Author Question: You are planning to purchase the stock of Ted's Sheds Inc and you expect it to pay a dividend of 3 ... (Read 38 times)

jlmhmf · **on:** Jul 10, 2018

You are planning to purchase the stock of Ted's Sheds Inc and you expect it to pay a dividend of 3 in 1 year, 4.25 in 2 years, and 6.00 in 3 years. You expect to sell the stock for 100 in 3 years.

If your required return for purchasing the stock is 12 percent, how much would you pay for the stock today?
A) 75.45
B) 77.24
C) 81.52
D) 85.66

Question 2

Cash and Equivalents are 1,561; Short-Term Investments are 1,052; Accounts Receivables are 3,616; Accounts Payable are 5,173; Short-Term Debt is 288; Inventories are 1,816; Other Current Liabilities are 1,401; and Other Current Assets are 707.

What is the amount of Total Current Liabilities?
A) 8,752
B) 6,974
C) 6,862
D) 6,574

phuda · **Reply #1 on:** Jul 10, 2018

Answer to Question 1

C

Answer to Question 2

Answer: C
Explanation: C) Total Current Liabilities = Accounts Payable + Short-Term Debt + Other Current Liabilities = 5,173 + 288 + 1,401 = 6,862.