During the current year, Esty Company replaced the roof on its manufacturing facility with a better roof that also extended the
1 answer:
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Answer:<em>True cost = </em>
<em>= </em>
<em>= $ 13,669,821.2</em>
Explanation:
Given :
Debt-Equity ratio = 0.55
Flotation cost for new equity = 6%
Flotation cost for debt = 3 %
∴ To compute the weighted flotation cost , we'll use the following formula:
Weighted Flotation cost =
=
= 0.0387 + 0.0106
= 0.04934 or 4.93%
The true cost of building the new assembly line after taking flotation costs into account is evaluated using the following formula :
True cost =
=
= $ 13,669,821.2
Answer:
Therefore after 16.26 unit of time, both accounts have same balance.
The both account have $8,834.43.
Explanation:
Formula for continuous compounding :
P(t)= value after t time
= Initial principal
r= rate of interest annually
t=length of time.
Given that, someone invested $5,000 at an interest 3.5% and another one invested $5,250 at an interest 3.2% .
Let after t year the both accounts have same balance.
For the first case,
P= $5,000, r=3.5%=0.035
For the second case,
P= $5,250, r=3.5%=0.032
According to the problem,
Taking ln both sides
Therefore after 16.26 unit of time, both accounts have same balance.
The account balance on that time is
=$8,834.43
The both account have $8,834.43.