Answer:
C. $25,960
Explanation:
Cost of asset includes all the cost involved to acquire and install the asset. In simple term all the costs that are necessary to make the asset usable are capitalised and added to the cost of the asset.
In this question stamping machine has following cost which need to be capitalised.
Discounted Price = $24,000 x ( 100% - 3% ) = $24,000 x 97% = $23,280
Transportation cost = $550
Sales Tax = $1,680
Installation cost = $450
Total cost to be capitalized = $23,280 + $550 + $1,680 + $450 = $25,960
Routine Maintenance cost is the routine / period cost which incur every month, It is not necessary to make the asset usable and it is incurred after the asset is used.
Answer:
e. the power of buyers is low and barriers to entry are high.
Explanation:
- The cost leadership is the establishing a competitive advantage by having the lowest cost of operations and cost leadership is often driven by the company efficiency in size and sales. And the cumulative expand has a well-defined scope and the economies have chosen strategist and consists of the simultaneous cost leaderships example as Walmart and is different from the price leadership.
Answer:
The After Tax Cost of Debt = 0.072 or 7.2%
Explanation:
The question is to determine the After Tax Cost of Debt for Rolling Stone.
This is carried out as follows
Step 1: When we decide to calculate the Yield to Maturity, it should be noted that Market Value = Par Value
Therefore,
Coupon Rate which is the same as the Yield to Maturity (YTM) = 12%
Step 2: Based on this derivative, therefore,
After Tax Cost of Debt = Yield TO Maturity Rate (1-Marginal Tax Rate)
= 12% (1-40%)
= 0.12 (1-0.4)
The After Tax Cost of Debt = 0.072 or 7.2%
Answer:
beta of stock B = 1.33
Explanation:
the beta of treasury bills is 0
the beta of stock A = 1.46
the beta of stock B = ?
the portfolio contains equal amounts of each investment and its overall beta is 0.93
0.93 = (0 x 1/3) + (1.46 x 1/3) + (B x 1/3)
0.93 = 0 + 0.4867 + 0.333B
0.93 = 0.4867 + 0.333B
0.4433 = 0.333B
B = 0.4433 / 0.333 = 1.33
Answer: Im not doing the math but Option 2 is the better option
Explanation:
