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Flura [38]
3 years ago
5

A firm is planning on increasing its annual dividend by 3.50% a year in perpetuity. The company just paid its annual dividend in

the amount of $.20 per share. What is the current value of one share of this stock if the required rate of return is 15.50%?a) $2.04b) $1.67c) $1.73d) $1.34
Business
1 answer:
uysha [10]3 years ago
5 0

Answer:

c.) $1.73

Explanation:

Price = \frac{D0(1+g)}{(r-g)}

D0= Last dividend paid

r= rate of return

g = growth rate

Price = \frac{0.20(1.035)}{(0.1550-0.035)}

Price = 0.207 / 0.12

Price = 1.725

Therefore, the current value of the stock is $1.73

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The treasurer of Systems Company has accumulated the following budget information for the first two months of the coming year:Ma
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Answer:

March $6,000

April $134,400

Explanation:

Preparation of a monthly cash budget for March and April

SYSTEMS COMPANY CASH BUDGET FOR MARCH AND APRIL

March April

Estimated cash receipts from:

Cash sales $157,500 $182,000

($450,000*35%=$157,500)

($520,000*35%=$182,000)

Collections of accounts receivable

$285,000 $328,900

[$51,000+($450,000*65%*80%)=$285,000]

[($450,000*65%*20)+($520,000*65%*80%)=$328,900]

Total cash receipts $442,500 $510,900

($157,500+$285,000=$442,500)

($182,000+$328,900=$510,900)

Estimated cash payments for:

Manufacturing costs $174,500 $305,000

[$102,000+($290,000*1/4)=$174,500]

[($290,000*3/4)+($350,000*1/4=$305,000)]

Selling and administrative expenses $37,000 $37,500

[($41,400-$6,400)/2 + $19,500 $37,000]

[($46,400-$6,400)/2 +$19,500$37,500]

Capital additions $250,000 $0

Income taxes $0 $40,000

Total cash payments $461,500 $382,500

Cash increase (decrease) -$19,000 $128,400

($442,500-$461,500=-$19,000)

($510,900-$382,500=$128,400)

Cash balance at beginning of month $45,000 $26,000

Cash balance at end of month $26,000 $154,400

(-$19,000+$45,000=$26,000)

($128,400+$26,000=$154,400)

Minimum cash balance $20,000 $20,000

Excess (deficiency) $6,000 $134,400

($26,000-$20,000=$6,000)

($154,400-$20,000=$134,400)

Therefore The monthly cash budget for March and April will be :

March $6,000

April $134,400

7 0
3 years ago
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Answer:

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Explanation:

Standard Costs are established through past experiences and hence they can be used to control costs, and plan production schedules.

Changes in technology and machinery need to be made is part of perfomance management with a future outlook.

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3 years ago
Eileen is considering assignments, training programs, and development opportunities that she will need in preparation for being
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<span>Eileen is in the development phase in terms of her career development. The development phase is where the person is starting and learning to develop the activities that he or she is involved in—in a way to show the person strengths and achieve things with the use of their performance.</span>

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2 years ago
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