Sapp trucking’s balance sheet shows a total of noncallable $45 million long-term debt with a coupon rate of 7.00% and a yield to maturity of 6.00%. this debt currently has a market value of $50 million. the balance sheet also shows that the company has 10 million shares of common stock, and the book value of the common equity (common stock plus retained earnings) is $65 million. the current stock price is $22.50 per share; stockholders' required return, rs, is 14.00%; and the firm's tax rate is 40%. the cfo thinks the wacc should be based on market value weights, but the president thinks book weights are more appropriate. what is the difference between these two waccs?
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Business, 22.06.2019 09:30
What is the relationship among market segmentation, target markts, and consumer profiles?
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Business, 23.06.2019 01:00
Need with an adjusting journal entrycmc records depreciation and amortization expense annually. they do not use an accumulated amortization account. (i.e. amortization expense is recorded with a debit to amort. exp and a credit to the patent.) annual depreciation rates are 7% for buildings/equipment/furniture, no salvage. (round to the nearest whole dollar.) annual amortization rates are 10% of original cost, straight-line method, no salvage. cmc owns two patents: patent #fj101 and patent #cq510. patent #cq510 was acquired on october 1, 2016. patent #fj101 was acquired on april 1, 2018 for $119,000. the last time depreciation & amortization were recorded was december 31, 2017.before adjustment: land: 348791equpment and furniture: 332989building: 876418patents 217000
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Business, 23.06.2019 03:20
Milden company has an exclusive franchise to purchase a product from the manufacturer and distribute it on the retail level. as an aid in planning, the company has decided to start using a contribution format income statement. to have data to prepare such a statement, the company has analyzed its expenses and has developed the following cost formulas: cost cost formula cost of good sold $35 per unit sold advertising expense $210,000 per quarter sales commissions 6% of sales shipping expense ? administrative salaries $145,000 per quarter insurance expense $9,000 per quarter depreciation expense $76,000 per quarter management has concluded that shipping expense is a mixed cost, containing both variable and fixed cost elements. units sold and the related shipping expense over the last eight quarters follow: quarter units sold shipping expense year 1: first 10,000 $ 119,000 second 16,000 $ 175,000 third 18,000 $ 190,000 fourth 15,000 $ 164,000 year 2: first 11,000 $ 130,000 second 17,000 $ 185,000 third 20,000 $ 210,000 fourth 13,000 $ 147,000 milden company’s president would like a cost formula derived for shipping expense so that a budgeted contribution format income statement can be prepared for the next quarter. required: 1. using the high-low method, estimate a cost formula for shipping expe
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Sapp trucking’s balance sheet shows a total of noncallable $45 million long-term debt with a coupon...
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