Answer:
A) $8,125
Explanation:
Note Slotkin Products uses the double-declining balance method. Under the double-declining balance method depreciation expense is calculated as :
Annual depreciation expense = 2 x SLDP x BVSLDP
where,
SLDP = 100 ÷ Useful life
= 12.5 %
and
BVSLDP = Cost in first year or Book Value for other succeeding years =
therefore,
Annual Depreciation expense = 2 x 12.50 % x $65,000 = $16,250
thus,
Partial depreciation from July 1, 2017 to Dec 31, 2017 - 6 months will be :
Depreciation expense = $16,250 x 6/12 = $8,125
Conclusion :
Depreciation for 2017 is $8,125
Answer:
d. 5.14%.
Explanation:
Calculation to determine the best estimate of the after-tax cost of debt.
First step
Based on the information given we would make use of rate formula in excel.
=rate(nper,pmt,-pv,fv)
Where,
nper= coupon every six months for 20 years = 40 coupon payments
Pmt =$1000*7.25%*6/12=$36.25
Pv = $875
Fv =$1000
Let plug in the formula
=rate(40,36.25,-875,1000)=4.28% semiannually
=4.28% *2=8.56% annually
Now let calculate the after tax cost of debt using this formula
After tax cost of debt=8.56%*(1-t)
Where,
t represent tax rate of 40%
Let plug in the formula
After tax cost of debt=8.56%*(1-0.4)
After tax cost of debt=5.14%
Therefore the best estimate of the after-tax cost of debt is 5.14%
Answer: 7%
Explanation:
The following can be deduced.from the question:
Loan amount = $9,600
Equity = $9,600
Market price = $48 per share
Total investment = $19,200
Growth of Investment = 5%.
We then calculate value of the investment in a year. This.will be:
= 19,200 × 1.05
= $20,160
Interest on the loan would be:
= $9,600 * 0.03
= $288
Therefore, rate of return will be:
= (20,160 - 9,600 - 288)/9,600 - 1
= 0.07 = 7%
False. It does not reduce market risk.
Capitalism because it was on the day they did it
