CHAPTER 11: THE COST OF CAPITAL LEARNING GOALS: 1. Understand the key assumptions‚ the basic concept and the specific sources of capital associated with the cost of capital. 2. Determine the cost of long-term debt and the cost of preferred stock. 3. Calculate the cost of common stock equity and convert it into the cost of retained earnings and the cost of new issues of common stock. 4. Calculate the weighted average cost of capital (WACC) and discuss alternative weighing schemes.
Premium Balance sheet Generally Accepted Accounting Principles Asset
Alternatives and recommendation: Decision criteria: 1. Enables CRL to achieve its 20% annual growth goal. 2. Does not distract SPAFAS’s continual expansion in United States. Alternatives: 1. CRL invests $2 million to build a joint-venture with Alpes. Pros: Cons: It fills up CPL’s "strategic growth gap" It is a potential distraction for SPAFAS’s development in U.S. It facilitates SPAFAS’s expansion into international market There is "uncertain market and unstable currency" in Mexico Alpes has
Premium Investment Rate of return
Capital markets:Meaning: Capital markets are markets where people‚ companies‚ and governments withmore funds than they need (because they save some of their income) transfer those funds to people‚ companies‚ or governments who have a shortage of funds(because they spend more than their income). Stock and bond markets are twomajor capital markets. Capital markets promote economic efficiency bychannelling money from those who do not have an immediate productive use for it to those who do.Capital markets
Premium Stock market Investment Stock
Capital Leases vs. Operating Leases - What’s the Difference? Which One Should I Use for Equipment Leasing? Leasing equipment is a common alternative to purchase. Of the two kinds of leases - capital leases and operating leases - each is used for different purposes and results in differing treatment on the accounting books of a business. Capital Leases •Capital leases are used for long-term leases and for items that not become technologically obsolete‚ such as many kinds of machinery.
Premium Lease Finance lease Leasing
like my life. So I just use my imagination. If it ever came down to the point where‚ to make a part better‚ I had to lose a little bit of my sanity‚ I wouldn’t do it. I would just do comedies. 2. Today‚ I will inform you about Jennifer Lawrence. 3. Jennifer Lawrence is my superstar because of the things she goes through as a superstar‚ all the positive outcomes of her stardom and why I look up to her. Body of the Speech – I. The things she goes through as a superstar A. She never has much family
Premium Actor Film Entertainment
Capital Punishment Capital punishment‚ also known as the death penalty‚ is the toughest form of punishment enforced today in the United States. According to the online Webster dictionary‚ capital punishment is defined as “the judicially ordered execution of a prisoner as a punishment for a serious crime‚ often called a capital offence or a capital crime” (1). In those jurisdictions that practice capital punishment‚ its use is usually restricted to a small number of criminal offences‚ principally
Premium Capital punishment Crime Prison
INTRODUCTION Venture capital‚ a financial innovation of the twentieth century‚ is a long-term liquid investment‚ which can be in the form of equity‚ quasi-equity and sometimes debt in new and high-risk ventures. Venture capital became better known after the famous legend of Apple Computers‚ which started out in the US in 1977 with the capital firm‚ Arthur Rock & Co. Apple Computers then made it to the Fortune 500 and Arthur Rock & Co. attained height in Venture capital industry. However the success
Premium Venture capital
In Romeo and Juliet‚ Friar Lawrence acts as a confidant to Romeo although he has a duty to maintain‚ towards all the people of Verona. He makes a lot of decisions which are central in the development of the play. The morality behind many of his decisions is debatable‚ and his actions undoubtedly prompted by good intentions‚ ended in the death of Romeo and Juliet. We first meet Friar Lawrence early in the morning‚ collecting herbs and flowers. His soliloquy brings about his similarity between
Premium
Research Focus: Sports & Fair Play Dilemma: Pragmatism versus idealism Understanding the current reality 1. What are the ideas of fair play in sports? a) What principles and/or value lie behind the ideals of fair play? ’Fair play’ is usually understood to mean using only tactics that are in accord with the spirit of the sport. In ethics‚ the concept of fairness involves treating everyone equally and impartially. It is complex notion that comprises and embodies a number of values
Premium Olympic Games International Olympic Committee Summer Olympic Games
Bill Kozel Ms. Livingston English Comp 2 18 September 2012 Alternative Fuels in America On a national average the world uses 87.8 million barrels of crude oil on a daily basis. In 2000 it was estimated that the US alone consumed nearly 20 million barrels of oil a day‚ which is about 5% more than similar nations (Friedman 195). Oil consumption is only going to increase until it peaks‚ then it will steadily decrease as oil supply goes down. It is predicted that oil consumption will peak by the year
Premium Petroleum Internal combustion engine Biofuel