- Here are five examples of South Africa's successful competition policy: 1) Consumers were given a variety of product options as well as affordable pricing. 2) In 1984, horizontal collusion and resale price maintenance were ruled illegal.
Answer:
Find below complete question:
There are three equally large divisions in a conglomerate: (i) food division, (ii) travel division, and (iii) construction division. Their divisional betas are 0.5, 1.8, and 2.2, respectively.
What is the overall beta for the entire firm?
A.0.5
B.1.8
C.1.5
D.2.2
Correct option is C,1.5
Suppose that you are evaluating a project in the food division. What is the appropriate discount rate for this project? Assume that the CAPM holds. The risk-free rate is 1% and the expected return on the market is 7%.
A.10%
B.11.8%
C.4%
D.14.2%
Correct option is A,10%
Explanation:
The starting point is to determine the overall beta for the company.
Since all the three divisions are equally large,it means they share the same probability weighting of 0.3333(1/3)
food division 0.3333 *0.5
Travel division 0.3333*1.8
construction 0.3333*2.2
overall beta 1.49985
1.5 approx
Ke=Rf+beta(Rm-Rf)
Rf is the risk free rate of 1%
Rm is the expected return on market of 7%
beta is 1.5
Ke=1%+1.5*(7%-1%)
Ke=10%
Answer:
With the correcting entry method, the wrongly posted account will transfer the amount that was to be posted elsewhere to the place it was to be posted in. In this case the posting was to be to Accounts Receivable not Service fees so:
Date Account Title Debit Credit
May 23 Service Fees $1,270
Accounts Receivable $1,270
Answer:
Option (B) is correct.
Explanation:
Amount of which adjusting entry required:
= Amount of uncollectible accounts - Balance in Allowance for uncollectible accounts
= (Balance in accounts receivable × Estimated percentage of accounts receivable to be uncollectible) - Balance in Allowance for uncollectible accounts
= ($200,000 × 4%) - $2,000
= $8,000 - $2,000
= $6,000
Therefore, the adjusting entry is as follows:
Bad debt expense A/c Dr. $6,000
To Allowance for uncollectible accounts $6,000
(To record the bad debt expense)
