Answer:
5.84%
Explanation:
We use the RATE function that is shown in the excel. Kindly find the attachment below:
The NPER shows the time period.
Given that,
Present value = $45
Future value or Face value = $47
PMT = $2
NPER = 3
The formula is shown below:
= Rate(NPER,PMT,-PV,FV,type)
So, the annual compound rate of return is 5.84%
Answer:
The earnings per share for Bramble in 2020 is $2.99
Explanation:
This was arrived at by preparing income statement for 2020,where in the results from continued operations and discontinued were shown.
The income from continued operations attracted tax at 35% while the losses from the discontinued operations got a tax benefit at the same 35% tax rate.
Note that the earnings used in calculating earnings per share is net of preferred dividends as only earnings attributable to ordinary shareholders are considered.
Find attached spreadsheet for the full blown income statement and the calculation of earnings per share.
Answer:
9.6845%
Explanation:
Market risk premium = Market return - Risk free rate
7.3 = 11.2 - Risk free rate
Risk free rate = 3.9%
(1) Use CAPM:
Cost of equity = Risk free rate + Beta × Market risk premium
= 3.9% + 1.06(7.3)
= 11.638%
(2) Use DDM
:
Stock price = [Latest dividend × (1 + dividend growth rate)] ÷ (Cost of equity-dividend growth rate)
$17 = [0.92 (1 + 0.022)] ÷ (Cost of equity - 0.022)
Cost of equity = 7.731%
Cost of equity = average value from using DDM and CAPM
Cost of equity = 0.5 (7.731 + 11.638)
= 9.6845%
Answer:
productivity is calculated by using formula
Explanation:
formula = total output/ total input
Answer:
Dr Retained earnings $14,000
Cr Inventory $14,000
Explanation:
There is a need to make adjustment to the inventory . Therefore,
Adjusted inventory
= New method of $171,000 - Old method of $185,000
= $14,000 decrease
It is to be noted that a lower inventory will have high costs associated with goods sold hence reduces profit/net income for the previous year by $14,000.
Also, the net income reports to retained earnings account hence decreases retained earnings.
Having made the above adjustment, we can assume that the average cost method was used for 2020 books.
