Which of the following may be true of the cost of debt and cost of equity??
A. The weighted average cost of capital is computed by assigning weights to the cost of debt and the cost of equity of a firm.?
B. ?The cost of debt for a firm is always equal to the cost of equity to the firm.
C. ?The cost of internally generated equity for a firm is greater than the cost of externally generated equity funds for the firm.
D. ?The cost of internally generated equity for a firm is less than the cost of debt for the firm.
E. ?The cost of externally generated equity is the sum of the cost of debt and the cost of retained earnings.
Answer: A
You might also like to view...
Describe the factors that should be considered in developing new products for international markets with particular emphasis on the consequences for not adequately testing new products
What will be an ideal response?
The following information is available from JB Corporation's accounting records for the year ended December 31, Year 4: Cash received from customers $600,000 Dividends received from marketable securities 80,000 Cash paid for purchase of supplies 300,000 Income taxes paid 50,000 Cash dividends paid to shareholders 30,000 Net cash flow from operating activities for Year 4 totaled
a. $200,000 b. $250,000 c. $300,000 d. $330,000 e. $220,000
Explain how each of the following items should be reported by a corporation: (1) The accounting department discovered that an entry was made last year to Insurance Expense instead of to Prepaid Insurance. The after-tax effect of the charge to Insurance Expense was $5,000.(2) The accounting department determined the depreciable lives of equipment will be five years instead of the original estimate of seven years.
What will be an ideal response?
Prenuptial agreements are void
Indicate whether the statement is true or false