Answer:
weighted-average cost of capital is 11.57 %
Explanation:
Weighted Average Cost of Capital (WACC) is the return that is required by providers of long term permanent sources of capital.
WACC = Weight of Equity × Cost of Equity + Weight of Debt × After tax cost of debt.
where,
After tax cost of debt = interest × ( 1 - tax rate)
= 8% × (1 - 0.35)
= 5.20 %
Therefore,
WACC = 0.65 × 15% + 0.35 × 5.20 %
= 11.57 %
Answer:
cost of goods manufactured= $490,000
Explanation:
<u>To calculate the cost of goods manufactured, we need to use the following formula:</u>
cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP
cost of goods manufactured= 20,000 + 120,000 + 190,000 + 170,000 - 10,000
cost of goods manufactured= $490,000
D. Lenders are worried that the borrower won't pay them back, and they assess how likely that is to happen by looking at the borrower's income, other assets, credit history, etc.
Answer: 1. $218750 ; 2. $231, 250 ; 3. $11562.50
Explanation:
1. The bonds with a par value of $250,000 and implied selling price of 87 ½.
Cash proceed = 250,000 × 87.5%
= $218,750
2. Since it's semiannual interest payments, the total amount of bond interest expense that will be recognized over the life of these bonds will be:
[20 × (250,000 × 8% × 6/12)]+ $250,000 - $218,750
= $200,000 + $250,000 - $218,750
= $231, 250
3. The amount of bond interest expense recorded on the first interest payment date will be:
= Total bond interest expense/number of payments
= $231,250/20
= $11562.50
