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Andrews [41]
3 years ago
7

The Hype Company's currently outstanding bonds have a 10 percent coupon and a 11 percent yield to maturity. Hype believes it cou

ld issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 38 percent, what is Hype's after-tax cost of debt
Business
1 answer:
zavuch27 [327]3 years ago
5 0

Answer:

After tax cost of debt is 6.82%

Explanation:

Currently the yield to maturity is the  pre-tax cost of debt for Hype company, however the after tax cost of debt considers that the bonds are tax deductible , its actual is less than the pre-tax cost of debt , hence the after-tax cost of debt is shown below

After tax cost of debt=yield to maturity *(1-tax)

after tax cost of debt=11%*(1-0.38)

after tax cost of debt=11%*0.62

after tax cost of debt =6.82%

This confirms that cost of debt is usually lower than cost of equity , where shareholders would want an extra premium to compensate them for the increased risk taken by investing in the business.

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Acme, Inc., which manufactures the fireworks that municipal governments buy to put on their annual fireworks shows on the Fourth
kap26 [50]

Answer:

Reshoring.

Explanation:

Reshoring is the process of returning the production and manufacturing of goods back to the company's original country. Reshoring is also known as onshoring, inshoring or backshoring.

7 0
3 years ago
Amanda Winter worked as a public engagement coordinator at Safe Food Alliance until three months ago when her manager, Laura Mor
arlik [135]

Answer:

Option D is the correct answer to this question.

Explanation:

Laura sat in on only one of Amanda's presentations before giving her the promotion.

They were made by hand before slides were mounted on computers. Designing a PowerPoint presentation took several hours and though it was costly. Presentations were illustrated back then people with devices such as journal flip charts and computer monitors, but these have been used in schools and conference rooms worldwide.

Other options are incorrect because they are not related to the given scenario.

6 0
3 years ago
On January 1, Avers Co. borrowed $10,000 by extending their past-due account payable with a a 60-day, 8% interest-bearing note.
babymother [125]

Answer:

Notes payable; $10,000

Explanation:

Given that,

Borrowing amount = $10,000

Time period = 60 day

Interest rate = 8%

On the due date of the note, avers co. paid the amount.

Therefore, this entry would be recorded by Avers with a debit to Notes payable with an amount of $10,000.

Interest amount = $10,000 × (60 ÷ 360) × 0.08

                           = $10,000 × 0.17 × 0.08

                           = $136

(Note: Assuming 360 days in a year)

Therefore, the Journal entry is as follows:

Notes payable A/c     Dr. $10,000

Interest Expense A/c Dr. $136

To cash                                             $10,136

(To record Avers pays the amount due in full)

4 0
3 years ago
During _____ processes for a new project, the organization recognizes that a new project exists, and completes a project charter
never [62]

Answer: (D) Initiating

Explanation:

The Initiating processes is one of the phase in the project management life cycle that is necessary for defining the existing project's main objective, success criteria and also the outcome.

The initiating processes helps in providing the effective information or data that is necessary for the developing the project. It is also refers top the process for obtaining the authorization for the given project.    

 According to the given question, the initiating processes recognizing all the existing projects and also complete all the project charter as part of recognition process.  

 Therefore, Option (D) is correct answer.

5 0
3 years ago
When perfect competition prevails, which characteristic of firms are we likely to observe? They are all price takers. They all t
andrezito [222]

Answer:

They are all price takers. 

Explanation:

A perfect competition is characterised by many buyers and sellers of homogenous goods and services.

Market price is set by the forces of demand and supply. Therefore, firms are price takers. Because all firms sell identical goods, no seller can set the price for her goods. If a seller attempts to sell above the market price, it would lose patronage. A seller would have no incentive to sell below market price because they would be earning losses.

Perfect competition produces at : price = marginal cost = marginal revenue.

I hope my answer helps you

5 0
3 years ago
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