Leverage and the cost of capital spam corp. is financed entirely by common stock and has a beta of 1.0. the firm is expected to generate a level, perpetual stream of earnings and dividends. the stock has a price–earnings ratio of 8 and a cost of equity of 12.5%. the company’s stock is selling for $50. now the firm decides to repurchase half of its shares and substitute an equal value of debt. the debt is risk-free, with a 5% interest rate. the company is exempt from corporate income taxes. assuming mm are correct, calculate the following items after the refinancing: a. cost of equity
b. overall cost of capital (wacc)
c. price-earnings ratio
d. stock price
e. stock's beta

Lauer corporation uses the periodic inventory system and has provided the following information about one of its laptop computers: date transaction number of units cost per unit 1/1 beginning inventory 210 $ 910 5/5 purchase 310 $ 1,010 8/10 purchase 410 $ 1,110 10/15 purchase 255 $ 1,160 during the year, lauer sold 1,025 laptop computers. what was cost of goods sold using the lifo cost flow assumption?

Swathmore clothing corporation grants its customers 30 days' credit. the company uses the allowance method for its uncollectible accounts receivable. during the year, a monthly bad debt accrual is made by multiplying 3% times the amount of credit sales for the month. at the fiscal year-end of december 31, an aging of accounts receivable schedule is prepared and the allowance for uncollectible accounts is adjusted accordingly. at the end of 2012, accounts receivable were dollar 586.000 and the allowance account had a credit balance of dollar 50,000. accounts receivable activity for 2013 was as follows: the company's controller prepared the following aging summary of year-end accounts receivable: prepare a summary journal entry to record the monthly bad debt accrual and the write-offs during the year. (if no entry is required for a particular event, select "no journal entry required" in the first account field.) prepare the necessary year-end adjusting entry for bad debt expense. (if no entry is required for an event, select "no journal entry required" in the first account field.) what is total bad debt expense for 2013? calculate the amount of accounts receivable that would appear in the 2013 balance sheet?

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