A company’s stock is currently selling for 28.50. Its next dividend, payable one year from now, is expected to be 0.50 per share

Response:

Clarification:

Last year's customer orders totaled 15000

Predicted orders for next year with a 15% rise = 15000 x 1.15 = 17250

Each customer order takes 1.5 hours to fulfill

Total time needed to satisfy customer orders = 17250 x 1.5 = 25875

Knowing that the standard work year comprises 2000 hours

Hence, the effective work year with a 2% capacity cushion

= Standard work year x ( 1 – Capacity cushion %/100)

= 2000 x 0.98  = 1960 hours

Workers required by manager

= Total time needed for orders / effective work year

= 25875 / 1960  = 13.20, rounded to 13

Thus, the manager will require 13 workers next year

Answer:

Based on the calculations, the amount is $135,000.

Explanation:

Book value of the acquiring company's inventory before the merger = $90,000

Fair value of the acquired inventory = $45,000

Total inventory value post-business combination = $90,000 + $45,000 = $135,000

Thus, the total amount is $135,000

Answer:

To begin with, we require a discount rate; in researching similar questions, I found that the discount rates ranged from 4% to 8%, so I opted for 6%.

The company has two options: continue operating in a competitive market or reduce its prices to eliminate competition.

Utilizing the perpetuity formula, the present value for the first option is calculated as follows: = $10,000,000 / 0.06 = $166,666,667

For the second option, the present value is:

PV of price reduction = $1,000,000,000 / 1.06 = $943,396,226 plus the present value of future net income

The present value of future net income = $50,000,000 / 0.06 = $833,333,333, but this figure must be discounted as the terminal value relates to the end of the current year, not now: $833,333,333 / 1.06 = $786,163,552

Consequently, the NPV associated with lowering prices is $786,163,552 - $943,396,226 = -$157,232,674, indicating this is certainly not a favorable plan.