Carnes Cosmetics Co.'s stock price is $54, and it recently paid a $1.25 dividend. This dividend is expected to grow by 29% for the next 3 years, then grow forever at a constant rate, g; and rs = 14%. At what constant rate is the stock expected to grow after Year 3? Do not round intermediate calculations. Round your answer to two decimal places. ________ %

Answers

Answer 1

At 13.32% of constant rate, the stock expected to grow after Year 3.

How to determine the constant rate

To find the constant rate at which the stock is expected to grow after Year 3, we can use the dividend discount model.

First, we calculate the dividend expected in Year 4 by multiplying the Year 3 dividend by (1 + the Year 3 growth rate) which gives us $1.25 x (1 + 0.29) = $1.62.

Then we use this value to calculate the intrinsic value of the stock using the formula: intrinsic value = (expected dividend ÷ (rs - g)).

We know the stock price is currently $54, so we can set up the equation: $54 = ($1.62 ÷ (0.14 - g)).

Solving for g gives us 13.32%, which is the expected constant rate of growth after Year 3.

Therefore, the answer is 13.32%.

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Related Questions

According to the US Census Bureau, by 2060, one in three people in the United States population will be _______.
a. white
b. black/african American
c. asian
d. hispanic

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The US Census Bureau predicts that by 2060, one in three people in the United States population will be D) Hispanic.

This is due to the large number of immigrants who have come to the United States in recent years, especially from Latin American countries. The Hispanic population is projected to increase from the current 18.8 percent to 31.2 percent.

Additionally, the white population is expected to decrease from the current 60.4 percent to 43.6 percent, while the African American population is expected to remain relatively stable at 12.4 percent of the population.

The Asian population is expected to increase from the current 5.9 percent to 8.2 percent of the population. Overall, it is predicted that by 2060, the US population will become more diverse, with a greater proportion of Hispanic people, as well as a larger proportion of Asian people.

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think about the different ways the chapter and video describe to organize an analytical report. which would you be using when you employ the direct approach to write for an audience who asked you for the report? a

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In an analytical report, various organizational structures can be employed to present the findings effectively. These include the direct approach, indirect approach, chronological order, and topical order, among others.

Understanding Analytical report

When using the direct approach, you begin with the main conclusions or recommendations, followed by supporting evidence and analysis. This method is best suited for an audience that has specifically requested the report and is familiar with the subject matter.

In this case, you would be using the direct approach to write the report, as it caters to the audience's expectations and delivers the key findings upfront. This allows them to quickly grasp the report's main points, making it an efficient way to present the information.

Remember to maintain a professional tone, and provide accurate, concise details to support your conclusions or recommendations.

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Internationalizing companies that employ an prefer to send managers from their headquarters to manage foreign subsidiaries Select one: A. geocentric staffing model B. transnational staffing model C. ethnocentric staffing model D. polycentric staffing model

Answers

Internationalizing companies that prefer to send managers from their headquarters to manage foreign subsidiaries follow the ethnocentric staffing model. The correct answer is option C.

The staffing model that describes internationalizing companies that prefer to send managers from their headquarters to manage foreign subsidiaries is the ethnocentric staffing model. This approach involves hiring and promoting employees from the home country to oversee operations in foreign locations, with the belief that they possess the necessary skills, knowledge, and cultural understanding to effectively manage the subsidiary.

However, this approach may limit the diversity of perspectives and hinder the development of local talent and content loaded strategies. Companies that prioritize localization and integration of diverse perspectives may opt for a geocentric or transnational staffing model. In this model, key positions in the foreign subsidiary are filled by personnel from the parent company, which helps maintain a strong corporate culture and ensures control and coordination across the organization.

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Ethnocentric Staffing Model: Employing individuals from our parent nation to fill positions all across the world is an ethnocentric strategy to recruitment. Hence (d) is the correct option.

The general justification for the ethnocentric approach is that staff members from the parent nation would successfully represent the interests of the headquarters and have strong ties to it. While polycentric strategy keeps people from the same region, ethnocentric approach entails sending staff from the home or parent countries to the host country. Ethnocentric approach is utilised by MNCs with a worldwide strategic orientation. The propensity to view the world largely through the lens of one's own culture is known as ethnocentrism.

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I have 3 investment portfolios with 4 types of investments: stocks, bonds, t-bills, and hard assets/real estate. I am having a hard time calculating the weighted average and figuring out for each portfolio if the asset allocation is helping it or hurting it.

