Answer:
158,500
Explanation:
Preparation of the third - quarter production budget for skis .
BLACK DIAMOND COMPANY Production Budget (in units)Third Quarter
Budgeted ending inventory (skis) 4,500
Add budgeted sale 160,000
Required units of available production 164,500
(4500+160,000)
Deduct beginning inventory (skis) (6,000)
Units to be manufactured 158,500
(164,500-6,000)
Therefore the third - quarter production budget for skis is 158,500
Answer: Cash for $180
Explanation:
The Petty Cash balance should be at a certain level necessary to cover petty cash expenses of the company. In this case that amount is $200. $20 is already in cash in the account and so will need to be topped up to get to $200.
= 200 - 20
= $180
$180 will take the balance back to $200. The Cash account would be credited of this $200 and the Petty Cash would be debited.
The expected return of stock A is 16.34%.
The formula for computing expected return according to CAPM is:
Expected Rate of Return = Rf +β <u>(Rm-Rf)</u>
The underlined term (Rm - Rf) in the equation above is known as the reward-to-risk premium. This represents the excess return earned by an investment over and above the risk free rate.
From the data given in the question, we can arrive at the reward-to-risk premium of stock b.
Let the reward to risk premium (Rm - Rf) be 'x'.
Substituting the values in the CAPM equation we get,
0.132 = 0.045+1.08x
Solving for x we get,
0.087= 1.08x
x = 0.080555556
(0.087/1.08)
Now, we substitute this value of 'x' again in this CAPM, but this time with stock a's beta.
Expected Return = 0.045+ (1.47 × 0.080555556
)
= 0.045 + 0.118416667
= 0.163416667
or 16.34%
