Answer:
43,411.15
Explanation:
The formula for compound interest is
A = P(1 +I) ^n
From the question,
A = 45,000
P = Unknown
I = 0.036 ÷ 12
n = 1 * 12
Therefore,
45,000 = P(1 +0.036/12) ^1 *12
45,000 = P(1.003)^12
45,000 = 1.0365998P
P = 43,411.15
Answer:
6.816%
Explanation:
The real rate of return is nominal rate of return less inflation rate
(1 + nominal rate ) = (1 + real rate ) x (1 + inflation rate)
= 1.097 = real rate x 1.027 = 1.06816 - 1 = 0.06816 = 6.816%
I hope my answer helps you
Answer:
A. 8.15
Explanation:
WACC is the firm's weighted average cost for the capital that is employed from different sources which includes common equity, preferred equity and debt.
In order to calculate WACC, the weighted average cost of each capital is added, so the formula becomes:
WACC = (E x %E) + (D x (1 - Tax) x %D) + (PE x %PE)
E = Common equity
D = Debt
PE = Preferred equity
%E = Common equity / total capital
%D = Debt / total capital
%PE = Preferred equity / total capital
Tax = Tax rate
<em>Interest on debt is a tax deductible expense therefore the interest rate is taken after accounting for tax in order to calculate WACC.</em>
<u>Calculation:</u>
Using the above formula we can calculate WACC
WACC = (11.25% x 55%) + (6.5% x (1-40%) x 35%) + (6% x 10%)
WACC = 0.0815 or 8.15%
Answer:
d. depreciation expense
Explanation:
The expenses which are paid by cash reduced the cash balance displayed in the balance sheet
. Like interest to creditors, stockholders dividend, wages expenses, miscellaneous expenses, admin expenses, etc. These expenses can be paid either by cash or by bank account
.
But the depreciation expense is a non - cash expense which reduces the fixed asset balance over the fixed asset useful life. Plus this is shown in the income statement on the debit side. Like this other examples would be goodwill impairment, amortization expenses, etc.
