Question:
A bond with par value of $1,000 has an annual coupon rate of 4.8% and currently sells for $970. What is the bond’s current yield?
Assuming a maturity period of 10 years (Note the tutor added this)
Answer:
Yield to Maturity =5.18%
Explanation:
The Yield to maturity is the discount rate that equates then price of the bonds to the present of cash inflows expected from the bond
The yield on the bond can be determined as follows using the formula below:
YTM = C + F-P/n) ÷ 1/2 (F+P)
YTM-Yield to maturity-
C- annual coupon
F- Face Value
P- Current Price
n- years to maturity
YTM-?, C- 4.8%× 1000 =60, Face Value - 1,000, P-970, n- 10
YTM = (48 + (1000-970)/10) ÷ ( 1/2× (1000 + 970) )
YTM = 0.0518 × 100 = 5.18%
Yield to Maturity =5.18%
You bought a stock one year ago for $48.28 per share and sold it today for $55.92 per share. It paid a $1.38 per share dividend today. What was your realized return?
Answer: 17.9%
Explanation:
From the question, a stock was bought one year ago for $48.28 per share and sold today for $55.92 per share and also paid a $1.38 per share dividend today.
The realized return will be calculated as:
Po = (P1 + D1) ÷ (1+Re)
48.28 = (55.92 + 1)/(1 + Re)
48.28 = 56.92/(1 + Re)
Cross multiply
48.28 + 48.28Re = 56.92
48.28Re = 56.92 - 48.28
48.28Re = 8.64
Re = 8.64/48.28
Re = 0.179 = 17.9%
Alistar Inc. recently issued $90 par value preferred stock that pays a 8.25% dividend rate per year. If the stock is currently selling for $85, what is the expected return of this preferred stock?
Answer: 8.735%
Explanation:
From the question, we are informed that Alistar Inc. recently issued $90 par value preferred stock that pays a 8.25% dividend rate per year and that the stock is currently selling for $85.
The expected return of this preferred stock will be calculated this:
The annual dividend will be:
= $90 × 8.25%
= $90 × 0.0825
= $7.425
The expected return on the preferred stock will be:
= Annual dividend ÷ Current price
=$7.425 ÷ $85
=0.08735
=8.735%
Jim transfers money from his money market account to his savings account. This action:________.
a. reduced Ml and increases M2.
b. increases Ml and reduces M2.
c. has no effect on MI or M2.
d. increases Ml and M2.
Answer:
a.reduced MI and increases M2
Explanation:
Hope that help you!!
"You are in the middle of a discussion with an institutional client over the phone, where you recommend that the client buy 100,000 shares of ABC stock. It looks like the client may be interested in making the purchase. Your cubicle is within earshot of the neighboring cubicle. Just before your client tells you take the order to buy, you overhear your colleague, the representative in the neighboring cubicle, selling 10,000 shares of ABC stock to his client. Which statement is TRUE about this situation?"
Answer:
The colleague has committed a violation because your customer's order could move the price of ABC stock
Explanation:
Front running is also called tailgating. It is a prohibited practice where a trader enters into a position security based on non-public information about a large trade that will influence the price of the security.
The trade is initiated to take advantage of the new price that the large trade will cause. The position is entered before the large trade occurs.
In this scenario your neighbour heard you telling your client to but 100,000 share of ABC. Because the transaction will influence the market he also tells his client to buy 10,000.
This is tailgating and it is a violation.
The following information was available for the year ended December 31, 2016: Net sales $ 857,750 Cost of goods sold 609,550 Average accounts receivable for the year 39,900 Accounts receivable at year-end 29,400 Average inventory for the year 174,000 Inventory at year-end 157,800
Required:
a. Calculate the inventory turnover for 2016. (Round your answer to 2 decimal places.)
b. Calculate the number of days' sales in inventory for 2016, using year-end inventories. (Use 365 days a year. Round your answer to 1 decimal place.)
c. Calculate the accounts receivable turnover for 2016. (Round your answer to 1 decimal place.)
d. Calculate the number of days' sales in accounts receivable for 2016, using year-end accounts receivable. (Use 365 days a year. Round your answer to 1 decimal place.)
