Answer: 8.45%
Explanation:
From the question, we are informed that Holmes Company's currently has an outstanding bonds and has a 8% coupon and a 13% yield to maturity.
We are further told that Holmes believes it could issue new bonds at par that would provide a similar yield to maturity and that its marginal tax rate is 35%.
Holmes's after-tax cost of debt will therefore be calculated as:
= Yield to maturity × (1 - Marginal tax rate)
= 13% × (1 - 35%)
= 13% × (65%)
= 0.13 × 0.65
= 0.0845
= 8.45%
Answer and Explanation:
As per the data given in the question,
a)
1. FIFO inventory > LIFO inventory
(Because in case of LIFO recent purchases are considered in production first or sold first so the remaining inventory are old inventory which is less costlier.)
2. FIFO cost of goods sold < LIFO cost of goods sold
(Because in case of LIFO recent purchases are considered in production first which are expensive so the cost of production is greater than FIFO.)
3. FIFO net income > LIFO net income
(Because cost of production is less under FIFO and the value of closing inventory is high, therefore the net income is also high.)
4. FIFO income taxes > LIFO income taxes
(Since, income is high in FIFO, therefore the tax under FIFO will be higher.)
b)
Management would like prefer to use LIFO over FIFO in periods of rising prices because Income shown in the company's Tax return will be higher if we use FIFO rather than using LIFO.
Answer:
The catering supplies in the planning budget for September would be closest to $3,200
Explanation:
In order to calculate the the catering supplies in the planning budget for September we would have to use the following formula:
catering supplies in the planning budget=The cost formula for catering supplies+cost per job×number of jobs+cost per meal×number of meals
catering supplies in the planning budget=($400+$90*15+145*$10) = $3,200
The catering supplies in the planning budget for September would be closest to $3,200
Sales taxes and individual income taxes
<span>If the economy booms and people's' incomes rise, then the demand curve for a normal good such as new houses will shift to the right and the equilibrium quantity of new houses produced will increase.
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Hope this helps !
Photon</span>
