Assume the following information about a company:
Past dividends
2015 $1.32 Required return = 11%
2016 $1.44
2017 $1.54
2018 $1.66
2019 $1.76
Use the appropriate dividend model to place a value on this stock for 2020.
How do I set this up in excel?
In: Finance
Consider two bonds, one issued in euros in Germany, and one issued in dollars in the US.
Assume that both government securities are one-year bonds – paying the face value of the bond
one year from now. The exchange rate, E, stands at 0.75 euros per dollar.
The face values and prices on the two bonds are given by:
US:
Face Value: $10,000 Price: $9,615.38
Germany:
Face Value: $10,000 euros : 9,433.96 euros
a.Compute the nominal interest rate on the bonds.
b. Compute the expected exchange rate next year consistent with uncovered interest parity.
c. If you expect the dollar to depreciate relative to the euro, which bond should you buy?
d. Assume that you are a US investor and you exchange dollars for euros and purchase the
German bond today. One year from now, it turns out that the exchange rate, E, is actually
0.72 (.72 euros buys one dollar). What is your realized rate of return in dollars compared to
the realized rate of return you would have made had you held the US bond?
In: Economics
The T-accounts below summarize transactions of Dansko Integrated from February 22 to February 25, 2020:
Cash
Balance
9,900
90
16
65
10
4
49
PP&E, Net
Balance
16,800
49
Accounts Payable
4
Balance
2,700
17
Other Liabilities
Balance
1,000
Accounts Receivable
Balance
4,500
10
Other Assets
Balance
1,600
Debt
Balance
3,500
65
Paid-In Capital
Balance
8,000
90
Inventory
Balance
3,800
17
13
Retained Earnings
Balance
21,400
3
What is the final amount in Total Equity?
| Gulf Shipping Company Balance Sheet As of March 11, 2020 (amounts in thousands) |
|||
|---|---|---|---|
| Cash | 14,300 | Accounts Payable | 1,900 |
| Accounts Receivable | 4,100 | Debt | 3,200 |
| Inventory | 5,800 | Other Liabilities | 4,000 |
| Property Plant & Equipment | 14,800 | Total Liabilities | 9,100 |
| Other Assets | 700 | Paid-In Capital | 7,700 |
| Retained Earnings | 22,900 | ||
| Total Equity | 30,600 | ||
| Total Assets | 39,700 | Total Liabilities & Equity | 39,700 |
Use T-accounts to record the transactions below, which occur on March 12, 2020, close the T-accounts, and construct a balance sheet to answer the question.
1. Purchase equipment for $50,000 in cash
2. Borrow $67,000 from a bank
3. Issue $80,000 in stock
4. Buy $16,000 worth of manufacturing supplies on credit
5. Pay $7,000 owed to a supplier
What is the final amount in Total Equity?
| Lightspeed Industries Balance Sheet As of March 11, 2020 (amounts in thousands) |
|||
|---|---|---|---|
| Cash | 14,100 | Accounts Payable | 1,900 |
| Accounts Receivable | 3,200 | Debt | 3,600 |
| Inventory | 4,900 | Other Liabilities | 2,000 |
| Property Plant & Equipment | 16,300 | Total Liabilities | 7,500 |
| Other Assets | 500 | Paid-In Capital | 7,200 |
| Retained Earnings | 24,300 | ||
| Total Equity | 31,500 | ||
| Total Assets | 39,000 | Total Liabilities & Equity | 39,000 |
Use T-accounts to record the transactions below, which occur on March 12, 2020, close the T-accounts, and construct a balance sheet to answer the question.
1. Sell, deliver, and receive payment of $20,000 for
service
2. Consume good or service and pay expense of $3,000
3. Sell product for $25,000 in cash with historical cost of
$20,000
What is the final amount in Total Assets?
In: Accounting
On July 31, 2020, Crane Company paid $2,950,000 to acquire all of the common stock of Conchita Incorporated, which became a division (a reporting unit) of Crane. Conchita reported the following balance sheet at the time of the acquisition.
|
Current assets |
$720,000 |
Current liabilities |
$520,000 |
|||
|---|---|---|---|---|---|---|
|
Noncurrent assets |
2,650,000 |
Long-term liabilities |
420,000 |
|||
|
Total assets |
$3,370,000 |
Stockholders’ equity |
2,430,000 |
|||
|
Total liabilities and stockholders’ equity |
$3,370,000 |
It was determined at the date of the purchase that the fair value
of the identifiable net assets of Conchita was $2,650,000. Over the
next 6 months of operations, the newly purchased division
experienced operating losses. In addition, it now appears that it
will generate substantial losses for the foreseeable future. At
December 31, 2020, Conchita reports the following balance sheet
information.
| Current assets |
$420,000 |
||
| Noncurrent assets (including goodwill recognized in purchase) |
2,300,000 |
||
| Current liabilities |
(640,000 |
) |
|
| Long-term liabilities |
(440,000 |
) |
|
| Net assets |
$1,640,000 |
Finally, it is determined that the fair value of the Conchita
Division is $1,850,000.
