8. The company just paid an annual dividend of $1.42 a share last month. Today, the company announced that future dividends will be increasing by 1.3 percent annually. If you require a return of 14.6 percent, how much are you willing to pay to purchase one share of this stock today

Answers

Answer 1

Answer:

$10.82

Explanation:

the amount i would pay for the stock would be its intrinsic value

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid

r = cost of equity

g = growth rate

1.42 x 1.013) / 0.146 - 0.013 = $10.82


Related Questions

Danks Corporation purchased a patent for $405,000 on September 1, 2019. It had a useful life of 10 years. On January 1, 2021, Danks spent $99,000 to successfully defend the patent in a lawsuit. Danks feels that as of that date, the remaining useful life is 5 years. What amount should be reported for patent amortization expense for 2021?

Answers

Answer:

Amortization Expense for year 2021 $90,000

Explanation:

The computation of the amount that should be reported for patent amortization for the year 2021 is shown below:

But before that following calculations need to be done

The value of the patent as of 31st Dec, 2020

Purchase Value as of Sep 1,2019 $405000

Less:- Amortization Expense for the year 2019 $13,500

($405000 ÷ 10 × 4 ÷ 12)

Less:- amortization expense for the year 2020 $40500 ($405,000 ÷ 10)

Value of patent as on 1st Jan, 2021 $351,000

Add:- fees to defend $99000

New Book Value for the year 2021 $450,000

Now Remaining Useful Life 5 years

So,

Amortization Expense for year 2021 $90,000 ($450,000 ÷ 5)

The following is a list of account titles and amounts (dollars in millions) from a recent annual report of Calvin, Inc., a leading manufacturer of games, toys, and interactive entertainment software for children and families:

Buildings and improvements $195
Prepaid expenses and other current assets 165
Allowance for doubtful accounts 39
Other noncurrent assets 210
Accumulated amortization (other intangibles) 819
Cash and cash equivalents 636
Goodwill 469
Machinery, equipment, and software 418
Accumulated depreciation 417
Inventories 300
Tools, dies, and molds 71
Other intangibles 1,359
Land and improvements 15
Accounts receivable 641

Required:
Prepare the asset section of the balance sheet for Calvin, Inc., classifying the assets into Current Assets, Property, Plant, and Equipment (net), and Other Assets.

Answers

Answer:

ASSETS

NON -CURRENT ASSETS

Buildings and improvements                              195

Land and improvements                                       15

Other intangibles                                              1,359

Machinery, equipment, and software                418

Tools, dies, and molds                                          71

Accumulated depreciation                               (417)

Goodwill                                                              469

Accumulated amortization (other intangibles) (819)

TOTAL NON -CURRENT ASSETS                    1,291

CURRENT ASSETS

Inventories 300

Prepaid expenses and other current assets   165

Allowance for doubtful accounts                     (39)

Accounts receivable                                          641

Other noncurrent assets                                   210

Cash and cash equivalents                              636

TOTAL CURRENT ASSETS                             1,613

TOTAL ASSETS                                             2,904

Explanation:

Non-current assets are assets of a long term nature ,exceeding period of 12 months.

Current assets are assets of a short term nature, not exceeding a period of 12 months.

The following production data were taken from the records of the Finishing Department for June:

Inventory in process, June 1, 30% completed 4,000 units
Completed units during June 65,000 units
Ending inventory, 60% completed 65,000 units

The number of materials equivalent units of production in the June 30 Finishing Department inventory, assuming that the first-in, first-out method is used to cost inventories and materials were added at the beginning of the process, is:______

Answers

Answer:

the equivalent units of production related to the material is 126,000 units

Explanation:

The computation of the equivalent units of production related to the material is shown below:

= Completed units + Ending inventory units - Beginning inventory units.

= 65,000 units + 65,000 units -  4,000 units

= 126,000 units

hence, the equivalent units of production related to the material is 126,000 units

Because there isn't one single measure of inflation, the government and researchers use a variety of methods to get the most balanced picture of how prices fluctuate in the economy. Two of the most commonly used price indexes are the consumer price index (CPI) and the GDP deflator.

