The Auto Group has 1,200 bonds outstanding that are selling for $980 each. The company also has 7,500 shares of preferred stock at a market price of $40 each. The common stock is priced at $32 a share and there are 32,000 shares outstanding. What is the weight of the preferred stock as it relates […]
Date: September 19th, 2020
The book value of an asset is equal to the asset’s after-tax proceeds, provided after the asset has been sold. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Looking at a future value of $1 table, you find the number 4.661 for 20 years and 8%. This means that a dollar invested today will grow to $4.661 at the end of 20 years. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Giant Koala Stores Inc has forecasted sales for July through October in the top row of the table. Forecasted collections from cash and credit sales as well as forecasted payments to suppliers are also shown in the table. Wages, general & administrative expenses are 28% of the current month’s sales. Giant Koala starts August with […]
Date: September 19th, 2020
If you have a capital short-term gain of $500, only $200 is included in gross income. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
All veterans are entitled to loan guarantees through the Veterans Administration. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Utility Muffin Research Kitchen Inc is financed with debt, preferred stock and common equity. Selected information for each of the securities is provided in the table below. Calculate the capital structure weights which would be used to calculate the weighted average cost of capital. Long-term Debt: $5M Face Value, Coupon Rate = 3.5%, Annual Coupons, […]
Date: September 19th, 2020
The weighted average cost of capital for a firm is the: A) discount rate which the firm should apply to all of the projects it undertakes. B) overall rate which the firm must earn on its existing assets to maintain the value of its stock. C) rate the firm should expect to pay on its […]
Date: September 19th, 2020
Compounding is the process of increasing present value to future value. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Income tax withheld by your employer is reported on employers’ W-2 forms. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
