Titan Mining Corporation has 8.1 million shares of common stock outstanding, 300,000 shares of 4.1 percent preferred stock outstanding, and 185,000 bonds with a semiannual coupon rate of 5.5 percent outstanding, par value $2,000 each. The common stock currently sells for $57 per share and has a beta of 1.15, the preferred stock has a par value of $100 and currently sells for $99 per share, and the bonds have 18 years to maturity and sell for 107 percent of par. The market risk premium is 6.6 percent, T-bills are yielding 3.3 percent, and the company’s tax rate is 24 percent. a. What is the firm’s market value capital structure? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., .1616.) b. If the company is evaluating a new investment project that has the same risk as the firm’s typical project, what rate should the firm use to discount the project’s cash flows?

Answer:

a.

Market value of debt = 185000 * 2000 * 107%  = 395900000 or 395.9 million

Market value of preferred stock = 300000 * 99 = 29700000 or 29.7 million

Market value of common stock = 8100000 * 57  =  461700000 or 461.7 million

Total value of capital structure = 395.9 + 29.7 + 461.7  =  887300000 or 887.3 million

b.

WACC = 0.0953387 or 9.53387% rounded off to 9.5339%

As the new project will have the same risk as that of the firm's typical project, it shall be discounted using the WACC of the firm which is 9.5339%

Explanation:

The capital structure of a company is typically made of at least one or at most all of the following components namely debt, common stock and preferred stock. To calculate the market value of capital structure, we calculate the market value of each component and sum it.

Market value of debt = 185000 * 2000 * 107%  = 395900000 or 395.9 million

Market value of preferred stock = 300000 * 99 = 29700000 or 29.7 million

Market value of common stock = 8100000 * 57  =  461700000 or 461.7 million

Total value of capital structure = 395.9 + 29.7 + 461.7  =  887300000 or 887.3 million

b.

The cash flows of a firm having the capital structure mix containing more than one component should be discounted using the WACC or weighted average cost of capital. The WACC is calculated using the following formula,

WACC = wD * rD * (1-tax rate)  +  wP * rP  +  wE * rE

Where,

First we need to determine the cost of equity.

rE  = 0.033 + 1.15 * 0.066

rE = 0.1089 or 10.89%

Cost of debt = 5.5* 2 = 11% or 0.11

WACC = 395.9 / 887.3 * 0.11 * (1 - 0.24)  +  29.7 / 887.3 * 0.041  +  

461.7 / 887.3 * 0.1089

WACC = 0.0953387 or 9.53387% rounded off to 9.5339%

As the new project will have the same risk as that of the firm's typical project, it shall be discounted using the WACC of the firm which is 9.5339%

The sales era emerged because of an increased need to move products during the Great Depression.

True
False

A major manufacturing company has initiated a project to determine the best course of action to take in response to the new green laws recently passed by congress. The company has many plants located in the U.S. and overseas, some of which have been in place for decades and will likely not be cost effective to modernize. The CEO has warned that this project will rise or fall based on effective communications. During the plan communications management process, the project manager and his team will rely on potentially five key inputs. Which of the following is a key input of the process? Select one: a. Communications technology b. Lessons learned register c. Project management plan d. Meetings

Diego Company manufactures one product that is sold for $73 per unit in two geographic regions—the East and West regions. The following information pertains to the company’s first year of operations in which it produced 56,000 units and sold 51,000 units. Variable costs per unit: Manufacturing: Direct materials $ 24 Direct labor $ 16 Variable manufacturing overhead $ 2 Variable selling and administrative $ 3 Fixed costs per year: Fixed manufacturing overhead $ 784,000 Fixed selling and administrative expense $ 672,000 The company sold 38,000 units in the East region and 13,000 units in the West region. It determined that $300,000 of its fixed selling and administrative expense is traceable to the West region, $250,000 is traceable to the East region, and the remaining $122,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product. Foundational 6-10 10. What would have been the company’s variable costing net operating income (loss) if it had produced and sold 51,000 units? You do not need to perform any calculations to answer this question.

A company rented a computer for $800 a month. Five years later the treasurer calculated that if the company had purchased the computer and paid a $100 monthly maintenance charge, the company would have saved $1000. What was the purchase price of the computer?