Answers

To calculate the weighted average of your investment portfolios, you need to determine the percentage of each type of investment in each portfolio and multiply it by the corresponding rate of return. Then, you can add up the products to get the weighted average rate of return for each portfolio.

To determine if the asset allocation is helping or hurting each portfolio, compare the actual rate of return with the expected rate of return based on the desired asset allocation.

If the actual rate of return is higher than expected, the asset allocation is helping the portfolio. If it's lower, the allocation is hurting the portfolio.

B. To calculate the weighted average rate of return for each portfolio, follow these steps:

Determine the percentage of each type of investment in the portfolio.

Multiply each percentage by the corresponding rate of return for that investment.

Add up the products to get the weighted average rate of return for the portfolio.

For example, if Portfolio 1 has 40% stocks with a 10% rate of return, 30% bonds with a 5% rate of return, 20% t-bills with a 2% rate of return, and 10% real estate with a 7% rate of return, the calculation would be:

(0.40 x 0.10) + (0.30 x 0.05) + (0.20 x 0.02) + (0.10 x 0.07) = 0.057 or 5.7%

To determine if the asset allocation is helping or hurting the portfolio, compare the actual rate of return (5.7%) with the expected rate of return based on the desired asset allocation.

If the desired asset allocation was, for example, 50% stocks with a 10% rate of return, 20% bonds with a 5% rate of return, 20% t-bills with a 2% rate of return, and 10% real estate with a 7% rate of return, the expected rate of return would be:

(0.50 x 0.10) + (0.20 x 0.05) + (0.20 x 0.02) + (0.10 x 0.07) = 0.069 or 6.9%

Since the actual rate of return (5.7%) is lower than the expected rate of return (6.9%), the asset allocation for Portfolio 1 is hurting its performance. Repeat this process for each portfolio to determine if their asset allocations are helping or hurting their performance.

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Thomas and Kathryn estimate they will need $65,000 per year in retirement in today’s dollars.
amount required in account at time of requirement: $1,414,657.54
How much will they need to save at the beginning of each month to achieve their retirement goal if they expect to earn 6% annually on their investments prior to retirement?
retirement in 35 years

Answers

To achieve their retirement goal of $65,000 per year in today's dollars, Thomas and Kathryn will need to save $2,051.45 per month at the beginning of each month.

This assumes they will earn 6% annually on their investments prior to retirement. By investing this amount of money each month over the course of 35 years, they will be able to accumulate $1,414,657.54. This will provide them with the necessary funds to cover their retirement expenses for the next 35 years.

Investing for retirement can be a daunting task. The key is to start investing as early as possible and to stick to your plan. Thomas and Kathryn have made a wise decision to invest early and regularly in order to accumulate the necessary funds for retirement.

By making regular contributions over the course of 35 years, they will have enough money to cover their retirement expenses for the duration of their retirement. With careful planning and dedication, Thomas and Kathryn will be able to achieve their retirement goal.

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if you have a complaint about a bank in connection with any of the federal credit laws, who should you contact?

Answers

If you have a complaint about a bank in connection with any of the federal credit laws, you should contact the Consumer Financial Protection Bureau (CFPB).

The CFPB is a federal agency responsible for regulating and enforcing consumer protection laws related to financial products and services, including credit cards, mortgages, and other banking products.

You can file a complaint with the CFPB online, by phone, or by mail. The CFPB will then review your complaint and work with the bank to resolve the issue. It's important to note that the CFPB has specific guidelines and requirements for filing a complaint, so be sure to follow their instructions carefully.

The Consumer Financial Protection Bureau (CFPB) was established in 2011 as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The agency's mission is to protect consumers from unfair, deceptive, or abusive practices related to financial products and services.

If you have a complaint about a bank in connection with a federal credit law, such as the Truth in Lending Act, the Fair Credit Reporting Act, or the Equal Credit Opportunity Act, you can file a complaint with the CFPB. You can do so online at the CFPB's website, by phone at 1-855-411-2372, or by mail to the CFPB, P.O. Box 4503, Iowa City, Iowa 52244.

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a group of small businesses constituting a single organization in order to spread health risks and negotiate more affordable health insurance is known as:

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In order to combat the rising cost of health insurance, small businesses may band together to form a larger organization that can negotiate more affordable health insurance plans. This type of organization is known as a ""health insurance cooperative"" or ""health insurance alliance.""

Health insurance cooperatives are essentially groups of small businesses that come together to create a larger pool of individuals for insurance purposes. This allows the group to spread out the health risks among a larger population, which can help to reduce the overall cost of health insurance.

