Answer: Actual overhead costs always enter the Work-in-Process account.
Explanation:
The work-in-process account is an account where the value of goods yet to be completely produced are recorded while the overhead cost is simply a business running cost, that is cost on expenses the business makes to keep functioning.
Overhead cost is not recorded in work-in-process account, rather it is recorded as business expenses.
Answer:
Mature companies with relatively predictable earnings
Explanation:
Constant growth model is under the assumption that a company's dividend will grow at a constant rate indefinitely(forever). This makes more sense and hold is appropriate method of valuation for a mature company that has relatively predictable earnings. Young companies on the other hand have fluctuating earnings making it appropriate to use non-constant growth model to value its dividends.
Answer:
d. all resources are privately owned and prices are used to coordinate economic activity.
Explanation:
- A mixed economy is a system of the economy that is based on the aspects of the capitalism and the socialism and is the style that protect the private ownership and allows for the levels of the economic freedom.
- In the case of the capital and also allows for the government intervene in the matter of the economy and in order to obtain social aims.
Answer:
a.cost of common equity is 14.40%
b.WACC is 10.62%
c.Midwest Electric Company should accept project A since it has a rate of return higher than WACC of 10.62%
Explanation:
The cost of common equity can be ascertained using the stock price formula and changing the subject of the formula to r(cost of common equity)
Stock price=Do*(1+g)/(r-g)
stock price is $20
g is the dividend growth rate at 4%
Do is the dividend just paid $2
20=2*(1+4%)/(r-4%)
20=2.08/r-4%
20(r-4%)=2.08
r-4%=2.08/20
r=(2.08/20)+4%
r=14.40%
WACC=Ke*E/V+Kd*D/V*(1-t)
Ke is the cost of equity of 14.40%
E is the 55% or 0.55
D is 45% or 0.45
V=E+D=045+0.55=1
Kd is the cost of debt which is 10%
t is the tax rate at 40% or 0.40
WACC=14.40%*0.55/1+10%*0.45/1*(1-0.4)
WACC=(14.40%*0.55/1)+(10%*0.45/1*0.6)
WACC=10.62%
Midwest Electric Company should accept project A since it has a rate of return higher than WACC of 10.62%
The component of authentic leadership that the person is
using is the internal moral reasoning. Internal moral reasoning is defined as a
thinking process by which the goal is having to determine if a certain thought or
an idea is considered to be right or wrong to do.
