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baherus [9]
3 years ago
11

Michael's, Inc., just paid $2.60 to its shareholders as the annual dividend. Simultaneously, the company announced that future d

ividends will be increasing by 5.6 percent. If you require a rate of return of 9.8 percent, how much are you willing to pay today to purchase one share of the company's stock
Business
1 answer:
mixas84 [53]3 years ago
6 0

Answer:

$65.37

Explanation:

Calculation for how much are you willing to pay today to purchase one share of the company's stock

Using this formula

P/0 = D0 ( 1 + g ) / R-g

Let plug in the formula

P/0 = $2.60 (1 + .056) / .098 - .056

P/0 = $2.60 (1 .056)/0.042

P/0=$2.7456/0.042

P/0=$65.37

Therefore how much are you willing to pay today to purchase one share of the company's stock will be $65.37

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Utopia Corporation provides $6,000 worth of lawn care on account during the month. Experience suggests that about 3% of net cred
photoshop1234 [79]

Answer:

The answer is C.

Explanation:

Credit sales is $6,000

Bad debt is 3% of net credit sales which is $180($6,000 x3%)

Creating allowance for doubtful debt entry is one of the prudent method and it tells us that some customers won't pay part of what they are owing. And it is also a contra account that offset bad debt.

According to the accounting rule, debit increases asset and expenses and vice-versa while credit decreases liability, equity, income and vice versa.

So we have have:

Dr Bad debt expense $180

Cr Allowance for Doubtful Accounts $180

6 0
2 years ago
On January 1, a company issues bonds dated January 1 with a par value of $460,000. The bonds mature in 5 years. The contract rat
Stolb23 [73]

Answer:

January 1, 202x, bonds issued at a discount

Dr Cash 441,361

Dr Discount on bonds payable 18,639

         Cr Bonds payable 460,000

amortization of bond discount = ($441,361 x 4%) - ($460,000 x 3.5%) = $17,654.44 - $16,100 = $1,554.44

June 20, 202x, first coupon payment

Dr Interest expense 17,654.44

       Cr Cash 16,100

       Cr Discount on bonds payable 1,554.44

7 0
3 years ago
Which element of the marketing mix is most relevant to the activity "creating value"? select one:
defon
The answer is "price".

The marketing mix alludes to the arrangement of activities, or strategies, that an organization uses to advance its image or item in the market.There are 4 p's included in the marketing mix, that are; promotion (communicating value), product (creating value), price (capturing value), and place (delivering value).
7 0
3 years ago
Businesses adopt and identify target markets for their products to: a. maximize the impact of the cost of marketing. b. coerce p
NeTakaya

Answer: maximize the impact of the cost of marketing

Explanation:

The target market is a particular group of consumers that the advertisement of a product or service is typically aimed at.

Businesses adopt and identify target markets for their products to maximize the impact of the cost of marketing. When the target market for a product or service has been known by a company, the business can find the most efficient and effective strategy to advertise their product. This will help in the minimization of cost of marketing.

6 0
2 years ago
Phillippe invested $1,000 ten years ago and expected to have $1,800 today He has neither added nor withdrawn any money since his
jasenka [17]

Answer:

The interest paid on loan was at floating rate which means that the investor earning was lower because of lower interest rate than the interest rate he was expecting.

Explanation:

Because the bond was dependent on the floating rate in the market. The borrower kept paying the investor at the floating rate not at the fixed rate which would had increased its investment worth to $1800. As $1600 is less than $1800 so the interest rate agreed was floating rate interest.

4 0
3 years ago
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