Answer:
$1.06; 11.3%
Explanation:
Current selling price of stock, P = $20
Dividend paid a share, D0 = $1
Dividend growth rate = 6%
Dividend growth rate = (D1 ÷ D0) - 1
6% = (D1 ÷ 1) - 1
0.06 = (D1 ÷ 1) - 1
D1 = 1.06
Expected dividend yield = D1 ÷ P
= 1.06 ÷ 20
= 5.3%
Required rate of return = Expected growth + Expected dividend yield
= 6% + 5.3%
= 11.3%
Answer:
A) $2.50 per direct labor-hour
Explanation:
The computation of the predetermined overhead rate is shown below:
Predetermined overhead rate = (Total estimated manufacturing overhead) ÷ (estimated direct labor-hours)
where,
Estimated manufacturing overhead = Rent on factory building + Depreciation on factory equipment + Indirect labor + Production Supervisor's salary
= $15,000 + $8,000 + $12,000 + $15,000
= $50,000
And, the estimated direct labor hours is 20,000
So, the rate is
= $50,000 ÷ 20,000
= $2.5 per direct labor-hour