Answer:
Annual contributions to the retirement fund will be $6,347.31
Explanation:
First find the Present Value of the Annuity giving payments of $32,000 annually for 25 years at the rate of 10%.
Using a Financial Calculator enter the following data
PMT = $32,000
P/y = 1
N = 25
R = 10%
FV = 0
Thus, the Present Value, PV is $290,465.28
At the time of retirement (in 20 years time) the Value of the annuity fund is $290,465.28.
Next we need to find the Payments PMT to reach this amount in 20 years time at the interest rate of 8%
Using a Financial Calculator enter the following data
FV = $290,465.28
N = 20
R = 8 %
PV = $0
Thus, the Payments, PMT required will be $6,347.3080
Conclusion :
Annual contributions to the retirement fund will be $6,347.31
Answer: C. Less than Market Interest rate
Explanation: When the interest rate on a bonds issued by an organization is lesser than the prevailing interest rate being offered in the market at a certain time on Bank deposits, loans or other interest bearing funds, organization tends to issue discounts on bonds in scenarios like this and as such bonds are being issued or traded at prices lower or below it's face value in other to encourage investors and bridge the interest gap between the bond rate and the market rate.
Answer:
8.30%
Explanation:
The weighted average cost of capital of the company is computed using the WACC formula below:
WACC=(We*Ke)+(Wp*Kp)+(Wd*kd)
We=weight of common equity=50%
Ke=cost of retained earnings which is a proxy for the cost of equity=11.50%
Wp=weight of preferred stock=20%
Kp=cost of preferred stock=6.00%
Wd=weight of debt=30%
Kd=after-tax cost of debt=4.50%
WACC=(50%*11.50%)+(20%*6.00%)+(30%*4.50%)
WACC=8.30%
Hello!
Working capital in 2014 is
4,630−2,190=2,440
Working capital in 2015 is
5,180−2,830=2,350
change in net working capital, or nwc
2,350−2,440=−90
Good luck!
Answer:
I think letter A is the right answer
