If Apr of a savings account is 2.7% and interest is compounded quarterly, what is the approximate APY of the account

Colorado Mountain Mining paid $ 896,900 for the right to extract mineral assets from a 500,000-ton deposit. In addition to the

Zepler [3.9K]

Answer:

(a) The asset would be recorded in accordance to IAS 16 Property, plant & equipment.

Dr Mining Asset 896,900

Cr Bank 896,900

(b) IAS 16 says that the costs incurred to make the asset ready for use must be capitalized as part of the asset. This means the license fee $1000 filing fee, License fee $2100 and $50,000 amount paid for geological survey must be capitalized. So the entry is as under:

Dr Mining asset (1k+2.1k+50k) $53,100

Cr Bank $53,100

(c) This assets must be depreciated on the basis of tons of minerals extracted which is 60 thousands tons in the first year.

Depreciation Expense = (60k tons / 500k tons) * (Total capitalized cost)

=(60,000/500,000) * (896,900+53,100) = $108,000

The Double entry of Depreciation Expense would be as under:

Dr Depreciation Expense $108,000

Cr Accumulating Depreciation $108,000

3 0

2 years ago

Targaryen Corporation has a target capital structure of 65 percent common stock, 5 percent preferred stock, and 30 percent debt.

Juli2301 [7.4K]

Answer:

a. What is the company’s WACC?

R_Wacc = 13% (65%) + 5% (5%) + 6% (30%) * (1-0,25) = 10,05%

b. What is the aftertax cost of debt?

The aftertax cost of debt is:

R_Debt : (1 - 0,25) x 6% = 4,50%

Explanation:

The WACC it's defined by the formula :

WACC: E/V*Re + D/V*Rd *(1-0,25)

Re: 13,00% Cost of Common Equity

Re: 5,00% Cost of Preferred STOCK

Re: 6% Cost of Debt

E/V: 65% Percentage of financing that is Common Equity

PS/V: 5% Percentage of financing that is Preferred Stock

DB/V: 30% Percentage of financing that is Debt

Tax: 25% Corporate tax rate

Now we have all of the components to calculate the WACC.

The WACC is:

R_Wacc = 13% (65%) + 5% (5%) + 6% (30%)*(1-0,25) = 10,05%

The aftertax cost of debt is:

R_Debt : (1 - 0,25) x 6% = 4,50%

5 0

3 years ago

An entrepreneur recently purchased Cocoon's, a local deli, on the beach. To operate the business, she estimates that selling and

crimeas [40]

Answer:

27%

Explanation:

The computation of the net profit margin is shown below;

As we know that

net profit margin = Net profit ÷ sales

where

net profit is

<u>Particulars Amount </u>

Sales (200 customers × $12 × 350 days) $840,000

Less: cost of goods sold (200 customers × $4.50 × 350 days) -$315,000

Gross profit $525,000

Less:

Selling and admin expense -$98,510

Depreciation expense - $20,000

Bank loan interest -$76,265

Net income before tax $330,225

Less tax at 32% -$105,672

Net income after tax $224,553

Now the net profit margin is

= $224,553 ÷ $840,000

= 27%

6 0

2 years ago

In the past, Peter Kelle's tire dealership in Baton Rouge sold an average of 1 comma 000 radials each year. In the past 2 yea

Lina20 [59]

Answer:

Explanation:

For computing the demand for each sale, first we have to compute the average sale for each season which is show below:

Average sale in fall = (240 + 260) ÷ 2 = 250

Average sale in winter = (340 + 300) ÷ 2 = 320

Average sale in spring = (140 + 160) ÷ 2 = 150

Average sale in summer = (320 + 240) ÷ 2 = 280

Demand for next fall = (250 ÷ 1,000) × 1,200 = 300

Demand for next winter = (320 ÷ 1,000) × 1,200 = 384

Demand for next spring = (150 ÷ 1,000) × 1,200 = 180

Demand for next summer = 1,200 - (300+384+180) = 336

6 0

3 years ago

Nibbles pet food corporation is in the process of developing its new market strategy. the marketing team has already established

Semmy [17]

The marketing team need to <u>"create a promotion strategy to increase customer awareness."</u>

Promotion is the point at which a business chooses which types of communication it needs to use in their marketing plan. Research is done that points of interest statistical surveying, division, and spending plan. Huge organizations may complete a national crusade, particularly if the brand is as of now well-known to the purchaser. Littler organizations, with less assets, may utilize coordinate offering until the point when they have a bigger spending plan for advertising.

5 0

3 years ago