Answer:
b.Interest Expense should be increased, because the cost of interest relates to the current period
Explanation:
The adjusting entry of interest expense is shown below:
Interest expense A/c Dr $2,500
To Interest payable A/c $2,500
(Being the interest expense is recorded)
Since the interest expense is recorded that increases the balance of the interest expense account plus the interest cost is also related to that period.
Answer:
The discount rate assign to a new project with a Beta of 1.25 is 13.94%
Explanation:
The applicable formula is the Capital Asset Pricing Model formula of Miller and Modgliani quoted below:
Ke = Rf + (Market risk premium x Beta)
Currently Ke=14.945%
Beta =1.38
Risk free rate of return (Rf) is 4.25%
Market risk premium is the unknown
14.945%=4.25%+(Market Risk Premium)*1.38
14.945%-4.25%=Market Risk Premium*1.38
10.70%
=Market Risk Premium*1.38
10.70%/1.38=Market Risk Premium
Market Risk Premium =7.75%
However, the new project cost of equity has to be determined due to having a different Beta factor of 1.25(a different risk appetite)
Using the above formula, we have
Ke=4.25%+(7.75%
*1.25)
Ke =13.94%
If these are the choices:
A.<span> empower employees to make their own decisions and accept the consequences.
</span>B.<span> obtain the necessary information system technologies.
</span>C.<span> recognize that perfect information is readily available in all organizations.
D. determine what knowledge is most important to the organization.</span>
My answer is D.
The first step in developing a knowledge management system is to <span>
D. determine what knowledge is most important to the organization.</span>
One can't find solution to a problem if the problem is not recognized and specified. Once you have identified what knowledge is more important to the organization, you will be able to focus your energies in finding ways to obtain said knowledge.
The lender is bearing the risk on defaulting the loan
Answer:
The Average return on this asset over the next 5 years = 14.79 percent
Explanation:
using below mentioned calculation :
=((5-1)/(12-1) * 0.145) + ((12-5)/(12-1)*0.1496)
=0.1479 or 14.79%.