Answer:Inventory turnover = 3.50 Times
Number of days sales in inventory= 94.5 Days
Accounts Receivable Turnover = 21.5 Times
Number of days sales in accounts receivable =12.5 days
Explanation:
a) Inventory turnover = Cost of goods sold / Average inventory
$609,550 / $174,000 = 3.50 Times
b)Number of days sales in inventory = inventory at year end / Cost of goods sold x 365
$157,800 / $609,550 x 365 = 94.49≈94.5 Days
.
c)Accounts Receivable Turnover = Net sales / Average accounts Receivable for the year
$857,750/$39,900 = 21.49≈ 21.5 Times
d)Number of days sales in accounts receivable = end of year Accounts Receivable / Net credit sales x 365
$29,400 / $857,750 x 365 = 12.51 ≈ 12.5 days
_____________, is the measure of how popular a product is. a) Marketability b) Profitability c) Popularity d) Consumability
Popularity is the measure of how popular a product is.
Product popularity is defined as the extent to which a product is purchased by the general public. The popularity appeal helps to persuade targeted customers with an advertisement. Product reviews are one of the most efficient ways of branding and marketing your online store. A good review can always increase the popularity and reliability of a product.
Popularity is the measure of how popular a product is.
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Crane Company has two divisions—Standard and Premium. Each division has hundreds of different types of tennis racquets and tennis products. The following information is available: (Round answer to 0 decimal places, e.g. 5,275.) Standard Division Premium Division Total Sales $300000 $700000 $1000000 Variable costs $180000 280000 Contribution margin $120000 $420000 Total fixed costs $300000 What is the break-even point in dollars?
Answer:
The break-even point sales in dollars are $555,555.60
Explanation:
Contribution margin ratio= (Total contribution margin / Total sales ) ×100
Contribution margin ratio= (S′ s contribution margin + P's contribution margin) / Total sales * 100
Contribution margin ratio = $120000 + $420000) / $1000000 * 100
Contribution margin ratio = 54%
Therefore, the contribution margin ratio of sales mix is 54%.
Break Even Point sales = Fixed cost / Contribution margin ratio
=$300,000 / 54%
=$555,555.60
Therefore, the break-even point sales in dollars are $555,555.60
Paradise, Inc., has identified an investment project with the following cash flows.Year Cash Flow1 = $5752= $ 8253= $1,1254 =$1,325(a) If the discount rate is 11 percent, what is the future value of these cash flows in year 4?(b) What is the future value at a discount rate of 16 percent? (c) What is the future value at discount rate of 29 percent?
Answer and Explanation:
The computation of the future value is shown below;
a. For the year 4
Future value is
= ($575 × 1.11^3) + ($825 × 1.11^2) + ($1,125 × 1.11) + ($1325)
= $4,275.89
b. At 16%
Future value is
= ($575 × 1.16^3) + ($825 × 1.16^2) + ($1,125 x 1.16) + ($1,325)
=$4,637.64
c. At 29%
Future value is
= ($575 × 1.29^3) + ($825 × 1.29^2) + ($1125 × 1.29) + ($1,325)
= $5,383.48
Companies like GE have committed significant resources to develop products that meet the needs of developing nations, products that deliver just enough adequate functionality at a fraction of a cost. interesting, these products have consequently found considerable success in value segment in the U.S as well. this is an example of:________.
Answer:
reverse innovation
Explanation:
Based on this scenario, this is an example of reverse innovation. This term refers to the process whereby goods developed as inexpensive models to meet the needs of developing nations are repackaged as low-cost innovative goods for Western buyers. There are many companies that have created such products, these include companies like Nestle, Xerox, Microsoft, and even Nokia each of which in their respected markets.
