What is the Racial Wealth Gap?
1 answer:
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Answer:
Intrinsic value: 53.41 dollars
Explanation:
First, we use the CAPM model to know the value of the stock
risk free 0.085
premium market =(market rate - risk free) = 0.045
beta(non diversifiable risk) 1.3
Ke 0.14350
Now we need to know the present value of the future dividends:
D0 = 2.8
D1 = D0 x (1+g) = 2.8 * 1.23 = 3.444
D2 3.444 x 1.23 = 4.2361200
The next dividends, which are at perpetuity will we solve using the dividned grow model:
In this case dividends will be:
4.23612 x 1.07 = 4.5326484
return will be how return given by CAPM and g = 7%
plug this into the Dividend grow model.
value of the dividends at perpetity: 61.6686857
FInally is important to note this values are calculate in their current year. We must bring them to present day using the present value of a lump sum:
3.011805859
3.239633762
47.16201531
We add them and get the value of the stock:
53.413455
Answer:
a. see attachment
b.
total equivalent units : Materials = 30,500 units and Conversion Costs = 16,860
cost per equivalent unit : Materials = $0.14 and Conversion Costs = $0.30
c.
(a) units completed and transferred to Finished Goods = $6,732
(b) units still in process at June 30 = $1,196
d.
<u>Journals</u>
Work In Process :Direct Materials $4,305 (debit)
Raw Materials $4,305 (credit)
<em>Being Raw Materials used in Production</em>
Work In Process :Direct Labor $3,320 (debit)
Salaries Payable $3,320 (credit)
<em>Being Labor used in Production</em>
Work In Process ; Overheads $1,738 (debit)
Overheads $1,738 (credit)
<em>Being Overheads Assigned to Production</em>
Finished Goods $6,732 (debit)
Work In Process $6,732 (credit)
<em>Being Units transferred to Finished Goods</em>
Explanation:
<u>Calculation of Equivalent units of Production in respect with Raw Materials and Conversion Costs</u>
1. Materials
Ending Work In Process (5,200 × 100%) 5,200
Completed and Transferred Out (15,300 × 100%) 15,300
Equivalent units of Production in respect with Raw Materials 30,500
2. Conversion Costs
Ending Work In Process (5,200 × 30%) 1,560
Completed and Transferred Out (15,300 × 100%) 15,300
Equivalent units of Production in respect with Conversion Cost 16,860
<u>Calculation of Cost per Equivalent unit of production in respect with Raw Materials and Conversion Costs</u>
Unit Cost = Total Cost ÷ Total Equivalent units
1. Materials
Unit Cost = $4,305 ÷ 30,500
= $0.14
2. Conversion Costs
Unit Cost = ($3,320 + $1,738) ÷ 16,860
= $0.30
3. Total unit cost
Total unit cost = Material Cost + Conversion Cost
= $0.14 + $0.30
= $0.44
<u>Calculation of costs assigned to (a) units completed and transferred to Finished Goods and (b) units still in process at June 30.</u>
(a) units completed and transferred to Finished Goods
Total Cost = units completed and transferred out × total unit cost
= 15,300 × $0.44
= $6,732
(b) units still in process at June 30.
Total Cost = Materials Cost + Conversion Cost
= $0.14 × 5,200 + $0.30 × 1,560
= $1,196