Compute the amount of goodwill recognized, if any, on July 31, 2020. (If answer is zero, do not leave answer field blank. Enter 0 for the amount.)
| The amount of goodwill |
$enter The amount of goodwill in dollars |
Determine the impairment loss, if any, to be recorded on December 31, 2020. (If answer is zero, do not leave answer field blank. Enter 0 for the amount.)
| The impairment loss |
$enter the impairment loss in dollars |
Assume that fair value of the Conchita Division is $1,590,000 instead of $1,850,000. Determine the impairment loss, if any, to be recorded on December 31, 2020. (If answer is zero, do not leave answer field blank. Enter 0 for the amount.)
| The impairment loss |
$enter The impairment loss in dollars |
Prepare the journal entry to record the impairment loss, if any, and indicate where the loss would be reported in the income statement. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title |
enter a debit amount |
enter a credit amount |
|
enter an account title |
enter a debit amount |
enter a credit amount |
| This loss will be reported in income as a separate line item before the subtotal select an income statement item Income from Discontinued OperationsCost of Goods SoldIncome From Continuing OperationsExtraordinary Items. |
In: Accounting
EcoPak Ltd is a small private company, specialising in the manufacture of takeaway packaging, which offers an environmentally friendly alternative to disposable food containers. The business’s accountant Kate has prepared a draft version of EcoPak’s Balance Sheet and Income Statement for the financial year ended 30 June 2020. Kate knows she has made several mistakes in classifying the elements of the Balance Sheet and Income Statement because the income statement shows EcoPak has made a loss and the Balance Sheet doesn’t balance! Kate’s statements are shown below.
|
EcoPak Ltd - Draft Income Statement for the year ended 30 June 2020 |
|
|
Cash at Bank |
255,000 |
|
Accrued Wages |
22,000 |
|
Gross profit |
277,000 |
|
Expenses |
|
|
Bank Loan |
320,000 |
|
Interest expense |
27,000 |
|
Prepaid Rent |
3,600 |
|
Depreciation Expense |
43,000 |
|
Donations Expense |
12,000 |
|
Accounts Receivable |
14,000 |
|
Other expenses |
32,000 |
|
Earnings before interest and tax |
-174,600 |
|
Accounts Payable |
22,000 |
|
Profit before tax |
-196,600 |
|
Income tax expense |
125,000 |
|
Profit for the period from continuing operations |
-321,600 |
|
EcoPak Ltd – Draft Balance Sheet AS AT 30 June 2020 |
|||
|
Assets |
Liabilities |
||
|
Current Assets |
Current Liabilities |
||
|
Wages Expense |
78,000 |
Drawings |
-25,000 |
|
Cost of Sales |
376,000 |
Inventory |
108,000 |
|
Rent Expense |
31,200 |
Electricity expense |
18,000 |
|
Sales revenue |
1,244,000 |
Non-current liabilities |
|
|
Prepaid Utilities |
2,100 |
Trucks |
90,000 |
|
Property Plant and Equipment |
578,000 |
Advertising Expense |
45,000 |
|
Non-current Assets |
Total Liabilities |
236,000 |
|
|
Retained Profits |
468,700 |
Owner’s Equity |
|
|
Mortgage |
63,000 |
Insurance Expense |
72,000 |
|
Contributions |
198,000 |
||
|
Intangibles |
18,000 |
||
|
Total Owner’s Equity |
288,000 |
||
|
Total Assets |
2,841,000 |
Total Liabilities and Owner’s Equity |
524,000 |
|
EcoPak Ltd – CORRECTED Draft Income Statement for the year ended 30 June 2020 |
|
|
Gross profit |
|
|
Expenses |
|
|
Earnings before interest and tax |
|
|
Profit before tax |
|
|
Profit for the period from continuing operations |
|
|
EcoPak Ltd – Draft Balance Sheet AS AT 30 June 2020 |
|||
|
Assets |
Liabilities |
||
|
Current Assets |
Current Liabilities |
||
|
Non-current liabilities |
|||
|
Non-current Assets |
Total Liabilities |
||
|
Owner’s Equity |
|||
|
Total Owner’s Equity |
|||
|
Total Assets |
Total Liabilities and Owner’s Equity |
||
In: Accounting
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
In: Accounting
Smoking remains more common in much of Europe than in the United States. In the United States, there is a strong relationship between education and smoking: well-educated people are less likely to smoke. Does a similar relationship hold in France? Here is a two-way table of the level of education and smoking status (nonsmoker, former smoker, moderate smoker, heavy smoker) of a sample of 467 French men aged 20 to 60 years. The subjects are a random sample of men who visited a health center for a routine checkup. We are willing to consider them an SRS of men from their region of France.
| Education | Smoking Status | ||||
| Nonsmoker | Former | Moderate | Heavy | ||
| Primary school | 58 | 53 | 41 | 38 | |
| Secondary school | 39 | 42 | 28 | 32 | |
| University | 53 | 27 | 38 | 18 | |
The null hypothesis states that there is no relationship between these variables. That is, the distribution of smoking is the same for all three levels of education.
