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Sonja [21]
3 years ago
8

Wild Swings Inc.’s stock has a beta of 2.5. If the risk-free rate is 6% and the market risk premium is 7%, what is an estimate o

f Wild Swings’ cost of equity?
Business
1 answer:
Bess [88]3 years ago
3 0

Answer:

r = 0.235 or 23.5%

Explanation:

Using the CAPM, we can calculate the required/expected rate of return on a stock. This is the minimum return required by the investors to invest in a stock based on its systematic risk, the market's risk premium and the risk free rate.  

The formula for required rate of return under CAPM is,

r = rRF + Beta * rpM

Where,

  • rRF is the risk free rate
  • rpM is the market return

r = 0.06 + 2.5 * 0.07

r = 0.235 or 23.5%

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At the beginning of the current accounting period Blazer Company had a $40,000 balance in its Finished Goods Inventory account.
Salsk061 [2.6K]

Answer:

The correct answer is A.

Explanation:

Giving the following information:

Beginning finished goods inventory= $40,000

During the period cost of goods manufactured amounted to $280,000. The ending balance in the Finished Goods Inventory account was $42,000.

To calculate the cost of goods sold, we need to use the following formula:

COGS= beginning finished inventory + cost of goods manufactured - ending finished inventory

COGS= 40,000 + 280,000 - 42,000

COGS= 278,000

4 0
3 years ago
Olongapo Sports Corporation is the distributor in the Philippines of two premium golf balls-the Flight Dynamic and the Sure Shot
Goshia [24]

                                     = Fixed Expenses/Weighted Average CM Ratio

Break-even point         = P183,750 / (210,000/400,000)    

                                     = P350,000      

The break-even point is the point at which total costs equal total sales, and there is no loss or profit for a small business. This means that we have reached a production stage where production costs are comparable to product sales.

The break-even point is used in several areas of economics and finance. In accounting terms, it refers to the level of production at which the total revenue from production equals the total cost of production. In investing, the break-even point is the point at which the original cost equals the market price.

Learn more about the break-even point at

brainly.com/question/9212451

#SPJ4

3 0
2 years ago
What percentage of data would you predict would be between 40 and 70 and what percentage would you predict would be more than 70
Mariana [72]

Answer:

<em>The percentage of data of prediction between 40 and 70 is 0.4347 or about 43.57%., the percentage of prediction that would be more than 70 miles is 0.2389 or about 23.89%</em>

Explanation:

<em>Let us Recall that, </em>

<em>We can perform analysis using the z-score of certain values, only when the standard deviation and the men are. The z-score is the measure of how many standard deviations from the mean a certain value is known. by finding the percentage of values that is expected to be above or below a value is by applying the z-score </em>

<em>The first step is to find the z-score for each of these values. After that, we apply the Standard Normal Probabilities table to find the percentage between the values. The z-score given as follows, </em>

<em>z= x-ẋ/s </em>

<em> ẋ = the sample mean </em>

<em>s = the sample standard deviation </em>

<em>x = is the data value not given </em>

<em> The mean value is = 51.6571429 </em>

<em>The standard deviation value is = 25.8012116 </em>

<em> Then </em>

<em>The z score for 40 is given as </em>

<em> z = 40 – 51.6571429/ 25.8012116 = - 0.45 </em>

<em> The z score for 70 is given as, </em>

<em> Z = 70 – 51.6571429/ 25.8012116 = -0.71 </em>

<em> The table entry for both -0.45 and 0.71 is 0.3264, and 0.7611 </em>

<em>Therefore, </em>

<em> find the percentage between 40 and 70, we subtract table entries to get 0.7611 - 0.3264 = 0.4347 or about 43.57%. </em>

<em>To find the percentage above 70, we subtract the table entry for 70 from 1 to get 1 - 0.7611 = 0.2389 or about 23.89% </em>

4 0
4 years ago
Read 2 more answers
Indirect labor includes:_________ (You may select more than one answer. Single click the box with the question mark to produce a
ch4aika [34]

Answer:

b labor of the maintenance employees

c labor of the clerical staff

Explanation:

During the production or composition of finished goods, some form of labors are directly or indirectly involved in the manufacturing of such finished product. Where labor is not readily traced to the manufacturing of finished product, such is known as indirect labor.

On the other hand, labor that is directly involved in the composition of finished product is known as direct labor. Examples of indirect labor are ; wages of supervisors , clerical staff, general helpers , material handlers and maintenance workers.

3 0
3 years ago
Partial balance sheets and additional information are listed below for Monaco Company. Monaco Company Partial Balance Sheets as
Studentka2010 [4]

Answer:

Net Purchases = Cost of goods sold - Decrease in Inventory

                        = $308,000 - $16,500

                        = $291,500

Cash paid to Suppliers = Net Purchases + Decrease in accounts Payable

                                      = $291,500 + $13,500

                                      = $305,000

The summary entry is as follows:

Merchandise Inventory A/c Dr. $291,500

Accounts payable A/c          Dr. $13,500

To cash                                                              $305,000

(To record the amount of cash paid to merchandise suppliers during 2018)

                                       

5 0
4 years ago
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