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3 years ago

Investments are different from savings accounts in that they:

Business

2 answers:

Natalka [10]3 years ago

5 0

I think it is Carry a risk of losing money (A)

svetoff [14.1K]3 years ago

5 0

lower earning potential

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Rank the following instruments in terms of credit risk. In your rankings, use 1 for the greatest credit risk and 4 for the small

bija089 [108]

Answer:

a. A Ba1 corporate bond 2 (not investment grade)

b. A ten-year BBB- corporate bond with a YTM of 7% 3 (medium risk but still investment grade)

c. A secured loan from Argosy Gaming, which is a B- rated firm 4 (less risky since it is backed by a collateral)

d. A senior subordinated bond from Argosy Gaming 1 (highest risk)

Explanation:

There are two major bond rating agencies in the US: Moody's and Standard & Poor's.

Their rankings are very similar, although the letters vary a little:

AAA: safest

AA: low risk

A: low risk

BBB: medium risk

BB: a little bit more riskier

B: risky

CCC: very high risk

CC: even riskier

C: riskiest

D: junk, in default

8 0

3 years ago

The following data were taken from the balance sheet accounts of Masefield Corporation on December 31, 2019.

viktelen [127]

Answer:

Please see below

Explanation:

a. A 5% stock dividend is declared and distributed when the market per share was $39.

Common stock par value($10) 500,000

Retained earning = 50,000 × 5% × 39

= $97,500

Common stock dividend distributed

50,000 × 5% × $10

= $25,000

See attached further explanations.

7 0

3 years ago

Connie stepped in to assist her friend Fred conduct his research plan for his business. He is trying to see where he should open

Illusion [34]

Connie's next step should be

Not - go back and revisit her plan objectives

Maybe - Conduct primary research and analyze Fred's current customers.

<h3>Explanation:</h3>

It is very essential for an entrepreneur who decides to start a new business to have a business plan that helps him in setting up the businesses in the right track and usage of funds in an effective manner. A business plan acts as a blue print of a new business and the objectives and resource utilization.

In the scenario give, Fred decides to start a new boutique and has conducted researches geographic locations and the type of boutiques supported by the demography. She must not then go back and review her plan objectives as she has decided to start it with a good plan and she may conduct a primary research about the current customers of him.

5 0

2 years ago

Saint Nick Enterprises has 17,500 shares of common stock outstanding at a price of $69 per share. The company has two bond issue

mihalych1998 [28]

Answer:

total weight of debt = 0.343 or 34.3%

Explanation:

stock's market value = 17,500 x $69 = $1,207,500

bond₁'s market value = $250,000 x 101.5% = $256,750

bond₂'s market value = $350,000 x 106.5% = $372,750

total market value of the firm = $1,837,000

weighted capital structure:

market value weight

stocks $1,207,500 0.657

bond₁ $256,750 0.140

bond₂ $372,750 0.203

total $1,837,000 1

total weight of debt = 0.343 or 34.3%

8 0

2 years ago

Use the following information for questions 6 and 7. Wonderland Company imports and sells a product produced in Canada. In the s

GarryVolchara [31]

Answer:

$1,564,800

Explanation:

Year Purchased Quantity (Units) Cost per unit Total Cost

2017 4,000 $160 $640,000

2018 10,000 $220 $2,220,000

2019 16,000 $320 $5,120,000

(A) Sales Revenue

2019 18,400 $392 $7,212,800

(B) Less: Cost of Goods Sold (LIFO)

2019 (16,000 x $320) ($5,120,000)

2018 {(18,400 - 16,000) x $220} ($528,000)

(A - B)Gross Profit $1,564,800

7 0

3 years ago