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2 years ago

20. WACC and NPV [LO3, 5] Sommer, Inc., is considering a project that will result

1 answer:

8 0

Mark Brainliest please

Sommer Inc is considering the new project, and yet we have to calculate under what circumstances the company have to take on the project. In order to assess the project, we need to compute the break-even cost such as the present value of future cash flows and calculate the WACC weighted cost of capital. It measures the weighted cost of equity and the after tax cost of debt. The following information are given: Debt to equity ratio = 0.90 Cost of equity = 13% After-tax cost of debt = 4.8% After-tax cost of savings = $2.7 million Debt to equity ratio = Debt / Equity = 0.90 Therefore, Value of firm = value of debt + value of equity Value of firm = 0.90E + E Value of firm

See the calculation of WACC as attachment

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Monument Health buys $400,000 of a particular item (at gross prices) from its major supplier, Cardinal Health, which offers Monu

Anna007 [38]

1. The amount of the free trade credit that Monument Health obtains from Cardinal Health is <u>$400,000.00</u>.

2. The total amount of trade credit offered by Cardinal is <u>$404,000.00</u>.

3. The approximate annual cost of the costly trade credit is <u>72%</u>.

4. <u>No.</u> Monument Health should not replace a portion of the trade credit with a bank loan.

5. If the bank loan is used, the trade credit should be replaced by $133,333.00.

<h3>What is trade credit?</h3>

Trade credit is a business arrangement that allows the buyer to buy goods in exchange for later payment.

Giving trade credit is costly to the seller but profitable to the buyer, especially with the offer of cash discounts.

<h3>Data and Calculations:</h3>

Gross prices = $400,000

Terms of trade = 1/5, net 15

Bank loan = $400,000

Loan interest rate = 12%

Days per year = 360 days

Cost of Trade Credit for 5 days = $4,000.00 ($400,000 x 1%)

Annualized cost = 72% (1%/5 x 360)

Cost of bank loan for 10 days = $1,333.33 ($400,000 x 12% x 10/360)

Learn more about trade credit and cash discounts at brainly.com/question/14883253

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6 0

1 year ago

Sales revenue for a sporting goods store amounted to $528,000 for the current period. All sales are on account and are subject t

weqwewe [10]

Answer:

The answer is A. A debit to Accounts Receivable for $ 586,080

Explanation:

Sales tax is an additional amount of money one pays based on a percentage of the selling price of goods and services that are purchased.

The sales tax amount will be added to sales revenue to form the total bill.

Sales revenue ----------------- $528,00

Sales tax -------------------------- 11%

Sales tax amount

$528,00 x 0.11

= $58,080

Therefore, total bill is:

$528,00 + $58,080

=$586,080.

Debit increases an asset(accounts receivable) while credit decreases an asset(accounts receivable).

Since the accounts receivable will increase, it will be on debit side.

8 0

3 years ago

Cash dividends of $83,126 were declared during the year. Cash dividends payable were $9,151 at the beginning of the year and $15

morpeh [17]

Answer:

option (b) $76,642

Explanation:

Data provided in the question:

Cash dividends declared = $83,126

Cash dividends payable at the beginning of the year = $9,151

Cash dividends payable at the end of the year = $15,635

Now,

Cash payment of dividends

= Cash dividends declared + Beginning cash dividends payable - Ending cash dividends payable

= $83,126 + $9,151 - $15,635

= $76,642

Hence,

the answer is option (b) $76,642

7 0

2 years ago

Which of the following is NOT a useful strategy when making an informed purchase?

nasty-shy [4]

The answer to this question is B

8 0

2 years ago

Jeff was recently hired as a ﬂight attendant. He is expected to use both mind and body to becheerful on the job. Jeff's ﬂight at

hjlf

Answer: The person must be able to regulate their emotions to do a good job.

Explanation:

The ﬂight attendant job is one that requires great physical and mental effort. In the physical aspect, the person must be prepared to withstand long hours of flight, problems falling asleep, standing to serve the crew of the plane and various activities that involve physical effort, and this is accompanied by mental work.

The mental work that must be done by a person who works as a flight attendant is very large. It must constantly deal with a large number of people with different cultures, which means that things are not always going to go as expected. First of all, the flight attendant must maintain a cordial attitude and remain calm, since if some uncomfortable situation is to blame it is usually on the part of the flight attendant even if she is not guilty.

A person exercising the ﬂight attendant profession may feel a day in a bad mood and will have to put this aside and try to give a good face to fulfill their duties on the plane. It is important that their expressions and their way of behaving towards others be as friendly as possible.

Exercising a function where you have great contact with people can often create great tensions because, due to human differences, there may be a time when incompatibility occurs and conflicts exist, the flight attendant cannot let them reach these levels since its function focuses on keeping passengers as comfortable as possible while they are flying.

3 0

2 years ago