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Get college assignment help at uniessay writers School uestion 2 (15%) A firm buys on terms of 3/15, net 45, It does not take the discount, and it generally pays after 60 days. What is the nominal annual percentage cost of its non-free trade credit, based on a 365-day year? SOLUTION: Question 3 (15 % ) A firm buys on terms of 2/8, net 45 days, it does not take discounts, and it actually pays after 58 days. What is the effective annual percentage cost of its non-free trade credit? (Use a 365-day year.) SOLUTION:
can you suggest 2 poems from a portable anthology second edition by peter schakel that connect and tell me how they connect for me to write a paper on
Duncan has 200,000 bonds outstanding with a face value of $100 each, which have 4 years to maturity and pay an-annual 7% coupon. The yield on the bonds is 6% p.a. Duncan’s marginal corporate tax rate is 30%. Duncan has 6 million preference shares on issue, which are currently trading for $3.50 each, giving a total market value of $21 millign. They pay an annual dividend of 35 cents. Duncan has 5 million ordinary shares on issue, which are currently trading for $8.00 each, giving a total market value of $40 million. These shares have just paid a dividend of $1.10, and this dividend is expected to grow at a constant rate of 2% in perpetuity. What is the market value of Duncan’s bonds? (a) [3 marks] 1 1 FV P =CPN x- 1- (1 y)” (1 y)” 1 1 1- 0.06 20,000,000 =1,400,000 x $20,693.021 1.064 1.06 1 1 1- 0.06 100 or P=7 x- $103.4651 1.06 1.064 PROTAL 200,000×103.4651= $20,693.021 What is Duncan’s cost of preference shares? [2 marks] (b) DivP 0.35 10% 3.50 PP What is Duncan’s cost of ordinary shares? (c) [2 marks] Div (1 g) g Div 1.10(1.02) g 0.02 16% PE PE 8.00 (d) What is Duncan’s WACC? [3 marks] WACC =reE% rP% ro(1-To)D% 40 21 20.693 (0.16) 11.47% 81.693(0.06)(1-0.3) 81.693(0.10) 81.693 [Total for Question C3: 3 2 2 3 = 10 marks]
Question C5 You are thinking of investing in shares in Grey Matter Ltd. The possible returns on Grey Matter shares over the next vear, and the probability of three of those returns, are shown in the following table. Probability Return 8% -4% round to loo 28% 40 % 3% 8 % Ki-001-(oht82 3 13% [2 marks) What is the expected urn on Grey Matter shares? (a) EIR-R.Pr[R.] R,Pr[R,] R, Pr[R. (-0.04)(0.08) (0.03)(0.28) (0.08)(0.4) (0.13)(0.24) 6.84% You are considering investing in a portfolio of shares, including the Grey Matter shares referred to above, as well as shares in White Ice Production Ltd. Details of these shares are shown in the table below. You plan to invest 60 % of your funds in Grey Matter shares and the remainder in White Ice shares. The risk-free rate of return is 2.0 % , and the market risk premium is 7 %. The correlation between the two shares is 0.6. Grey White Ice Matter Expected Return 6.84% 6.5% 4% 6% Standard Deviation Beta (B) 1.1 1.7 [2 marks] What is the expected return on the portfolio? (b) E[R] = w.E[R] w_E[R,] .wE[R,] (0.6)(0.0684) (0.4) (0.065) = 6.704% What is the standard deviation of the portfolio? [3 marks] (c) a, w?SD(R.) w3SD (R,) 2ww,Corr (R,,R.) SD (R, ) SD (R,) VO.6)(0.04) (0.4) (0.06) 2(0.6)(0.4)(0.6)(0.04) (0.06) V0.001843-4.29% Practice Examination Solutions FIN1FOF-Fundamentals of Finance 18
considering an expansion. The necessary equipment would be purchased for $8 million, and the expansion would require an additional $3 million investment in net operating working capital. The Tannen Industries tax rate is 40% . s the initial investment outlay? Round your answer to the nearest dollar. Write out your answer completely. For example million should be entered as 13,000,000. a. What b. The company spent and expensed $10,000 on research related the project last year. Would this change your answer? Why? I. No, last year’s expenditure is consideered a sunk cost and does not represent incremental cash flow, Hence, it should not be included the analysis. II. Yes, the cost of research is an incremental cash flow and should be included in the analysis. III. Yes, but only the tax effect of the research expenses should be included in the analysis. the end of the project’s life. Hence, tshould not be included in the initial investment outlay. IV. No, last year’s expenditure should be treated as a terminal cash flow and dealt with V. No, last year’s expenditure is considered as an opportunity cost and does not represent an incremental cash flow. Hence, it should not be included in the analysis. -5elect- c. The company plans to use a building that it owns to house the project. The building could be sold for $3 million after taxes and real estate commissions. How would that fact affect your answer? of the building represents