Answer:
It will take 1 year and 307 days to cover the initial investment.
Explanation:
Giving the following information:
Initial investment= $6,900
Cash flows:
Cf1= $4,200
Cf2= $5,100
Cf3= $6,300
Cf4= $5,500
Discount rate= 15%
<u>The payback period is the time required to cover the initial investment. We need to discount each cash flow.</u>
<u></u>
Year 1= 4,200/1.15 - 6,900= -3,247.83
Year 2= 5,100/1.15^2 - 3,247.83= 608.50
<u>To be more accurate:</u>
(3,247.83 / 3,856.33)*365= 307 days
It will take 1 year and 307 days to cover the initial investment.
Answer:
B. causing the interest expense to be lower than the bond interest paid
Explanation:
Answer:
Jones may decide that the equity method would not be appropriate to account for the investment when Jones Company does not have significant influences over the management/operation of Sandridge Company.
Although an investors holding from 25% of investee is very much likely to have significant influences on the investee, this may not be true all over the times. For Jones, to prove that it does not have significant influences over Sandridge, there may be some following evidences:
+ Jones and Sandridge sign an agreement that Jones surrenders significant rights as a shareholder;
+ There is/are investor(s)/group(s) of investors who has more voting right than Jones and whose visionary/mission for Sandridge is opposite to Jones's.
+ Sandridge tries to reject Jones' influences on its management by seeking lawsuit or by successfully prevent representatives from Jones on its Board of Directors.
Explanation:
Answer:
"trading fortress."
Explanation:
Trade can be defined as a process which typically involves the buying and selling of goods and services between a producer and the customers (consumers) at a specific period of time.
Firms outside of trading areas run the risk of being shut out of the single market by the creation of a "trade fortress." A trade fortress serves as a barrier for the exchange of goods and services.
Free trade policy includes the adoption and implementation of tariffs and quotas between countries.
Trade policies tariffs and quotas will most likely benefit domestic producers of the protected good and harm domestic consumers of the protected good as they're made to pay for the consumption of imported products. Hence, under free trade there are more societal benefits due to the specialization of domestic goods.
Tariffs can reduce both the volume of exports and imports in a country.
