Answer:
the firm’s total corporate value is 3.500.000.000
Explanation:
Consider the following formula to calculate the corporate value of the firm
Firm Total Corporate Value =Free cash flow (T1) / Ke - G
= 250.000.000 ( 1+0.05)/12.5%-5%
= 3.500.000.000
Answer:
Please find solutions in the attached images
Explanation:
I have attached images of my journal entry solutions to this question as required.
Answer:
B. $11,000 increase in Assets; No effect on Liabilities; $11,000 increase in Stockholders’ Equity
Explanation:
As the company received cash in exchange for the common stock. So, it affect the accounting equation which is shown below:
Total Assets = Total liabilities + Total stockholder equity
The journal entry is shown below for better understanding:
Cash A/c Dr XXXXX
To Common stock XXXXX
To Additional Paid-in capital - in excess of par XXXXX
(Being cash is received)
So, it would not impact the total liabilities
Opportunity cost of going to college is actually the salary forgone.
With a yearly salary of $15,000 and a rent of $12000 yearly (parents would not let you live at home), we are left with $15000 - $12000 = $3000 per year
For 4 years, the opportunity cost will be 4 x $3000 = $12000
Answer:
C. Shut down the presses printing my book
Explanation:
Since the average variable cost of producing the book is above the demand curve, the best course of action is to shut down the printing (production) of more books. The author would lose less money by shutting down operations rather than continuing production at a variable cost higher than the demand he's receiving for the books.
In economics, when profit is less than the average variable cost, firms are advised to stop production in the short run and incur economic loss on fixed inputs. This is because with continued operations, total revenue would not only be lower than total cost, but rather, would also be less than total variable cost.
