Finance question and answers for September 23, 2023
- Q For all of the capital budgeting methodologies, what are theadvantages and disadvantages using them as a financial manager?
- Q o-Anne just bought 200 bonds at a purchase price of R1 043.70each. The bonds will mature in 7 years’ time and have a face valueof R1 000.00. The coupon rate...
- Q Caviar Fishfarm Ltd (‘CFL’) is unlevered, has an equity beta of1.25 and unlevered cash flows of $76,800 per annum that willcontinue in perpetuity. The expected market return is 10%p.a andTreasury...
- Q Caviar Fishfarm Ltd (‘CFL’) is unlevered, has an equity beta of1.25 and unlevered cash flows of $76,800 per annum that willcontinue in perpetuity. The expected market return is 10%p.a andTreasury...
- Q You will deposit $300 per year for the next 5 years. You expectthe interest rate 1 year from now to be 8%, 2 years from now to be8%, 3 years...
- Q Problem Set 1You are the owner of a large data-services firm and are decidingon the purchase of a new hardware cooling system that you expectwill yield $233,300 in cost-savings per...
- Q Of the following investments, which has the lowest risk?Question 23 options:government bondsconservative mutual fundsfuturesblue chip stocksjunk bondsIn general, the riskier an investment, the greater theopportunity for a large return.Question 24...
- Q Last year Carson Industries issued a 10-year, 12% semiannualcoupon bond at its par value of $1,000. Currently, the bond can becalled in 6 years at a price of $1,060 and...
- Q Describe financial risk management, and how it can effectivelybe used by a sports business. What risk management strategies wouldbe used to protect the business’ finances?
- Q Two banks in the area offer 30-year, $250,000 mortgages at 5.2percent and charge a $3,900 loan application fee. However, theapplication fee charged by Insecurity Bank and Trust is refundableif the...
- Q Question #9Calculating NPA and IRR LO1,5 A project that provides annualcash flows of $11,700 for nine years’ costs $63,000 today is the agood project if the required return is 8...
- Q Venture capital financing is a type of funding whichassembles cash from investors and lends it to startup businessesthat have high potential for success. Venture capitalinvestments usually encompass very high risk; however,...
- Q What is the main advantage of the geometric mean in regards toReal Estate Investment?
- Q You have just won a $5,000,000 lottery! You can collect$3,000,000 now or wait 5 years to collect the full amount. Assumean APR of 5%. Which is the best alternative?
- Q Nine years ago the Templeton Company issued 25-year bonds withan 12% annual coupon rate at their $1,000 par value. The bonds hadan 8% call premium, with 5 years of call...
- Q How much money do you need to invest now, to have $50,000 in 10years?  Assume an APR of 4.5%.
- Q Problem 1Assume the T-bill maturity and futures delivery are on the sameday. Ignore transactions costs.Treasury BillMaturity         DTM              Bid                 Asked                                   Mar               90                   1.18                1.17                                       Index FuturesS&P 500 Index (CME)                       Open              High               Low               SettleMar                1,905.00         1,911.00         1,901.00           1,907.70S&P 500 closed at $1,910.00 on the sameday.Find the discount...
- Q Young screenwriter Carl Draper has just finished his firstscript. It has action, drama, and humor, and he thinks it will be ablockbuster. He takes the script to every motion picture...
- Q Consider a 30-year, $155,000 mortgage with a rate of 6.05percent. Ten years into the mortgage, rates have fallen to 5percent. What would be the monthly saving to a homeowner fromrefinancing...
- Q An investment of $1,000,000 yields $1,100,000 in exactly oneyear. Calculate the annual rate of return on this investmentwith:annual compoundingsemiannual compoundingMonthly compoundingContinuous compounding.
- Q On September 3, 2008 you invested $1,000 at the annual risk-freerate of 7% until APR. 18, 2009. Calculate the amount you willreceive on APR 18, 2009 if the annual 5%...
- Q Calligraphy Pens is deciding when to replace its old machine.The machine's current salvage value is $2,900,000. Its current bookvalue is $1,725,000. If not sold, the old machine will requiremaintenance costs...
- Q Sheffield Manufactures Ltd, operate in the printing andpackaging industry. They feel that some of their older printing andlabelling machines need to be replaced. They seek help in order tocalculate their...
- Q BUSI 320 Comprehensive Problem 3 FALL 2019Use what you have learned about the time value of money toanalyze each of the following decisions:Decision #1: Which set of Cash Flows is...
- Q You have been given the following return information for amutual fund, the market index, and the risk-free rate. You alsoknow that the return correlation between the fund and the market...
- Q List five goals of a firm and Select which goals you will setfor your organization as a manager and give the reason why you haveselected those goals. (260 wordsUse this...
