Debit Accounts Receivable $5,000; credit Tile Sales $5,000
Answer:
10.12 %
Explanation:
Weighted Average Cost of Capital (WACC) is the cost of permanent sources of capital pooled together. It shows the risk of the business and is used to evaluate projects.
WACC = Cost of equity x Weight of Equity + Cost of Debt x Weight of Debt + Cost of Preference Stock x Weight of Preference Stock
<u>Remember to use the After tax cost of debt :</u>
After tax cost of debt = Interest x (1 - tax rate)
= 10% x ( 1 - 0.40)
= 6.00 %
<u>Cost of equity :</u>
Cost of equity = Return from Risk free security + Beta x Risk Premium
= 4.00 % + 1.8 x 8.00%
= 18.40 %
<u>Cost of Preference Stock :</u>
Cost of Preference Stock = Dividend / Market return x 100
= $2.50 / $ 25 x 100
= 10%
therefore,
WACC = 18.40 % x 30 % + 6.00 % x 60 % + 10.00% x 10%
= 10.12 %
thus,
Ford's weighted average cost of capital is 10.12 %
Considering the situation described in the question, if the allegations were accurate, the rating error the staff identified is known as the "Similarity Bias" error.
- This is because the Similarity Bias is a type of rating error where the rater rates a person or candidate higher than he deserves because they shared or have some similarities like having played for the same football team or attended the same school.
- There are other types of rating bias that do not apply to this situation.
- These include Halo bias and Leniency bias.
Hence in this case the correct answer is "Similarity Bias"
Learn more here: brainly.com/question/14467377
Answer:
The total fixed costs must be:
$36,000.
Explanation:
a) Data and Calculations:
Contribution margin ratio for the new product = 0.2
Target operating income = $60,000
Targeted sales volume in dollars = $480,000
Fixed costs = targeted sales volume in dollars multiplied by contribution margin ratio, minus target operating income
Fixed costs = ($480,000 * 0.2) - $60,000 = $36,000
b) The focus should be on the break-even formula for dollar sales with a target profit. When the formula is reversed, the fixed costs can be calculated as shown above.
