Answer:
KSAOs play a significant role in interviews and selection decisions
Explanation:
According to the given situation, Chris has been hired as an HR team at C Corp. and he took the responsibility of developing job descriptions and specialization for the vacancy of engineers.
Here Chris collects relevant data about the KSAO's so that he can choose a specialized engineer for an organization.
So, in the above case, the relevant answer is KSAOs play a significant role in interviews and selection decisions.
Answer:
WACC = 8%
Explanation:
WACC is the minimum return that a company should make to on its investment to satisfy the providers of funds (i.e loan providers and equity holders). The rate usually reflect the riskiness of the of the investment and finance structure used.
<u>Calculation</u>
WACC =(MV of Equity÷MV of the Company)Ke +(MV of Debt÷MV of the Company)Kd (1-t).
Where :
MV of the Company ⇒ MV of Equity+MV of Company
Ke ⇒ Cost of Equity
Kd(1-t) ⇒ Cost of Debt after Tax
WACC= (50/100)12.1% + (50/100) 6%(1-0.35)
= 6.05% + 1.95%
Hence, WACC = 8%
<u>Implication of Captital Structure on WACC</u>
Provided the investment was solely financed by equity instrument alone, the the WACC would have remained at 12.1%. However, with the introduction of debt finance, this has resuced our WACC to 8%.
Answer:
A) company HD pays less in Tax
Explanation:
Because interest is deducted before tax in income statement. Higher interest means less Earning before tax, and less amount of Tax be deducted.
HD and LD both have same Earning before interest and tax.
Let suppose both have EBIT of $1000,
Not HD has interest expense of 150, and LD has interest expense of $100
Now HD Earning before tax would be 850, and LD EBT would be 900.
Let's say tax is 40%
so,
HD tax would be 850*0.4=340
LD tax would be 900*0.4=360
So, HD pays higher interest, it benefit company in paying lower tax amount. bacause interest is tax saving.
HD saves $20 in this hypothetical example.
Answer:
You can sell the bond for $1,008.78 today
Explanation:
We need to calculate current value of the bond & its coupon
Face value: $1,000
Left tenor: 20 years (= 30 years to maturity - 10 years ago)
Coupon rate: 5%
Yield to maturity: 4.93%
Total coupon to be paid every year= $1,000* 5% = $50
To calculate the current value of coupon received in every of 20 years, we use formula PV in excel or manually as below:
PV = 50/(1+4.93%)^20 + 50/(1+4.93%)^19+.... +50/(1+4.93%)^1 = $626.83
The current value of face value after 20 years = $1,000/(1+4.93%)^20 = $381.95
So the value of bond = $626.83 + $381.95 = $1,008.78