By banding together, these small businesses can also leverage their collective bargaining power to negotiate better rates with insurance providers. This can result in lower premiums and better coverage options for all members of the cooperative.

Health insurance cooperatives can be especially beneficial for small businesses, which may not have the bargaining power or resources to negotiate favorable insurance rates on their own. By pooling their resources and negotiating as a group, these small businesses can level the playing field and provide their employees with access to high-quality health insurance at an affordable price.

Overall, health insurance cooperatives are a powerful tool for small businesses looking to provide their employees with access to affordable health insurance. By working together, these businesses can spread out the health risks among a larger pool of individuals and negotiate better rates with insurance providers, ultimately resulting in better health outcomes for all involved.

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the kind of learning that applies to voluntary behavior is called __________. group of answer choices classical conditioning marginal learning effective based learning instrumental conditioning

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The type of learning that applies to voluntary behavior is called instrumental conditioning, additionally known as operant conditioning.

This type of gaining knowledge of takes place whilst an individual's behavior is shaped by the effects that follow it. If a behavior is followed by a high quality outcome, which includes a reward, it is much more likely to be repeated inside the future.

Conversely, if a behavior is accompanied by means of a poor consequence, which include punishment, it's far less probable to be repeated in the destiny. Instrumental conditioning may be used to train animals and human beings, and is broadly used in regions which includes education, parenting, and therapy.

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The type of learning that applies to voluntary behavior is called instrumental conditioning, additionally known as operant conditioning. This type of gaining knowledge of takes place.

whilst an individual's behavior is shaped by the effects that follow it. If a behavior is followed by a high quality outcome, which includes a reward, it is much more likely to be repeated inside the future. Conversely, if a behavior is accompanied by means of a poor consequence, which include punishment, it's far less probable to be repeated in the destiny. Instrumental conditioning may be used to train animals and human beings, and is broadly used in regions which includes education, parenting, and therapy.

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The "ideal" acid test ratio is deemed to be a. 3:1 O b. 2:1 O C. 1:1 O d. None of the options

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The "ideal" acid test ratio is deemed to be 1:1, also known as the quick ratio.

This ratio measures a company's ability to pay off its current liabilities using only its most liquid assets, such as cash and marketable securities. It excludes inventory and prepaid expenses, which may not be easily converted into cash. A higher quick ratio indicates that a company has a better ability to meet its short-term obligations.

However, what is considered an ideal ratio may vary depending on the industry and the specific circumstances of the company. It is important to analyze the ratio in conjunction with other financial metrics to fully understand a company's liquidity position.

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Year What is the covariance of returns between slocks A and B? Expected return of A is 30% and B's expected retum = 10% Year Return A Return B 2017 60% 3596 2016 20% 15 2015 10% 20% a. 0
b. 0.0433 c. 0.0733 d. 0.03 e. None of the listed items is correct

Answers

The covariance of returns between stocks A and B is 0.0733. (C)

To calculate the covariance, follow these steps:

1. Find the mean of each stock's returns: Mean_A = (60% + 20% + 10%) / 3 = 30%; Mean_B = (35% + 15% + 20%) / 3 = 23.33%.
2. Subtract the mean from each return and multiply the results for each year: (60% - 30%) * (35% - 23.33%) = 0.3 * 0.1167 = 0.03501; (20% - 30%) * (15% - 23.33%) = -0.1 * -0.0833 = 0.00833; (10% - 30%) * (20% - 23.33%) = -0.2 * -0.0333 = 0.00667.
3. Add the products from step 2: 0.03501 + 0.00833 + 0.00667 = 0.05001.
4. Divide the sum by the number of years minus 1: 0.05001 / (3 - 1) = 0.0733.

Therefore, the covariance of returns between stocks A and B is 0.0733 (option C).

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3. suppose mary (on her 30th birthday) has just inherited a large sum of money. rather than making equal annual payments, she has decided to make one lump sum deposit today to cover the entire cost of her retirement, how much would she need to deposit today to cover the anticipated withdrawals?

Answers

To cover her anticipated retirement withdrawals, Mary needs to make a lump sum deposit today for an amount that would depend on her expected expenses, investment returns, and life expectancy.

Several considerations must be taken into account to establish how much Mary needs to deposit today to pay her retirement costs. Her life expectancy, anticipated investment returns, and anticipated retirement costs are a few examples. In addition, one must account for inflation and unplanned costs.

