#### Felton Co. sells major household appliance service contracts for cash. The service contracts are for a one-year, two-year, or three-year period.

Felton Co. sells major household appliance service contracts for cash. The service contracts are for a one-year, two-year, or three-year period. Cash receipts from contracts are credited to unearned service contract revenues. This account had a balance of \$480,000 at December 31, 2009 before year-end adjustment. Service contract costs are charged as incurred to the service contract expense account, which ...

#### Calculate an equivalent annual income stream for 20 years based on the following income stream received over 30 years assuming an interest rate of

Calculate an equivalent annual income stream for 20 years based on the following income stream received over 30 years assuming an interest rate of 10% per annum compounded annually (in other words, convert the stream of payments over 30 years into a stream of payments over 20 years) : Yrs 1-15 \$15,000pa Years 16-20 \$20,000pa ...

#### Alpha Company purchased a \$1,000, 5 years, 5% bond on July 1, 2015 for \$950. Interest is paid semi-annually on June 30. The straight line method of…

Alpha Company purchased a \$1,000, 5 years, 5% bond on July 1, 2015 for \$950. Interest is paid semi-annually on June 30. The straight line method of amortization is used for both premiums & discounts. Use this information to prepare the adjusting General Journal entry (without explanation) for the December 31, 2017 ...

#### Inflation represents an external impact upon future returns. Purchasing power decreases in times of inflation.

Inflation represents an external impact upon future returns. Purchasing power decreases in times of inflation. When an investor considers future returns of his or her portfolio, it is critical to consider inflation and build this variable into their analysis. In many cases, the impact can be significant especially in terms of retirement portfolios where the time horizon can be 10, ...

#### Calculate the WACC for Martin Industries given: A tax rate of 34%, the market return is 13.2% and the risk-free rate is 4. 7,500 preferred stock…

Calculate the WACC for Martin Industries given: A tax rate of 34%, the market return is 13.2% and the risk-free rate is 4.5%. 7,500 preferred stock shares selling at \$88/share with a 6% dividend rate. 265,000 common shares outstanding selling for \$76/share. The stock has a beta of 0.92 and will pay a dividend of \$2.48 next year. The dividend ...

#### Photochronograph Corporation (PC) manufactures time series photographic equipment. It is currently at its target debtequity ratio of .

3. Increased use of accounts payable financing: Because this financing is part of the company's ongoing daily business, it has no flotation costs, and the company assigns it a cost that is the same as the overall firm WACC. Management has a target ratio of accounts payable to long-term debt of .15. (Assume there is no difference between the pretax ...