Beckman engineering and associates (bea) is considering a change in its capital structure bea currently has $20 million in debt carrying a rate of 8%, and its stock price is $40 per share with 2 millions shares outstanding. bea is a zero growth firm and pays out all of its earnings as dividends. ebit is $14,933 millions, and bea faces a 40% debt, federal plus-rate-tax rate. the market risk premium is 4%, and the risk-free rate is 6%. bea is considering increasing its debt level to a capital structure with 40% debt, based on market values, and repurchasing shares with the extra money that it borrows. bea will have to retire the old debt in order to issue new debt, and the rate on the new debt will be 9%. bea has a beta of 1.0.

a- what is bea's unlevered beta? use market value d/s when unlevering.
b- what are bea's new beta and cost of equity if it has 40% debt?
c- what are bea's wacc and total value of the firm with 40% debt? .
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White company has two departments, cutting and finishing. the company uses a job-order costing system and computes a predetermined overhead rate in each department. the cutting department bases its rate on machine-hours, and the finishing department bases its rate on direct labor-hours. at the beginning of the year, the company made the following estimates: department cutting finishing direct labor-hours 6,000 30,000 machine-hours 48,000 5,000 total fixed manufacturing overhead cost $ 264,000 $ 366,000 variable manufacturing overhead per machine-hour $ 2.00 " variable manufacturing overhead per direct labor-hour " $ 4.00 required: 1. compute the predetermined overhead rate for each department. 2. the job cost sheet for job 203, which was started and completed during the year, showed the following: department cutting finishing direct labor-hours 6 20 machine-hours 80 4 direct materials $ 500 $ 310 direct labor cost $ 108 $ 360 using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to job 203. 3. would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours, rather than using departmental rates?

Compare the sources of consumer credit(there's not just one answer)1. consumers use a prearranged loan using special checks2. consumers use cards with no interest and non -revolving balances3. consumers pay off debt and credit is automatically renewed4. consumers take out a loan with a repayment date and have a specific purposea. travel and entertainment creditb. revolving check creditc. closed-end creditd. revolving credit

Mordica company identifies three activities in its manufacturing process: machine setups, machining, and inspections. estimated annual overhead cost for each activity is $156,960, $382,800, and $84,640, respectively. the cost driver for each activity and the expected annual usage are number of setups 2,180, machine hours 25,520, and number of inspections 1,840. compute the overhead rate for each activity. machine setups $ per setup machining $ per machine hour inspections $ per inspection