Answer:
1. Stockholders invested $24,500 cash in the business in exchange for common stock.
Dr Cash 24,500
Cr Common stock 24,500
2. Purchased equipment for $4,500 cash.
Dr Equipment 4,500
Cr Cash 4,500
3. Paid $200 cash for May office rent.
Dr Rent expense 200
Cr Cash 200
4. Paid $600 cash for supplies.
Dr Supplies 600
Cr Cash 600
5. Incurred $350 of advertising costs in the Beacon News on account.
Dr Advertising expense 350
Cr Accounts payable 350
6. Received $4,900 in cash from customers for repair service.
Dr Cash 4,900
Cr Service revenue 4,900
7. Declared and paid a $1,000 cash dividend.
Dr Dividends 1,000
Cr Cash 1,000
Answer: commitment
Explanation:
The Chief Executive Officer of Japan Airlines, who was Haruka Nishimatsu, was an example of a strategic leader who had a high performance.
The The decision to take less salary in a year when the company was less profitable and employees' pay was cut is an example of Nishimatsu commitment to the company.
Answer:
cost of common equity = 14.46%
WACC = 11.29%
accept = Project A
Explanation:
Cost of common equity is the return that is required by Holders of Common Stock.
The available details can be used to calculate the cost of common equity using the Dividend Growth Model as follows :
Cost of common equity = (Next year`s Dividend / Current Market Price of a Stock) + Expected Growth
= ($2.20/$26)+6%
= 14.46%
WACC is the minimum return that a project must offer before it can be accepted.It shows the risk of the company.
Cost of Debt = Market Interest Rate × (1 - tax rate)
= 9.00% × (1-0.40)
= 5.40%
Capital Source Weight Cost Total
Debt 35% 5.40% 1.89%
Common Equity 65% 14.46% 9.40%
Total 100% 19.86% 11.29%
Therefore WACC is 11.29%
When evaluating projects, Compare the Project`s Internal Rate of Return (IRR) to the WACC.
<u>Project A</u>
IRR 12% > WACC 11.29%
Therefore Accept
<u>Project B/S</u>
IRR 11% < WACC 11.29%
Therefore Do Not Accept
Answer:
Charlie consumes 100 books and 25 wines at pareto-optimal allocation, is the right answer.
Explanation:
According to the question, book is denoted with b whereas, wine is denoted with w.
The Utility function of Martha is- 
The Utility function for Charlie is- 
= $1 : 
= $4
At pareto-optimality,
The budget constraint,
Therefore, it may be said that Charlie must consume 100 books and 25 wine at pareto-optimal allocation.
