Questions
Olsen Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and 30%...

Olsen Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and 30% debt, and its tax rate is 40%. Olsen must raise additional capital to fund its upcoming expansion. The firm will have $4 million of retained earnings with a cost of rs = 10%. New common stock in an amount up to $7 million would have a cost of re = 11.5%. Furthermore, Olsen can raise up to $3 million of debt at an interest rate of rd = 11% and an additional $6 million of debt at rd = 14%. The CFO estimates that a proposed expansion would require an investment of $7.9 million. What is the WACC for the last dollar raised to complete the expansion? Round your answer to two decimal places.

  %

In: Finance

Olsen Outfitters Inc. believes that its optimal capital structure consists of 40% common equity and 60%...

Olsen Outfitters Inc. believes that its optimal capital structure consists of 40% common equity and 60% debt, and its tax rate is 25%. Olsen must raise additional capital to fund its upcoming expansion. The firm will have $1 million of retained earnings with a cost of rs = 12%. New common stock in an amount up to $7 million would have a cost of re = 13.5%. Furthermore, Olsen can raise up to $4 million of debt at an interest rate of rd = 10% and an additional $6 million of debt at rd = 13%. The CFO estimates that a proposed expansion would require an investment of $3.8 million. What is the WACC for the last dollar raised to complete the expansion? Round your answer to two decimal places.

%

In: Finance

Olsen Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and 30%...

Olsen Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and 30% debt, and its tax rate is 40%. Olsen must raise additional capital to fund its upcoming expansion. The firm will have $5 million of retained earnings with a cost of rs = 15%. New common stock in an amount up to $7 million would have a cost of re = 19%. Furthermore, Olsen can raise up to $3 million of debt at an interest rate of rd = 11% and an additional $3 million of debt at rd = 13%. The CFO estimates that a proposed expansion would require an investment of $7.8 million. What is the WACC for the last dollar raised to complete the expansion? Round your answer to two decimal places.

In: Finance

The manufacturer of hardness testing equipment uses​ steel-ball indenters to penetrate metal that is being tested.​...

The manufacturer of hardness testing equipment uses​ steel-ball indenters to penetrate metal that is being tested.​ However, the manufacturer thinks it would be better to use a diamond indenter so that all types of metal can be tested. Because of differences between the two types of​ indenters, it is suspected that the two methods will produce different hardness readings. The metal specimens to be tested are large enough so that two indentions can be made.​ Therefore, the manufacturer uses both indenters on each specimen and compares the hardness readings. Construct a​ 95% confidence interval to judge whether the two indenters result in different measurements.

​Note: A normal probability plot and boxplot of the data indicate that the differences are approximately normally distributed with no outliers.

Specimen   Steel ball   Diamond
1 50 52
2 57 55
3 61 63
4 70 74
5 68 69
6 54 55
7 65 68
8 51 51
9 53 56

Construct a​ 95% confidence interval to judge whether the two indenters result in different​ measurements, where the differences are computed as​ 'diamond minus steel​ ball'.

The lower bound is

The upper bound is

​(Round to the nearest tenth as​ needed.)

In: Statistics and Probability

A trucking company determined that the distance traveled per truck per year is normally​ distributed, with...

A trucking company determined that the distance traveled per truck per year is normally​ distributed, with a mean of 50 thousand miles and a standard deviation of 12 thousand miles. Complete parts​ (a) through​ (c) below. a. nbsp What proportion of trucks can be expected to travel between 34 and 50 thousand miles in a​ year? The proportion of trucks that can be expected to travel between 34 and 50 thousand miles in a year is . 4082. ​(Round to four decimal places as​ needed.) b. nbsp What percentage of trucks can be expected to travel either less than 40 or more than 65 thousand miles in a​ year?

The percentage of trucks that can be expected to travel either less than 40 or more than 65 thousand miles in a year is ______%. ​(Round to two decimal places as​ needed.)

In: Statistics and Probability

EXERCISE 5 The Quality Inspector of a bottle company checks a random sample of 7 elements...

EXERCISE 5

The Quality Inspector of a bottle company checks a random sample of 7 elements in two different processes that make the same product and checks the liquid in them.

The results are:

PROCESS 1:        50          49.9       50.2       50.1       50          49.8       50.3

PROCESS 2:       50,2       48,95    49,2       49,5       49,7       50          49,8

Do you think that the production of this plant is following a standard process? Test with an alpha-level of 5 per cent.

In: Finance

Membrane-associated translocators are responsible for importing polypeptides into both mitochondria and peroxisomes. The processes in the...

  1. Membrane-associated translocators are responsible for importing polypeptides into both mitochondria and peroxisomes. The processes in the two organelles are different because _______________.

    mitochondria have only one membrane translocator complex and peroxisomes have two

    polypeptides are unfolded during translocation into mitochondria but not peroxisomes

    mitochondrial polypeptides bind to cytosolic receptors or chaperones and peroxisomal polypeptides do not

    peroxisome import requires signal sequences while mitochondrial import does not

  2. Match each event in glycolysis with the correct description.

    First ATP investment step

    Second ATP investment step

    First step of cleavage stage

    Substrate-level phosphorylation

    A.

    Main point of allosteric regulation in the pathway

    B.

    Raises the free energy of glucose and traps it in the cell

    C.

    Transfers a phosphoryl group from an organic intermediate to ADP

    D.

    Produces two 3-carbon molecules that are similar but not identical

In: Biology

Transfer pricing company is a two division firm, consisting of a manufacturing division and a distribution...

