11. Interest calculated on principle that includes previously earned interest is referred to as:
Cool Shoes Inc. is considering buying new equipment costing $40,000 that enables them to save pre
tax $15,000 per year for four years.
They can depreciate the equipment $10,000 per year for the four years.
Their tax rate is 40%.
What is the NPV of this equipment if Cool Shoes
Inc. uses a hurdle rate of 12%
annually to analyze this investment?
13.Which of these shareholders will get a dividend that was declared on December 11
for shareholders on
the date of record of December 20
to be paid on Jan 4
Sandy sold her shares on Jan 3
Bill sold his shares on December 17
Jane sold her shares on December 7
Bob purchased his shares on December 26