Answer: <u><em>The irrelevant costs in Boise’s outsourcing decision is $25500</em></u>
Explanation:
Given :
Traceable variable costs = $80,000
Fixed operating costs = $25,000
If Boise were to use the outside consultant, fixed operating costs would be reduced by 70%.
Now,
Irrelevant costs in Boise’s outsourcing decision = Additional corporate administrative cost + 30% reduction in traceable cost
Irrelevant costs in Boise’s outsourcing decision = $ 18000 + (30% of $25000)
Irrelevant costs in Boise’s outsourcing decision = $ 25500
Answer:
total market value is $812.05 million
WACC project discount rate is 8.77%
Explanation:
The firm's market value is the sum of the market values of equity,debt and preferred stock.
Equity=10.1*$49=$494.9 million
debt=235,000*$1000*116%=$272.6 million
preferred stock=450,000*$99=$44.55 million
Total market value $812.05 million
WACC=Ke*E/V+Kd*D/V*(1-t)+Kp*P/V
Ke is the cost of equity=4%+1.55(8.9%-4%)=11.60%
Kd= rate(30,$1000*8.9%/2,-$1000*116%,1000)=3.57% semiannually
kd=3.57%*2=7.14%
Kp=5%
WACC=(11.50%*494.9/812.05)+(7.14%*272.6/812.05*(1-0.38)+(5%*44.55/812.05)=8.77%
Answer:
Days in inventory is 66 days
Explanation:
The formula for days in inventory is 365 days/inventory turnover while inventory turnover is costs of good sold divided by average inventory.
costs of goods sold is $550,000
average inventory is ($90,000+$110,000)/2=$100,000
inventory turnover =$550,000/$100000
inventory turnover =5.5 times
The days in inventory can then be computed thus:
days in inventory=365 days/5.5=66.36 days
The days in inventory is the average number of days that it took inventory to be sold and it is approximately 66 days in this instance
Answer:
Annual contributions to the retirement fund will be $6,347.31
Explanation:
First find the Present Value of the Annuity giving payments of $32,000 annually for 25 years at the rate of 10%.
Using a Financial Calculator enter the following data
PMT = $32,000
P/y = 1
N = 25
R = 10%
FV = 0
Thus, the Present Value, PV is $290,465.28
At the time of retirement (in 20 years time) the Value of the annuity fund is $290,465.28.
Next we need to find the Payments PMT to reach this amount in 20 years time at the interest rate of 8%
Using a Financial Calculator enter the following data
FV = $290,465.28
N = 20
R = 8 %
PV = $0
Thus, the Payments, PMT required will be $6,347.3080
Conclusion :
Annual contributions to the retirement fund will be $6,347.31
By the year of 2013 the number of high school students took classes that could earn them college credits in advanced placement or international baccalaureate course has increased to 33 percent, it is only 19 percent in the year 2003 so it had increase by 24 percent but the answer is 33 percent.