(a) Find the expected counts for each smoking status among men
with a university education. This is one row of the two-way table
of expected counts. Find the row total and verify that it agrees
with the row total for the observed counts.
Use two decimals for the expected counts and a whole number for the
total.
| Education | Smoking Status | TOTAL | ||||
| Nonsmoker | Former | Moderate | Heavy | |||
| University | ||||||
| Expected | ||||||
In: Statistics and Probability
Ali is a student at the University. He recently
purchased a car for OMR5,000 to use it for going to the University.
Ali also expects that other friends might ask for transportation
from him. He expects a total monthly revenue of OMR50. He expects
fuel cost to be OMR40 per month. One of Ali's friends is a taxi
driver. He offered Ali to take him to University for a monthly fee
of OMR10. Because he does not have to drive, Ali believes that he
can perform online work that would earn him a monthly revenue of
OMR30. What is the differential revenue in this scenario? Select
one: O a. OMR40 O b. OMR50 O c. OMR20 O d. OMR10 O e. OMR30
2.The total prime cost of a product was OMR5,200. The variable
manufacturing overhead is calculated based on the number of direct
labor hours. The variable manufacturing overhead cost per hour is
four times the direct labor cost per hour. The fixed manufacturing
overhead was OMR2,000. Assuming that direct labor hours were 350
and that the direct labor cost was 30% of direct materials cost,
how much is the total manufacturing cost? Select one: O a.
OMR12,000 O b. OMR18,000 c. OMR7,200 O d. OMR26,000 O e.
OMR28,000
In: Accounting
You are a college student, and you have a friend at a rival university. The two of you compete in almost everything! One day, your friend boasted that students at her university are taller than the students at yours. You each gather a random sample of heights of people from your respective campuses. Your data are displayed below (units are inches).
Your friend's data: (checksum: 1213.5)
| 75.5 | 72 | 76.4 | 69.7 | 76 | 74.7 | 80.5 | 71.5 | 73.2 | 67.3 |
| 66.8 | 65.2 | 66.7 | 72.5 | 75.7 | 68.5 | 61.3 |
Your data: (checksum: 1301.2)
| 66.9 | 66.2 | 67.6 | 74.1 | 72.3 | 69.4 | 69.3 | 66.7 | 69 | 64.3 |
| 65.9 | 63.1 | 68 | 64.8 | 73.6 | 71.2 | 72.8 | 59 | 77 |
Construct a 95% confidence interval for the difference in mean height between the two college populations.
a) State the parameter of interest, and verify that the necessary conditions are present in order to carry out the inference procedure.
b) Find the estimate for the degree of freedom and the margin of error.
Degree of freedom:
Margin of error:
c) Find the confidence interval: (,)
d) Interpret your 95% confidence interval in context.
e) Based on the confidence interval, is there evidence that the mean height at your friend's university is higher? Explain.
In: Statistics and Probability
From inception of operations to December 31, 2020, Metlock
Corporation provided for uncollectible accounts receivable under
the allowance method. The provisions are recorded, based on
analyses of customers with different risk characteristics. Bad
debts written off were charged to the allowance account; recoveries
of bad debts previously written off were credited to the allowance
account, and no year-end adjustments to the allowance account were
made. Metlock’s usual credit terms are net 30 days.
The balance in Allowance for Doubtful Accounts was $114,400 (Cr.)
at January 1, 2020. During 2020, credit sales totaled $7,920,000,
the provision for doubtful accounts was determined to be $158,400,
$79,200 of bad debts were written off, and recoveries of accounts
previously written off amounted to $13,200. Metlock installed a
computer system in November 2020, and an aging of accounts
receivable was prepared for the first time as of December 31, 2020.
A summary of the aging is as follows.
|
Classification by |
Balance in |
Estimated % |
|||
| November–December 2020 | $950,400 | 2% | |||
| July–October | 572,000 | 10% | |||
| January–June | 369,600 | 25% | |||
| Prior to 1/1/20 | 132,000 | 80% | |||
| $2,024,000 | |||||
Based on the review of collectibility of the account balances in
the “prior to 1/1/20” aging category, additional receivables
totaling $52,800 were written off as of December 31, 2020. The 80%
uncollectible estimate applies to the remaining $79,200 in the
category. Effective with the year ended December 31, 2020, Metlock
adopted a different method for estimating the allowance for
doubtful accounts at the amount indicated by the year-end aging
analysis of accounts receivable.
Prepare a schedule analyzing the changes in Allowance for
Doubtful Accounts for the year ended December 31, 2020. Show
supporting computations in good form. (Hint: In computing
the 12/31/20 allowance, subtract the $52,800 write-off.)
In: Accounting