Use the following information to answer question 10 and 11: Smashmedia Inc. has two outstanding bond issues: Bond A has a par value of $1000, has a coupon rate of 8% which it pays annually; Bond A matures in 5 Years and is currently trading at $738.06. Bond B matures in 3 year, pays 5% annual coupon, has a par value of $1000, and is currently trading at $791.05. In addition to the two bonds, Smashmedia also has a 10-Year loan with Deutsche Bank at an interest rate of 7%. Assume that the weights for the three borrowing sources are: 25% for Bond A; 25% for Bond B; and 50% for the 10-Year loan. Finally, the tax rate for firm X is T=25%. 1) What is the pre-tax cost of debt for Smashmedia Inc.?
2) What is the after-tax cost of debt for Smashmedia Inc?

while setting up his new office, an attorney ordered thick, frieze carpets for the floor. however, the building inspector had him remove the expensive carpeting. the building inspector stated that according to federal regulations, the office must be wheelchair accessible as it is a public area. he further explained that since wheelchairs do not maneuver well in thick, frieze carpeting, the carpets had to be removed and be replaced with smooth-textured carpets that do not restrict wheelchair maneuverability. this scenario illustrates how a company is influenced by the component of its specific environment.

Profits from using currency options and futures. on july 2, the two-month futures rate of the mexican peso contained a 2 percent discount (unannualized). there was a call option on pesos with an exercise price that was equal to the spot rate. there was also a put option on pesos with an exercise price equal to the spot rate. the premium on each of these options was 3 percent of the spot rate at that time. on september 2, the option expired. go to the oanda. com website (or any site that has foreign exchange rate quotations) and determine the direct quote of the mexican peso. you exercised the option on this date if it was feasible to do so. a. what was your net profit per unit if you had purchased the call option? b. what was your net profit per unit if you had purchased the put option? c. what was your net profit per unit if you had purchased a futures contract on july 2 that had a settlement date of september 2? d. what was your net profit per unit if you sold a futures contract on july 2 that had a settlement date of september 2

Computing equivalent units is especially important for: (a) goods that take a relatively short time to produce, such as plastic bottles. (b) goods with sustainability implications in their production processes. (c) goods that are started and completed during the same period. (d) goods that take a long time to produce, such as airplanes.