Beginning inventory (30% complete as to Material B and 60% complete for conversion) 700 units
Started this cycle 2,000 units
Ending inventory (50% complete as to Material B and 80% complete for conversion) 500 units
Beginning inventory costs:
Material A $14,270
Material B 5,950
Conversion 5,640
Current Period costs:
Material A $40,000
Material B 70,000
Conversion 98,100

Material A is added at the start of production, while Material B is added uniformly throughout the process.
Refer to Saturn Corporation Assuming a FIFO method of process costing, compute EUP units for Materials A and B.

Devon forgets to pay his credit card bill for three months. Which of the following statements is TRUE?

1. A Late Payment fee will not be charged to his account.


2. A Balance Transfer fee will be charged to his account.

3. His A.P.R. (interest rate) will rise to 30.24% until he pays back the amount he owes.

4. His A.P.R. (interest rate) will rise to 30.24% and stay there until he makes six consecutive minimum payments.

eBookPrintReferences Check my work Check My Work button is now enabledItem 180Item 180 Ouelette Corporation's relevant range of activity is 3,000 units to 7,000 units. When it produces and sells 5,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $5.25 Direct labor $4.05 Variable manufacturing overhead $1.30 Fixed manufacturing overhead $3.00 Fixed selling expense $0.70 Fixed administrative expense $0.40 Sales commissions $0.50 Variable administrative expense $0.45 If 6,000 units are produced, the total amount of indirect manufacturing cost incurred is closest to:

It’s been a crazy couple days at the car lot. Jerry, a potential customer, had been to the lot four times this week and said he would be coming in today to finally sign a contract on a top model Corvette, but his wife just called and told you that he had a heart attack and died on his way to the dealership. While you were taking the call and dealing with the grieving widow, a teenage boy came in with $5,000 cash and said he wanted the Chevy out front. Still on the phone, you quickly took the cash, had him sign the papers, and gave him the keys. Thinking that the widow would want to move forward with her husband’s agreement, you mail her a sales slip. Still flustered from the phone call, you realize that you still have an elderly lady in the lobby. She has been there for several hours, but still hasn’t made up her mind if she even wants to buy a car. In a previous conversation that you had with her, she said that she shouldn’t be making such large decisions until her dementia subsides. You tell her, "you need to buy car, you’ve been here too long not to buy a car. Here, sign these papers and take these keys." She reluctantly signs the papers, takes the keys, and drives off in the car. Of the contracts you made today, which ones are voidable, void, and enforceable?

BlackBerry, a one-time leader in secure cell phones, lost its edge. Without significant upgrades or innovation, the company quickly lost market share to iPhones and Android devices. The company attempted to imitate these advances with the Blackberry Storm product, which flopped. Blackberry was criticized as trying to leverage capabilities beyond its core competencies. Which of the following tools should Blackberry use to regain a scope of its core competencies and determine potential sources of competitive advantage

a. External environmental analysis
b. Competitor analysis
c. Industry analysis
d. Value chain analysis

PLEASE HELP WITH THIS
This lesson examines many concepts, including opportunity costs. For this discussion, you will write a brief scenario that describes opportunity costs.

For example:

After working weekends for the past three years, Janet has saved $7,000. Her goal is to buy a new 90-inch HD television. Before she buys the TV, she is offered an opportunity to travel with her best friend to Australia and New Zealand. The trip will cost about $7,000.

Janet’s opportunity costs are either missing out on purchasing a new television (if she chooses to travel) or forgoing her plan to purchase a television (if she travels abroad).

Now, write your own scenario that illustrates opportunity costs.

Use the following data to determine the total amount of working capital.

