Answer:
Vertical growth
Explanation:
Vertical growth occurs when a company sets up operations and distribution channels for a new product. There is an expansion from its traditional product offering.
Vertical growth aims to increase control of distribution and suppliers and scaling of product within existing line of production.
Ford motor's initiative in setting up its River Rouge Plant outside of Detroit so that iron ore could enter into one end of the plant and a finished automobile could exit out of the other end is vertical growth.
The required rate of return is $3.42%
<h3>What is Perpetuity?</h3>
A constant cash flow with indefinite period of time is called perpetuity. In this question a perpetual payment of dividend is being made. so the price of the share is calculated by the formula of perpetuity.
<u>Given:</u>
Present value of perpetuity = $92 per share
Cash flows = $3.15 every year
<u>Find:</u>
Rate of return can be calculated from the perpetuity formula
Present value of perpetuity = Cash flows / Required rate of return
Present value of perpetuity = Cash flows / Required rate of return
$92 = $3.15 / Required rate of return
Required rate of return = $3.15 / $92
= 0.0342
= $ 3.42%
Therefore the Required return for Oberholser, Inc will be 3.42%.
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Answer:
Borrow $6,300.
Explanation:
The company has $10,100 cash at the beginning of June
and anticipates $31,900 in cash receipts
and $38,300 in cash disbursements during June.
This gives a positive balance of (10,100 + 31,900 - 38,300) $3,700 and
To maintain the $10,000 required balance, during June the company must:Borrow $6,300.
Answer:
$4.5
Explanation:
Interest to be capitalized=$90*6%*10/12=$4.5
As the loan was outstanding from January to October 2021, therefore interest is worked out for 10 months.
Please note that interest of only those debt instruments are capitalized which have been obtained to finance any construction project under the specific interest method.
In our example $90 is the construction loan therefore only this loan's interest is capitalized.
Answer:
d. Change to a just-in-time inventory system and make the shoes as they are ordered rather than making and storing many shoes and hoping to sell them.
Explanation:
In the Just-in-time inventory management system, materials purchased go straight to the production line. The business keeps minimum or nil raw material in its stores. Demand for goods guides the production process.
Should Alfredo manufactures adopt a Just in time production style, its inventory budgetary requirement will significantly reduce. Alfredo will be ordering for material need for production at that moment. The company will be manufacturing shoes that customers are ready to buy. Its cost of finished inventory will also decrease.
For Just-in-time system to work well at Alfredo, managers must learn how to predict demand accurately and employ an excellent order management system
