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liubo4ka [24]
2 years ago
5

Asonia Co. will pay a dividend of $4.95, $9.05, $11.90, and $13.65 per share for each of the next four years, respectively. The

company will then close its doors. If investors require a return of 9.2 percent on the company's stock, what is the stock price
Business
1 answer:
kompoz [17]2 years ago
7 0

Answer: $30.86

P = $4.95/(1 + .92) + $9.05/(1 + .92)^2 + $11.90/(1 + .92)^3 + $13.65/(1 + .92)^4

P = 4.53+7.59+ 9.14+ 9.60=$30.86

Explanation:

Dividend discount: Dividend year 1 divided by (1 plus the required rate of return)

PLUS Dividend year 2 divided by (1 plus the required rate of return) to the second power

PLUS Dividend year 3 divided by (1 plus the required rate of return) to the third power

PLUS Dividend year 4 divided by (1 plus the required rate of return) to the fourth power

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Cash Inflow

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On January 1, 2018, Nath-Langstrom Services, Inc., a computer software training firm, leased several computers under a two-year
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Answer:

Answer to the question :

On January 1, 2018, Nath-Langstrom Services, Inc., a computer software training firm, leased several computers under a two-year operating lease agreement from ComputerWorld Leasing, which routinely finances equipment for other firms at an annual interest rate of 4%. The contract calls for four rent payments of $13,000 each, payable semiannually on June 30 and December 31 each year. The computers were acquired by ComputerWorld at a cost of $90,000 and were expected to have a useful life of five years with no residual value. Both firms record amortization and depreciation semi-annually.

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is explained in the attachment.

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