Answer:
The revenue that the investment in the company would increase by $100,000.
Explanation:
Though the International Accounting Standard IAS 2 Inventories says that the inventory must be recorded at lower of:
- Cost
- Net Realizable Value (Fair Value less Cost to Sell)
This means though the Net realizable value increases but the cost remains the lower. This means their must not be any changes made to inventory account.
The profit earned from the increase in inventory value will be reflected in the income which will increase the net worth of the investment. So the increase in investment revenue would be by $100,000.
The answer business. This is made up of association of
people where they share a common purpose or interest in having to focus the
talents that they have and to be able to organize these skills and offer this
for their own benefit.
Answer:
The value of the difference between the earnings per share (EPS) forecasts for Feast and Famine is $2.40
Explanation:
The solution is as evident in the attached Excel Sheet. In the excel sheet the formulas are used which are also given in the second sheet.
For the data values from the question are used.
Answer:
Student responses will vary, but should include: A young investor has years of earning power and can take greater risks because he/she has time to make-up for losses. An older investor needs more security and current income from their investments because they are using it to retire on or they need it to continually grow so that they can retire.
Explanation:
Answer:
14.05%
Explanation:
Given that,
Beta = 1.3
Risk-free rate (Rf) = 9.5%
Return on the Market (RM) = 13%
According to CAPM approach:
Cost of common equity (RE):
= [Rf + β (RM – Rf)]
= [9.5% + 1.3 (13% - 9.5%)]
= [9.5% + 1.3 (3.5%)]
= [0.095 + 1.3 (0.035)]
= [0.095 + 0.0455]
= 0.1405
= 14.05%
Therefore, the firm's cost of common equity is 14.05%.