The constraint at Johngrass Corporation is time on a particular machine. The company makes three products that use this machine. Data concerning those products appear below: VT UV LQ Selling price per unit $335.09 $228.37 $199.12 Variable cost per unit $259.44 $173.26 $159.79 Minutes on the constraint 6.60 3.40 4.60 Assume that sufficient time is available on the constrained machine to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource
Answer:
$8.55 per minute
Explanation:
The computation of willing to pay to acquire more of the constrained resource is shown below:-
= (Selling price - Variable cost) ÷ Minutes on the constraint
= ($199.12 - $159.79) ÷ 4.60
= $39.33 ÷ 4.60
= $8.55 per minute
Therefore for computing the willingness to pay to acquire more of the constrained resource we simply applied the above formula.
Lei Corporation has bonds on the market with 22.5 years to maturity, a YTM of 6.9 percent, a par value of $1,000, and a current price of $1,057. The bonds make semiannual payments. What must the coupon rate be on these bonds
Answer:
7.4%
Explanation:
Coupon rate=coupon payment/face value
The coupon payment can be ascertained using the pmt Excel function as stated below:
=pmt(rate,nper,-pv,fv)
rate is the yield to maturity expressed in semiannual terms i.e 6.9%*6/12=3.45%
nper is the number of semiannual coupons the bond would pay over its 22.5 years i.e 22.5*2=45 payments
pv is the current price of $1057
fv is the face value of $1000
=pmt(3.45%,45,-1057,1000)=$37(semiannual coupon)
annual coupon=$37*2=$74
coupon rate=$74/$1000=7.4%
An investor purchases a long call at a price of $2.60. The strike price at expiration is $37. If the current stock price is $37.10, what is the break-even point for the investor?
Answer: $39.60
Explanation:
A long call makes a profit when the price of the underlying stock is higher than the strike price and the cost of acquiring the call.
The Break-even point for the investor will be at the point where the underlying stock price will be the same as the strike price plus the cost paid to purchase the call.
Break-even point = Strike price + Price of call
= 37 + 2.60
= $39.60
On January 1, a company issues bonds dated January 1 with a par value of $380,000. The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The market rate is 6% and the bonds are sold for $396,210. The journal entry to record the issuance of the bond is
Answer:
See explanation
Explanation:
Selling Price of Bonds =396,210
Journal Entry
Date Account Title and Explanation Debit Credit
1 Jan Cash $396,210
Bond payable $380,000
Premium on bond payable $ 16,210
(To record issuance of bond)
Working
Premium On Bonds Payable = Selling Price of Bonds - Value of Bonds
= $396,210 - $380,000 = $ 16,210
Interest payment:
Semi-annual interest = 7%× 380,000× 1/2 =13,300
Date Account Title and Explanation Debit Credit
June 30 Bond interest expense $13,300
Cash $13,300
(To record semi annual interest paid on bond)
Gerritt wants to buy a car that costs $30,750. The interest rate on his loan is 5.65 percent compounded monthly and the loan is for 7 years. What are his monthly payments
Answer:
$444.07
Explanation:
EMI = [P * I * (1+I)^N]/[(1+I)^N-1]
P =loan amount or Principal = 30750
I = Interest rate per month = .0565/12
N = the number of installments = 7*12 = 84
EMI = [30750*.0565/12* (1+(.0565/12))^84]/[(.0565/12))^84-1]
EMI = [30,750 * 0.0565 / 12 * 1.48374877204] / [1.48374877204 - 1]
EMI = 214.819001902 / 0.48374877204
EMI = $444.07
Ms. Jackson borrowed $42,000 at 8.75% annual simple interest. If exactly 1 year later she was able to repay the loan without penalty, how much interest would she owe
Answer:
$3675
Explanation:
Interest = principal x interest rate x year
= $42,000 x 0.0875 x 1 = $3675
You own a portfolio equally invested in a risk-free asset and two stocks. One of the stocks has a beta of 1.31 and the total portfolio is equally as risky as the market. What must the beta be for the other stock in your portfolio?
Answer:
the beta of stock₂ = 1.69
Explanation:
the weight of each security is ¹/₃ of the portfolio:
the risk free asset has a beta of 0stock₁ has a beta of 1.31stock₂ has a beta of ?the portfolio's beta is 1
1 = (¹/₃ x 0) + (¹/₃ x 1.31) + (¹/₃ x ?)
