Accounts recelvable 20,000 Accounts payable 15,000 Common stock Building Land 145,000 Calculate the missing amounts, the company has total assets of $1,000,000. [Choose] Building: [ Choose] Common stock:
Cost of Capital
Shareholders and investors who invest into the capital of the firm desire to have a suitable return on their investment funding. The cost of capital reflects what shareholders expect. It is a discount rate for converting expected cash flow into present cash flow.
Capital Structure
Capital structure is the combination of debt and equity employed by an organization in order to take care of its operations. It is an important concept in corporate finance and is expressed in the form of a debt-equity ratio.
Weighted Average Cost of Capital
The Weighted Average Cost of Capital is a tool used for calculating the cost of capital for a firm wherein proportional weightage is assigned to each category of capital. It can also be defined as the average amount that a firm needs to pay its stakeholders and for its security to finance the assets. The most commonly used sources of capital include common stocks, bonds, long-term debts, etc. The increase in weighted average cost of capital is an indicator of a decrease in the valuation of a firm and an increase in its risk.
![35000
Accounts recelvable
20,000
Accounts payable
15,000
Common stock
Building
Land
145,000
Calculate the missing amounts, the company has total assets of $1,000,000.
[Choose]
Building:
[ Choose]
Common stock:
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Financial statements are used by the stakeholders for decision-making. It includes income statements, balance sheets, cash flow statements. The total assets are equal to the sum of total liabilities and stockholders' equity.
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