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postnew [5]
2 years ago
15

A firm does not expect to pay dividends in the next four years. beginning five years from today, the firm expects to pay a const

ant dividend of $4.75 per year forever. investors required rate of return on the firm's stock is 10 percent. what is the price of the stock today?
Business
2 answers:
liraira [26]2 years ago
7 0
Given:
dividend: 4.75 per year forever
required rate of return: 10%

<span>Since the dividend is always the same, the stock can be viewed as an ordinary perpetuity with a cash flow equal to D every period. The per-share value is thus given by
</span>
P₀ = D/R

P₀ = Price today
D = dividend per year
R = required rate of return

P₀ = 4.75 / 0.10 = 47.50

The price of the stock today is $47.50

abruzzese [7]2 years ago
4 0
From the data given above, the investor required rate of return on the firm's stock is 10% and is equal to $4,75 that is expected to be paid each year.
If $4.75 = 10%, then the price of the stock which is 100% will be equal to $4,75 * 10= $47.50.
Therefore, the current price of the stock is $47.50.
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Christmas Timber, Inc., produces Christmas trees. The trees are produced through a cutting and pruning process. Machine maintena
seropon [69]

Answer:

Cutting = $62,020

Pruning = $16,280

Explanation:

<em>The direct method does not consider the impact of reciprocal servicing arrangement when allocating the overhead  of service centers and only allocates overhead to the production cost centers only.</em>

Allocation of Overhead

Janitorial overhead

Cutting = 6/(6+54)×   $5,000 = $500

Pruning =54/(6+54) ×  $5,000= $4,500

Maintenance overhead

Cutting = 9/(9+1)×   $7,800 = $7020

Pruning =1/(9+1) ×  $7,800= $780

Total cost of production department

Cutting = 54,500 + 500 + 7020= 62,020

Pruning department = 11,000 + 4,500 + 780 = 16,280

Cutting = $62,020

Pruning = $16,280

7 0
3 years ago
In the context of contemporary approaches to management, the _____ theory was developed in the early 1950s by researchers from t
faltersainse [42]
In the context of contemporary approaches to management, the sociotechnical systems theory was developed in the early 1950s by researchers from the London-based Tavistock Institute of Human Relations. This sociotechnical theory states that <span>the design and performance of any organisational system can only be understood and improved if both ‘social’ and ‘technical’ aspects are brought together and are working together.</span>
8 0
3 years ago
Presented below are three receivables transactions. Indicate whether these receivables are reported as accounts receivable, note
tatuchka [14]

Answer:

1. Accounts receivable

2. Notes receivable

3. Other receivable

Explanation:

Sold merchandise on account for $64,000 to a customer - Accounts receivable. Since the merchandise is sold on credit to a customer, the same is recorded in the current assets of the balance sheet as accounts receivable.

Received a promissory note of $57,000 for services performed - Notes receivable. Since the promissory note is received for service performed which we term as a note receivable. This also come under the current assets of the balance sheet

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6 0
3 years ago
Maria, a citizen and resident of Mexico, received the following investment income during 2018: $1,000 of dividend income from ow
dmitriy555 [2]

Answer: $6,000

Explanation:

Maria is a citizen and resident of Mexico so the only way the U.S. can tax Maria is by taxing income that is in U.S. jurisdiction before it comes to Maria.

This will include the dividend from ownership of stock in a U.S. Corporation, the interest from a U.S. company issued bond and rental income from a property located in the U.S.

The U.S. will be unable to tax the capital gain from sale of stock however because the sale might not be conducted in the U.S.

Income subject to U.S. taxation is therefore:

= 1,000 + 2,000 + 3,000

= $6,000

8 0
3 years ago
According to W. E. B. Du Bois, "The true college will ever have one goal—not to earn meat, but to know the end and aim of that l
emmainna [20.7K]

Answer:

The correct answer is True.

Explanation:

Basically, Du Bios' message invites awareness of the true usefulness of education, which is not found within the productive environment but in service and satisfaction to others. Also, education has to be a process of self-growth where progress is internalized and people can feel the accomplishment of reaching an educational goal.

7 0
3 years ago
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