1 = 0.437 + (¹/₃ x ?)
1 - 0.437 = (¹/₃ x ?)
0.563 = (¹/₃ x ?)
? = 0.563 / ¹/₃ = 1.689 = 1.69
the beta of stock₂ = 1.69
You buy a share of stock, write a one-year call option with X = $12, and buy a one-year put option with X = $12. Your net outlay to establish the entire portfolio is $11.50. What must be the risk-free interest rate? The stock pays no dividends.
Answer:
4.35%
Explanation:
You buy a share of stock, write a one-year call option with X = $12, and buy a one-year put option with X = $12. Your net outlay to establish the entire portfolio is $11.50. What must be the risk-free interest rate? The stock pays no dividends.
Given the following :
1 - year call option with X = $12
1- year put option with X = $12
Net outlay to establish portfio = $11.50
No dividend
Risk-free interest rate :
(X / net outlay) - 1
(12 / 11.50) - 1
1.0434782 - 1
= 0.0434782
Expressing as a percentage :
0.0434782 * 100
= 4.347%
=4.35%
king costume uses a periodic inventory system. The company started the month with 9 masks in its begining inventory that cost %8 each. During the month, King Costume purchased 41 additional masks for $10 each. At the end of the month, King counted its inventory and found that 3 masks remained unsold. Using the LIFO method, its cost of goods sold for the month is:______.
a. $434.
b. $440.
c. $24.
d. $428.
The options given in the question are incorrect. The options are correct with respect to the question if beginning inventory is 6 masks.
Answer:
The cost of goods sold for the month is $458
Explanation:
The LIFO or last in first out is a method for inventory valuation. It values the closing inventory assuming that it contains the units that were present in the inventory at the very start of the period. Thus, the cost of goods sold contains the units that were most recently purchased.
The number of units available for sale was = 9 + 41 = 50
The sales in units = 50 - 3 = 47
Out of the 47 units of masks sold, under LIFO, the 41 masks will be from the masks purchased in the month while the remaining 6 masks will be from the opening inventory as the inventory that is bought later is sold first.
The cost of goods sold for the month under LIFO will be,
Cost of Goods Sold
41 masks at $10 each $410
6 masks at $8 each $48
Total value of COGS $458
Your investment bank has an investment of $100 million in the stock of the Swiss Roll Corporation and a short position in the stock of the Frankfurter Sausage Company. Here is the recent price history of the two stocks:
Answer:
hello your question is incomplete below is the complete question and the missing table
Your investment bank has an investment of $100 million in the stock of the Swiss Roll Corporation and a short position in the stock of the Frankfurter Sausage Company. Here is the recent price history of the two stocks: on the evidence of these six months how large would your short position in Frankfurter sausage needed to be to hedge you as far as possible against movements in the price of swiss Roll
answer : $42003667
Explanation:
$100 million in stocks
According to the data provided in the table attached below, to short the Frankfurt in order to hedge investment in Rolls is calculated below
we have to calculate the total return on both Roll corporation and Frankfurter sausage
for f-sausage
∑ (1 + monthly returns ) / 100
= ( 1 - 0.1 + 1 - 0.1 .... + 1 + 0.1 ) = -0.0297 = -2.97%
for Roll corporation
∑ (1 + monthly returns ) / 100
= ( 1 - 0.1 + 1 - 0.05 .... + 1 + 0.1 ) = -0.012475 = - 1.24%
next we will calculate the total loss inquired when investing in Roll corporation
Total loss = percentage loss * total investment
= 0.012475 * $100 million = - $ 1247500
we will have to offset the loss by shorting investments in F sausage
hence : $1247500 = investment in sausage * total return
1247500 = investment in sausage * 0.0297 ( The total return of F sausage is positive because it was a short position )
hence short investment in F sausage to offset loss incurred in ROLLS INVESTMENT
= 1247500 / 0.0297 = $42003667
I sell shoes for $250 per pair. They cost me $25 to produce. My markup on cost is:______
A. $2
B. 9096
C. 900%
D. None of the above.
Answer:
Markup percentage= 900%
Explanation:
Giving the following information:
I sell shoes for $250 per pair. They cost me $25 to produce.
