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yulyashka [42]
3 years ago
12

A company purchased a van at a cost of $42,000 and expects it can be sold for $6,000 after 120,000 miles of service. Assuming th

e units-of-production method is used and the van is driven for 24,000 miles during the first year, the depreciation at the end of the first year would be
Business
1 answer:
scoray [572]3 years ago
8 0

Answer:

Annual depreciation= $7,200

Explanation:

Giving the following information:

A company purchased a van for $42,000 and expects it can be sold for $6,000 after 120,000 miles of service.

<u>To calculate the annual depreciation, we need to use the following formula:</u>

Annual depreciation= [(original cost - salvage value)/useful life of production in miles]*miles driven

<u>For 24,000 miles:</u>

<u></u>

Annual depreciation= [(42,000 - 6,000) / 120,000]*24,000

Annual depreciation= 0.3*24,000

Annual depreciation= $7,200

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U.i designs is an all equity firm that has 40000 shares of stock outstanding. the company has decided to borrow $1 million to bu
velikii [3]

Answer: The value of the firm is $16 million.

For this question we use the Modigliani-Miller Proposition I which states that the value of the firm is same irrespective of the amount of equity and debt in its capital structure, ignoring taxes.

Amount borrowed for buyback = $1m

No. of shares bought back   = 2500

Value per share                    = $400 = \frac{1000000}{2500}

Shares outstanding before buyback = 40000 shares

Shares bought back                           =  2500 shares

Shares outstanding after buyback    = 37500 = 40000-2500  

Next we calculate the value of the firm before and after buyback of shares.

The value of the firm before buyback comprises of only 40000 equity shares. There is no debt. Hence,

Value of the firm before buyback = Shares outstanding before buyback * Value per share

Value of the firm before buyback = 40000 * 400

Value of the firm before buyback = 16000000 or 16 million

The value of the firm after buyback will be

Value after buyback = (Shares outstanding after buyback * Value per share) + Value of debt

Value after buyback = (37500* 400) + 1000000

Value after buyback = 15000000 + 1000000

Value after buyback = 16000000 or 16 million

Since value of the firm before and after buyback of shares is the same, we can say that the Modigliani-Miller Proposition I without taxes holds and the value of the firm is $16 million.

3 0
3 years ago
Skills devalopment act
xxTIMURxx [149]
What is the question?
8 0
3 years ago
Name one of the three different levels at which an organization can be diagnosed?
Sav [38]

Three different levels at which an organization can be diagnosed are Organizational, Group and Individual.

In the organizational level three faces are considered which includes the Inputs, outputs and the system designs. This creates a process through which the organization arrive at its goals.

The second level of the diagnosis is the group level diagnosis.In this level of diagnosis the focus is on the input of the organizational design.

Third level of diagnosis is at the individual level. Individual jobs have specific designs to accomplish individual goals which are required to be performed for a certain process.

An organization is an open system in which different ways of the environment impact the organizations in many ways.

To learn more about organizational diagnosis here:

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6 0
2 years ago
The monetary inflation needed to relieve the social and economic hardships of the late nineteenth century eventually came as a r
AnnZ [28]

Answer:

Came as a result of:an increase in the international gold supply .

6 0
3 years ago
How can a developing country generate internal funds?
Brrunno [24]

Answer:

The correct answer would be option C, By producing more than it consumes.

Explanation:

A developing country can generate internal funds by producing more than it consumes.

Internal funds are the funds that are generated internally, either at the individual level or at the country level. When a country generates funds on its own, the funds are called as the internal funds.

So internal funds can be generated by producing more than the consumption requirements. In this way the economic activities will increase, the money supply would be better and the country would be able to generate funds it need.

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3 years ago
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