The answer is seasonal discounts. A seasonal discount is a value incitement that organizations offer clients to make deals out-of-season. In mold, for example, retailers offer rebates for winter garments when spring nears, and they offer lower costs on summer garments amid end-of-summer deals.
The implied quality weight is 6/10 = 0.6. A year lived with chpitis scars is only 60% as satisfying as living a year in full health.
Atchley corporation’s last free cash flow was $1.55 million. the free cash flow growth rate is expected to be constant at 1.5% for 2 years, after which free cash flows are expected to grow at a rate of 8.0% forever. the firm's weighted average cost of capital (wacc) is 12.0%. The best estimate of the intrinsic stock price is $25.05.
What is free cash flows?
The amount by which a company's operating cash flow exceeds its demands for working capital and expenditures for fixed assets is known in corporate finance as free cash flow or free cash flow to firm.
Therefore,
The best estimate of the intrinsic stock price is $25.05.
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If an accrual is for an expense, the adjusting entry debits and asset expense account and credit a liabilty.
<h3> What is an accrued expense?</h3>
Accrued expenses are expenses that are recorded as account payable under the current liabilities section and it is recorded as an expense in the income statement of a company or individual balance sheet.
Example of accrual accounts is accounts payable and receivable, and future interest expense.
Therefore, If an accrual is for an expense, the adjusting entry debits and asset expense account and credit a liabilty.
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Answer:
Market price of bond = $2,166.30
Explanation:
Step 1
<em>Calculate the interest payment per 6 months and number of periods</em>
Interest rate per 6 months = (5.96% × 2000)/2 = 59.6
Number of periods = 19 × 2 = 38 periods
Step 2
<em>Calculate the Present Value (PV) of the interest payment</em>
Yield per six month = 5.3%/2 = 2.65%
PV = A × (1+r)^(-n)
= 59.6× ( (1.0265)^(-38)/0.0265 )
= 59.6 ×23.7685
= $1,416.60
Step 3
<em>Calculate the PV of the Redemption Value (RV)</em>
PV = RV × (1+r)^(-n)
= 2000 × (1.053)^(-19)
= 749.705925
Market price of Bond =1,416.60 + 749.70
= $2,166.30
Market price of bond = $2,166.30
