Corporation X needs $1,000,000 and can raise this through debt at an annual rate of 10 percent, or preferred stock at an annual cost of 7 percent. If the corporation has a 40 percent tax rate, the after-tax cost of each is ________
A) debt: $100,000; preferred stock: $70,000
B) debt: $60,000; preferred stock: $42,000
C) debt: $60,000; preferred stock: $70,000
D) debt: $100,000; preferred stock: $42,000
C
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Which of the following is an example of a wasting asset?
a. timber b. land c. equipment d. building
Fern's Flowers established a $400 petty cash fund. The following expenditures were made from the fund:Office supplies$129.00Shipping expense86.50Maintenance expense48.68Miscellaneous expenses44.35A count of the cash in the fund revealed a balance of $89.00.Required:a) Enter the event relating to establishing the fund into the horizontal financial statements model. Indicate dollar amounts of increases and decreases; for accounts that are not affected, indicate NA. For cash flows, show whether they are operating activities (OA), investing activities (IA), or financing activities (FA).b) Assets=Liab.+Stk. EquityRev.?Exp.=Net IncomeStmt. of Cash FlowsCash+Petty Cash???????????????????????b) What is the amount of the check that must be written
to replenish the fund?c) Assuming the company combines the entries to record the disbursements and to replenish the petty cash fund, prepare the general journal entry. What will be an ideal response?
Austin's Pub Supply uses the periodic inventory system and the gross method of accounting for sales. The company had the following sales transactions during August:August 2Sold merchandise to Jo's Pub and Grub on credit for $3,750, terms 2/15, n/60. The items sold had a cost of $1,200. August 4 Jo's Pub and Grub returned merchandise that had a selling price of $300. The cost of the merchandise returned was $110.August 13Jo's Pub and Grub paid for the merchandise sold on August 2, taking any appropriate discount earned.Prepare the journal entries that Austin's Pub Supply must make to record these transactions.
What will be an ideal response?
The Prosthetic Legs and Arms Act (PLAA) sets up a no-fault compensation program for persons injured throughthe use of medical prostheses. The PLAA protects prosthesis makers from liability for unavoidable side effects. When Quint is injured in an auto
accident, his physicianprescribes and fits him for a certain prosthetic. When Quint suffers injuries from its use, he, files a suit against Replacement Limbs LLC, the maker of the prosthetic, alleging strict product liability. Is there a defense that Replacement Limbs might successfully assert in this case? If so, what is it, and why?