1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
marta [7]
3 years ago
9

Bacchus Enterprises has $12B in book value of common stock selling at a book to market rate of 1.35 and a beta of 1.5. The combi

ned preferred stock is valued at $8.5B with a beta of 1.23. The restructured debt has a book value of $4.8B in book value and has a coupon of 6%, maturing in 9 years, and selling at 102.5%. The market is doing quite well and is returning 14% with a risk free asset returning 4%. What is the Cost of Preferred Stock
Business
1 answer:
goldfiish [28.3K]3 years ago
7 0

Answer: 16.3%

Explanation:

Given the details in the question, the cost of preferred capital can be calculated using the CAPM method.

Cost of preferred stock using the Capital Asset Pricing Model is:

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

= 4% + 1.23 * (14% - 4%)

= 16.3%

You might be interested in
Pls help me and thanks I’m super stuck
Snezhnost [94]

Answer:

Explanation:

750% is 7.5 times the amount of the principle -- in this case 100 dollars.

If you need a formula, it is Amount = 750/100 * Principle

The answer should be 750 dollars. Any less than 100 is absurd, so both 7.50 and 75 make no sense.

3 0
2 years ago
Read 2 more answers
Exercise 4-2A Allocating costs between divisions Beasley Services Company (BSC) has 50 employees, 28 of whom are assigned to Div
Rasek [7]

Answer:

(a) $9,000 per employee

(b) $252,000; $198,000

Explanation:

Given that,

Fringe benefits cost during 2018 = $450,000

Employees assigned to division A = 28

Employees assigned to division B = 22

(a) Allocation rate:

= Total cost to be allocated ÷ Cost driver

= $450,000 ÷ 50

= $9,000 per employee

(b) Cost assigned to A:

= Division Allocation Rate × Weight of base (No. of employees)

= $9,000 × 28

= $252,000

Cost assigned to B:

= Division Allocation Rate × Weight of base (No. of employees)

= $9,000 × 22

= $198,000

6 0
3 years ago
Use the following selected information from Wheeler, LLC to determine the 2017 and 2016 trend percentages for net sales using 20
Nookie1986 [14]

Answer:

See below.

Explanation:

Trend percentages for net sales can be calculated by comparing base year sales to the current year sales.

For 2016

Base year 2016 Sales = $233,200

Current year sales (2016) = $233,200

Trend percentage = 233,200 / 233,200 = 1.00 * 100% = 100%

For 2017

Base year 2016 Sales = $233,200

Current year sales (2017) = $285,200

Trend percentage = 285,200 / 233,200 = 1.22 * 100% = 122%

Using the same formula for trends we can calculate multiple percentages for analysis.

Hope that helps.

8 0
3 years ago
According to the leadership grid developed by Blake and Mouton, which management style reflects moderate concern for production
sergiy2304 [10]

Answer:

Middle-of-the-road management

Explanation:

Middle - of - the - road management -  

It refers to the leadership style , which is plotted in the center of the grid , and the balanced concern between people and production is observed , is referred to as the Middle-of-the-road management .  

These type of leaders helps to settles the average performance by the employees.  

Hence, from the given information of the question,

The correct term is Middle-of-the-road management .

7 0
3 years ago
Assume that​ "cost of​ processing" includes all labor and​ materials, including the​ owner's wages. Assume further that​ Isabel'
Vika [28.1K]

Answer:

Check the explanation

Explanation:

In the field of economics, to draw a graph that will show a cost curve of any item will involve the costs of production as a function of the overall quantity that was produced. When there’s a free market economy, productively effective and efficient firms optimize their production procedures by reducing their cost consistent with each potential level of production, thereby resulting into a cost curve.

Kindly check the attached images below to see the full explanation and the graphical presentation of the total cost curve.

7 0
3 years ago
Other questions:
  • Maertge airlines purchases an aircraft for $84,000,000 on january 1, 2016. the residual value of the aircraft is estimated at $7
    8·1 answer
  • Which statement best describes how an informational interview differs from a job interview
    7·2 answers
  • One of the appeals of a sole proprietorship is that business expenses are
    9·2 answers
  • Chipotle’s "Food with Integrity" program outlines the company’s commitment to using only quality ingredients and respecting the
    12·1 answer
  • A firm has net working capital of $1,770. long-term debt is $4,180, total assets are $11,830, and fixed assets are $3,910. what
    8·1 answer
  • Which relationship BEST illustrates a comparison of absolute advantage and comparative advantage? A) A country with an absolute
    11·2 answers
  • Which value describes the desire to be one’s own boss?
    14·2 answers
  • Select the correct answer.
    11·1 answer
  • Lisa is a homeowner looking to sell her house. She opts not to sign a listing agreement with a broker in order to save on the co
    9·1 answer
  • The project management institute initially published the _________ to address the need to bridge the gap between organizational
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!