Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.26 percent. Selected operating data for the three divisions follow:  

Corporation is conducting a time-driven activity-based costing study in its Tech Support Department. The company has provided the following data to aid in that study:

On the Customer Cost Analysis report in time-driven activity-based costing, the time-driven activity rate for Resolving Problems would be closest to:

The (short-run) production function for ACME Widgets is given byQ= 50K0(L−10)2/3, where Q is the weekly output of widgets, L is the weekly labor input,measured in $1000s, and K0 is the fixed level of capital input.

a. Compute the labor-elasticity of output, ηQ/L, as a function of L.

b. What is the labor-elasticity of output when labor input is $45000 a week?

c. Suppose that ACME hires two additional widget polishers, at a combined cost of $1500 a week. Use your answer to part b. to estimate the resulting percentage change in output.

d. Can the answers above be used to estimate the change in ACME’s weekly revenue? If so, what is the resulting change in revenue? If not, explain why not.

c)Assuming that ROCE (return on common equity), g (the growth rate of the book value of common shareholders’ equity) and rE (the cost of equity capital) are constant, that markets are efficient, and:the company’s dividend payout ratio d is 20%,g is 8%,the company’s stock has an equity beta of 1.2,the risk free rate is 1% and the market risk premium is 6%,

what is the ROCE priced into the market?

Continuing with the information given in part (c), what will be the percentage effect onthe stock’s intrinsic value if:

(i)the market risk premium increases to 7%;

(ii)the market expectation of the dividend payout ratio changes to 50%;

(iii)the market expectation of future ROCE changes to 9%?

Try to explain the direction and magnitude of each change.

1) Executives of Studio Recordings, Inc. produced the latest compact disc by the Starshine Sisters Band. The following cost information pertains to the new CD:

CD package and disc (direct material and labor)                   $1.25/CD

Songwriters’ royalties                                                                         $0.35/CD

Recording artists’ royalties                                                              $1.00/CD

Advertising and promotion                                                              $275,000

Studio rent                                                                                                $250,000

Selling price to CD distributor                                                        $9.00

Calculate the following:

1. contribution per unit
2. break-even volume in CD units and dollars
3. net profit if 1 million CDs were sold
4. necessary CD unit volume to achieve a $200,000 profit
5. the percentage share of the market that the CD has to achieve to earn $200,000 profit, assuming the total market for the CD is 250,000 units.

What is the value of a 10-year, PKR 100,000 par value bond with a 12% annual coupon if its required rate of return is 14%? e. (1) What would be the value of the bond described in Part d if, just after it had been issued, the expected inflation rate rose by 5 percentage points, causing investors to require a 19% return? Would we now have a discount or a premium bond? (2) What would happen to the bond’s value if inflation fell and Kd (Cost of Debt) declined to 7%? Would we now have a premium or a discount bond? (3) What would happen to the value of the 10-year bond over time if the required rate of return remained at 13%? If it remained at 7%?

Support SUPERTEL, a new Telecommunication company, in calculating the Lifetime Value per customer based on the following assumptions: Perform the necessary calculations (A THROUGH K NEEDS TO BE CALCULATED):

Superman Enterprises has just completed an initial public offering. The firm sold 800,000 new shares (the primary offering). In addition, existing shareholders sold 325,000 shares (the secondary issue). The new shares were offered to the public at $14.50 per share and underwriters received a spread of $1.21/share. The legal, administrative, and other costs were $175,000 and were split proportionately between the company and the selling stockholders. The amounts a company receive is $10632000. Suppose that on the first day of trading, the price of superman's stock is $18/share. The cost to the firm from the underpricing is $2800000. So, what are the total costs of the issue to the firm as a percentage of the funds raised? Answer is 33.56+-0.03. Please write down the details calculation. Thank you!

The Quarles Distributing Company manufactures an assortment of cold air intake systems for high-performance engines. The average selling price for the various units is $600. The associated variable cost is $250 per unit. Fixed costs for the firm average $190,000 annually.

a. What is the break-even point in units for the company?

b. What is the dollar sales volume the firm must achieve to reach the break-even point?

c. What is the degree of operating leverage for a production and sales level of 3,000 units for the firm? (Calculate to three decimal places.)

d. What will be the projected effect on earnings before interest and taxes if the firm's sales level should increase by 50 percent from the volume noted in part (c)? (Need tp be a percentage)