Kellogg Company manufactures cereal and other convenience food under its many well-known brands such as Kellogg’s®, Keebler®, and Cheez-It®. The company, with over $13.5 billion in annual sales worldwide, partially finances its operation through the issuance of debt. At the beginning of its 2015 fiscal year, it had $6.5 billion in total debt. At the end of fiscal year 2015, its total debt had increased to $6.6 billion. Its fiscal 2015 interest expense was $227 million, and its assumed statutory tax rate was 37%. Kellogg has an estimated market beta of 0.30. Assume that the expected risk-free rate is 2.5% and the expected market premium is 5%. a. What does Kellogg’s market beta imply about its stock returns? A beta of 0.30 indicates Kellogg's stock is less volatile than the market index. A beta of 0.30 indicates Kellogg's stock is more volatile than the market index. A beta of 0.30 indicates Kellogg's stock moves perfectly with the market index. Mark 1.00 out of 1.00 b. Estimate Kellogg’s cost of equity capital. Round answer to one decimal place (ex: 0.0245 = 2.5%). Answer %

The following balance sheet for the los gatos corporation was prepared by a recently hired accountant. in reviewing the statement you notice several errors. los gatos corporation balance sheet at december 31, 2018 assets cash $ 44,000 accounts receivable 86,000 inventories 57,000 machinery (net) 122,000 franchise (net) 32,000 total assets $ 341,000 liabilities and shareholders' equity accounts payable $ 54,000 allowance for uncollectible accounts 7,000 note payable 59,000 bonds payable 112,000 shareholders' equity 109,000 total liabilities and shareholders' equity $ 341,000 additional information: cash includes a $22,000 restricted amount to be used for repayment of the bonds payable in 2022. the cost of the machinery is $194,000. accounts receivable includes a $22,000 note receivable from a customer due in 2021. the note payable includes accrued interest of $7,000. principal and interest are both due on february 1, 2019. the company began operations in 2013. income less dividends since inception of the company totals $37,000. 52,000 shares of no par common stock were issued in 2013. 200,000 shares are authorized. required: prepare a corrected, classified balance sheet. (amounts to be deducted should be indicated by a minus sign.)

If you offer up your car as a demonstration that you will pay off your loan to a bank or another financial lending institution, you are using your car as collateral. true false

You decide to invest in a portfolio consisting of 25 percent stock a, 25 percent stock b, and the remainder in stock c. based on the following information, what is the expected return of your portfolio? state of economy probability of state return if state occurs of economy stock a stock b stock c recession .16 - 16.4 % - 2.7 % - 21.6 % normal .55 12.6 % 7.3 % 15.9 % boom .29 26.2 % 14.6 % 30.5 %