Sheffield Corp. Balance Sheet December 31, 2022

Cash $200000 Accounts payable $202000
Accounts receivable 154000 Salaries and wages payable 27000
Inventory 152000 Mortgage payable 236000
Prepaid insurance 90300 Total liabilities $465000
Stock investments (long-term) 266000
Land 299000
Buildings $305000 Common stock $420300
Less: Accumulated depreciation (55000) 250000 Retained earnings 742000
Goodwill 216000 Total stockholders' equity $1162300
Total assets $1627300 Total liabilities and stockholders' equity $1627300

Amazon’s employees will return to the office after a lengthy period of remote working and managers will need to employ the most suitable leadership models, styles or theories to ease the transition In light of this, assess the suitability of key leadership models, theories or styles in terms of their effectiveness in the context provided

In 2017, real per capita gross domestic product (GDP) in the United States was roughly $53,357. In 2018, real per capita GDP in the United States was roughly $54,542. Therefore, between 2017 and 2018, the rate of economic growth in the United States was ________.

A situation in which a partnerships breaks up completely is called

a family limited partnership
a dissociation
a dissolution
an LLC

how can I create a new business?​

Additional information about the company follows: a.Hubs require $29 in direct materials per unit, and Sprockets require $12. b.The direct labor wage rate is $10 per hour. c.Hubs are more complex to manufacture than Sprockets and they require special equipment. d.The ABC system has the following activity cost pools: Estimated Activity Activity Cost Pool (Activity Measure) Overhead Cost Hubs Sprockets Total Machine setups (number of setups) $ 27,945 115 92 207 Special processing (machine-hours) $ 236,500 4,300 0 4,300 General factory (organization-sustaining) $ 74,000 NA NA NA Required: 1. Compute the activity rate for each activity cost pool. 2. Determine the unit product cost of each product according to the ABC system.

The table below contains data on Fincorp Inc. The balance sheet items correspond to values at year-end 2015, while the income statement items correspond to revenues or expenses during the year ending in 2015. All values are in thousands of dollars.
2017 2018
Revenue $ 4,400 $ 4,500
Cost of goods sold 1,500 1,600
Depreciation 480 500
Inventories 290 320
Administrative expenses 530 580
Interest expense 210 210
Federal and state taxes* 530 550
Accounts payable 280 340
Accounts receivable 440 480
Net fixed assets† 4,500 5,270
Long-term debt 2,800 3,240
Notes payable 896 610
Dividends paid 440 440
Cash and marketable
securities 870 510
Taxes are paid in their entirety in the year that the tax obligation is incurred.
Net fixed assets are fixed assets net of accumulated depreciation since the asset was installed.
Suppose that Fincorp has 468,000 shares outstanding. What were earnings per share?

Do you have a course for Economics?

To reduce costs and the environmental impact of commuting, your software company decides to close a number of offices and enable staff to work from home. However, the senior management team who introduced the policy is unaware that your team is using agile methods, which rely on the co-location of teams and pair programming.

Required:
Discuss the difficulties that this new policy might cause and how you might get around these problems?

A sales rep is on a phone call with a prospect who likes to control the conversation. The constant interruptions make it hard for the rep to find out the prospect's pain points and to pitch. What should the rep do first

Gilligan Corporation was established on February 15, Year 1. Gilligan is authorized to issue 500,000 shares of $6.00 par value common stock. As of December 30, Year 1, Gilligan's stockholders' equity accounts report the following balances: Common stock, $6 par, 500,000 shares authorized 55,000 shares issued and outstanding $ 330,000 Paid-in capital in excess of par - common 440,000 $ 770,000 Retained earnings 1,400,000 Total Stockholders' Equity $ 2,170,000 On December 31, Year 1, Gilligan decides to issue a 5% stock dividend. At the time of issue, the market price of the stock was $22 per share. How will the issuance of the stock dividend affect the financial statements

Consider a situation where a manufacturer from country A and a distributor based in country B are considering a relationship. To serve this market, the firm from A must invest in new equipment, which can be used only for the B market. The two firms transact infrequently, and there is significant uncertainty about the nature of the market demand. Trust between the two firms is low, and country B's legal system to be unsympathetic to foreign firms. How should the manufacturer choose to organize its transactions

Check my work Check My Work button is now enabledItem 5Item 5 1.11 points Prepare summary journal entries to record the following transactions for a company in its first month of operations. a. Raw materials purchased on account, $80,000. b. Direct materials used in production, $37,000. Indirect materials used in production, $12,000. c. Paid cash for factory payroll, $35,000. Of this total, $25,000 is for direct labor and $10,000 is for indirect labor. d. Paid cash for other actual overhead costs, $7,000. e. Applied overhead at the rate of 120% of direct labor cost. f. Transferred cost of jobs completed to finished goods, $50,470. g1. Jobs that had a cost of $50,470 were sold. g2. Sold jobs on account for $72,100.