an opportunity cost ofconducting the project in that building. Therefore, the possible proceeds after taxes and commissions must be charged against the rotect as a cost. II. The potential sale of the building represents an opportunity cost of conducting the project in that building. Therefore, the possible proceeds before taxes and commissions must be charged against the project as a cost. III. The potential sale of the building represents an externality and therefore should not be charged against the project. IV. The potential sale of the building represents a real option and therefore should be charged against the project. V. The potential sale of the building represents a real option and therefore should not be charged against the project. -Select
Colsen Communications is trying to estimate the first-year cash flow (at Year 1) for a proposed project. The financial staff has collected the following information on the project: Sales revenues $15 million Operating costs (excluding depreciation) 10.5 million 3 million Depreciation Interest expense 3 million The company has a 40% tax rate, and its WACC is 11% . Write out your answers completely. For example, 13 million should be entered as 13,000,000. a. What the project’s cash flow for the first year (t 1)? Round your answer to the nearest dollar. b. If this project would cannibalize other projects by $1.5 million of cash flow before taxes per year, how would this change your answer to part a? Round your answer to the nearest dollar. The firm’s project’s cash flow would now be $ c. Ignore part The firm’s project’s cash flow would -Select by $ If the tax rate dropped to 35%, how would that change your answer to part Round your answer to the nearest dollar.
This a Medical Office Procedures class Deliverable Length: 3 pages Details: The billing assistant is out sick today and the office manager has asked you to fill in. Before entering the billing office, you decide to quickly review the office protocol for Medicare insurance billing. While reading the procedure, you notice that a new form is now required for Medicare, and the office is not currently utilizing the new form. After bringing this mistake to the office manager’s attention, you are asked to update the office’s Medicare form and outline a system to help keep the office appraised of Medicare billing and claim submission updates. Produce a basic insurance billing information collection tool and draft a basic policy regarding patient billing. Include protocols for Medicare insurance and private insurance. The AMA council approved Health Insurance Claim form can be accessed for reference from the following website: http://www.cms.hhs.gov/cmsforms/downloads/CMS1500805.pdf
Karsted Air Services is now in the final year of a project. The equipment originally cost $25 mil lion, of which 85 % has been depreciated. Karsted can sell the used equipment today for $6.25 million, and its tax rate is 35 %, What is the equipment’s after-tax salvage value? Round your answer the nearest dollar. Write out your answer completely. For example, 13 million should be entered as 13,000,000.
You must evaluate the purchase of a proposed spectrometer for the R
Exam Structure: Essay questions and small problems. Material allowed: scientific or financial calculator and student’s formula sheet Time: 1hour 15minutes RADING 25% of final mark EXAM QUESTIONS: Problem 1 (15 points) The next dividend payment by ECY, Inc., will be $3.20 per share. The dividends are anticipated to maintain a growth rate of 6 percent, forever. If the stock currently sells for $65 per share, what is the dividend yield? (5 points) What is the required return? (10 points) Problem 2 (20 points) Fifth National Bank just issued some new preferred stock. The issue will pay an annual dividend of $6.5 in perpetuity, beginning four years from now. If the market requires a return of 8 percent on this investment, how much does a share of preferred stock cost today? Problem 3 (15 points) Ramsay Corp. currently has an EPS of $2.5, and the benchmark PE for the company is 17. a. What is your estimate of the current stock price? (8 points) b. If the current price of the stock is $62, would you buy it? How confident do you feel about your decision? (7 points) Problem 4 (30 points) Lohn Corporation is expected to pay the following dividends over the next four years: $12, $7, $6, and $3. Afterwards, the company pledges to maintain a constant 3.5 percent growth rate in dividends forever. Assuming that the stock’s beta is of 1.12 and that the risk-free rate of return is 2.75% and the a. average market return is 11.5%, determine the required return on the stock. (10 points) www.euruni.edu 2