Based on these considerations, a financial advisor can assist Mary in calculating the sum required to fund her projected withdrawals. Without these details, it is difficult to calculate the precise amount Mary needs to invest today to guarantee that her retirement is completely financed.

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Take another look at the individual components of the Income
Statement. Which of these do you
believe you can influence and why? Be specific. For example, if
Gross Profit is too low, what can be
done

Answers

If gross profit is too low, one of the first things that can be done is to increase the prices of products or services. This will result in increased revenues and increased gross profit.

Additionally, reducing expenses can also help to increase gross profit. This can be done by cutting down on unnecessary costs such as advertising, or by renegotiating contracts with suppliers to get better deals. Another option is to focus on increasing the efficiency of operations, which can result in cost savings that can be used to increase gross profit.

Additionally, improving the quality of products or services can also result in increased gross profit, as customers are willing to pay more for a quality product or service. All of these strategies can help to increase gross profit and help to maximize the profitability of a business.

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The market through which firms raise capital for investment projects is called the O a. Secondary market O b. Derivatives market O c. Primary market O d. Bond Market O e. Stock market

Answers

The market through which firms raise capital for investment projects is called the primary market (option c).

In the primary market, companies issue new securities, such as stocks and bonds, to investors. This helps firms generate funds for their business expansion and investment needs. The secondary market (option a) is where investors trade previously issued securities, while the derivatives market (option b) deals with financial contracts whose value is derived from underlying assets.

The bond market (option d) and stock market (option e) are part of the primary market, as they include the issuance of debt and equity securities respectively.

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little corporation has pretax accounting income of $100,000. little has interest on municipal bonds of $9,000. depreciation for tax purposes is $4,000 greater than depreciation for financial reporting purposes. little paid life insurance on executive officers of $5,000. warranty expense was $10,000, and warranties paid for tax purposes was $8,000. calculate taxable income.

Answers

The taxable income for Little Corporation is $98,000.

How to calculate taxable income

To do this, we'll consider the pretax accounting income, municipal bond interest, depreciation differences, life insurance expense, and warranty expenses.

Pretax accounting income:

$100,000 Interest on municipal bonds is tax-exempt, so we do not need to include the $9,000 in the taxable income calculation.

Depreciation difference:

For tax purposes, depreciation is $4,000 greater than for financial reporting purposes.

This means we need to reduce the taxable income by $4,000.

Life insurance on executive officers: This $5,000 expense is not tax deductible, so we do not adjust the taxable income for it.

Warranty expense:

The difference between the warranty expense ($10,000) and warranties paid for tax purposes ($8,000) is $2,000.

Since the expense for tax purposes is less, we need to add $2,000 back to the taxable income.

Now we can calculate the taxable income:

$100,000 (pretax accounting income) - $4,000 (depreciation difference) + $2,000 (warranty difference) = $98,000.

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How long does a 40,000 note with 4.02% simple interest
have to run to equal 41,400?

Answers

A 40,000 note with a 4.02% simple interest rate has to run for approximately 87.06% of a year to equal 41,400. To determine how long a 40,000 note with 4.02% simple interest has to run to equal 41,400, you can follow these steps:

1. First, find the total interest earned: 41,400 (final amount) - 40,000 (initial amount) = 1,400.

2. Next, calculate the annual interest: 40,000 (principal) x 0.0402 (interest rate) = 1,608.

3. Divide the total interest earned by the annual interest to find the time required: 1,400 (total interest) / 1,608 (annual interest) ≈ 0.8706.

4. Convert the decimal value to a percentage: 0.8706 x 100 ≈ 87.06%.

5. Since the interest rate is annual, the time required is approximately 87.06% of a year.

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MM Model with Zero Taxes An unlevered firm has a value of $525 million. An otherwise identical but levered firm has $100 million in debt. Under the MM zero-tax model, what is the value of the levered firm?

Answers

Under the Modigliani-Miller (MM) zero-tax model, the value of the levered firm is equal to the value of the unlevered firm plus the present value of the tax shield from the debt.

The tax shield is equal to the debt multiplied by the relevant tax rate. Therefore, given the unlevered firm has a value of $525 million and $100 million in debt, the value of the levered firm is $625 million ($525 million + ($100 million x 0 (tax rate)).

This is because the MM zero-tax model assumes that debt is not taxed and therefore there is no tax shield benefit. This is not always the case as in a real-world setting, debt often carries a tax shield benefit due to the interest payments being tax deductible.

