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wlad13 [49]
3 years ago
14

Deployment Specialists pays a current (annual) dividend of $1 and is expected to grow at 20% for two years and then at 3% therea

fter. If the required return for Deployment Specialists is 10.0%, what is the intrinsic value of its stock
Business
1 answer:
ivanzaharov [21]3 years ago
5 0

Answer:

the intrinsic value of its stock is  $19.78

Explanation:

Given the information:

  • D0 = $1
  • required return for Deployment Specialists is 10.0%,
  • (1+0.2) =  Dividend for next 2 year  

                                           Year           Year             Year

                                            0                    1                 2

                                                                 20%            20%

Dividend                              1                    1.2            1.44

After this the next thing to do is to take out terminal value , were we will use the growth rate of 4%

= Dividend for second year x (1+growth rate thereafter)  /( R - growth rate thereafter)

= $1.44( 1 + 3% ) / (10% - 3%)

= $21.18

=> the intrinsic value of its stock

= Dividend year 1/ (1+ R) + (Dividend year 2 + Terminal value) /(1+R)^{2}

=  $1.20 / (1+10%)  + ($1.44 + $21.18) / (1+0.1)^{2}

= $19.78

So the intrinsic value of its stock is  $19.78

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If I've got it right, the answer with missing word looks like this: The market-perceived quality attributes are embedded in the total product, that is, the physical or core product and all the additional features the consumer expects.
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3 years ago
Tom's Textiles shipped the wrong material to a customer, who refused to accept the order. This is an example of a:-Sales revenue
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Sales return

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Sales return when a customer is not satisfied with a product, refuses to accept the order and expects to receive back the whole amount of money he paid for it.

Tom's Textiles are at wrong here as they shipped the wrong material to a customer. The customer is allowed not to accept the order and all the money he paid must be reimbursed to him. The company should apologize for the mistake in a pleasant manner, as mistakes happen everyday and can be corrected quickly and efficiently.  

3 0
3 years ago
Ruby Corporation, a calendar year, accrual method C corporation, has two cash method, calendar year shareholders who are unrelat
telo118 [61]

Answer:

Explanation:

Answer:

$200000 + $200000 +$50000(to COLE's bonus)

= $450000

Ruby corporation uses accrual method.

A corporation that is using accrual method, cannot claim a deduction for an accrual with respect to a related party until the recipient reports that amount as income.

Here, Cole owns more than 50% (55%) so its a related party and it will report bonus on february 1,2017

Therefore, Ruby can not deduct bonus payable to oliver in 2016

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5 0
3 years ago
The Baldwin company will sell 100 units (x1000) of capacity from their Baker product line. Each unit of capacity is worth $6 plu
yKpoI14uk [10]

Answer: $2,210,000

Explanation:

From the question, we are informed that the Baldwin company will sell 100 units (x1000) of capacity from their Baker product line and that each unit of capacity is worth $6 plus $4 per automation rating.

We are further told that the Baldwin company will sell the capacity for 35% off. The amount they'll receive when the capacity is sold will be:

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= 6 + (4 × 7)

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= 100000 × 34

= 3,400,000

The amount received will be:

= 3400000 × (1-35%)

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3 years ago
if the discount (or interest) rate is positive, the future value of an expected series of payments will always exceed the presen
AlekseyPX

if the discount (or interest) rate is positive, the future value of an expected series of payments will always exceed the present value of the same series

True

What is a discount(or interest) rate?

An interest rate is the rate of return the present value of the series can over as an interest over the investment time horizon.

On the premise that the interest rate is positive, it means that there would positive value-added over the investment period which increases the present value to ensure that the future value exceeds the present value

In other words, a positive discount or interest ensures a higher future value

Find out more about future value on:brainly.com/question/24703884

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7 0
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