Transfer pricing company is a two division firm, consisting of a manufacturing division and a distribution division. Manufacturing division produces a single product, called product X. The cost of producing product X consists of a variable cost of $50 per unit, and a fixed cost of $100 per unit. This fixed cost per unit is calculated assuming that Manufacturing runs at its capacity of 10,000 units. Assume there is an external customer that contracts with Manufacturing to buy up to 4,000 units of product X for $200 per unit. More precisely, assume that the external customer will pay $200 per unit for any number of units that Manufacturing ships to it, up to 4,000 units, but it will not buy more than 4,000 units.

Q1. The distribution division wants 8,000 units of product X from the manufacturing division. Calculate the transfer price for the internal transfer of 8,000 units of product X according to the general transfer pricing rule.

Q2. The distribution division wants 10,000 units of product X from the manufacturing division. Calculate the transfer price for the internal transfer of 10,000 units of product X according to the general transfer pricing rule.

Q3. Compute the payback period of a project that requires an initial investment of $500,000 in year zero and pays back $100,000, $300,000, $400,000, and $200,000 in years 1 through 4.

Q4. Compute the discounted payback period of a project that requires an initial investment of $500,000 in year zero and pays back $100,000, $300,000, $400,000, and $200,000 in years 1 through 4. Assume that 10% is the appropriate discount rate of the project

Please show me how to get the answers.

In: Accounting

1. FIN3100’s outstanding bonds mature in 10 years, have a par value of $1,000, and make...

1.

FIN3100’s outstanding bonds mature in 10 years, have a par value of $1,000, and make an annual coupon payment of $70. The market yield on the bond is currently 10%. What is the bond's price?

B.) FIN3100 issued bonds with a 15-year maturity two year ago. The bonds have a 7% coupon, make one payment per year, and sold at their $1,000 par value. Market rate at the time was 7%. Now, two year later, the market rate has declined from 7% to 4%. At what price should FIN3100's bonds now sell?

C.)

FIN3100’s bonds have a 15-year maturity, a 12% quarterly coupon ($30 coupon payments are made every three months), a face value of $1,000, and cannot be called. The going nominal annual interest rate (rd) for similar quarterly payment bonds of equivalent risk is 8%. What is the bond's price?

In: Finance

Stick Collapsible Units Sold 60,000 3,000 Selling Price $12.50 $14.00 Direct Material Cost Per Unit $3.00...

Stick Collapsible
Units Sold 60,000 3,000
Selling Price $12.50 $14.00
Direct Material Cost Per Unit $3.00 $3.10
Direct Labor Cost Per Hour $7.50 $8.00
Variable MO $0.40 $0.40
Variable Selling Costs $1.10 $1.10
Labor Hours Per Unit 0.2 0.2
Sales Orders 120 1
Purchase Orders 50 3
Production Runs 45 6
Material Moves 86 10
Machine Setups 130 6
Machine Hours 525 32
Inspections 200 10
Shipments 60 3
Activity Information from Instructions
Activity Activity Cost Activity Cost Driver
Order Processing $35,000 Number of Sales Orders
Purchasing $36,000 Number of Purchase Orders
Material Handing $28,000 Material Moves
Machine Setup $14,000 Machine Setups
Production $99,000 Production Runs
Assembly $80,000 Machine Hours
Inspecting $11,000 Number of Inspections
Shipping $7,500 Number of Shipments
Requirement 1
Activity Total Costs Quantity of Cost Allocation Base Overhead Allocation Rate
Order Processing $35,000 121 $289.26
Purchasing $36,000 53 $679.25
Material Handing $28,000 96 $291.67
Machine Setup $14,000 136 $102.94
Production $99,000 51 $1,941.18
Assembly $80,002 557 $143.63
Inspecting $11,000 210 $52.38
Shipping $7,500 63 $119.05
Requirement 2
Traditional Costing
Stick Umbrella Collapsible Umbrella Total
Revenues $750,000 $42,000 $792,000
Direct Materials $180,000 $9,300 $189,300
Direct Labor $90,000 $4,800 $94,800
Variable Overhead $24,000 $1,200 $25,200
Variable Selling Costs $66,000 $3,300 $69,300
Allocated Fixed Overhead $295,200 $14,760 $309,960
Total Costs $655,200 $33,360 $688,560
Operating Income $94,800 $8,640 $103,440
Operating Income % 12.64% 20.57%
Per Unit Operating Income $1.58 $2.88
Requirement 3
Activity-Based Costing
Stick Umbrella Collapsible Umbrella Total
Revenues $750,000 $42,000 $792,000
Direct Materials $180,000 $9,300 $189,300
Direct Labor $90,000 $4,800 $94,800
Variable Overhead $24,000 $1,200 $25,200
Variable Selling Costs $66,000 $3,300 $69,300
Order Processing Costs $34,711 $289 $35,000
Purchasing Costs $33,963 $2,038 $36,000
Material Handing Costs $25,084 $2,917 $28,000
Machine Setup Costs $13,382 $618 $14,000
Production Costs $87,353 $11,647 $99,000
Assembly Costs $75,406 $4,596 $80,002
Inspecting Costs $10,476 $524 $11,000
Shipping Costs $7,143 $357 $7,500
Total Costs $647,517 $41,586 $689,103
Operating Income $102,483 $414 $102,897
Operating Income % 14% 1%
Per Unit Operating Income $1.71 $0.14
Requirement 4
Costs per Unit Stick Umbrella Collapsible Umbrella
Traditional $1.58 $2.88
ABC $1.71 $0.14
Difference -$0.13 $2.74

Identify an alternative costing method that could benefit this company, and describe the main characteristics of that method. What should a company look for when trying to determine whether they should adopt such a system?Should the company adopt this alternative costing method?

In: Accounting