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Accounting: Calculate Net Present Value ( NPV )

Create a presentation that you will make to management. Use the following assumptions: Assume the risk-adjusted cost of capital is 12%, compute net present value (NPV) for each proposal. Include the cash flows from salvage value and the tax benefits of depreciation (assume 5-year straight-line). Incorporate the research data

Stock Price for Non-constant Growth

A company will pay a $2 per share dividend in 1 year. The dividend in 2 years will be $4 per share, and it is expected that dividends will grow at 5 percent per year thereafter. The expected rate of return on the stock is 12 percent. a. What is the current price of the stock? b. What is the expected price of the stock in a

Johnson & Johnson/ Procter & Gamble Comparison

I am doing a comparison between 2 companies .. Johnson & Johnson and Procter & Gamble these two companies are 2 that trade the similiar products and are in the same industry. How can I find the finance information shown below? Are there explanations with these questions as well? (Please provide site information if used)

Factors for diversified fund

Assume you've decided to buy a diversified (i.e., not a sector fund) open-end mutual fund investing in U.S. common stocks. Because there are thousands of these funds available, you need to shorten your list. Describe the factors that will be important to you as you narrow your choices.

Risk Management in Investments

Risk management relates to reducing the cost of risk, meaning reducing the cost of the actual management of risk. People invest their money, whether it's in bonds or stocks, with the hope of acquiring profit or gains. The question one shall ask regarding risk management, is the risk appropriate given the returns? a) Therefor

Managerial Finance

Companies have relied on external funding because of the following reason: A)reaction to the economy B)need for expansion C)change in the cost of capital D)all of the above

Accounting 2 Problems

1. Butler Sales Company is a distributor that has an exclusive franchise to sell a particular product made by another company. Butler Sales Company's income statements for the last two years are given below: This Year Last Year Units sold 200,000 160,000 Sales revenue $1,000,000 $800,000 Less cost of goods s

Finance 201 Problem

(See attached file for full problem description) --- Current Ratio 1.09 1.41 Quick Ratio 0.60 1.00 Total Debt Ratio 48.00% 77.80% TIE 6.20 3.20 BEP N/A N/A FATO N/A N/A You have been given the following information. Complete a Balance Sheet and Income Statement for 2005. All figures are in millions. Also b

Explain how to arrive at the appropriate derivation of a cost.

Dr. Stephanie White, the Chief Administrator of Uptown Clinic, a community mental health agency, is concerned about the dilemma of coping with reduced budgets next year and into the foreseeable future, but increasing demand for services. In order to plan for reduced budgets, she must first identify where costs can be cut or redu

Investment, Time Value of Money, Savings and Interest

Old Alfred Road, who is well-known to drivers on the Maine Turnpike, has reached his seventieth birthday and is ready to retire. Mr. Road has no formal training in finance but has saved his money and invested carefully. Mr. Road owns his home-the mortgage is paid off-and does not want to move. He is a widower, and he wants to b

Mortgage amortization


Description of Liquidity ratios

(See attached file for full problem description) --- 2. Gulf and Northern total current assets, net working capital, and inventory for each of the past four years is as follows: 1999 2000 2001 2002 Total current asset Net working c

Managerial Finance

As the discount rate becomes higher and higher, the present value of infows approaches: A) 0, B) minus infinity, C) plus infinity, D) need more information

Present Value

You have determined the profitability of a planned project by finding the present value of all the cash flow from that project. Which of the following would cause the project to look less appealing, that is, have a lower present value? a. The discount rate decrease. b. The Cash flows are extended over a longer period of t


You must show all your work on this homework to receive credit. Downloadable Financials Data Return to Hoover's Annual Financials Annual Financials Income Statement (All dollar amounts in millions except per share amounts.) Dec 04 Dec 03 Dec 02 Revenue 13,564.70 12,358.60 11,356.60 Costs of Good

Discount Rate

One task of a financial manager is to do research on the main competition to the firm you work for. Do some research using Yahoo Finance and other search engines on these two competitors, then write a two to three page paper answering the following question: Is your reference company more or less risky to the point of view o

Once opportunity costs

True or False Once opportunity costs are recognized they typically do not result in a direct reduction of cash but must be allocated as a cash outflow.

CCA rates

True of False Other factors held constant, higher CCA rates have the effect of reducing taxes and increasing cash flows.

Board of Director

True or False When the Board of Directors carefully selects and then appoints the management team, this is an example of an indirect agency cost.


1. Myers Business Systems is evaluating the introduction of a new product. The possible levels of unit sales and the probabilities of their occurrence are given below: Possible Sales Market Reaction in Units Probabilities Low response . . . . . . . . . . . . . 20 .10 Moderate response . . . . . . . . . 40 .30 High respons

Sara Lee Corporation

Sara Lee Corporation earned revenues of $17.7 billion during 20x1 and ended the year with net income of $2.3 billion. During 20x1, Sara Lee collected $18.0 billion from customers and paid cash for all of its expenses plus an additional $0.4 billion on 20x0 expenses left over from the preceding year. Answer these questions abou

Managerial Finance

Firms with a high degree of operating leverage are: a)easily capable of surviving large changes in sales volume, b)usually trading off lower levels of risk for higher profits, c)significantly affected by changes in interest rates, d)trading off higher fixed costs for lower per-unit variable costs.

Bonds and sinking fund deposits

I would just like someone to check this and tell me if I'm on the right track with this or totally off. Thanks! --- BE2-20 Gordon Company issued $1,000,000, 10-year bonds and agreed to make annual sinking fund deposits of $80,000. The deposits are made at the end of each year into an account paying 5% annual interest. What a

Annual sinking fund

Gordon Company issued $1,000,000, 10 year bonds and agreed to make annual sinking fund deposits of $80,000. The deposits are made at the end of each year into an account paying 5% annual interest. What amount will be in the sinking fund at the end of 10 years? How do I set this up to calculate?


Using the following financial information, calculate the current ratio and inventory turnover ratio for Wal-Mart and Target. What does it tell you? Discuss. Wal-Mart Balance Sheet Wal-Mart Get Balance Sheet for: View: Annual Data | Quarterly Data All numbers in thousands PERIOD ENDING 31-Jan-05 31-Jan-04 31-J

15-2. Recording the Issuance of Common and Preferred Stock

2. (Recording the Issuance of Common and Preferred Stock) Kathleen Battle Corporation was organized on January 1, 2003. It is authorized to issue 10,000 shares of 8%, $100 par value preferred stock, and 500,000 shares of no par common stock with a stated value of $1 per share. The following stock transactions were completed duri