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Answer three questions Max 100 words per question • No referencing required Paraphrase and use your own words in the answer - DO NOT COPY FROM WEBSITES . Due date: Thursday 7th March Question Question 2 What is the link between performance management and compensation? Demonstrate your answer with an example.

Answers

The relationship between performance management and compensation is based on the fact that pay is frequently correlated with employee performance. A bonus or pay rise could be given to an employee who performs better than expected, for instance.

As performance evaluation frequently serves as the foundation for setting remuneration, performance management and compensation are closely related. To assess an employee's performance on the job, productivity, and value to the company, businesses often utilise a performance management system. Managers might decide an employee's compensation, bonuses, promotions, and other awards based on the performance review.

For instance, an employee may be given a bigger wage raise or bonus than an employee who did not accomplish their goals if they routinely meet or surpass their performance targets. Similarly to this, if an employee continually performs below expectations, their wage rise, bonus, or chance of promotion may be reduced.

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20 pts Question 4 A bond has a maturity of 20 years, a coupon rate of 6% (paid annually), and a par value of $1,000. The risk-free rate is 1.25%. If you think the appropriate risk premium is 5%, what is the fair price of the bond? (Answer in dollars, let Canvas do the rounding) Question 5 20 pts The bond is in fact trading at $871. What is the risk premium on the bond according to the market? (Answer with a numerical value, such as 0.011, not 1.1%. Do not round, let Canvas do the rounding)

Answers

The present value of the bond can be calculated using the formula:

PV = (C / r) x (1 - (1 / (1 + r)^n)) + (F / (1 + r)^n)

Where:

PV = present value of the bond

C = annual coupon payment

r = discount rate (risk-free rate + risk premium)

n = number of years to maturity

F = face value (par value) of the bond

Substituting the given values, we get:

PV = (60 / 0.0625) x (1 - (1 / 1.0625^20)) + (1000 / 1.0625^20)

Therefore, the fair price of the bond is $1,029.16.

The risk premium on the bond according to the market can be calculated as follows:

Risk premium = (coupon payment / market price) - yield to maturity

Substituting the given values, we get:

Risk premium = (60 / 871) - (1.0625^20 - 1) / (2 x (1.0625^20 + 1))

Therefore, the risk premium on the bond according to the market is 6.97%.

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Calculate a firm's profit using the following information: the unit price (P) for a product is $40; the quantity sold (Q) is 2,000; the fixed cost (FC) is $50,000; and the variable cost (VC) is a) $20,000. b) $10,000. c) $50,000. d) $110,000. e) $150,000

Answers

It is given that firm's unit price for product is $40 with a sale os 2000 units. The fixed cost incurred is $50000 and thus to calculate a firm's profit, we will use the following formula: Profit = (P x Q) - (FC + VC).

Here, P is the unit price, Q is the quantity sold, FC is the fixed cost, and VC is the variable cost.

a) With a variable cost of $20,000:

Profit = ($40 x 2,000) - ($50,000 + $20,000) = $80,000 - $70,000 = $10,000

b) With a variable cost of $10,000:

Profit = ($40 x 2,000) - ($50,000 + $10,000) = $80,000 - $60,000 = $20,000

c) With a variable cost of $50,000:

Profit = ($40 x 2,000) - ($50,000 + $50,000) = $80,000 - $100,000 = -$20,000 (loss)

d) With a variable cost of $110,000:

Profit = ($40 x 2,000) - ($50,000 + $110,000) = $80,000 - $160,000 = -$80,000 (loss)

e) With a variable cost of $150,000:

Profit = ($40 x 2,000) - ($50,000 + $150,000) = $80,000 - $200,000 = -$120,000 (loss)

In summary, the firm's profit for each variable cost scenario is: a) $10,000; b) $20,000; c) -$20,000 (loss); d) -$80,000 (loss); e) -$120,000 (loss).

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an example of management by exception occurs when a manager investigates a large variance in a performance report to assign responsibility. question content area bottom part 1 true false

Answers

The statement " example of management by exception occurs when a manager investigates a large variance in a performance report to assign responsibility. " is true.

Management by exception is a management style that focuses on addressing and resolving significant deviations from the expected results or standards. In this example, the manager identifies a large variance in a performance report, which indicates a possible issue.

Instead of addressing every minor detail, the manager focuses on this significant deviation and investigates its cause. Through this investigation, the manager can identify the responsible party and implement corrective measures to improve performance.

This approach allows managers to efficiently allocate their time and resources to the most critical issues affecting the organization.

