Dane Co. both purchases and constructs various equipment it uses in its operations. The following items for two different types of equipment were recorded in random order during the calendar year 2015.
Cash paid for equipment, including sales tax of $6,400 $134,400
Freight and insurance cost while in transit 2,560
Cost of moving equipment into place at factory 3,968
Wage cost for technicians to test equipment 5,120
Insurance premium paid during first year of operation on this equipment 1,920
Special plumbing fixtures required for new equipment 10,240
Repair cost incurred in first year of operations related to this equipment 1,664
Construction Material and purchased parts (gross cost $256,000; failed to take 2% cash discount) $256,000
Imputed interest on funds used during construction (stock financing) 17,920
Labor costs 243,200
Allocated overhead costs (fixed-$25,600; variable-$38,400) 64,000
Profit on self-construction 38,400
Cost of installing equipment 5,632
Required:
1. Compute the total cost to be capitalized for each of these two pieces of equipment.

Calculate the cost of each capital component—in other words, the after-tax cost of debt, the cost of preferred stock (including flotation costs), and the cost of equity (ignoring flotation costs). use both the capm method and the dividend growth approach to find the cost of equity. calculate the cost of new stock using the dividend growth approach. what is the cost of new common stock based on the capm? (hint: find the difference between re and rs as determined by the dividend growth approach and then add that difference to the capm value for rs.)assuming that gao will not issue new equity and will continue to use the same target capital structure, what is the company’s wacc? e. suppose gao is evaluating three projects with the following characteristics. each project has a cost of $1 million. they will all be financed using the target mix of long-term debt, preferred stock, and common equity. the cost of the common equity for each project should be based on the beta estimated for the project. all equity will come from reinvested earnings. equity invested in project a would have a beta of 0.5 and an expected return of 9.0%.equity invested in project b would have a beta of 1.0 and an expected return of 10.0%.equity invested in project c would have a beta of 2.0 and an expected return of 11.0%.analyze the company’s situation, and explain why each project should be accepted or rejected g

Lillypad toys is a manufacturer of educational toys for children. six months ago, the company's research and development division came up with an idea for a unique touchscreen device that can be used to introduce children to a number of foreign languages. three months ago, the company produced a working prototype, and last month the company successfully launched its new device on the commercial market. what should lillypad's managers prepare for next? a. increased competition from imitators b. a prolonged period of uncontested success c. a sharp decline in demand for the product d. a difficult struggle to move from invention to innovation

Tl & co. is following a related-linked diversification strategy, and soar inc. is following a related-constrained diversification strategy. how do the two firms differ from each other? a. soar inc. generates 70 percent of its revenues from its primary business, while tl & co. generates only 10 percent of its revenues from its primary business. b. soar inc. pursues a backward diversification strategy, while tl & co. pursues a forward diversification strategy. c. tl & co. will share fewer common competencies and resources between its various businesses when compared to soar inc. d. tl & co. pursues a differentiation strategy, and soar inc. pursues a cost-leadership strategy, to gain a competitive advantage.