Answer the Following Question(s)using the Information Below

question 5

Multiple Choice

Answer the following question(s) using the information below:
Coldbrook Company has two sources of funds: long-term debt with a market and book value of $15 million issued at an interest rate of 10%,and equity capital that has a market value of $9 million (book value of $5 million) .Coldbrook Company has profit centres in the following locations with the following operating incomes,total assets,and current liabilities.The cost of equity capital is 15%,while the tax rate is 30%.

-What is the for Stonybrook?

• A)$1,108,000
• B)$1,168,700
• C)$1,315,063
• D)$1,403,063
• E)$994,188

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Definitions:

Constructive Trust

An equitable remedy imposed by a court to prevent unjust enrichment, treating the holder of property as if they were a trustee of it for the benefit of another.

Lakeside Lot

A piece of land located adjacent to, or in close proximity to, a lake.

Possession

The act of having control over something or owning something, either physically or legally.

Agent's Compensation

The payment or reward given to an agent for services performed as outlined in the agency agreement between the agent and the principal.