Get college assignment help at uniessay writers An electric utility is considering a new power plant in northern Arizona. Power from the plant would be sold in the Phoenix area, where it is badly needed. Because the firm has received a permit, the plant would be legal; but it would cause some air pollution. The company could spend an additional $40 million at Year 0 to mitigate the environmental problem, but it would not be required to do so. The plant without mitigation would cost $210.17 million, and the expected cash inflows would be $70 million per year for 5 years. If the firm does invest in mitigation, the annual inflows would be $76.12 million. Unemployment in the area where the plant would be built high, and the plant would provide about 350 good jobs. The risk adjusted WACC is 17%. Calculate the NPV and IRR with mitiqation. Round your answers to two decimal places. Enter your answer for NPV in millions. Do not round your intermediate calculations. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign NPV $ million IRR Calculate the NPV and IRR without mitigation. Round your answers to two decimal places. Enter your answer for NPV in millions. Do not round your intermediate calculations. For example, an answer of $10,550,000 should be entered as 10.55. NPV $ million IRR 0% How should the environmental effects be dealt with when evaluating this project? I. If the utility mitigates for the environmental effects, the project is not acceptable. However, before the company chooses to do the project without mitigation, it needs to make . “ill will” for not mitigating environmental effects have bee onsidered in the origin analysis. any costs which they actually occur II. The environmental effects should be treated as a remote possibility and should only be considered at the time III. The environmental effects if not mitigated would result in additional cash flows. Therefore, since the plant is legal without mitigation, there are no benefits to performing a “no mitigation” analysis. legal without mitigation. IV. The environmental effects should be ignored since the plant V. The environmental effects should be treated as a sunk cost and therefore ignored. -Select- Should this project be undertaken? I. The project should be undertaken since the IRR is positive under both the “mitigation” and “no mitigation” assumptions. II. The project should be undertaken since the NPV is positive under both the “mitigation” and “no mitigation” assumptions. wi considered undertaken. I! negative NPV, so it should IV. The project should be undertaken only if they do not mitigate for the environmental effects. However, they want to make sure that they’ve done the analysis properly due to any additional “costs” that might result from undertaking th project without concern for the environmental impacts. v. The project should be undertaken only under the “mitigation” assumption. -Select-
considering two projects with the following cash flows (in millions) Your division 0 2 3 Project A -$27 $13 $17 $8 Project B -$25 $14 $11 $2 What are the projects’ NPVS assuming the WACC is 5%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign. million Project A Project B million What are the projects’ NPVs assuming the WACC is 10%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer n millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign Project A million Project B million What are the projects’ NPVs assuming the WACC is 15%? Round your answer t two decimal places. Do not round your intermediate calculations. Enter your answer millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign. Project A million Project B million 5% Round your answer to two decimal places. Do not round your intermediate calculations. What are the projects’ IRRS assuming the WACC Project A % Project B % 10% Round your answer to two decimal places. Do not round your intermediate calculations. What are the projects’ IRRs assuming the WACC Project A % Project B What are the projects’ IRRS assuming the WACC is 15%? Round your answer to two decimal places. Do not round your intermediate calculations. Project A % Project B c. If the WACC was 5% and A and were mutually exclusive, which project would you choose? (Hint: The crossover rate is 90.37%.) -Select- If the WACC was 10% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 90.37%.) -Select If the WACC was 15% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 90.37%.) -Select-
Business School b. What is the current share price? (20 points) Problem 5 (20 points) Mau Corporation stock currently sells for $72 per share, The market requires a return of 9.25 percent on the firm’s stock. If the company maintains a constant 5 percent growth rate in dividends, what was the most recent dividend per share paid on the stock?
