b. Revising the estimated life of equipment from 10 years to 8 years. c. Not writing off obsolete inventory. d. Reducing research and development expenditures. 2. Prophet Corporation has an extraordinary loss of $200,000, an unusual gain of $140,000, and a tax rate of 40%.
The asset's original cost was $160,000 and this amount was entirely expensed in 2006. This particular asset has a 10-year useful life and no salvage value. The straight-line method was chosen for depreciation purposes. Additional data: 1. Income in 2010 before depreciation expense amount to $400,000 2.
The last 12 month trailing (ttm) net earnings is $14.58 billion with 9 billion shares. What is the 12 month trailing EPS and P/E ratio? a. $1.62, 15.36 b. $2.26, 13.31 c. $1.26, 17.88 d. $2.32, 12.21 e. $1.18, 20.33 Answer: a EPS = NE/Shares
Dawn Tipton ACC-309 Case 19-15 Professor Ed Kaplan Microsoft Corporation- On March 30th 2012 at 7:10pm Microsoft Corporation’s (MSFT) common stock price closed at $32.21 per share. This was a decrease of 0.05 from the previous day’s close of $32.26. While reviewing Microsoft’s past twelve months, I have found that the fifty-two week low was in June 2011 and it closed at $23.65 per share. The stock has some slight fluctuations between June 2011 and mid November 2011. Since November, the stock has shown an increase through mid March 2012 where it reached the fifty-two week high of $32.95 per share.
A) 20% B) 25% C) 10% D) 15% E) None of the above Answer: B Response: r = (120+5-100)/100 = 25% 2. PC Company stockholders expect to receive a year-end dividend of $10 per share and then be sold for $122 dollars per share. If the required rate of return for the stock is 20%, what is the current value of the stock? A) $100 B) $122 C) $132 D) $110 E) None of the above Answer: D Response: P = (122+10)/1.2 = 110 3. The constant dividend growth formula P0 = D1/(r-g) assumes: A) The dividends are growing at a constant rate g forever.
An investor purchased call options for $2 per option. This investor purchased 1,000 of these call options on a stock that has a standard deviation of 20% and an exercise price of $140/share. The investor has a liquidity problem at this point and needs to sell the call options at current value. The current stock price is $120/share and the option will expire in a ½ year. What is the total profit or loss to the investor?
D. AR -To record revenue earned but not yet billed (nor recorded). E. PE -To record expiration of prepaid insurance. 3-9 In its first year of operations, Harden Co. earned $39,000 in revenues and received $33,000 cash from these customers. The company incurred expenses of $22,500 but had not paid $2,250 of them at yearend. Harden also prepaid $3,750 cash for expenses that would be incurred the next year.
The project will run for 10 years, the discount rate is 16%, and an initial investment of $2.1 million is required. The project has no salvage value at the end of 10 years. Ignore taxes. (a) What is the base case NPV? (b) Now, suppose that at the end of the first year, the project can be dismantled and sold for $1.4 million.
They were given a 10% discount by the manufacturer. They paid $400 for shipping and sales tax of $3,000. Stine estimates that the machinery will have a useful life of 10 years and a residual value of $20,000. If Stine uses straight-line depreciation, annual depreciation will be • $3,760. • $4,072.
Category: Finance Value: $9 Status: CLOSED Accepted Answer [pic] Expert: John Mark replied 456 days and 15 hours ago. HI, Thanks XXXXX a not-for-profit business, had revenues of$12 million in 2007. Expenses other than depreciation totaled 75 percent of revenues, and depreciation expense was $1.5million. All revenues were collected in cash during the year and all expenses other than depreciation were paid in cash. 3.