Zippers, Corp., a development company, has constructed a zip-line course on government land after signing a leasing agreement with the state government. A few years after signing the agreement, the state authority sanctioned the Never-ending Tunnel Company to build a long tunnel through the land where the zip-line course already exists. The proprietors of Zippers, Corp. claim that the state authority has violated their existing agreement. Which of the following is most likely to be applied in this case between Zippers, Corp. and the state government?

a. the free exercise clause
b. the contract clause
c. the doctrine of preemption
d. the establishment clause
e. the commerce clause

Federal tax-deferred employee benefits are:

Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Its unadjusted trial balance as of December 31 follows along with descriptions of items a through h that require adjusting entries on December 31.

Additional Information Items:

a. An analysis of WTI's insurance policies shows that $2,400 of coverage has expired.
b. An inventory count shows that teaching supplies costing $2,800 are available at year-end 2015.
c. Annual depreciation on the equipment is $13,200.
d. Annual depreciation on the professional library is $7,200.
e. On November 1, WTI agreed to do a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,500, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training Fees account was credited. The fee for the sixth month will be recorded when it is collected in 2016.
f. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an individual for $3,000 tuition per month payable at the end of the class. The class started on October 15, but no payment has yet been received. (WTI's accruals are applied to the nearest half-month; for example, October recognizes one-half month accrual.)
g. WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee.
h. The balance in the Prepaid Rent account represents rent for December.


Debit    Credit
Cash 34,000     
  Accounts receivable 0     
  Teaching supplies 8,000     
  Prepaid insurance 12,000     
  Prepaid rent 3,000     
  Professional library 35,000     
  Accumulated depreciation—Professional library 10,000  
  Equipment 80,000     
  Accumulated depreciation—Equipment 15,000
  Accounts payable 26,000  
  Salaries payable 0
  Unearned training fees 12,500  
  Common stock 10,000  
  Retained earnings 80,000  
  Dividends 50,000     
  Tuition fees earned 123,900  
  Training fees earned 40,000  
  Depreciation expense—Professional library 0     
  Depreciation expense—Equipment 0     
  Salaries expense 50,000     
  Insurance expense 0     
  Rent expense 33,000     
  Teaching supplies expense 0     
  Advertising expense 6,000     
  Utilities expense 6,400     

  Totals 317,400      317,400

Required:
Prepare the adjusting entries, adjusted trial balance, and financial statements of above entries.

A resource-based strategy:

a. is often based on cross-department combinations of intellectual capital and expertise.
b. uses a company's valuable and rare resources and competitive capabilities to deliver value to customers that rivals have difficulty matching.
c. is typically based on a stand-alone resource strength such as technological expertise.
d. refers to a company's most efficiently executed value-chain activity.
e. uses industry key success factors to provide a company with a core competence that rivals cannot effectively imitate.

10 . From a Keynesian point of view, which is more likely to cause a recession: aggregate demand or aggregate supply, and why

The Skysong Inc., a manufacturer of low-sugar, low-sodium, low-cholesterol TV dinners, would like to increase its market share in the Sunbelt. In order to do so, Skysong has decided to locate a new factory in the Panama City area. Skysong will either buy or lease a site depending upon which is more advantageous. The site location committee has narrowed down the available sites to the following three very similar buildings that will meet their needs. Building A: Purchase for a cash price of $620,000, useful life 27 years. Building B: Lease for 27 years with annual lease payments of $71,170 being made at the beginning of the year. Building C: Purchase for $657,500 cash. This building is larger than needed; however, the excess space can be sublet for 27 years at a net annual rental of $6,200. Rental payments will be received at the end of each year. The Skysong Inc. has no aversion to being a landlord. Click here to view factor tables In which building would you recommend that The Skysong Inc. locate, assuming a 11% cost of funds

Workers in Peru collect cochineal bugs used to dye certain United States food items red. Market activities such as this one can best be described as: