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Identify the source of information used in the given scenario.


A show manufacturer from a small town wants to estimate the size of the niche market. The manufacturer does so by looking at the population census of the town. The shoe manufacturer is using SECONDARY source information.

Answers

Answer 1

Answer: Secondary source of information

Explanation:

Primary sources of information are those where the person who wants to use the information finds it out for themselves such as conducting interviews.

Secondary sources of information are those that have already been collected by other researchers or entities which can then be used by other people for their own research.

The population census is population information that was already collected by the government so the shoe manufacturer is using secondary information in using it.


Related Questions

How much is the value of mortgaged property, owned by a partner when invested in the partnership. Explain

Answers

Answer:

alls you have to do is ask the interne

The welding department supplies parts to the final assembly line. Management decides to implement a kanban system and has collected the following data: The daily demand is 2500 units. The production lead time is 3 days (this includes processing time, transport time, and waiting time). Management has decided to have 1.5 days of safety stock. One container fits 250 units.How many kanban containers will be needed to support this system?

Answers

Answer: 45 containers

Explanation:

The number of containers needed is calculated by:

= (Expected demand during Lead time + Safety Stock) / Container Capacity

Expected demand during Lead time = Daily demand * Lead time

= 2,500 * 3

= 7,500 units

Safety stock = 1.5 days * 2,500

= 3,750 units

Number of containers needed:

= (7,500 + 3,750) / 250

= 45 containers

. Which ONE of the following statements about Cash Budgets is NOT true?
A. The cash budget shows all of the business’s receipts and payments for the year ahead
B. The cash budget shows the forecasted profit for the year
C. The cash budget is a tool for planning and controlling cashflow
D. The cash budget is usually produced in a month by month format

Answers

C.the cash budget is a tool for planning and controlling cash flow

Biarritz Corp. is growing quickly. Dividends are expected to grow at a rate of 31 percent for the next three years, with the growth rate falling off to a constant 6.1 percent thereafter. If the required return is 12 percent and the company just paid a dividend of $2.80, what is the current share price

Answers

Answer:

$82.85

Explanation:

Nemo Gill was hired by the Spectacular Tropical Aquarium and agreed to submit any disputes arising out of his employment to binding arbitration. Nemo was fired when he became a Rastafarian and urged his coworkers to become vegetarians and smoke ganja. Without waiting for the results of the arbitration, Nemo filed a complaint alleging religious discrimination with the EEOC. The EEOC quickly filed a lawsuit on his behalf. Spectacular moved to have the EEOC's lawsuit dismissed on the grounds that Nemo signed a valid arbitration agreement.

a. The EEOC cannot bring a lawsuit enforcement action against Spectacular because Nemo signed the mandatory arbitration agreement.
b. The EEOC can bring a lawsuit enforcement action against Spectacular despite Nemo's agreeing to arbitration.
c. The EEOC cannot bring a lawsuit enforcement action against Spectacular because Nemo did not wait for the results of the arbitration.
d. The EEOC cannot bring a lawsuit enforcement action against Spectacular because Nemo's urging his co-workers to smoke ganja and become vegetarians had nothing to do with his job.

Answers

Answer:

The correct answer to the question above is OPTION B (The EEOC can bring a lawsuit enforcement action against Spectacular despite Nemo's agreeing to arbitration).

Explanation:

Companies (mostly private) usually desire their employees to sign an arbitration agreement giving the fact that it removes the power of an employee to take the employer to court on certain claims instead the claims go through an arbitration proceeding that happens outside of court.

EEOC (Equal Employment Opportunity Commission) enforces the laws of the state that prohibits discrimination against employees by their employers because of where they come from, their religion, their marital status, sex, their citizenship, and a whole lot more.

So, the EEOC can bring a lawsuit enforcement action against Spectacular despite Nemo's agreeing to arbitration because the EEOC itself was not a party to the arbitration agreement between Spectacular and Nemo, and the U. S. Supreme Court gave EEOC the power to exercise its enforcement powers.

Rahul needs a loan and is speaking to several lending agencies about the interest rates they would charge and the terms they offer. He particularly likes his local bank because he is being offered a nominal rate of 6%. But the bank is compounding monthly. What is the effective interest rate that Rahul would pay for the loan

Answers

Answer: 6.17%

Explanation:

When calculating the effective rate of an interest rate being compounded over a number of periods in a year, use the following:

= [ (1 + Nominal rate / Number of periods in a year) ^ Number of periods in a year- 1] * 100%

Number of periods = Compounding is monthly = 12

Effective rate = [ (1 + 6% / 12)¹² - 1 ] * 100%

= 6.17%

Explain with examples, the process of screening and evaluating new venture opportunities.

Answers

Self-Analysis
According to the Arkansas Small Business Development Center, most small businesses fail because of poor management and the owner’s inability to manage resources. Before you even start researching the feasibility of your idea and the market you plan on entering, evaluate your own talents, desires and goals. Consider your willingness to take risks as well as the amount of time and energy you’ll need to make the business a success. Review your financial, personnel and marketing skills as well to ensure you have the necessary background to make a success of your new venture.

Financial Components
After learning about the investment required to purchase the existing business or franchise or the start-up costs you’ll need initially, evaluate your own resources. Part of a financial assessment includes the amount you have in personal savings to add to the initial investment. Banks typically require entrepreneurs to come up with a portion of the investment to show good faith and willingness to take a risk with the lender. Assess the financing available through the seller, investors and lenders when evaluating your chances of succeeding.

Market Research
To thoroughly understand what you’re getting into, perform an extensive market research project to determine the feasibility of your business. In addition to gleaning statistics of trends and current customer buying patterns, you need to know who your customers are, where they are located and what kind of competition exists in your area. Consider market research your first steps in opportunity analysis that help you understand exactly how you will sell products or services to a specific market.

Support
Finally, evaluate the amount of support you expect to receive from your family and the community.

Bretts Construction Company had a contract starting April 2017, to construct a $6,000,000 building that is expected to be completed in September 2018, at an estimated cost of $5,500,000. At the end of 2017, the costs to date were $2,530,000 and the estimated total costs to complete had not changed. The progress billings during 2017 were $1,200,000 and the cash collected during 2017 was $800,000. For the year ended December 31, 2017, Bretts would recognize gross profit on the building of:

Answers

Answer: $230,000

Explanation:

Gross profit to be earned from project:

= Construction price - cost of construction

= 6,000,000 - 5,500,000

= $500,000

Percentage of costs incurred in 2017:

= 2,530,000 / 5,500,000 * 100%

= 46%

The Gross profit for 2017 is therefore:

= Percentage of cost incurred * total gross profit

= 46% * 500,000

= $230,000

hich of the statements is TRUE? Patents give inventors exclusive rights to sell a product for an unlimited period of time. Copyrights are legal protections that protect a product from being copied by others for an unlimited period of time. Copyrights give inventors exclusive rights to sell a product for a specific period of time. Patents are legal protections that protect a product from being copied by others for a specific period of time. Copyrights give inventors exclusive rights to sell a product for an unlimited period of time. Patents are legal protections that protect a product from being copied by others for an unlimited period of time. Patents give inventors exclusive rights to sell a product for a specific period of time. Copyrights are legal protections that protect a product from being copied by others for an unlimited period of time. Patents give inventors exclusive rights to sell a product for a

Answers

Answer:

Patents allow inventors to exclusively sell a product for a specific period of time. Copyrights are legal protections that protect a product from being copied by others for a specific period of time

Explanation:

Patents are a right granted to an inventor to exclusively sell a product for a specific period of time usually for 20 years. During this period, others are prevented from  making, using, or selling the invention.

Types of patents include :

utility patents design patents plant patent

Copyright gives the inventor of a product and anyone they give the permission to the right to reproduce the product.

Suppose you are a euro-based investor who just sold shares of a U.S. company that you had bought six months ago. You had invested 10,000 euros to buy theshares for $120 per share; the exchange rate was $1.03 per euro. You sold the stock for $171 per share and converted the dollar proceeds into euro at the exchange rate of $0.94 per euro.

Required:
Compute the rate of return on your investment in euro terms.

Answers

Answer:

The rate of return on your investment in euro terms is 56.14%.

Explanation:

Amount invested in euros = 10,000 euros

Amount invested in dollars = Amount invested in euros * Exchange rate at the time of purchase = 10,000 euros * $1.03 = $10,300

Number of shares bought = Amount invested in dollars / Cost price per share in dollars = $10,300 / $120 = 85.8333333333333

Proceeds from sales in dollars = Number of shares bought * Selling price per share in dollars = 85.8333333333333 * $171 = $14,677.50

Proceeds from sales in euros = Proceeds from sales in dollars / Exchange rate at the time of sales = $14,677.50 / $0.94 = 15,614.36 euros

Rate of return in euro terms = (Proceeds from sales in euros - Amount invested in euros) / Amount invested in euros = (15,614.36 - 10,000) / 10,000 = 0.5614, or 56.14%

Therefore, the rate of return on your investment in euro terms is 56.14%.

A machine that cost $121,000 has an estimated residual value of $11,000 and an estimated useful life of 11,000 machine hours. The company uses units-of-production depreciation and ran the machine 3,000 hours in year 1, 2,000 hours in year 2, and 3,000 hours in year 3. Calculate its book value at the end of year 3. (Do not round intermediate calculations.)

Answers

Answer:

Book value= $41,000

Explanation:

Giving the following information:

Purchase price= $121,000

Salvage value= $11,000

Useful life= 11,000 machine hours

First, we need to calculate the depreciation expense for each year using the following formula:

Annual depreciation= [(original cost - salvage value)/useful life of production in hours]*hours operated

Year 1:

Annual depreciation= [(121,000 - 11,000) / 11,000]*2,000

Annual depreciation= 10*3,000

Annual depreciation= $30,000

Year 2:

Annual depreciation= 10*2,000

Annual depreciation= $20,000

Year 3:

Annual depreciation= 10*3,000

Annual depreciation= $30,000

Now, the accumulated depreciation:

Accumulated depreciation= 30,000 + 20,000 + 30,000

Accumulated depreciation= $80,000

Finally, the book value at the end of year 3:

Book value= purchase price - accumulated depreciation

Book value= 121,000 - 80,000

Book value= $41,000

Members of 67 countries attended a conference on economic development hosted by an international organization based in Gent, Belgium. Attendees of the workshop learned about techniques designed to assist countries in expanding their degree of economic development. Emerging markets act as manufacturing bases for global Miltinationals Enterprises because of ________.

Answers

Answer:

High availability.of cheaper labour

Explanation:

An emerging market is defined as one that does not meet the standards of a fully developed market. For example in the area.of labour cost there is no standard set for it.

So companies can get cheap labour from these economies.

Companies like Apple and Nike have used cheap labour from emerging countries to reduce their cost of production.

Manufacturing bases are established in relatively poorer economies where the workers are willing to work for cheap wage


This picture of gas stations BEST illustrates which aspect of a market economy?
A
credit
B
competition
с
interest rates
D
opportunity cost

Answers

Answer:

B. Competition is the answer for E2020

Explanation:

Drag each label to the correct location on the image.
Identify the features of stocks and bonds.

Answers

There are various types of investments. The most common type of investments are Bonds and Stocks.

What is difference between Bond and Stock?

A bond is an investment which is considered as less risky because it provides fixed coupon rate as return.

A Stock is considered as risky investment because its returns vary.

The features of Bond are : It has Coupon rate, Face value and Maturity date

The features of Stock are : It has Closing Price

Learn more about bonds  at https://brainly.com/question/13961163

#SPJ2

Answer:

stock- closing price; bond- coupon rate, face value, maturity date

Explanation:

As a project engineer, you received the AW analysis below from the finance department. It is for a new piece of equipment you ordered some months ago. You were told the interest rate used was 10% per year, but no first cost or projected salvage value was provided and you want to know them. Determine the values of P and S using the AW values for the year 3. Note: The AW values are equivalent values through the given year, not costs for the single year.

Answers

Answer and Explanation:

The computation of the value of P and the value of S is shown below:

For P

The Annual worth of the first cost for the year 3 is $18,899

Now

Annual worth = First Cost(A/P, 10%, 3)

$18,899 = P[0.1(1 + 0.1)^3 ÷ ((1 + 0.1)^3 - 1)]

$18,899 = 0.4021P

P = $46,999

For S

The Annual worth of the salvage value for the year 3 is $6,648

Now

Annual worth = Salvage value(A/F, 10%, 3)

$6,648 = S[0.1 ÷ ((1 + 0.1)^3 – 1)]

$6,648 = 0.30211S

S = $22,005

gooQS 8-1 Cost of plant assets LO C1 Kegler Bowling buys scorekeeping equipment with an invoice cost of $160,000. The electrical work required for the installation costs $16,800. Additional costs are $3,360 for delivery and $11,530 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,550. What is the total recorded cost of the scorekeeping equipment

Answers

Answer:

$180,160

Explanation:

Calculation of Cost of scorekeeping equipment

Purchase Price                          $160,000

Installation Cost                           $16,800

Delivery Cost                                 $3,360

Total Cost                                    $180,160

Note Sales Tax and Costs incurred subsequently after asset is put to use is excluded from Cost of Asset.

Therefore,

the total recorded cost of the scorekeeping equipment is  $180,160.

Mary Alice just won the lottery and is trying to decide between the options of receiving the annual cash flow payment option of $420,000 per year for 25 years beginning today, or receiving one lump-sum amount today. Mary Alice can earn 6% investing this money. At what lump-sum payment amount would she be indifferent between the two alternatives

Answers

Answer:

The lum-sum must equal $5,369,009.59

Explanation:

Giving the following information:

First option:

Annual payment= $420,000

Number of periods= 25 years

Interest rate= 6%

First, we need to calculate the future value of the first option using the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual deposit

FV= {420,000*[(1.06^25) - 1]} / 0.06

FV= $23,043,095.04

Now, to determine the lump-sum to receive today, we need to determine the present worth of the annuity:

PV= FV / (1 + i)^n

PV= 23,043,095.04 / (1.06^25)

PV= $5,369,009.59

distribution strategies ​

Answers

At the strategic level, there are three broad approaches to distribution, namely mass, selective and exclusive distribution. The number and type of intermediaries selected largely depends on the strategic approach. The overall distribution channel should add value to the consumer.

Matlock Company uses a periodic inventory system. Its beginning inventory consists of 50 units that cost $ 34 each. On June 3, the company purchased 150 units at $ 34 each. On June 15, the company sold 125 units at $ 50 each. Thecompany closes the books on June 30. The physical counts indicate that 75 units are available in the warehouse on June 30. Journalize the June transactions.

Answers

Answer:

Matlock Company

Journal Entries:

June 3: Debit Inventory $5,100

Credit Cash $5,100

To record the purchase of inventory.

June 15: Debit Cash $6,250

Credit Sales revenue $6,250

To record the sale of goods.

June 15: Debit Cost of goods sold $4,250

Credit Inventory $4,250

To record the cost of goods sold.

Explanation:

a) Data and Analysis:

June 3: Inventory $5,100 Cash $5,100

June 15: Cash $6,250 Sales revenue $6,250

June 15: Cost of goods sold $4,250 Inventory $4,250

Shareholders in Frontier Communications were not pleased to learn that the company's market share had changed from 40 to 21 percentage points, a loss of 19 percentage points. What was the percent change in market share

Answers

Answer:

[tex]47.5\%[/tex]

Explanation:

Given: The company's market share had changed from 40 to 21 percentage points.

To find: percent change in market share

Solution:

Change in percentage of company's market share [tex]=40-21=19[/tex]

Percent change in market share = (Change in percentage of company's market share ÷ 40) × 100

[tex]=\frac{19}{40}(100)=47.5\%[/tex]

At the beginning of 2017, Miyazaki Company's Accounts Receivable balance was $105,000, and the balance in Allowance for Doubtful Accounts was $1,950. Miyazaki's sales in 2017 were $787,500, 80% of which were on credit. Collections on account during the year were $502,500. The company wrote off $3,000 of uncollectible accounts during the year.

Required
a. Identify and analyze the transactions related to the sales, collections, and write-offs of accounts receivable during 2017.
b. Identify and analyze the adjustments to recognize bad debts assuming that (a) bad debts expense is 3% of credit sales and (b) amounts expected to be uncollectible are 6% of the yearend accounts receivable.
c. What is the net realizable value of accounts receivable on December 31, 2017, under each assumption in part (2)?
d. What effect does the recognition of bad debts expense have on the net realizable value? What effect does the write-off of accounts have on the net realizable value?

Answers

Answer:

Miyazaki Company

a. Analysis of transactions:

Sales in 2017 = $787,500

Credit Sales = $630,000 (80% of $787,500)

Total collections on account = $502,500

Uncollectibles written off =   $3,000

Unpaid balance for the year = $229,500 ($105,000 + $124,500)

b. a) Bad Debt Expense = $18,900

   b) Bad Debt Expense = $14,820

c. Net Realizable Value of Accounts Receivable on December 31:

                                                             a)                      b)

Unpaid balance for the year       $229,500      $229,500

Allowance for doubtful accounts    (18,900)          (14,820)

Net Realizable Value =                $210,600        $214,680

d. The recognition of bad debts expense does not have any direct effect on the net realizable value.  It is the Allowance for doubtful accounts that has a negative effect on the net realizable value.

The write-off of accounts reduces the net realizable value by $3,000.

Explanation:

a) Data and Calculations:

Beginning balances:

Accounts receivable = $105,000

Allowance for Doubtful Accounts = $1,950

Sales in 2017 = $787,500

Credit Sales = $630,000 (80% of $787,500)

Total collections on account = $502,500

Uncollectibles written off =   $3,000

Unpaid balance for the year = $229,500 ($105,000 + $124,500)

Bad Debts Expense = $18,900 ($630,000 * 3%)

Allowance for Uncollectibles = $13,770 ($229,500 * 6%)

a) Allowance for Doubtful Accounts:

Account Titles               Debit        Credit

Beginning balance                        $1,950

Accounts receivable  $3,000

Bad Debts Expense                      18,900

Balance                       17,850

b) Allowance for Doubtful Accounts:

Account Titles               Debit        Credit

Beginning balance                        $1,950

Accounts receivable  $3,000

Bad Debts Expense                      14,820

Balance                       13,770

Cost standards for one unit of product no. C77: Direct material 3 pounds at $2.50 per pound $ 7.50 Direct labor 5 hours at $7.50 per hour 37.50 Actual results: Units produced 7,800 units Direct material purchased 26,000 pounds at $2.70 $ 70,200 Direct material used 23,100 pounds at $2.70 62,370 Direct labor 40,100 hours at $7.30 292,730 Use the information to compute the following variances. The direct-material quantity variance is:

Answers

Answer:

Usage variance=$750

Explanation:

A material usage variance occurs when the standard quantity required to active a particular level of production is higher or lower than than the actual actual quantity used. A favorable variance would mean than less quantity of materials were used than the standard to achieve a given output level. And an adverse variance would mean the opposite

                                                                                 Pounds

7,800 units should have used ( 7,800× 3)           23,400

but did use                                                               23,100

Usage variance                                                         300      

×    standard price                                                    $2.50    

Usage variance                                                          $750 favorable

Usage variance   =$750                      

Mars Corporation merges into Jupiter Corporation by exchanging all of its assets for 300,000 shares of Jupiter stock valued at $2 per share and $100,000 cash. Wanda, the sole shareholder of Mars, surrenders her Mars stock (basis $900,000) and receives all of the Jupiter stock transferred to Mars plus the $100,000. How does Wanda treat this transaction on her tax return

Answers

Answer: capital loss of $200000

Explanation:

To solve the question goes thus:

Value of shares that was received from Jupiter = 300000 × $2 = $600,000

Cash received = $100,000

Total gotten = $700,000

We then deduct the value of stock that was foregone by Mars. This will be:

= $700,000 - $900,000

= - $200,000

Therefore, a capital loss of $200,000 would be disclosed in the Income tax return.

Blue Corporation leases equipment from Falls Company on January 1, 2020. The lease agreement does not transfer ownership, contain a bargain purchase option, and is not a specialized asset. It covers 3 years of the equipment's 8-year useful life, and the present value of the lease payments is less than 90% of the fair value of the asset leased. The annual lease payment is $37,000 at the beginning of each year, and Blue's incremental borrowing rate is 5%, which is the same as the lessor's implicit rate Prepare all the necessary journal entries for Falls Company (the lessor) for 2020, assuming the equipment is carried at a cost of $232,000.

Answers

Answer:

this is an operating lease, so you do not have to calculate present value, all you need to calculate is depreciation expense:

January 1, 2020

Dr Cash 37,000

    Cr Unearned revenue 37,000

December 31, 2020

Dr Unearned revenue 37,000

    Cr Lease revenue 37,000

December 31, 2020

Dr Depreciation expense 29,000

    Cr Accumulated depreciation, equipment 29,000

$232,000 / 8 years = $29,000

9. Matilda just graduated from college. In order to devote all her efforts to college, she did not hold a job. Matilda just graduated from college. In order to devote all her efforts to college, she did not hold a job. She is going to cruise around the country on her motorcycle for a month before she starts looking for work. Other things the same, the unemployment rate ____________ and the labor force participation rate ______________.

Answers

Answer:

Remain the same; remain the same.

Explanation:

Unemployment rate refers to the percentage of the total labor force in an economy, who are unemployed but seeking to be gainfully employed. The unemployment rate is divided into various types, these include;

I. Natural Rate of Unemployment (NU).

II. Frictional unemployment rate (FU).

III. Structural unemployment rate (SU).

IV. Actual unemployment rate (AU).

V. Cyclical unemployment rate (CU).

There are different measures used in the measurement of the unemployment rate in a country's economy and these includes;

A. U-1: this is the percentage of people that are unemployed for at least 15 weeks or more.

B. U-2: this is the percentage of the people who have lost their job or the people that finished a temporary job.

C. U-3: this is the percentage of the population that is unemployed but actively seeking employment.

All things being equal (ceteris paribus), the unemployment rate would remain the same and the labor force participation rate remain the same because Matilda has decided to cruise around the country on her motorcycle for a month before she starts looking for work.

Petty Cash Journal Entries
1. Based on the following petty cash information, prepare (a) the journal entry to establish a petty cash fund, and (b) the journal entry to replenish the petty cash fund. If an amount box does not require an entry, leave it blank. When required, enter amounts in dollars and cents.
On January 1, 20--, a check was written in the amount of $200 to establish a petty cash fund. During January, the following vouchers were written for cash removed from the petty cash drawer:
Voucher No. Account Debited Amount
1 Phone Expense $17.50
2 Automobile Expense 33.00
3 Joseph Levine, Drawing 56.00
4 Postage Expense 12.50
5 Charitable Contributions Expense 15.00
6 Miscellaneous Expense 49.00

Answers

Answer:

(a) January 1

Dr Petty cash $200

Cr Cash $200

B. January

Dr Phone Expense $17.50

Dr Automobile Expense 33

Dr Joseph Levine, Drawing 56

Dr Postage Expense 12.50

Dr Charitable Contributions Expense 15

Dr Miscellaneous Expense 49

Cr Petty cash 183

January 31

Dr Petty cash $183

Cr Cash $183

Explanation:

(a) Preparation of the journal entry to establish a petty cash fund

January 1

Dr Petty cash $200

Cr Cash $200

b. Preparation of the journal entry to replenish the petty cash fund.

