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3 years ago

Are capital markets also organisational markets?

1 answer:

6 0

Answer:A capital market is a financial market in which long-term debt (over a year) or equity-backed securities are bought and sold.[6] Capital markets channel the wealth of savers to those who can put it to long-term productive use, such as companies or governments making long-term investments.[a] Financial regulators like Securities and Exchange Board of India (SEBI), Bank of England (BoE) and the U.S. Securities and Exchange Commission (SEC) oversee capital markets to protect investors against fraud, among other duties.

Modern capital markets are almost invariably hosted on computer-based electronic trading platforms; most can be accessed only by entities within the financial sector or the treasury departments of governments and corporations, but some can be accessed directly by the public. As an example, in the United States, any American citizen with an internet connection can create an account with TreasuryDirect and use it to buy bonds in the primary market, though sales to individuals form only a tiny fraction of the total volume of bonds sold. Various private companies provide browser-based platforms that allow individuals to buy shares and sometimes even bonds in the secondary markets. There are many thousands of such systems, most serving only small parts of the overall capital markets. Entities hosting the systems include stock exchanges, investment banks, and government departments. Physically, the systems are hosted all over the world, though they tend to be concentrated in financial centres like London, New York, and Hong Kong.

Explanation:

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Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms ha

Alborosie

Answer:

The answer is "Share offer is better".

Explanation:

Firstly Computing the value of the combined company:

The merger value = the market value of the B company + the market value of the T + synergically advantages

= shares issued * share price of company B + outstanding shares * price per share of company T + benefits for synergies

$=4,600 \times \$40+1,000\times \$14+\$8,800\\\\=\$206,800\\\\$

Number of new shares which have been created following the merger = the number of shares in the T *exchange ratio

$=1000 \times \frac{1}{2}\\\\=500 \ shares\\\\$

The percentage price of the fusion company = the value of the fusion company /the share value of the fusion company

The per-share price of the combined company $=\frac{\$206,800}{4,600+500}=\frac{\$206,800}{5,100}=\$40.55$

The cash offer value = 16 dollars per share

Stock offer value = price of merged company share /2 $= \frac{\$40.55}{2}=\$20.27 / \ share\\\\$

Thus, share offer is better

8 0

3 years ago

Kostelnik Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours

Leno4ka [110]

Answer:

Unit cost= $347.8

Explanation:

Giving the following information:

The total fixed manufacturing overhead cost of $468,000, variable manufacturing overhead of $2.10 per machine-hour, and 72,000 machine-hours.

Job A496:

Number of units in the job 10

Total machine-hours 80

Direct materials $ 930

Direct labor cost $ 1,860

First, we need to calculate the manufacturing overhead rate:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= (468,000/72,000) + 2.1= $8.6 per machine hour

Now, we can calculate the total cost:

Total cost= direct material + direct labor + manufacturing overhead

Total cost= 930 + 1,860 + (8.6*80)= $3,478

Unit cost= total cost/ number of units= 3,478/10= $347.8

8 0

3 years ago

The state collects a gasoline tax that must be used to support highway construction and maintenance. The gasoline tax revenue sh

gayaneshka [121]

Answer:

Special revenue fund.

Explanation:

A special revenue fund is a government account created to collect money that is used for an specific purpose or project. The money collected by this type of account can only be used for the specific purpose for which it was established.

In this case, the revenue collected from the gasoline tax can only be used for highway construction and maintenance.

8 0

3 years ago

Vextra Corporation is considering the purchase of new equipment costing $35,000. The projected annual cash inflow is $11,000, to

Klio2033 [76]

Answer:

The net present value of the machine = $ 1590

Explanation:

Solution

The first step is to compute the present value of annual cash inflows as shown below:

The present value of the inflow of cash = (Annual inflow of cash * PVIFA rate, period)

which is

= $11,000 * PVIFA 12%, 4

= $11,000 * 3.0373

= $ 33,410

Note: the present value of inflow of cash has been computed by multiplying Annual cash inflows and Cumulative factor of 12% and 4 years. Annual cash inflow is $11,000 and from the table of PVIFA rate for a 4 periods at 12% discount rate is 3.0373.

Next step is to compute the Net value as shown in the equation below:

Net present value = (present value of inflow of cash - Investment)

which is

=$ 33, 410 - $ 35,000

= $1590

The net present value is = $ 1590

Note: Net present value has been computed be subtracting investment from the present value of inflow of cash.

The opening investment is $35,000 and the present value of inflow of cash is $33,410. since the initial investment is more than the present value of cash inflows, the net present value is seen as negative.

6 0

3 years ago

Schultz Electronics manufactures two ultra high-definition television models: the Royale which sells for $1,580, and a new model

Sergio [31]

Answer:

Schultz Electronics

Royale Majestic

Cost per unit cost $971.35 $841.55

Explanation:

a) Data and Calculations:

Information about overhead for the year ended December 31, 2017.

Activity Cost Cost Drivers Estimated Expected Use Activity-Based

Pools Overhead of Cost Drivers O/H Rate

Purchasing No. of orders $1,261,700 40,700 $31/order

Machine

setups No. of setups 874,120 16,810 $52/setup

Machining Machine hours 5,440,500 120,900 $45/hour

Quality Number of

control inspections 872,900 30,100 $29/inspection

Total overhead costs $8,449,220

The cost drivers used for each product were:

Cost Drivers Royale Majestic Total

Purchase orders 17,600 23,100 40,700

Machine setups 14,510 2,300 16,810

Machine hours 75,300 45,600 120,900

Inspections 11,900 18,200 30,100

Allocation of overhead costs:

Cost Drivers Royale Majestic Total

Purchasing $545,600 (17,600*$31) $716,100 (23,100 *$31) $1,261,700

Machine setup 754,520 (14,510*$52) 119,600 (2,300*$52) 874,120

Machining 3,388,500 (75,300*$45) 2,052,000 (45,600*$45) 5,440,500

Quality Control 345,100 (11,900*$29) 527,800 (18,200*$29) 872,900

Total $5,033,720 $3,415,500 $8,449,220

Quantity 25,000 10,000

Overhead per

unit $201.35 $341.55

Cost per unit of each model, using ABC Costing Technique:

Royale Majestic

Direct materials $650 $420

Direct labor ($20 per hour) 120 100

Manufacturing overhead 201.35 341.55

($42 per DLH)

Total per unit cost $971.35 $841.55

6 0

3 years ago

Are capital markets also organisational markets?​

Are capital markets also organisational markets?