Answer: $350 Favorable
Explanation:
Fixed manufacturing overhead budget variance = Budgeted fixed overhead cost - Actual fixed overhead
= 10,890 - 10,540
= $350
As the Budgeted fixed overhead cost is larger than the Actual fixed overhead, that means that the company spent less than it budgeted to spend so the variance is FAVORABLE.
The correct answer is D.
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Answer:
duress
Explanation:
A contract may not be enforced it any of the parties does not give genuine or real assent, i.e. they freely agree with the contract terms.
Duress happens when one of the parties threatens to do something bad or wrong to the other party in order to force them to enter a contract. Contracts agreed under duress can be invalidated.
Answer:
WACC = 9.1%
Explanation:
The weighted Average cost of Capital(WACC) is the average cost of capital for the different sources of long-term capital available to a firm weighted according to the proportion each source of finance bears to the total capital in the pool.
cost of equity = Rf+ β×(Rm-Rf)
(Rm-Rf)= 6%, Rf- 4%, β- 1.4
=4% + (1.4×6%) = 12.4
Cost of preferred share = Dividend/price
= 3/25× 100= 12.0%
After tax cost of debt = Yield × (1-Tax rate) = 8.5%× (1-0.35)=5.53%
Type cost Market value Cost × Market Value
Equity 12.4% 7 0.868
Preferred 12% 4 0.48
Bond 5.53% <u>10 </u> <u> 0.553</u>
Total 21 1.901
WACC = 1.901
/21 × 100 =9.1%
WACC = 9.1%
Answer:
9.04%
Explanation:
The computation of firm's WACC is shown below:-
MV of equity = Price of equity × Number of shares outstanding
= $68 × 12,200
= $829,600
MV of Bond = Par value × bonds outstanding × Percentage of par
= $1,000 × 370 × 0.951
= $351,870
MV of firm = MV of Equity + MV of Bond
= $829,600 + $351,870
= $1,181,470
After tax cost of debt = Cost of debt × (1 - Tax rate)
After tax cost of debt = 5.99 × (1 - 0.39)
= 3.6539
Weight of equity = MV of Equity ÷ MV of firm
= $829,600 ÷ $1,181,470
=0.7022
Weight of debt = MV of Bond ÷ MV of firm
= $351,870 ÷ $1,181,470
= 0.2978
WACC = After tax cost of debt × Weight of debt + Cost of equity × Weight of equity
= 3.65 × 0.2978 + 11.33% × 0.7022
= 9.04%