The GDP price index for this year is calculated by dividing the ______________using___________ by the ________ using _____________and multiplying by 100.

Answers

Answer:

a (B) Value of all goods and services produced in the economy this year

this year's prices

Value of all goods and services produced in the economy in the base year

by the base year's prices

Explanation:

Here is the complete question

The GDP price index for this year is calculated by dividing the (A) Value of all goods and services produced in the economy in the base year (B) Value of all goods and services produced in the economy this year (C) cost of a given market basket of goods and services using 2) ______ (A) the base year's prices (B) this year's prices by the 3) ________ A) Value of all goods and services produced in the economy in the base year (B) Value of all goods and services produced in the economy this year (C) cost of a given market basket of goods and services using 4) ______ (A) the base year's prices (B) this year's prices

Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year

GDP price index = (nominal GDP / Real GDP ) X 100

Nominal GDP is GDP calculated using current year prices while Real GDP is GDP calculated using base year prices. Real GDP has been adjusted for inflation.

Nominal GDP is GDP calculated using current year prices while Real GDP is GDP calculated using base year prices. Real GDP has been adjusted for inflation.

For example, country A produces 10 kg of rice at $10 per kg in 2019 and 50kg of beans at $30 per kg in 2018. In 2019, it produces 10 kg of rice at $20 per kg in 2019 and 50kg of beans at $40 per kg in 2019. 2018 is the base year.

Nominal GDP in 2018 = (10 x $10) + (50 x $30) = $1600

Nominal GDP in 2019 = (10 x $20) + (50 x $40) = $2200

Real GDP in 2018 = (10 x $10) + (50 x $30) = $1600

Real GDP in 2019 = (10 x $10) + (50 x $30) = $1600

GDP price index in 2019 =  nominal gdp in 2019 / real gdp in 2019 ) x 100

(2200 / 1600 ) x 100 = 137.5

Cale Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Cale sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 7%. For example, if a hospital buys supplies from Cale that cost Cale $100 to buy from manufacturers, Cale would charge the hospital $107 to purchase these supplies.For years, Cale believed that the 7% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Cale decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown:Activity Cost Pool (Activity Measure) Total Cost Total ActivityCustomer deliveries (Number of deliveries) $420,000 5,000 deliveriesManual order processing (Number of manual orders) 624,000 8,000 ordersElectronic order processing (Number of electronic orders)170,000 10,000 ordersLine item picking (Number of line items picked) 675,000 450,000 line itemsOther organization-sustaining costs (None) 650,000 Total selling and administrative expenses $2,539,000 Cale gathered the data below for two of the many hospitals that it serves—Georgetown and Providence (each hospital purchased medical supplies that had cost Cale $38,000 to buy from manufacturers): ActivityActivity Measure University Memorial Number of deliveries 16 28Number of manual orders 0 49Number of electronic orders 18 0Number of line items picked 190 210Required:1. Compute the total revenue that Cale would receive from Georgetown and Providence.2. Compute the activity rate for each activity cost pool.3. Compute the total activity costs that would be assigned to Georgetown and Providence.4. Compute Cale's customer margin for Georgetown and Providence.

Answers

Solution :