- Q Mr. James, an ardent photographer has decided to take his forsteps on realizing his entrepreneurial dream. He has been mullingover various options and has narrowed them down to 2 options....
- Q You are given the following information for Smashville,Inc.  Cost of goods sold:$184,000Investment income:$1,600Net sales:$387,000Operating expense:$88,000Interest expense:$7,400Dividends:$6,000Tax rate:30%Current liabilities:$12,000Cash:$21,000Long-term debt:$32,000Other assets:$40,000Fixed assets:$125,000Other liabilities:$5,000Investments:$36,000Operating assets:$64,000During the year, Smashville, Inc., had 25,000 shares of...
- Q 16. Lowell Corp. is an all-equity firm with $820,000. It nowwants to issue debt and raise the debt ratio to 0.40 from 0.0without changing total assets. It plans to use...
- Q Are there any significant difference between working capitalmanagement and working capital investment?
- Q In a financial plan, how is the amount of borrowingdetermined?A.In direct proportion to sales growthB.By the needed increase in fixed assetsC.By the increase in total assets minus the increase in...
- Q Consider a company that is financing an expansion, with theexpansion financed bythe owners. Projected free cash flows are -$25 million in year 1,+$10 million in year 2, +30 millionin year...
- Q Aday Acoustics, Inc., projects unit sales for a new 7-octavevoice emulation implant as follows:YearUnit Sales172,600278,000383,000480,900567,100Production of the implants will require $1,420,000 in networking capital to start and additional net working...
- Q In a slow year, Deutsche Burgers will produce 2.400 millionhamburgers at a total cost of $3.900 million. In a good year, itcan produce 4.200 million hamburgers at a total cost...
- Q Amazing Manufacturing, Inc., has been considering the purchaseof a new manufacturing facility for $490,000. The facility is to befully depreciated on a straight-line basis over seven years. It isexpected to...
- Q I need an to check my answer with 4 decimal places:Better Mousetraps has developed a new trap. It can go intoproduction for an initial investment in equipment of $5.4 million.The...
- Q After years of playing the lottery, you just won $10,000,000.Now, you have to figure out how you want it paid to you. You cantake a lump sum now before tax,...
- Q After working for three years, you decide to purchase yourfirst home, which has a sales price of $350,000. With $70,000 downpayment, what is your monthly mortgage payments for a 30-year...
- Q Calculating Rates of Return [LO3]A coin sold at auction in 2017 for $2,897,000. The coin had aface value of $10 when it was issued in 1795 and had previouslybeen sold...
- Q A 7.10 percent coupon bond with 21 years left to maturity ispriced to offer a 5.2 percent yield to maturity. You believe thatin one year, the yield to maturity will...
- Q (Calculating corporate income tax) Last year the commercial realestate firm Kelly and Co., Inc., earned taxable income of $19million. Calculate Kelly’s federal income taxes. Now calculateKelly’s average and marginal tax...
- Q (CO B) Ms. Towne is buying a home for $250,000 and is puttingdown 20% cash on the purchase. She is financing the rest with a30-year, fixed rate mortgage with a...
- Q You discover that the client's previous tax returns fromlast year, which someone else prepared, listed a deduction of$3,000 in excess of the actual expenditure. This mistake was notintention and the...
- Q Identify and describe two incremental cash flows for projectsuch as expanding a product line or launching a new product orservice.Need 300b words discussion
- Q A borrower is purchasing a property for $180,000 and can choosebetween two possible loan alternatives. The first is a 80% loan for25 years at 8% interest and 1 point and...
- Q 10-year corporate bond has a coupon rate of 6% with semi-annualpayments. If interest rates rise to 7% on similar bonds then whatis the value of the bond in the marketplace?A...
- Q Giventhe financial data in the popup​ window, General Motor/Ford MotorCompanySales$155,305 /$146,808EBIT$7,626/ $7,817Interest Expense $345/ $714NetIncome $5,208/ $7,101Current Assets $81,478/ $131,491TotalAssets $166,365 / $202,094Current Liabilities $62,491/ $19,545Equity$42,527/ $26,399Valuesare expressed in millions...
- Q Balance Sheet AnalysisComplete the balance sheet and sales information in the tablethat follows for J. White Industries using the following financialdata:Total assets turnover: 1.3Gross profit margin on sales: (Sales -...
- Q (1) You wish to retire in 10 years, at which time you want tohave accumulated enough money to receive an annual annuity of$13,000 for 15 years after retirement. During the...
- Q You would like to purchase a vacation home in 15 years.The current price of such a home is $275,000 but the price of thesetypes of homes is rising at a...
- Q Currently, your firm plans on depreciating an upcoming project’sPPE from an initial value of $800k to a final book value of $100kover a 10 year period. You’ve been asked to...
- Q Do you agree that the selection of a top-quality candidate is acritical process in organizations, or do you think intensivetraining after the person is selected is more valuable? Explainyour answer.