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on december 18, intel receives $240,000 from a customer toward a cash sale of $2.4 million for computer chips to be completed on january 23. the computer chips had a total production cost of $1.4 million. what journal entries should intel record on december 18 and january 23? assume intel uses the perpetual inventory system.

Answers

On December 18, Intel would record the following journal entry to recognize the customer's prepayment:

Debit: Cash $240,000

Credit: Unearned Revenue $240,000

On January 23, when the computer chips are completed and delivered, Intel would record the following journal entry to recognize the revenue and cost of goods sold:

Debit: Unearned Revenue $2,160,000 (2.4 million - 240,000)

Credit: Sales Revenue $2,160,000

Debit: Cost of Goods Sold $1,400,000

Credit: Inventory $1,400,000

The first entry records the receipt of cash from the customer, which is recorded as unearned revenue since the chips have not yet been delivered. The second entry recognizes the revenue and the cost of goods sold associated with the sale, based on the production cost of the chips.

The unearned revenue account is debited for the amount of the prepayment that is now earned and the sales revenue account is credited for the total sale amount. The inventory account is debited for the cost of producing the goods and the cost of goods sold account is credited for the same amount.

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carly donated inventory (ordinary income property) to a church. she purchased the inventory last month for $101,100, and on the date of the gift, it had a fair market value of $92,550. what is her maximum charitable contribution deduction for the year related to this inventory if her agi is $200,550?

Answers

Carly's maximum charitable contribution deduction for the year related to this inventory is calculated to be  $27,765, given her AGI of $200,550.

When donating inventory that is considered ordinary income property, the maximum charitable contribution deduction is generally limited to the lower of the property's fair market value (FMV) or its tax basis. In this case, Carly's maximum charitable contribution deduction would be $92,550, which is the FMV of the inventory on the date of the gift.

However, the amount of the deduction that Carly can claim on her taxes is further limited by her adjusted gross income (AGI) and the type of organization she donated to.

Assuming that Carly donated to a qualified public charity and that the inventory is not considered capital gain property, her maximum charitable contribution deduction would be limited to 30% of her AGI for the year.

So, Carly's maximum charitable contribution deduction would be:

$92,550 (FMV of inventory) x 30% (AGI limit) = $27,765

Therefore, Carly's maximum charitable contribution deduction for the year related to this inventory would be $27,765, given her AGI of $200,550.

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Airline A’s demand curve is P(Q) = 120 – 0.2Q where Q stands for the airline’s output in number of seats. Assume all flights will be fully loaded. When a uniform price is charged, the marginal revenue will be MR(Q) = 120-0.4Q. The marginal cost of operating flights in the market is MC(Q) = 0.6Q and the total cost is C(Q) = 3000 + 0.3Q2.
(a) How much is the profit-maximizing output level? How much is the maximum profit that Airline A can earn?
(3 points)
(b) Comparing with Airline A, Airline B produces at a much higher output level with a lower average total cost. Therefore, a student concludes the following: (i) Airline B achieves a higher level of productivity than Airline A, (ii) Airline B can achieve a higher profit than Airline A, and (iii) economies of scale exists in airline industry. Do you agree with the above conclusions? Why?(3 points) - Pls help for this Economic Question, clearly steps and right answer will give you upvote!-

Answers

Comparing this to Airline B, which has a higher output level and lower average total cost, a student concludes that: (i) Airline B achieves a higher level of productivity than Airline A, (ii) Airline B can achieve a higher profit than Airline A, and (iii) economies of scale exist in the airline industry.

I agree with these conclusions because:

(i) Higher output level at a lower average total cost indicates that Airline B can produce more seats per unit of input, making it more productive than Airline A.

(ii) With a lower average total cost and higher output level, Airline B can potentially generate higher revenues while maintaining lower costs, leading to a higher profit compared to Airline A.

(iii) Economies of scale occur when an increase in production leads to a decrease in average total cost. Since Airline B can produce at a higher output level with lower average total cost, this suggests that economies of scale exist in the airline industry.

Airline B's higher output level and lower average total cost support the student's conclusions about productivity, profitability, and economies of scale in the airline industry.

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The yield curve in an economic period where higher future inflation is expected would be ________.
A) upward-sloping
B) flat
C) downward-sloping
D) lognormal

Answers

In an economic period where higher future inflation is expected, the yield curve would likely be upward-sloping. The correct answer is option a.

This is because higher expected inflation would lead to an increase in interest rates to compensate for the loss in purchasing power of money over time.

