Get college assignment help at uniessay writers advantage and disadvantages of choosing Bledsoe large-company stock fund with Bledsoe S
16. Ryngaert Inc. recently issued noncallable bonds that mature in 15 years. They have a par value of $1,000 and an annual coupon of 5.7%. If the current market interest rate is 7.0%, at what price should the bonds sell?
(Beta and required return) The riskless return is currently 6%, and Chicago Gear has estimated the contingent returns given here. A. Calculate the expected returns on the stock market and on Chicago Gear stock. B. What is Chicago Gear’s beta? C. What is Chicago Gear’s required return according to the CAPM?
Operational efficiency relates to bringing buyers and sellers together at the lowest possible cost. True False
The appropriate measure of risk for a diversified portfolio is a measure of total risk. True False
Stover Electricals is a company with no growth potential. Its last dividend was $3.75, and it expects no change in future dividends. What is the current price of the company’s stock given a discount rate of 12 percent? $40.50 $31.25 $37.50 $45.00
Prescription Express has a debt-equity ratio of .70. The pre-tax cost of debt is 8.5 percent while the unlevered cost of capital is 15 percent. What is the cost of equity if the tax rate is 35 percent?
Using Percentage of Sales Eagle Sports Supply has the attached financial statements. Assume that Eagle’s assets are proportional to its sales. a. Find Eagle’s required external funds if it maintains a dividend payout ratio of 70 percent and plans a growth rate of 15 percent in 2004. b. If Eagle chooses not to issue new shares of stock, what variable must be the balancing item? What will its value be? c. Now suppose that the firm plans instead to increase long-term debt only to $1,100 and does not wish to issue any new shares of stock. Why must the dividend payment now be the balancing item? What will its value be? Using Percentage of Sales. Eagle Sports Supply has the attached financial statements. Assume that Eagle’s assets are proportional to its sales. a. Find Eagle’s required external funds if it maintains a dividend payout ratio of 70 percent and plans a growth rate of 15 percent in 2004. b. If Eagle chooses not to issue new shares of stock, what variable must be the balancing item? What will its value be? c. Now suppose that the firm plans instead to increase long-term debt only to $1,100 and does not wish to issue any new shares of stock. Why must the dividend payment now be the balancing item? What will its value be?
matthew gabon, the sales manager of Office Furniture Solutions, prepared the following budget for 2008: Assuming sales of $12,000,000 salaries(fixed) $500,000 commissions(variable) 180,000 advertising(fixed) 100,000 charge for office space(fixed) 2,000 office supplies
Below is a performance report that compares budgeted and actual profit in the sporting goods department of Maxwell’s department store for the month of december. budget actual difference sales 600,000 675,000 75,000 less: costofmerchandise 300,000 375,000 75,000 salaries/salesstaff 60,000 68,000 (8,000) _____________________________________ $240,000 $232,000 ($8,000) A: evaluate the department in terms of its increases in sales and expenses. do you believe it would be useful to investigate either or both of the inceeases in expenses? B: Consider storewide electricity cost. Would this cost be a controllable or a noncontrollable cost for the manager of sporting goods? would it be useful to include a share of storewide electricity cost on the performance report for sporting goods?
Get college assignment help at uniessay writers At the end of 2008, Cyril Fedako, CFO for Fedako Products received a report comparing budgeted and actual production costs for the company’s plant in Forest Lake, Minnesota. Budget Actual Difference Materials $3,000,000 $3,300,000 $300,000 DirectLabor 2,100,000 2,300,000 200,000 SupervisorSalary 375,000 400,000 25,000 Utilities 75,000 85,000 10,000 MachineMatine 250,000 280,000 30,000 Depreciate Build 50,000 50,000 0 Depreciate Equip 200,000 205,000 5,000 Janitorial 120,000 135,000 15,000 Totals $6,170,000 $6,755,000 $585,000 His first thoughts was that costs must be out of control since actual costs exceeded the budget by $585,000. However, he quickly recalled that the budget was set assuming a production level of 50,000 units. The Forest Lake plant actually produced 55,000 units in 2008. A. Given that production was greater than planned, should Cyril expect that all actual costs will be greeater than budgeted? Which costs would you expect to increase and which costs whould you expect to remain relatively constant? B. Cyril is extremly busy, the company has six other plants. Therefore, he cannot spend time investigating every departure from the budget. With this in mind, which cost(s) should Cyril concentrate on in his investigation of budget differences?