1.                                Calculation of total revenue

Total revenue = cost of goods sold + Markup 7% = Revenue

University       = 38000 + 2660 = 40660

Memorial        = 38000 + 2660 = 40660

Therefore, markup = cost of goods sold x market up

                              = 38000 x 7%

                              = 2660

2.                                Calculations of Activity rates

Activity rate     = activity cost pool / total activity = activity rate

Customer deliveries  = 420000 / 5000 = 84

Manual order processing = 624000 / 8000 = 78

Ele order processing = 170000 / 10000 = 17

Line time picking = 675000 / 450000 = 1.5

3.                               Calculations of Activity costs

Activity cost for University

Activity cost pool =  Activity  x  Activity rate

Customer deliveries  = 16 x 84 = 1344

Manual order processing = 0 x 78 = 0

Ele order processing = 18 x 17 = 306

Line time picking = 190 x 1.5 = 285

Total activity cost = 1935

Activity cost for Memorial

Activity cost pool =  Activity  x  Activity rate

Customer deliveries  = 28 x 84 = 2352

Manual order processing = 49 x 78 = 3822

Ele order processing = 0 x 17 = 0

Line time picking = 210 x 1.5 = 315

Total activity cost = 6489

4.      Calculation of Customer margin

                                                 University        Memorial

Sales revenue                           40660              40660

Less : Cost of goods sold        38000               38000

Gross Margin                            2660                   2660

Less : Activity cost                    1935                    6489

Customer Margin                      725                    -3829

Mark took a loan out for $25,690 to purchase a truck. At an interest rate of 5.2% compounded
monthly, how much total will he have paid after 5 years?

Answers

Answer: He would have to pay 33,299.42$

Explanation:

(Gross Profit Method) Tim Legler requires an estimate of the cost of goods lost by fire on March 9. Merchandise on hand on January 1 was $38,000. Purchases since January 1 were $72,000; freight-in, $3,400; purchase returns and allowances, $2,400. Sales are made at 331/3% above cost and totaled $100,000 to March 9. Goods costing $10,900 were left undamaged by the fire; remaining goods were destroyed.
Instructions
(a) Compute the cost of goods destroyed.
(b) Compute the cost of goods destroyed, assuming that the gross profit is 331/3% of sales.

Answers

Answer:

a. $25,100

b. $33,433

Explanation:

Part a

Sales                                                                             $100,000

Less Cost of Sales :

Opening Merchandise                           $38,000

Add Purchases                                       $72,000

Add Freight In                                           $3,400

Less Purchase Return and Allowance   ($2,400)

Total                                                          111,000

Less Undamaged Inventory                 ($10,900)          

Total                                                       $100,100

Less goods destroyed                          ($25,100)        ($75,000)

Gross Profit                                                                     $25,000

Part b

Sales                                                                             $100,000

Less Cost of Sales :

Opening Merchandise                           $38,000

Add Purchases                                       $72,000

Add Freight In                                           $3,400

Less Purchase Return and Allowance   ($2,400)

Total                                                          111,000

Less Undamaged Inventory                 ($10,900)          

Total                                                       $100,100

Less goods destroyed                          ($33,433)        ($66,667)

Gross Profit                                                                     $33,333

Jordan paid $30,000 for equipment two years ago and has claimed total depreciation deductions of $15,600 for the two years. The cost of repairs during the same time period was $2,000 while a major overhaul which extended the life of the equipment cost $7,000. What is Jordan's adjusted basis in the equipment at the end of the two-year period

Answers

Answer: $21400

Explanation:

Cost of equipment = $30,000

Depreciation = $15600

Cost of repairs = $2000

Overhaul = $7000

Jordan's adjusted basis in the equipment at the end of the two-year period will be:

= Equipment cost - Depreciation + Overhaul

= $30000 - $15600 + $7000

= $21,400

What do you need to file your taxes?

Answers

Answer:

w-2, Form 1040, and possibly Schedule (1... etc. )

Explanation:

2- A local car dealer is advertising two leasing options for its new XT 3000 series sports car. Option A: is a standard 24-month lease of $1150 per month. In addition, this option requires a down payment of $4500, plus a $1000 refundable initial deposit. In option A, the lease payments are due at the beginning of every month. For example, the first lease payment (equal to $1150) is due at the beginning of month 1. Option B: In this option, the company offers a 24-month lease plan that has only a single up-front payment of $31000 (which is paid at the beginning of month one) Note: The initial deposit in option A will be refunded to the customer at the end of month 24. Assume an interest rate of 6% compounded monthly. Which option is better for the customer

Answers

Answer:

A. Interest rates wouldn't be so high. Customer would be able to afford this lease better.

Explain what boundaries are and why they are important in decision-making.