To calculate the markup percentage, we need to use the following formula:
Markup percentage= [(selling price - unitary cost)/unitary cost]*100
Markup percentage= [(250 - 25)/25]*100
Markup percentage= 900%
What would the year 3 stock price need to be to meet your required rate of return of 13%?
Answer: $105.49
Explanation:
The Value of the stock today is given by;
[tex]P = \frac{D1}{1 + r} + \frac{D2}{(1+r)^2} + \frac{D3}{(1+r)^3} + \frac{P3}{(1+r)^3}[/tex]
[tex]80 = \frac{2}{1 + 0.13} + \frac{3}{(1+0.13)^2} + \frac{4}{(1+0.13)^3} + \frac{P3}{(1+0.13)^3}[/tex]
[tex]P3 = (80 * {1.13^3) - (\frac{2}{1.13} + \frac{3}{1.13^2} + \frac{4}{1.13^3})[/tex]
P3 = $105.49
A advertising agency provides a complete range of services, including marketing research, media selection, copy development, artwork, and production.
a. True
b. False
Answer:
a. True
Explanation:
The advertising agency that provides a complete range of services with respect to research of market, selection of media, copy development, artwork, production, etc
This agency we called as a full service agency in which all the services are provided at one place
Therefore the given statement is true
hence, the correct option is A. True
The following information is taken from the financial statements of Burton Industries:________.
Total Assets $360,000
Total Liabilities 162,000
Total Stockholders' Equity 198,000
Net Income 126,000
Income Tax Expense 37,800
Interest Expense 9,000
a. 18.2
b. 15.0
c. 4.7
d. 19.2.
Answer:
d. 19.2
Explanation:
The missing question is "The company's times interest earned ratio is?"
Solution
Interest Earned Ratio = Income before Interest and taxes or EBIT / Interest Expenses
Net Income $126,000
Add: Income taxes $37,800
Add: Interest Expenses $9,000
EBIT $172,800
Hence, Interest Earned Ratio = EBIT / Interest Expenses
Interest Earned Ratio = $172,800 / $9,000
Interest Earned Ratio = 19.2
Two dimensions of product quality are hard to measure objectively and are therefore subject to subjective assessment. One of those subjective dimensions is:
Complete Question:
Two dimensions of product quality are hard to measure objectively and are therefore subject to subjective assessment. One of those subjective dimensions is:
Group of answer choices
A. Reliability
B. Perceived quality
C. Support
D. Features
Answer:
B. Perceived quality.
Explanation:
Two dimensions of product quality are hard to measure objectively and are therefore subject to subjective assessment. One of those subjective dimensions is perceived quality.
The perceived quality of goods and services is primarily based on the premise that, the consumers are the one responsible for the breakdown of how efficient and effective a product is.
You own a portfolio that is invested 35 percent in Stock X, 20 percent in Stock Y, and 45 percent in Stock Z. The expected returns on these three stocks are 9 percent, 15 percent, and 12 percent, respectively. What is the expected return on the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Answer:
Expected return - Portfolio = 0.1155 or 11.55%
Explanation:
The expected return on the portfolio is the weighted average of the expected returns of the individual stocks that form up the portfolio. Thus, the formula for the expected return of the portfolio is,
Expected return - Portfolio = rA * wA + rB * wB + ... + rN * wN
Where,
rA, rB, ... represents the expected return on stock A, return on stock B and so onw represents the weight of each stock in the portfolioExpected return - Portfolio = 0.09 * 0.35 + 0.15 * 0.2 + 0.12 * 0.45
Expected return - Portfolio = 0.1155 or 11.55%
Jacob is self-employed and reports all of his income and expenses in his personal income tax return. ______________
Answer:
Sole proprietorship
Explanation:
The sole proprietorship is the business organization in which there is only one owner who controls its day to day operations. In this, the owner has unlimited liability as he does whatever he wants without any restrictions
Also, in this the person should file his return on the personal income tax return where he disclosed all his incomes and expenses during the year
So this is an example of Sole proprietorship
Debt: 5,000 7.2 percent coupon bonds outstanding, $1,000 par value, 30 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. Common stock: 440,000 shares outstanding, selling for $62 per share; the beta is 1.05. Market: 11 percent market risk premium and 5.2 percent risk-free rate. What is the company's WACC?
