Answer:
b.$127,500 increase
Explanation:
Using Accounting Equation we can find thetotal increase in total assets:
Assets = Equity + Liabilities
Change in Assets = Change in Equity + Change in Liabilities
Change in Assets = $37,500 + $90,000
Change in Assets = $127,500
Total Change in equity and liabilities will be equal to the change in Assets.
So, the correct answer is b.$127,500 increase.
Answer:
true
Explanation:
the cost of the truck should include:
truck sales price $35,000
sales taxes $2,000
company's logo $1,200
<u>safety testing $220</u>
total $38,420
*not included: truck driver's license
Thee original cost of an asset must include its purchase price minus any discounts, and all the elements needed to put the asset into use. In this case, the truck's cost must include all taxes paid, painting of the company's logo and safety testing. It should not include the cost of a truck driver's license because the driver is not part of the truck.
Answer:
8.27%
Explanation:
Data provided in the question:
Current price = $36.72
Annual dividend paid, D0 = $2.18
Dividend growth rate, g = 2.2% = 0.022
Now,
Cost of Equity = [ (Dividend For Next Year) ÷ Current Price ] + Growth rate
= [ ( D0 × ( 1 + g ) ) ÷ $36.72 ] + 0.022
= [ ( $2.18 × ( 1 + 0.022 ) ) ÷ $36.72 ] + 0.022
= [ 2.22796 ÷ $36.72 ] + 0.022
= 0.06067 + 0.022
= 0.08267
or
= 0.08267 × 100% = 8.267% ≈ 8.27%
Answer:
a. Terrell's Optimal Capital Structure is 40:60. It means to obtain optimal capital structure in-order to increase value of firm, Terrell should finance 40% of its Assets through Debt and remaining through Common Equity.
b. The optimal Capital Structure is the point where company's WACC is minimized. So, 40:60 is the ratio where Terrell's WACC will be minimized.
Explanation:
The goal of Management is to increase Shareholders' wealth and not to generate profits because wealth is something that is for long-run whereas Profits are temporary. Management would accept projects having negative NPV if its goal is to maximize Profit.
Maximizing Shareholders' wealth means to increase the Share Price whereas Generating a higher EPS is Profit Maximization Strategy. So, you should look for that Capital Structure Point where the Company's Stock Price is Highest.
Thanks!
Answer:
Franchise.
Explanation:
A Franchise is a system in which semi-independent business owners (franchisees) pay fees and royalties to a parent company (franchiser) in return for the right to become identified with its trademark, to sell its products or services, and often to use its business format and system.
Is a network of interdependent business relationshipsthat allows a number of people to share:
1. A brand identification
2. A successful method of doing business
3. A proven marketing and distribution system