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Scilla [17]
2 years ago
7

The optimal capital structure has been achieved when the: debt-equity ratio is equal to 1. debt-equity ratio results in the lowe

st possible weighted average cost of capital. debt-equity ratio is such that the cost of debt exceeds the cost of equity. weight of equity is equal to the weight of debt. cost of equity is maximized given a pretax cost of debt.
Business
1 answer:
icang [17]2 years ago
3 0

The optimal capital structure can be realized if : Debt-equity ratio selected results in the lowest possible weighted average cost of capital.

  • An optimal capital structure can be regarded as best mix of debt as well as equity financing which maximizes a company's market value.

  • And as well minimizing its cost of capital, it can be realized when Debt-equity ratio  that is been selected, gives the lowest possible weighted average cost of capital.

Learn more at:

brainly.com/question/10782180?referrer=searchResults

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Pie Co. uses the installment sales method to recognize revenue. Customers pay the installment notes in 24 equal monthly amounts,
Nataliya [291]

Answer:

C. The present value of the remaining monthly payments discounted at 12%.

Explanation:

To answer the question I have used following values to workout

Original Sales Value = 500,000

Interest rate  = 12%

Numbers of periods = 24

First I calculate the Equal annual installment payment by using following excel formula

=PMT(rate,nper,pv,[fv],[type])

Where

PMT = Equal Annual Payment

rate = Interst rate = 12%/12 = 1%

nper = Tota numbers of payment = 24 payments

pv = oroginal sales value = 500,000

FV = Value outstanding after 24 payments = 0

Type = The payment made at the start or end of the year ( 0 for the payment made at the end of the period and 1 for the payment made at the beginning of the period ) = 0

placing values in the formula

=PMT(1%,24,50,000,0,0)

= $23,536.74  

Now use these values to make the schedule which is attached with this answer.

After six Payment

Outstanding value = 385,961.72  

Original sales price = 500,000

Percentage of outstanding balance to original sales value = 385,961.72 / 500,000 = 0.77 = 77%

The reamining balance is above 75% of the original sales price.

Note:

A payment schedule is attached for reference

Download pdf
3 0
3 years ago
5. A business in its first period of trading charges $4,000 of sales tax on its sales and suffers $3,500 of sales tax on its pur
Katyanochek1 [597]

The unrecoverable sales tax on business entertaining ($250) has been deducted from $3,500

solution

                                   SALES TAX CONTROL ACCOUNT

Payable s                                             $ 3250        Receivables       $4000

Balance c/d (owned to tax authority)   $ 750

                                                           -------------                                ---------------

                                                             $ 4000                                    $4000

                                                           --------------                               ----------------

                                                                              By balance b/d       $ 750

8 0
3 years ago
The following information pertains to Crane Video Company:1. Cash balance per bank, July 31, $7,263.2. July bank service charge
My name is Ann [436]

Answer:

A. Prepare a bank reconciliation at July 31.

                                        Crane Video Company

                                             Bank Reconciliation

                                                        July 31

Cash balance per bank statement                             $7,263

Add: Deposits in transit                                                 1300

                                                                                      8,563

Less: Outstanding checks                                              591

Adjusted cash balance per bank                                $7,972

Cash balance per books                                             $7,284

Add: Collection of N/R ($700 plus

accrued interest $36 less collection

fee $20)                                                                          716

                                                                                       8,000

Less: Bank service charge                                               28

Adjusted cash balance per books                               $7,972

B. Journalize the adjusting entries at July 31 on the books of Crane Video Company.

The adjusting entry would be,

Date           Account Title                         Debit        Credit

Jul 31         Cash                                         716

                 Miscellaneous Expense           20

                 Notes Receivable                                         700

                 Interest Revenue                                            36

(to record Collection of N/R ($700 plus accrued interest $36 less collection fee $20)

31              Miscellaneous Expense            28

                 Cash                                                                28

(to record bank service charge)

5 0
3 years ago
Which best describes the barrier to trade known as dumping? Destroying shipments of imports to force consumers into purchasing d
Lana71 [14]

Answer: Selling exports abroad at a lower price than the domestic price.

Explanation:

Dumping is a practice in international trade where the country exporting, does so at a price that is lower than the domestic price of the good being exported in the importing country.

This allows the country exporting to gain more market share but can also lead to the collapse of the domestic industry thereby allowing for an export based monopoly to form.

An example would be Japan selling electronics in the U.S. at lower rates to capture market share even though those same electronics commanded a higher price in Japan.

7 0
2 years ago
John, a line supervisor, has decided to increase Kerry's responsibilities by delegating more work to her station. what is the fi
melomori [17]
<h2>Clarify the assignment would be the first step john should take to increase Kerry's responsibilities.</h2>

Explanation:

Option A: If a new work is assigned or an additional work is assigned, it is necessary to first explain about the new responsibility and clarify about the assignment. This would ensure Kerry to continue the work smoothly.

Option B: Feedback is always welcome but this is not the first step to add responsibilities.

Option C: Notifying others is the responsibility of John and not Kerry. So this choice is invalid.

Option D: Accountability though it is mandatory comes only in the closure part.

7 0
3 years ago
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