Answer:
Price = $31.8
Explanation:
The formula for constant growth dividend model is:
Price = <u>D1</u>
r-g
Or
Price = <u>D0 (1+g)</u>
r-g
where,
D0 = Last Dividend Paid
r = required rate of return
g = growth rate
Substitute the values now in the formula according:
Price = <u>1.80 (1+0.06)</u>
0.12-0.06
Price = <u>1.908</u>
0.06
Price = $31.8
Answer:
Return on equity in 2017 is 12% while that of 2016 is 12.5%
Explanation:
The formula for return on equity is given as net income/equity.
The net income is $120000 for 2017 and $100000 for 2016.
Shareholders' average equity is 1000000 shares in 2017 and 800000 shares in 2016.
2017 2016
Return on equity 120000/1000000 100000/800000
Return on equity 0.12 0.125
The return on equity is 12.0% in 2017 and 12.5% in 2016.
From all indications, the issue of additional shares to the tune of $120000 lead to a reduction in return on equity in 2017 by 0.5%
Answer:
$7,000
Explanation:
For the purchase of office supplies, the entries required are
Debit Office supplies account
Credit cash/accounts payable
When supplies are used up, the entries required are
Debit Supplies expense account
Credit Office supplies account
As such where the Office Supplies account has a debit balance of $9,000 on the Unadjusted Trial Balance. In the Adjustments there is a credit of $2,000.
The balance in the office supplies account after adjustments
= $9,000 - $2,000
= $7,000
According to the Question,
Loan amount = 300000 - 15000 = 285000
Periodic loan payments are made by
- P = L [r ( 1 + r ) ²n ] / [ ( 1 + r )² n - 1 ]
- r - Rate of interest = 0.065/12
- L - Amount of Loan Taken = 285000
Periodic Payment = 285000 × ( 0.065/12 ) × (1 + ( 0.065 / 12 )² 360) / (1 + ( 0.065 / 12)² 360 - 1 )
= 1801.39
Monthly payment = $ 1801.39
Therefore the Correct Response is Option D
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Correct Question - Suppose You Are Buying Your First Condo For $300,000, And You Will Make A $15,000 Down Payment. You Have Arranged To Finance The Remainder With A 30-Year, Monthly Payment, Amortized Mortgage At A 6.5% Nominal Interest Rate, With The First Payment Due In One Month. What Will Your Monthly Payments Be?
a. $2,215.71
b. $1,459.13
c. $1,369.06
d. $1,801.39
e. $2,179.69
Answer:
B. $246,500
Explanation:
Retail Cost
Beginning inventory
$278,000 $201,000
Purchases
$1,280,000. $889,000
Freight-in
--- $23,500
Net markups
$78,700
Net markdown
$56,200
Sales
$1,334,000
Ending inventory at retail would be;
= Beginning inventory + Purchases + Net markups - Net markdowns - Sales
= $278,000 + $1,280,000 + $78,700 -
$56,200 - $1,334,000
=$246,500