value of 36 months of subscriptions.
Therefore, the value of a month is $ 1,818 / 36 months = $ 50.5
Garcia will recognize revenue as time past, each month will accrue a month of earnings.
For the first year will accrued from April 1st to December31th
That is 9 months:
50.5 per month x 9 months = 454.5