Answers

Answer:

boundaries are that invisible line in social structure that people try not to cross lest by accident.

Explanation:

When you are making decisions you always have to think of the outcome or else you could end up doing something bad or wrong. Boundaries in decisions making are so you don't just go and do whatever without thinking. we as humans subconsciously try not to cross other people's boundaries for mainly two reasons. The first is it makes people feel uncomfortable. The second is that it brings out our inner guilt. if you cross someone's boundaries you will most likely realize it imededietly and to to back off instinctively.

I hope this helps!

what is the relative worth of goods

Answers

Relative Value in Consumption is measured as the relative cost of the amount of goods and services such as food, shelter, clothing, etc., that an average household would buy. Historically this bundle has become larger as households have bought more over time.

Ely Company has two support departments, Maintenance Department and Personnel Department, and two producing departments, X and Y. The Maintenance Department costs of $60,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $9,000 are allocated on the basis of number of employees. The direct costs of Departments X and Y are $18,000 and $30,000, respectively. Data on standard service hours and number of employees are as follows:

Data on standard service hours and number of employees are as follows:
Maint. Person. Dept. Dept.
Dept. Dept. X Y
Standard service hours used 100 50 300 150
Number of employees 5 10 45 45
Direct labor hours 50 50 250 250

Predetermined overhead rates for Departments X and Y, respectively, are based on direct labor hours.

What is the overhead rate for Department Y assuming the direct method is used?

a. $120.00
b. $218.00
c. $109.00
d. $250.00

Answers

Answer:

b. $218.00

Explanation:

Calculation to determine the overhead rate for Department Y assuming the direct method is used

First step

Department Y$30,000

Maintenance Department $20,000

($60,000 × 150/450)

Personnel Department $4,500

($9,000 × 45/90)

Total $54,500

Now let calculate the overhead rate for Department Y

Department Y Overhead rate=$54,500/250

Department Y Overhead rate = $218

Therefore the overhead rate for Department Y assuming the direct method is used will be $218

The world Street Journal published that United Airlines is not covering its cost (the cost include both fixed and variable cost) in the route from Washington to San Francisco and therefore they should discontinue the flight in this route. Based on the above situation answer the following questions: 1.Do you think United should continue its flight from Washington to San Francisco? Explain. 2. What are the major condition United needs to check before ‘shut down’ its operation Washington to San Francisco? Explain

Answers

Answer:

Following are the solution to the given points:

Explanation:

In question 1:

No, airline through Washington to San Fransisco should not continue. It is because the airline could recover its constant but varying expenses, as mentioned in the article. Service would therefore not be able to endure failure. The airline should therefore avoid driving.

In question 2:

To determine whether the airline should close down or not, the US should equate the price with both the Average total cost. Each airline is required to close down its activities if its cost is reduced than AVC. If the price is higher therefore the AVC price will continue. Since, as per the report, the airline cannot also cover its variable costs, its activities must be stopped.

You are running a hypothetical e-business in this course. Suppose your company only have one employee and three customers who do not access your website frequently. Your company also does not need to process a lot of information; in this case, to save your money, which types of computers does your company need to fulfill such a computing need?

Answers

Answer:

do the challnge in brainly it gives u points !!!!

Explanation:

According to the given hypothetical e-business situation, simple personal computers can be used to fulfill the required computing needs.

What is e-business?

"E-business is an electronic business or transaction in which user shares the information online. In this, information, products, and services can be shared between business, groups, and individuals and considered as an essential activities."

What is personal computer?

"Personal computer is a computer which is a multi-purpose system and its size, capabilities and prize makes it feasible for individual use."

In the given situation, the analyses of data is less which can be fulfilled by the personal computers only and there is no need to purchase systems with special features. The employee can fulfill the requirements of current e-business with the help of any personal computer like desktop, laptop, etc.

