Answer:
c. 2.50 years
Explanation:
In the payback, we analyze in how many years the invested amount is recovered. The computation is shown below:
In year 0 = $500
In year 1 = $150
In year 2 = $200
In year 3 = $300
If we sum the first 2 year cash inflows than it would be $350
Now we deduct the $350 from the $500 , so the amount would be $150 as if we added the fourth year cash inflow so the total amount exceed to the initial investment. So, we deduct it
And, the next year cash inflow is $300
So, the payback period equal to
= 2 years + ($150 ÷ $300)
= 2.50 years
In 2.50 yeas, the invested amount is recovered.
Answer:
Dividends are fixed. ⇒ Consistent with Debt
Fixed dividends makes preferred shares consistent with debt because debt repayments are made in equal payments as well.
Usually has no specified maturity date ⇒ Consistent with Equity.
Equity has no set maturity date unlike debt and preferred stock has no maturity date either so is much like equity in this regard.
Cost of preferred stock.
Preferred stock is like a perpetuity. The cost of preferred stock is therefore:
= Constant dividend / Price of stock
= 13 / 130.45
= 9.97%
= 10%
Answer:
Time donated to a qualified veterans organization
Explanation:
The reason is that the company can only only deduct the products or services delivered which had cost the organization. The companies are not allowed to deduct the cost of time delivered however if the employee is specially paid to offer the services to qualified charitable institution then the charity would be tax deductable.
Answer:
Year Cash Flow Cumulative Cash flow Discounted Cash Flow(8.9%) 0 $5,095,000 $5,095,000 $453,455 1 $1,500,000 $3,595.000 $3,141,5452 $3,000,000 $ 595,000 $141,5453 $4,500,000 ($3,905,000) $3,4515454 $6,500,000ABC Hospital will get ROI in 3 years, this option I would recommend to the CEO.
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