January

Dr Phone Expense $17.50

Dr Automobile Expense 33

Dr Joseph Levine, Drawing 56

Dr Postage Expense 12.50

Dr Charitable Contributions Expense 15

Dr Miscellaneous Expense 49

Cr Petty cash 183

($17.50+33+56+12.50+15+49)

January 31

Dr Petty cash $183

Cr Cash $183

($17.50+33+56+12.50+15+49)

Ds games recommendation give me some :D

Thanks

Answers

Any lego game or any Pokémon game

Joe King has an annual income of $240,000. Joe is buying a $400,000 house in a very desirable area, sought after by buyers. He applies for a loan at the bank and is approved for fully amortizing 30-year FRM at an annual rate of 3.40%, with monthly payments, compounded monthly. The bank will not lend more than 80% LTV. The appraisal indicates the house is worth $375,000. Assuming he does not want PMI What is the biggest mortgage Joe can get

Answers

Answer:

Joe King

The biggest mortgage Joe can get $300,000 (80% of $375,000).

Explanation:

a) Data and Calculations:

Joe King's annual income = $240,000

Cost of purchasing a house = $400,000

Bank highest limit = 80% LTV

Appraised worth of house = $375,000

80% of $375,000 = $300,000

b) 80% LTV means 80% of the loan to the property value (LTV).  It is essentially the size of the mortgage that the bank is prepared to offer Joe in relation to the value of the property he is purchasing.  In this instance, the appraised value of the property is $375,000.  The 80% LTV will be equal to $300,000 ($375,000 * 80%).

On September 1, 2012, an investor purchases a $10,000 par T-bond that matures in 8 years. The coupon rate is 8 percent and the investor buys the bond 45 days after the last coupon payment (135 days before the next). The ask yield is 7 percent. The dirty price of the bond is

Answers

Answer:

Dirty price of the bond = $10,098.63

Explanation:

Clean price = $10,000

Accrued interest = F * (C / M) * (D / T) ............... (1)

F = Face value = $10,000

C = Total annual coupon rate = 8%, or 0.08

M = Number of coupon payment per year = 1

D = Days since last payment date = 45

T = Accrual period (Number of days between payments) = 365

Substituting the values into equation (1), we have:

Accrued interest = $10000 * (0.08 / 1) * (45 / 365) = $98.63

Dirty price of the bond = Clean price + Accrued interest = $10,000 + $98.63 = $10,098.63

The dirty price of the bond is $10,098.63.

Calculation of the dirty price of the bond:

Since Clean price = $10,000

Now

Accrued interest = Face value * (Coupon rate / coupon payment) * (Days / period)

So,

Accrued interest = $10000 * (0.08 / 1) * (45 / 365)

= $98.63

Now we know that

Dirty price of the bond = Clean price + Accrued interest

= $10,000 + $98.63

= $10,098.63

Hence, we can conclude that The dirty price of the bond is $10,098.63.

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Branford has one share of stock and one bond. The total value of the two securities is $1,200. The bond has a YTM of 10.2%, a coupon rate of 9.2%, and a face value of $1,000; pays semi-annual coupons with the next one expected in 6 months; and matures in 8 years. The stock pays annual dividends and the next dividend is expected to be $24.87 and paid in one year. The expected return for the stock is 15.2%. What is the price of the stock expected to be in 1 year?

Answers

Answer:

The price of the stock is expected to be $188.16 in 1 year.

Explanation:

This can be determined as follows:

Current price of the stock = Expected next dividend / Expected return = $24.87 / 15.2% = $163.62

Expected stock price in 1 year = Current price of the stock * (100% + Expected return)^Number of year = $163.62 * (100% + 15.2%)^1 = $188.16

Therefore, the price of the stock is expected to be $188.16 in 1 year.

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