- Q Analyze why, despite employing various investment appraisaltechniques, large investment projects in big corporations may failto deliver their estimated cash flows. Critically assess how afailed capital project may affect key stakeholders...
- Q Comprehensive Ratio AnalysisData for Lozano Chip Company and its industry averagesfollow.Lozano Chip Company: Balance Sheet as of December 31,2016 (Thousands of Dollars)Cash$Â Â 225,000Accounts payable$601,866Receivables1,575,000Notes payable326,634Inventories1,125,000Other current liabilities525,000Â Â Total current assets$2,925,000Â Â Total current liabilities$1,453,500Net...
- Q 12. Assume the BonBon Candy Company is a constant growth companywhose last dividend was $3,00 and whose dividend is expected togrow indefinitely at 6% rate. It normally discounts all cash...
- Q How much debt is too much for an organization, andshould more users of organizational data use the combined degree ofoperating leverage versus operational and/or financial? min 200words
- Q DFB, Inc. expects earnings next year of $5.53 per share, and itplans to pay a $3.05 dividend to shareholders (assume that is1-year from now). DFB will retain $2.48 per share...
- Q Assume a corporation has earnings before depreciation and taxesof $104,000, depreciation of $42,000, and that it has a 30 percenttax bracket.a. Compute its cash flow using the followingformat. (Input all...
- Q Two years ago you took out a mortgage at 4.5%. The initialbalance of the loan was $200,000 and it was for 25 years (300months.) Today, you observe that you could...
- Q You have just sold your house for $1,000,000 in cash. Yourmortgage was originally a 30-year mortgage with monthly paymentsand an initial balance of $800,000. The mortgage is currentlyexactly 18½ years...
- Q Heavy Metal Corporation is expected to generate the followingfree cash flows over the next five​ years:(in millions)Year 1 : 54.4Year 2: 66.2Year 3: 79.5Year 4: 73.6Year 5: 80.2Thereafter, the free...
- Q 7. One of your neighbors, Mr. and Mrs. Schekel, ( an elderlycouple that always bring cookies when they visit ) has been veryinterested in hearing about your experiences at university....
- Q Question 4HMK Enterprises would like to raise $10 million to invest incapital expenditures. The company plans to issue 5-year bonds witha face value of $1,000 and a coupon rate of...
- Q Do you agree with the statement below? Why or why not?“Given the inflation in Venezuela was well above 10,000% in2017, Venezuela should adopt a cryptocurrency such as Bitcoin as anational...
- Q (ONLY NEED STOCK C ANSWERS)Consider the following three stocks:Stock A is expected to provide a dividend of $10.40 a shareforever.Stock B is expected to pay a dividend of $5.40 next...
- Q Johnson Electronics is considering extending trade credit tosome customers previously considered poor risks. Sales wouldincrease by $120,000 if credit were extended to these newcustomers. Of the new accounts receivable generated,...
- Q Assume that Atlas Sporting Goods Inc. has $810,000 in assets. Ifit goes with a low-liquidity plan for the assets, it can earn areturn of 12 percent, but with a high-liquidity...
- Q Please concisely answer the following questions onSarbanes-Oxley and Dodd-Frank.1. Describe each Act, their major components and theirimpacts.2. Why did Congress pass each Act?3. Describe the issues these Acts have solved...
- Q This exercise parallels the machine-purchase decision for theMendoza Company that is discussed in the body of the chapter.Assume that Mendoza is exploring whether to enter a complementaryline of business. The...
- Q after depositing 23795890.29 today into an account which offers12% compounded annually, how many times will you be able to makeannual withdrawals of 2675000.00 from the account .if A, the first...
- Q The top part of Ramakrishnan, Inc.’s 2018 and 2017 balancesheets is listed below (in millions of dollars).2018201720182017Current assets:Current liabilities:Cash and marketable securities$36$27Accrued wages and taxes$33$32Accounts receivable144129Accounts payable8877Inventory207188Notes payable7567Total$387$344Total$196$176Calculate Ramakrishnan, Inc.’s...
- Q CFO of LincolnHike Inc. has created the firm’spro forma balance sheet for the next fiscal year. Sales areprojected to grow by 20% to 295.5 million. Current assets, fixedassets, and short-term...
- Q Using the data in the table to the​ right, calculate the returnfor investing in the stock from January 1 to December 31. Pricesare after the dividend has been paid.Date Price...
- Q Super Sonics Entertainment is considering buying a machine thatcosts $435,000. The machine will be depreciated over five years bythe straight-line method and will be worthless at that time. Thecompany can...
- Q Allen Products​ LP, wants to do a scenario analysis for thecoming year. The pessimistic prediction for sales is $ 900,000​;the most likely amount of sales is $ 1,118,000​; and the...
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