Answer:
outstanding, $1,000 par value, 30 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. Common stock: 440,000 shares outstanding, selling for $62 per share; the beta is 1.05. Market: 11 percent market risk premium and 5.2 percent risk-free rate. What is the company's WACC
Geographically dispersed work groups no longer pose additional communication challenges given todays technology.
a) true
b) false
The given statement is False Option(b) is correct.
What are work groups?A Working group, or working party, is a group of specialists working together to accomplish indicated objectives. The groups are space explicit and center around conversation or action around a particular branch of knowledge.
A working group's presentation is comprised of the singular consequences of all its singular individuals. A group's presentation is comprised of both individual outcomes and aggregate outcomes. In enormous associations, working groups are predominant, and the attention is dependably on individual objectives, execution and accountabilities.
Working group individuals don't get a sense of ownership with results other than their own. Then again, groups require both individual and common responsibility. There is more data sharing, more group conversations and discussions to show up at a group choice The life expectancy of a working group can endure anyplace between a couple of months and quite a long while. Such groups tend to foster a semi extremely durable presence when the relegated task is achieved consequently the need to disband or gradually eliminate the working group when it has accomplished its objective.
Therefore Option(b) is correct.
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The one-year call on TLM stock with a strike price of $65 is priced at $2.20 while the one-year put with a strike price of $65 is priced at $11.18. The annual risk-free rate is 3.8 percent, compounded continuously. What is the current price of TLM stock?
Answer:
The answer is "53.60"
Explanation:
Given value:
Exercise price(E) = 65
risk-free rate= 3.8 %= 0.038
calling price (C)= 2.20
one-year put price (P)= 11.18
The value of dividend-yield =0
time = 1 year
stock price =?
calculated value:
[tex]e^{-0.038 \times 1} = 0.962713[/tex]
Formula:
[tex]\bold{S \times e^{-dt} +P = E \times e^{-rt} +c}\\[/tex]
[tex]\to S \times e^{-0.00\times 1}+11.18 =65 \times e^{-0.038 \times 1}+2.2\\\\\to S \times e^{0}+11.18 =65 \times0.962713+ 2.2\\\\\to S \times 1+11.18 =65 \times0.962713+ 2.2\\\\\to S +11.18 =65 \times0.962713+ 2.2\\\\\to S+11.18 = 62.576345+2.2\\\\\to S+11.18 = 64.776345\\\\\to S= 64.776345-11.18\\\\\to S= 53.596345 \ \ or \ \ 53.60[/tex]
At her death Siena owned real estate worth $200,000 that was titled with her sister in joint tenancy with the right of survivorship. Siena contributed $50,000 to the total cost of the property and her sister contributed the remaining $75,000. What amount, if any, is included in Siena's gross estate?
A. $80,000.
B. $125,000.
C. $50,000.
D. $100,000.
E. None of the choices are correct.
Answer:
$80,000
Explanation:
Sienna owned $200,000 worth of real estate at her death
This real estate was titled with her sister in joint tenancy with the right of ownership
Sienna contributed $50,000 to the total cost of the property
Her sister contributed the remaining $75,000
The first step is to determine the portion contributed by Sienna
= $50,000/$50,000+$75,000
= $50,000/$125,000
= 0.4×100
= 40%
Therefore, the amount that should be included in Sienna's gross estate can be calculated as follows
= 40/100 × $200,000
= 0.4 × $200,000
= $80,000
Hence the amount that should be included in Sienna's gross estate is $80,000