Problem 1-06A bWildhorse Co. was formed on January 1, 2022. At December 31, 2022, Miko Liu, the president and sole stockholder, decided to prepare a balance sheet, which appeared as follows. Wildhorse Co. Balance SheetDecember 31, 2022AssetsLiabilities and Stockholders’ EquityCash$22,000Accounts payable$30,600Accounts receivable51,000Notes payable14,200Inventory38,000Boat loan19,700Boat23,500Stockholders’ equity70,000Miko willingly admits that she is not an accountant by training. She is concerned that her balance sheet might not be correct. She has provided you with the following additional information.1. The boat actually belongs to Miko, not to Wildhorse Co.. However, because she thinks she might take customers out on the boat occasionally, she decided to list it as an asset of the company. To be consistent, she also listed as a lia

Which of the following best explains how the invention of money affected the barter system? a. the invention of money supplemented the barter system by providing a nonperishable medium of exchange b. the invention of money completely replaced the barter system with a free-market system c. the invention of money had no effect on the barter system d. the invention of money drastically reduced the value of goods used in the barter system 2b2t

If a firm plans to issue new stock, flotation costs (investment bankers' fees) should not be ignored. there are two approaches to use to account for flotation costs. the first approach is to add the sum of flotation costs for the debt, preferred, and common stock and add them to the initial investment cost. because the investment cost is increased, the project's expected return is reduced so it may not meet the firm's hurdle rate for acceptance of the project. the second approach involves adjusting the cost of common equity as follows: . the difference between the flotation-adjusted cost of equity and the cost of equity calculated without the flotation adjustment represents the flotation cost adjustment. quantitative problem: barton industries expects next year's annual dividend, d1, to be $1.90 and it expects dividends to grow at a constant rate g = 4.3%. the firm's current common stock price, p0, is $22.00. if it needs to issue new common stock, the firm will encounter a 6% flotation cost, f. assume that the cost of equity calculated without the flotation adjustment is 12% and the cost of old common equity is 11.5%. what is the flotation cost adjustment that must be added to its cost of retaine

Ursus, inc., is considering a project that would have a five-year life and would require a $1,650,000 investment in equipment. at the end of five years, the project would terminate and the equipment would have no salvage value. the project would provide net operating income each year as follows (ignore income taxes.):