Finance question and answers for October 09, 2023
- Q (c) You have commenced work as a certified Financial Planner.Your supervisor has provided the following financial data for a newclient Brant Jerome. The client turned 34 years old today and...
- Q (a) Your daughter has expressed a wish to attend university whenshe finishes school in five (5) years. You anticipate the cost willbe $60,000 at the time she commences university. If...
- Q 1.What is meant by limited liability?2.Why do most professionals consider the Wilshire 5000 abetter index of the performance of the broad stock market than theDow Jones Industrial Average?3.What options position...
- Q 2. Describe the construction of stock market indexes.3. How would you calculate the profit or loss on investmentsin options and future contracts?
- Q (Hedgingprinciple?)A popular theory for managing risk to the firm that arises outof its management of working capital? (that is, current assets andcurrent? liabilities) involves following something called theprinciple of? self-liquidating...
- Q Lindsey was recently hired by Swift Ltd. as a junior budgetanalyst. She is working for the Venture Capital Division and hasbeen given for capital budgeting projects to evaluate. She mustgive...
- Q Raising Extra CapitalAs companies mature, their business needs change. This typicallycauses the need to raise extra capital to begin an expansionproject. An influx of capital funding may be necessary to...
- Q Use the following information to compute Fixed costs,Depreciation, and Operating Cash Flow:Price perunit 71.00Variable cost perunit 52.75Cash Break EvenQuantity 7,500 unitsAccounting Break EvenQuantity 9,800 unitsFinancial Break EvenQuantity 13,000 unitsFixed costsDepreciationOperating Cash Flow
- Q Draft a spreadsheet showing financial history and projectedperformance for Nordstrom. The rows should include revenue,expenses, calculated profit, and calculated profit margin. Thecolumns should represent years: two years of history, plus...
- Q The manager of Golden Ray Corporation receives a bonus ifcompany profits exceed $1,000,000 this year. During the final weekof the year, the manager changes an accounting policy that willincrease reported...
- Q analysis line 17 to 21RATIOS ANALYSISManagement Effectiveness (%)E. commerceAmazonEBay17) Return On Assets7.16%7.34%8.61%18) Return On Investment9.71%11.66%10.41%19) Return On Equity15.72%21.12%34.55%Dividends 20) Dividend Yield17.20%01.39%21) Payout Ratio0.02%012.60%
- Q One year ago, you purchased a stock at a price of $57.16 pershare. Today, you sold 4) your stock at a loss of 18.11 percent.Your capital loss was $12.21 per...
- Q Suppose you have 25 years until you retire, and that you desirea retirement nest-egg of $2,500,000 on the day you retire. Supposealso that you’ve saved $100,000 toward your retirement so...
- Q 5. XYZ plc has been offered the following quotes foroptions on the dollar given a current market price of60 pence: Strike price of dollar in pence Call premium Put premium 1 year...
- Q For the following bond,Par value: $1,000Coupon rate: 8% paid annuallyTime to maturity: 3 yearsInterest rate: 3%What is the convexity? Also, if the interest rate increases from3% to 4%, what is...
- Q ANALYSIS each line1 to 5RATIOSANALYSISProfitability Ratios (%)E. commerceAmazonEBay1)Gross Margin43%41.27%77.37%2)EBITD Margin028.79%31.48%3)Operating Margin9.41%5.96%22.17%4)Pretax Margin22.33%5.57%24.38%5) Effective Tax Rate21%0%6.99%
- Q Based on the following:The estimated purchase price for the equipment required to movethe operation in-house would be $500,000. Additional net workingcapital to support production (in the form of cash used...
- Q As you learned, mergers and acquisitions can be beneficial forcompanies (and sometimes, less than beneficial). After watching thevideos in the folders above, think of two companies that couldbenefit from a...
- Q A small firm makes three similar products, which allfollow the same three-step process, consisting of milling,inspection, and drilling. Product A requires 12 minutes of milling,5 minutes for inspection, and 10...
- Q ANZflix, a media-services provider, charges subscribers $13.49per month. To attract more customers, the Management and ProductPlanning team spents an estimated cost at $52,000 to produce anddeploy products across all user...
- Q Question 2Using real options in a risk environment can be beneficial ifthe enterprise need to make decisions on switching or acquiringmultiple suppliers. Ericsson and Nokia had different approaches inmanaging risk,...
- Q You expect the price of CEMENCO stockto be US$59.77 per share a year from now. Its current market priceis US$50.00, and you expect it to pay dividend one year from...
- Q Stock X has a beta of 0.88 and an expected return of 10.8percent. Stock Y has a beta of 1.15 and an expected return of 13.1percent. What is the risk-free...
- Q You wrote, "However, when the economists and market participantsexpect a recession, the yields curve invert as well, which meansthat the higher duration bond yields are lower than, the lowerduration bond...
- Q Rentz Corporation is investigating the optimal level of currentassets for the coming year. Management expects sales to increase toapproximately $3 million as a result of an asset expansionpresently being undertaken....
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