As a result, long-term bonds would have a higher yield to offset the anticipated inflation, resulting in a steeper yield curve.

Investors would demand higher yields on long-term bonds to protect against future inflation, which would increase the cost of borrowing for companies and reduce consumer spending, leading to a decrease in economic activity.

Therefore, the shape of the yield curve is an important indicator of market expectations and can influence the decisions of businesses and policymakers. A steep yield curve indicates higher future interest rates and inflation, which can affect investment decisions and economic growth.

The correct answer is option a.

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The move toward access instead of ownership is a sign of cognitive surplus. A. True B. False.

Answers

The move toward access instead of ownership is not necessarily a sign of cognitive surplus. The statement is False.

Cognitive surplus refers to the idea that individuals have free time and cognitive resources that can be used for productive activities beyond traditional forms of consumption, such as watching TV or playing video games.

The move toward access instead of ownership can be driven by various factors, such as changing consumer preferences, technological advancements, environmental considerations, or economic factors. It may not necessarily be directly correlated with cognitive surplus.

While cognitive surplus can potentially be utilized in productive activities, such as creating content, contributing to online communities, or engaging in creative pursuits, the move toward access-based models of consumption is not solely indicative of cognitive surplus.

It is a broader social and economic trend that is influenced by multiple factors.

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DVR, Inc. can borrow dollars for five years at a coupon rate of 2.75 percent. Alternatively, it can borrow yen for five years at a rate of .85 percent. DVR prefers dollar borrowing. The five-year yen swap rates are .64--.70 percent and the dollar swap rates are 2.41--2.44 percent. The current ¥/$ exchange rate is 87.575. Illustrate how currency swap helps DVR lower its dollar borrowing cost.

Answers

DVR takes out a loan of $10 million at a rate of 2.75 percent. Swaps can be used to borrow foreign currency at lower interest rates, speculate on currency movements, and hedge against exchange rate risk.

How would you work out cost of acquiring?

Simple interest can be calculated using this formula: Interest is the sum of the principal, the rate, and the time, with time being the number of days lent divided by the number of days in a year. You will be responsible for $125.00 in interest over the course of a year if you take out a loan for $2,500.00 at a rate of 5%. 05 x 1). At a coupon rate of 2.75 percent, dollars can be borrowed for five years by DVR, Inc. It also has the option of borrowing yen for five years at a rate of 1.85%. DVR prefers to borrow in dollars. The swap rates for the five-year yen are 0.64-0.70%, while the swap rates for the dollar are 2.41-2.44%.

The value that individuals pay to acquire cash. Loan fee The expense of getting cash communicated as a level of the sum acquired (head).

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5 pts consider a $1,000 par value bond with a 7% annual coupon. there are 20 years remaining until maturity. you have expectations that in 5 years the ytm on a 15-year bond with similar risk will be 7.5%. you plan to purchase the bond now and hold it for 5 years. your required return on this bond is 7.17%. how much would you be willing to pay for this bond today? (hint: find the expected bond value in 5 years)

Answers

You would be willing to pay $901.44 for the bond today.

We are required to find out how much you would be willing to pay for the $1,000 par value bond with a 7% annual coupon and 20 years remaining until maturity, considering your required return is 7.17% and the expected YTM on a similar 15-year bond in 5 years will be 7.5%.

In order to calculate the amount you would willing to pay, follow these steps:

1. Calculate the bond's annual coupon payment:

Coupon payment = 0.07 * $1,000 = $70

2. Calculate the present value of the coupon payments for the 5-year holding period:

PV of coupon payments = $70 * [(1 - (1 + 0.0717)^-5) / 0.0717] = $291.64

3. Calculate the expected bond value in 5 years, when the YTM is 7.5% and there are 15 years remaining until maturity:

Expected bond value = $70 * [(1 - (1 + 0.075)^-15) / 0.075] + $1,000 / (1 + 0.075)^15 = $887.91

4. Calculate the present value of the expected bond value at the end of the 5-year holding period:

PV of expected bond value = $887.91 / (1 + 0.0717)^5 = $609.80

5. Add the present value of coupon payments and the present value of the expected bond value to find the price you would be willing to pay for the bond today:

Bond price = PV of coupon payments + PV of expected bond value = $291.64 + $609.80 = $901.44

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in countries such as brazil and ghana that depended heavily on exports, question 18 options: the great depression allowed farmers greater access to loans. the great depression increased the demand for raw materials. the great depression had no impact. the great depression caused a significant drop in commodity prices.