To learn more about e-business and personal computer here

https://brainly.com/question/13165862

#SPJ3

General Mattress Company makes Memory Foam mattresses, a mass-market high-volume product, and Magnetic Levitation mattresses, a premium low-volume product. The company uses a traditional cost allocation with a single cost pool. It is planning to implement activity-based costing (ABC). After implementing ABC, the company will likely find that the traditional cost allocation: Group of answer choices

Answers

Answer:

Answer is explained in the explanation section below.

Explanation:

First of all, this question is not complete and lacks the group of answer choices. However, I have found that question with complete options on the internet.

So,

The Correct option is: D

Option D =  Not enough information

Reasoning:

For overestimated or underestimated or not full information required i.e. cost under traditional method and cost under activity based cost method , both information required for compare methods cost under each method.

Under Activity base costing all indirect cost is applied as per activities use by each product but under traditional method only one key factor use for applied overheads i.e. direct labor hours or machine hours etc.

The government of Uwannastan protects its newly privatized firms from foreign competition by imposing stringent barriers to international trade and foreign direct investment. As a result of this, the newly privatized firms will: have no control over production and pricing. import raw materials and many industrial goods at low tariffs. continue operating like State-owned enterprises continue operating like private companies under capitalism

Answers

Answer: Continue operating like State-owned enterprises

Explanation:

Newly privatized would imply that they were once government owned which means that they were probably monopolies. These new companies are protected from foreign competition which means that their goods will be the dominant ones in the economy.

They will therefore keep operating as though they are state-owned companies because their goods will be dominant making them monopolies which is what government owned companies usually are.

Atul purchased goods costing Rs 50000 at an invoice price,which is 50% above cost.. on invoice price je enjoyed 15% trade discount and Rs 3750 cash discount on cash payment of goods in lump sum at the time of purchase ...the purchase price to be recorded in the books will be​

Answers

Answer: Rs 63750

Explanation:

Since Atul purchased goods costing Rs 50000 at an invoice price,which is 50% above cost. Then the purchase of the goods cost:

= 50000 × (100% + 25%)

= 50000 × 125%

= 50000 × 1.25

= Rs 75000

We then deduct the trade discount of 15% to get the purchase price to be recorded in the book. This will be:

= 75000 × (100% - 15%)

= 75000 × 85%

= 75000 × 0.85

= 63750

Therefore, the answer is Rs63750

At which stage should Joan discuss the look and feel of her website with her website designer?
At the _____?______ stage, Joan should discuss the look and feel of her website with her website designer.

Answers

Answer:

Joan and Website Design

At the ____Visual ____Elements_____ stage, Joan should discuss the look and feel of her website with her website designer.

Explanation:

The visual elements stage details the visual style together with the visual brand that Joan has specified for her desired website.  At this stage, the site architecture with some content is already in place.  The website designer must have utilized such tools like style tiles, mood boards, and element collages to create the visual appeal that resonates with Joan's specifications and requirements.

Auditory Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended: Actual units produced: 13,000 Actual fixed overhead incurred: $742,000 Standard fixed overhead rate: $15 per hour Budgeted fixed overhead: $720,000 Planned level of machine-hour activity: 48,000 If Auditory estimates four hours to manufacture a completed unit, the company's fixed-overhead budget variance would be:

Answers

Answer:

$22,000 unfavorable

Explanation:

Calculation to determine the company's fixed-overhead budget variance would be:

Using this formula

Fixed-overhead budget variance=Actual fixed overhead incurred-Budgeted fixed overhead

Let plug in the formula

Fixed-overhead budget variance=$742,000 – 720,000

Fixed-overhead budget variance = $22,000 unfavorable

Therefore the company's fixed-overhead budget variance would be:$22,000 unfavorable

Returns on ABC, Inc. are forecast to be the following: State Probability Return Boom 0.25 30% Normal 0.65 15% Bust 0.10 -14% What is the standard deviation of this company’s stock? Returns on ABC, Inc. are forecast to be the following: State Probability Return Boom 0.25 30% Normal 0.65 15% Bust 0.10 -14% What is the standard deviation of this company’s stock? 11.82% 11.56% 11.32% 11.07% 10.83%

Answers

Answer:

Standard deviation=11.82%

Explanation:

Standard deviation is measure of the total risks of an investment. It measures the volatility in return of an investment as a result of both systematic and non-systematic risks. Non-systematic risk includes risk that are unique to a company like poor management, legal suit against the company .

