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lakkis [162]
2 years ago
8

Consider an asset with a beta of 1.2, a risk-free rate of 4.4%, and a market return of 12.4%. What is the reward to risk ratio?

Business
1 answer:
charle [14.2K]2 years ago
3 0

Answer: 8%

Explanation:

Reward to risk ratio = (Expected return - Risk free rate) / Beta

Expected return = Risk free rate + Beta * ( Market return - Risk free rate)

= 4.4% + 1.2 * (12.4% - 4.4%)

= 14%

Reward to risk ratio = (14% - 4.4%) / 1.2

= 8%

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E3-18 Comparing cash and accrual basis accounting and applying the revenue recognition principle Momentous Occasions is a photog
dusya [7]

Answer:

Momentous Occasions

a. Revenue of $1,000 is recognized on April 2, though the cash receipt is recorded on March 3 as deferred revenue.  This means that the recognition occurred on a separate date from when the cash was received.

b. Revenue of $4,100 will be recognized on the date the party is held and not on the February 28 date when the cash was received.  This means that the recognition occurred on a separate date from when the cash was received.

Explanation:

Momentous Occasions is required to recognize revenue on the date the service is performed and not when the cash is received in accordance with the accrual concept, unless it chooses to use the cash basis as a small business.

4 0
3 years ago
There were few communication issues with alice, bob, betty, and frank for each communication issue where was the breakdown in co
satela [25.4K]
During communication between Herb and each of his teammates, there was some type of “blank space”. Herb was not communicating properly as a project manager should. His staff either did not understood what he was trying to say, missing information in his message, or did not communicated at all.

Alice- Encoding
Bob- Improper format for the message
Betty- Feedback
<span>Frank- Decoding/ Encoding</span>
5 0
3 years ago
During its first year of operations, Silverman Company paid $14,000 for direct materials and $19,000 for production workers' wag
hjlf

Answer:

GROSS MARGIN = 33.33%

Explanation:

PRODUCTION COST COMPONENTS

  • Direct materials 14,000  
  • Direct work 19,000  
  • Lease and utilities 17,000

TOTAL PRODUCTION COST = 50,000

TOTAL UNITS PRODUCED = 5,000

UNIT COST= (Total Production Cost / Total Units Produced) = 50,000 / 5,000 = 10  

FINAL GOODS INVENTORY = (Total Units Produced – Total Units Sales) = 5,000 – 3,000 = 2,000

FINAL GOODS INVENTORY AMOUNT = (Final goods Inventory * Unit Cost) = 2,000 * 10 = 20,000

SALES REVENUE= (Sold Units * Sale Price) = (3,000 * 15) = 45,000

COST OF SOLD GOODS (a) = (Sold Units * Unit Cost) = 3,000 * 10 = 30,000

COST OF SOLD GOODS (b) = (Beginning Balance + Production cost – Final Balance) = 0 + 50,000 – 20,000 = 30,000

GROSS MARGIN = ((Sales Revenue – Cost of sold Goods) / Sales Revenues) * 100 = ((45,000 – 30,000) / 45,000) * 100 = 33.33%

COST OF SOLD GOODS (a) Calculated according to the inventory unit cost

COST OF SOLD GOODS (b) Calculated as the difference in inventory

7 0
3 years ago
Ironically, while the leaders of Enron Corporation were manipulating the company's finances for their personal benefit, the comp
faltersainse [42]

Answer:

Correct option is (d)

Explanation:

Corporate social responsibility is an initiative taken by companies to act for the benefit of the society. Since companies utilize resources from the society, it their responsibility to give back to the society in the form of charity to non governmental organizations, welfare of underprivileged and protecting the environment.

Here, though Enron was undertaking unethical means for personal benefits, it was also carrying out corporate social responsibility by donating to Houston area charities.

4 0
3 years ago
pany is considering the purchase of a new bubble packaging machine. If the machine will provide $15,000 annual savings for 12 ye
finlep [7]

Answer:

Present Value= $74,018.97

Explanation:

Giving the following information:

The machine will provide $15,000 annual savings for 12 years and can be sold for $48,000 at the end of the period.

Interest rate= 15%

<u>To determine the present value of the savings, first, we need to determine the future value at the rate provided.</u>

We need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual save

FV= {12,000*[(1.15^12)-1]}/ 0.15

FV= 348,020 + 48,000= $396,020

Now, we can calculate the present value:

PV= FV/(1+i)^n

PV= 396,020/1.15^12= $74,018.97

4 0
3 years ago
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