As a member of Rossi Corporation’s financial staff, you must estimate the Year 1 cash flow for a proposed project with the following data. What is the Year 1 cash flow? Sales revenues, each year Depreciation Other operating costs Interest expense Tax rate $34,750 $10,000 $17,000 $4,000 45.0% $12,298 $13,696 $13,313 $12,438 $12,063
Gisco Ltd will Pay on annual divi den d of $5 next year the pre dic hon tor dividend grow th will b cons taunt yeor Wow much is rehan is S tock @ yar Teavired 15 7 the rice of Tequie d retm is lo ho w me ch your price of s tork you Can draw (What conclosi on trom answer Jpart 6 is Part A
ber anauahon OL Danny de osite d $3000 in to a hiTleen yearS ago. Eigh years ago, he Pued pappo a ddi heras us arount. He 2 e the poinded seai-aer 1500 oun ded years the las eigh years earned 7 % (om annua Rea wired Caicularr the annu al atr he get tos t ei gt y eas de es has He Hew mu ch meney he wkh he heve 15000 FUnd compounding anavaily) be A SSU nhus arioyat hd Supperaabn the inter es rale in the lest
Hemp hag to e valvate the te asbi스 new prajer with 아 마ital is cas h flows IS a Hotel AmoTa ot inves hing 105, 000 ive- year ite The irm’s cost in a be low cash the projec te d 12 CF YeaT $30,000 30,000 $30, 000 $ 30, 000 $30, 000 Y 5 Calculate the NPv advi se. the the projert Pay back kJRR kplease they chould attep whe ther not
05/281TN Tokyo Disneyland and the DisneySea Park: Corporate Govemance and Differehcesen Capital Budgeting Concepts and Methods Between American and Japanese Companies Prepare OL’s pro forma future financial data for the new project for 1998-2004. The company’s past data is shown in Exhibit 2. Use the assumptions In Appendix 1 given in the case. 5. The project is not justified since AAR is negative. 6. Calculate the terminal value for DisneySea Park to be used for the American methods. ehet operating.cash Nov 5th year) The terminal value 244.7 WACC 0.0565 US$4,331.0million 7. Using the data fronm Exhibit 7, calculate NPV and IRR for the Tokyo DisneySea Park. Together with the initial investment in 2000 and tha tarmminal. HSearch Results x HHarvard Busine X H Harvard Busine X Harvard Busin x Dory Da- ownload?url-/catalog % 2Fteaching-note/HKUS69-PDF-ENG % 2Fcontent
INSTRUCTIONS Exam Structure: Practical and theoretical questions Material allowed: formula sheet, calculator, pens. Time: 1h30 GRADING This exam represents the 4th summative assignment and accounts for 25 % of the final course graade. EXAM QUESTIONS: Question 1(20 %) Dew Corporation has the following data, in thousands. Assuming a 365-day year, what is the irm’s cash cycle? How does it compare to its competitors? Annual sales = Annual cost of goods sold Average Inventory Average Accounts receivable Average Accounts payable E45,000 €31,500 E4,000 €2,000 2,400 Benchmark Cash Cycle (industry average) 52.00 SOLUTION:
INSTRUCTIONS Exam Structure: Practical and theoretical questions. Material allowed: formula sheet, calculator, pens. Time: 1h30 GRADING This exam represents the 4th summative assignment and accounts for 25 % of the final course grade. EXAM QUESTIONS: Question 1(20%) Dew Corporation has the following data, in thousands. Assuming a 365-day year, what is the im’s cash cycle? How does it compare to its competitors? Annual sales = Annual cost of goods sold Average Inventory Average Accounts receivable Average Accounts payable Benchmark Cash Cycle (industry average) E45,000 €31,500 E4,000 E2,000 €2,400 52.00 SOLUTION
Deliverable Length: 3 pages Details: The billing assistant is out sick today and the office manager has asked you to fill in. Before entering the billing office, you decide to quickly review the office protocol for Medicare insurance billing. While reading the procedure, you notice that a new form is now required for Medicare, and the office is not currently utilizing the new form. After bringing this mistake to the office manager’s attention, you are asked to update the office’s Medicare form and outline a system to help keep the office appraised of Medicare billing and claim submission updates. Produce a basic insurance billing information collection tool and draft a basic policy regarding patient billing. Include protocols for Medicare insurance and private insurance. The AMA council approved Health Insurance Claim form can be accessed for reference from the following website: http://www.cms.hhs.gov/cmsforms/downloads/CMS1500805.pdf
The post Question: School Uestion 2 (15%) A Firm Buys On Terms Of 3/15, Net 45, It Does Not Take The Discount, And It Generally Pays After 60 Days. What Is The Nominal Annual Percentage Cost Of Its Non-free Trade Credit, Based On A 365-day Year? SOLUTION: Question 3 (15 % ) A Firm Buys On Terms Of 2/8, Net 45 Days, It Does Not Take Discounts, And It Actually Pays After … appeared first on uniessay writers.
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