Standard deviation is the sum of the squared deviation of the individual return from the mean return under different scenarios

Expected return (r) = (30% × 0.25 ) + (15% × 0.65) + (-14%× 0.10)=15.8%

Outcome (R- r )^2 × P

Boom      (30%-15.8)^2× 0.25 = 50.05

Normal    (15%-15.8)^2×0.65 =   0.47

Bust       ( 13.6%- 15.8)^2 ×0.1=    89.10

                                                    139.63

Standard deviation =√139.63= 11.82%

Standard deviation=11.82%

Why do you think women occupy so few seats on boards of directors

Answers

Answer:

Women has always been discriminated against forever because of our sex. Men feel they should always be in charge so they should make more money

has 8.3 million shares of common stock outstanding. The current share price is $53, and the book value per share is $4. also has two bond issues outstanding. The first bond issue has a face value of $70 million and a coupon rate of 7 percent and sells for 108.3 percent of par. The second issue has a face value of $60 million and a coupon rate of 7.5 percent and sells for 108.9 percent of par. The first issue matures in 8 years, the second in 27 years. (a) What are capital structure weights on a book value basis

Answers

Answer:

Equity = 20.34%Debt = 79.66%

Explanation:

Book value of stock:

= 8,300,000 * 4

= $33,200,000

Total book value = BV of stock + BV of bonds

= 33,200,000 + 70,000,000 + 60,000,000

= $‭163,200,000‬.

Weight of Equity:

= 33,200,000 / ‭163,200,000‬

= 20.34%

Weight of debt:

= (70,000,000 + 60,000,000) / ‭163,200,000‬

= 79.66%

explain the rational accounting system in a business organization​

Answers

‍♂️‍♂️hiiiiiiiiiiuuiiunowbyeee

On January 1, 2018, Advanced Airline purchased a used airplane at a cost of $60,500,000. Advanced Airline expects the plane to remain useful for eight years (5,000,000 miles) and to have a residual value of $5,500,000. Advanced Airline expects the plane to be flown 1,100,000 miles the first year and 1,200,000 miles the second year.

Requirements
1.​Compute first-year (2019) depreciation expense on the plane using the following methods:
a.​Straight-line
b.​Units-of-production
2.​Show the airplane’s book value at the end of the first year for the two methods.

Answers

Answer:

Results are below.

Explanation:

First, we need to calculate the annual depreciation using the straight-line method:

Annual depreciation= (original cost - salvage value)/estimated life (years)

Annual depreciation= (60,500,000 - 5,500,000) / 8

Annual depreciation= $6,875,000

Now, using the units of production method:

Annual depreciation= [(original cost - salvage value)/useful life of production in miles]*miles operated

Annual depreciation= [(55,000,000 / 5,000,000)]*1,100,000

Annual depreciation= $12,100,000

Finally, the book value:

Book value= purchase price - accumulated depreciation

Straight-line:

Book value= 60,500,000 - 6,875,000= $53,625,000

Units-of-production:

Book value= 60,500,000 - 12,100,000=  $48,400,000

In business, a message written to right a wrong is called a claim. Straightforward claims are those where the receiver is expected to readily agree with your message. These claims require a direct approach. To be an effective business communicator, you should familiarize yourself with the best practices for making direct claims and voicing complaints.

Required:
What should you include in the opening of a direct claim message?

Answers

Answer: A clear statement of the problem

Explanation:

The opening of a direct claim message should clearly state the problem that you would like to be addressed by the receiver and would set the tone for the rest of the message.

