If the consumer expected price increase for any reason in such good he will buy it before the time he expects to apply for that increase.
Bond valuation:
<span>Par value = Maturity value = FV = $1,000 </span>
<span>Coupon rate = 7.5% </span>
<span>Years to maturity = N = 19 </span>
<span>Required rate = I/YR = 5.5% </span>
<span>(Coupon rate)(Par value) = PMT = $75 </span>
<span>PV = $1,232.15</span>
Answer:
1. TIE ratio = EBIT / Interest expense
EBIT = [ (Annual sales x profit margin) / (1 - tax rate) ] + Amount of debt x interest rate
= [ ($2,880,000 x 3%) / (1 - 0.30) ] + $800,000 x 8%
= 187428.57143
= $187,428.57
TIE ratio = $187,428.57 / ($800,000 x 8%)
TIE ratio = $187,428.57 / $64,000
TIE ratio = 2.92857
TIE ratio = 2.93
2. ROIC = [ EBIT x (1 - tax rate) ] / (Amount of debt + common stock)
= [$187428.57 x (1 - 0.30) ] / ($800,000 + $600,000)
= 0.093714285
= 9.37%
The legal contract between the bondholders and the issuer is called the bond <u>indenture.</u>
A bond indenture is important as it helps to protect the interest if the stakeholders and also lowers the chance of default.
It should be noted that the indenture list provides the details of a bond. It helps in ensuring transparency. Therefore, the legal contract between the bondholders and the issuer is called the bond indenture.
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Answer:
d. 829
Explanation:
The computation of the ending inventory using the LIFO method is shown below:
Since there are 300 units in hand which reflects the ending inventory units so
= 150 units ×$2.60 + 150 units $2.925
= $390 + $438.75
= $828.75
i.e d. 829
So 150 units is taken from June and the remaining units i.e 150 units are taken from June 10