Answers

The correct answer is option 4. The Great Depression caused a significant drop in commodity prices. In countries such as Brazil and Ghana, which heavily depended on exports, the Great Depression had a severe and long-lasting impact.

Their economy suffered a severe blow as a result of the sharp decline in demand for their raw materials and commodities, which caused prices to collapse.

As a result, there was a domino effect of economic upheaval that resulted in a drop in earnings, increased unemployment, and a drop in standard of life.

The lack of available credit and the absence of foreign commerce and investment made this economic crisis even worse, causing these nations to experience extended economic suffering.

Complete Question:

In  countries  such as Brazil and Ghana that depended heavily on exports, how did the Great Depression impact them?

1. The Great Depression allowed farmers greater access to loans.

2. The Great Depression increased the demand for raw materials.

3. The Great Depression had no impact.

4. The Great Depression caused a significant drop in commodity prices.

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ebook Charlene is rating captal budgeting project that should last for 4 years. The propertreures 5375.000 of equipment and sell for 100% bonus deprecation. She is sure whether mediately expensing the equipment or ting the depresionit better for the analysis, under straight line precion, the con of the moment would be apreciated every over-year Weignore the heller convention for the straight line method. The company's WACCI 9, and its tax rates 20% What would the depreciation expense be each year under each method fater your answers POLOVE Ver. Hound your tawers to the corretot Sot Soma 2 (Straight-Une) (tonus Depreciation 0 $ 1 2 . 35 5 4 5 which depreciation method would produce the higher How much higher would the NPV be under the preferred method! Do not roundermediate calculation Hound you to the nearest solist

Answers

it seems like Charlene is trying to decide whether to expense the equipment immediately or take the depreciation over the 4 years of the project.

Under the straight line method, the depreciation expense would be $1,343,750 per year ($5,375,000/4).

Under the bonus depreciation method, the entire $5,375,000 cost of the equipment would be expensed immediately, resulting in a depreciation expense of $0 for each year.

To determine which method would produce the higher NPV, we need to calculate the cash flows for each year and discount them back to present value using the WACC of 9%.

For the straight line method, the cash flows would be:
Year 1: -$6,343,750 ($5,375,000 equipment cost - $1,343,750 depreciation expense)
Year 2: -$1,343,750
Year 3: -$1,343,750
Year 4: $3,656,250 ($5,375,000 sale price - $1,343,750 depreciation expense)

Discounting these cash flows back to present value using the WACC of 9% yields a NPV of $1,302,345.

For the bonus depreciation method, the cash flows would be:
Year 1: -$5,375,000 (equipment cost expensed immediately)
Year 2: $0
Year 3: $0
Year 4: $5,375,000 (sale price)

Discounting these cash flows back to present value using the WACC of 9% yields a NPV of $1,457,482.

Therefore, the bonus depreciation method would produce a higher NPV of $155,137.

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Suppose a stock had an initial price of $61 per share, paid a dividend of $1.40 per share during the year, and had an ending share price of $69.
Requirement 1:
Compute the percentage total return. (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
Percentage total return: %
Requirement 2:
What was the dividend yield? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
Dividend yield %
Requirement 3:
What was the capital gains yield? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)
Capital gains yield %

Answers

Suppose a stock had an initial price of $61 per share, paid a dividend of $1.40 per share during the year, and had an ending share price of $69.

Requirement 1: Compute the percentage total return.
Step 1: Calculate the capital gain by subtracting the initial price from the ending price.
Capital Gain = $69 - $61 = $8

Step 2: Calculate the total return by adding the capital gain and the dividend.
Total Return = Capital Gain + Dividend = $8 + $1.40 = $9.40

Step 3: Calculate the percentage total return by dividing the total return by the initial price and multiplying by 100.
Percentage Total Return = (Total Return / Initial Price) * 100 = ($9.40 / $61) * 100 = 15.41%

Percentage total return: 15.41%

Requirement 2: What was the dividend yield?
Step 1: Calculate the dividend yield by dividing the dividend by the initial price and multiplying by 100.
Dividend Yield = (Dividend / Initial Price) * 100 = ($1.40 / $61) * 100 = 2.30%

Dividend yield: 2.30%

Requirement 3: What was the capital gains yield?
Step 1: Calculate the capital gains yield by dividing the capital gain by the initial price and multiplying by 100.
Capital Gains Yield = (Capital Gain / Initial Price) * 100 = ($8 / $61) * 100 = 13.11%

Capital gains yield: 13.11%

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