Answer:
a) 13.18%
b) 9.06%
c-1) 14.55%
c.2) 11.805%
c.3) 9.06%
Explanation:
debt = 60%, cost of debt = 5.4% x 0.75 = 4.05%
equity = 40%, Re = ?
WACC = 7.7%
7.7% = (40% x Re) + (60% x 4.05%)
7.7% = (40% x Re) + 2.43%
(40% x Re) = 5.27%
Re = 5.27% / 40% = 13.175 = 13.18%
13.18% = ReU + (ReU - 0.054) x 1.5 x (1 - 25%)
13.18% = ReU + (ReU - 0.054) x 1.125
0.1318 = ReU + 1.125Reu - 0.06075
0.19255 = 2.125ReU
ReU = 0.19255 / 2.125 = 9.06%
ReL = 9.06% + (9.06% - 5.4%) x 2 x 0.75
ReL = 14.55%
ReL = 9.06% + (9.06% - 5.4%) x 1 x 0.75
ReL = 11.805%
Answer:
The reason which is not used for allocating the internal costs to the cost objects is to measure the selling price of the products.
Explanation:
Internal cost is the cost on which the businesses or company bases its price on which involve costs such as energy, plant, equipments and materials.
Cost objects is the department or the product for which costs are evaluated or measured. For example, a product is the cost object for direct labor and direct materials.
And the reason which is not used for allocating the internal cost to the cost objects is the evaluation of the selling price of the product as in a market, selling prices are determined or set by the demand and the supply factor.
Answer:
Journal Entry to record the first interest payment
June 30, 2019
Dr. Interst Expense $19,979.32
Dr. Premium on Bond $1,620.68
Cr. Cash $21,600
Explanation:
First, we need to calculate the premium on bond amortization as follow
Premium on bond amortization = Coupon Payment - Interest Expense
Premium on bond amortization = ( $480,000 x 8% x 6/12 ) - ( $499,483 x 8% x 6/12 )
Premium on bond amortization = $21,600 - $19,979.32
Premium on bond amortization = $1,620.68
Answer:
$45,400.
Explanation:
The cost for the year will be the sum of the three main cost component:
the direct materials added
the factory overhead applied
and the direct labor cost
<em>Cost Incurred during the year:</em>
direct materials 12,800
factory overhead 5,800
Direct labor 26,800
<u>Total cost added (or ncurred) during the month: 45,400</u>
Beginning WIP 50,600
Total cost to be accounted for 96,000
Ending WIP (37,300)
Cost of goods transferred out 58,700