Claim messages are formal messages and as such, should be clear and concise so that the message is communicated effectively and there is a lesser chance of the message being misread. This is why the message should be clearly stated, so that the receiver understands it and responds in kind.

Marigold Corp. enters into a contract with a customer to build an apartment building for $1,069,900. The customer hopes to rent apartments at the beginning of the school year and provides a performance bonus of $153,300 to be paid if the building is ready for rental beginning August 1, 2021. The bonus is reduced by $51,100 each week that completion is delayed. Marigold commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by Probability August 1, 2021 70 % August 8, 2021 20 August 15, 2021 6 After August 15, 2021 4 Determine the transaction price for this contract.

Answers

Answer:

$1,193,562

Explanation:

Calculation to Determine the transaction price for this contract.

First step is to calculate the probabilities

Probabilities

August 1, 2021 =70 % *$153,300

August 1, 2021 =$107,310

August 8, 2021= 20%*$51,100

August 8, 2021= $10,220

August 15, 2021 =6%*$102,200

($153,300-$51,100)

August 15, 2021 =$6,132

After August 15, 2021= 4%*$0

After August 15, 2021= $0

Now let calculate the transaction price for this contract.

Total transaction price =$1,069,900+ $107,310+$10,220+$6,132+$0

Total transaction price =$1,193,562

Therefore the transaction price for this contract will be $1,193,562

The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2030. Weimer will make annual deposits of $125,000 into a special bank account at the end of each of 10 years beginning December 31, 2021. Assuming that the bank account pays 7% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2030

Answers

Answer:

the fund balance is $1,727,056.25

Explanation:

The computation of the fund balance is shown below:

Given that

PMT = $125,000

NPER  = 10

RATE = 7%

PV = $0

The formula is shown below:

= -FV(RATE,NPER,PMT,PV,TYPE)

After applying the above formula, the fund balance is $1,727,056.25

Here basically the future value formula should be applied

Ajax is reviewing its previous 100% acquisition of Baxter to determine if there is goodwill impairment. At December 31, 2020 Ajax has recorded Goodwill of $330,000 on its books relating to this acquisition. At December 31, 2020, Baxter had a book value of net assets of $400,000 (excluding goodwill) and an estimated fair value for the company of $600,000. What is the amount (if any) of the goodwill write-off required to be booked by Ajax at December 31, 2020 under the FASB rules effective in 2020.

Answers

Answer:

Baxter

The amount of the Goodwill write-off required to be booked by Ajax at December 31, 2020 under the FASB rules effective in 2020 is:

= $130,000.

Explanation:

a) Data and Calculations:

Recorded Goodwill = $330,000

Book value of net assets = $400,000

Book value of all assets = $730,000 ($400,000 + $330,000)

Estimated fair value of company = $600,000

Goodwill impairment = $130,000 ($730,000 - $600,000)

b) The Goodwill impairment of $130,000 arose when the book value or the carrying amount exceeded the estimated fair value.

On March 9, Phillips gave Jackson Company a 60-day, 12% promissory note for $5,200. Phillips dishonors the note on May 8. Record the entry that Jackson would make when the note is dishonored, assuming that no interest has been accrued. Assume Jackson expects collection will occur. (Use 360 days for calculation. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round intermediate calculations to 2 decimal places, e.g. 52.75 and final answers to 0 decimal places, e.g. 1,525.)

Answers

Answer:

Jackson Company

Journal Entries:

Debit Accounts Receivable (Phillips) $6,0687

Credit Notes Receivable $5,200

Credit Interest on Notes Receivable $867

To record the reversal of the dishonored promissory note and the accruing interest for 60 days.

Explanation:

a) Data and Calculations:

March 9, 12% Promissory Note Receivable = $5,200

May 8, Note dishonored

Interest on note = 12% of $5,200 * 60/360 = $867

b) The above entries are made with the hope that collection will be made from Phillips eventually.

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