This part of the project is to analyze the following capital structure plans. You will use the EBIT-EPS analysis to evaluate the two plans. One plan is all equity and one has debt and equity. Plan Plan 1: All Equity Plan 2: Some Debt Shares of Equity 80,000 50,000 Debt 0 $2,000,000 Cost of debt 0 12% Interest Expense 0 $240,000 Tax Rate 34% 34% Determine the EBIT indifference point Discuss the implications of EBIT above and below this point
“consider the production cost information for santiago’s salsa in problem 1. the company is currently producing and selling 250,000 jars of salsa annually. the jars sell for $4.00 each. the company is considering lowering the price to $3.70. suppose this action will increase sales to 300,000 jars.” A: what is the incremental cost associated with producing an extra 50,000 jars of salsa? B: what is the incremental revenue associated with the price reduction of $0.30 per jar? C: Should Santiago lower the price of its salsa?
“matthew gabon, the sales manager of Office Furniture Solutions, prepared the following budget for 2008: Assuming sales of $12,000,000 salaries(fixed) $500,000 commissions(variable) 180,000 advertising(fixed) 100,000 charge for office space(fixed) 2,000 office supplies
“”matthew gabon, the sales manager of Office Furniture Solutions, prepared the following budget for 2008: Assuming sales of $12,000,000 salaries(fixed) $500,000 commissions(variable) 180,000 advertising(fixed) 100,000 charge for office space(fixed) 2,000 office supplies
The Nelson Company has $1,417,500 in current assets and $675,000 in current liabilities. Its initial inventory level is $337,500, and it will raise funds as additional notes payable and use them to increase inventory. a. How much can Nelson’s short-term debt (notes payable) increase without pushing its current ratio below 1.6? Round your answer to two decimal places.
You can earn 5% per year compounded semi-annually for the next 4 years, followed by 8% per year compounded annually for 5 years. What is the average annual compounded rate of return over the 9 year period? Express your answer with quarterly compounding.
Wk10 Q15 Calculating the Cost of Debt Ying Import has several bond issues outstanding, each making semiannual interest payments. The bonds are listed in the following table. If the corporate tax rate is 34 percent, what is the aftertax cost of Ying’s debt? (Do not include the percent sign (%). Round your answer to 2 decimal places. (e.g., 32.16)) Bond Coupon Rate Price Quote Maturity Face Value 1 7.00% 103.00 5 years $40,000,000 2 8.50 108.00 8 years 35,000,000 3 8.20 97.00 15½ years 55,000,000 4 9.80 111.00 25 years 50,000,000 Aftertax cost of debt percent
Wk10 Q16 Calculating the Cost of Equity Floyd Industries stock has a beta of 1.50. The company just paid a dividend of $.80, and the dividends are expected to grow at 5 percent. The expected return of the market is 12 percent, and Treasury bills are yielding 5.5 percent. The most recent stock price for Floyd is $61. (Do not include the percent signs (%). Round your answers to 2 decimal places. (e.g., 32.16)) Required: (a) Calculate the cost of equity using the DCF method. Cost of equity ___ percent (b) Calculate the cost of equity using the SML method. Cost of equity ___ percent
Wk10 Q10 Book Value versus Market Value [LO3] Filer Manufacturing has 11 million shares of common stock outstanding. The current share price is $68, and the book value per share is $6. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $70 million, has a 7 percent coupon, and sells for 93 percent of par. The second issue has a face value of $55 million, has an 8 percent coupon, and sells for 104 percent of par. The first issue matures in 21 years, the second in 6 years. (Round your answers to 3 decimal places. (e.g., 32.161)) Required: (a) On a book value basis, Filer’s capital structure weights, E/V and D/V, are__ and__ respectively. (b) On a market value basis, Filer’s capital structure weights, E/V and D/V, are __and __ respectively.
A Treasury Bond pays half-yearly interest at the rate of 11.5% pa, and has 6 years to run to maturity. Find its price (per $100 face value) to yield 12% pa convertible half-yearly. Give your answer in dollars and cents to 2 decimal places
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