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Finance

Present value, DOL, DFL, unit breakeven, contribution margin

33. Gina Dare, who wants to be a millionaire, plans to retire at the end of 40 years. Gina's plan is to invest her money by depositing into an IRA at the end of every year. What is the amount that she needs to deposit annually in order to accumulate $1,000,000? Assume that the account will earn an annual rate of 11.5%. Round off

Overview of the Investment Environment

The Capital Markets and Investment Banking Process is new & quite confusing to me. I have to write a 1100 word essay which I analyze the investment banking process. In the paper be sure to address the following: a. Describe the investment banking process including portfolio construction. b. Describe the factors

Determining Year-to-Year Percentage Growth

Answer questions 1 and 2 below based on the financial data attached. 1) Determine the year-to-year percentage annual growth in total net sales. Based only on your answers to question #1, do you think the company will hit its sales goal of +10% annual revenue growth in 2009? Determine the target revenue figure, and explain

Home Depot Accounts Receivable and Payable Periods

Need help or steps to calculate Home Depot Accounts receivable and Accounts payable periods in excel spreadsheet for company's last 2 years have no idea how to locate this info on 10-K and what steps to create spreadsheet to get results. Need help understanding this week assignment Have to calculate Excel spreadsheet for Ac

Parametric / nonparametric data

Label each of the following situations "P" if it is an example of parametric data or "NP" if it is an example of nonparametric data. 1. A manufacturer produces a batch of memory chips (RAM) and measures the mean-time-between-failures (MTBF). The manufacturer then changes a manufacturing process and produces another batch

Corporate Nonliquidating Distributions (Karl Stick and Stock Company)

Karl Stick is president of Stock Company. He also owns 100 percent of its stock. Karl's salary is $120,000. At the end of the year, Karl was paid a bonus of $100,000 because the firm had a good year. Stock Company deducted $220,000 as compensation expense for the year. Upon audit, $80,000 of the deduction was disallowed. How cou

Stock Valuation Using the Constant Growth Model

Medtrans is A profitable firm that is not paying a dividend on its common stock. James Weber, an analyst for A. G. Edwards, believes that Medtrans will begin paying a $1.00 per share dividend in two years and that the dividend will increase 6% annually thereafter. Bret Kimes, one of James' colleagues at the same firm, is less op

Return on investment

(Default risk) You buy a very risky bond that promises a 9.5% coupon and return of the $1,000 principal in 10 years. You pay only $500 for the bond. a. You receive the coupon payments for three years and the bond defaults. After liquidating the firm, the bondholders receive a distribution of $150 per bond at the end of 3.5 year

Finance Problem - Is There Enough Information to Solve?

Suppose you are considering investing in a landscaping business. The cost of the equipment is $80,000 and you will need to invest another $20,000 in net working capital. You estimate that the business will generate net income of $15,000 each year over the next five years. At the end of five years, you will sell the equipment and

Expected return and standard deviation Finance Problem

Problem 1 (Chapter 13) Please use the following information to answer the following questions. State Probability Return on A Return on B Boom .65 0.30 0.05 Bust .35 0.10 0.20 What is the expected return for security A? __________________ What is the expected return for security B? __________________

Standard of living differences

In what ways is your standard of living different from that of your parents or grandparents when they were your age? Why have these changes occurred? Along those same lines, how do you see the standard of living being different from yours when they are your age now?

Firm's Overall Financial Analysis

Find attacheed excel spreadsheet, need assistance Summarizing the firm's overall financial position on the basis of your findings in Part B.

Stock and Bond value and Preferred stock's required return

PLEASE SHOW WHAT EQUATIONS WOULD BE USED TO COMPLETE THE BELOW PROBLEMS. A1. (Bond valuation) A 1,000 face value bond has remaining maturity of 10 years and a required return of 9%. The bond's coupon rate is 7.4%. What is the fair value of this bond? A10. (Dividend discount model) Assume RHM is expected to pay a total cas

Business Insurance

I need some assistance on the following question. Your place of business is deciding to purchase business insurance. You have been volunteered to be on a committee to help make the decision. What considerations drive your recommendation? What do you recommend? Why?

Control chart and process control

An aerospace company machines parts to be used in satellites. A critical dimension for one of these parts is its thickness: the target value is 1.04 millimeters with lower and upper specifications of 1.00 and 1.08 millimeters, respectively. Given the following data, complete an appropriate control chart and determine if the proc

Payoff Table and Financial Risks

Determine the financial risks of manufacturing 6,000 units of a product rather than purchasing them from a vendor. Manufacture = $50,000 one-time set up cost + $60/unit % defective 0% 1% 2% 3% 4% Probability of occurrence (%) 40% 30% 20% 6% 4% Cost to replace defectives = $145 Purchase = $66.50/unit, 100% defect

Beneficial Award Option

Problem2: Using all the information below, please present an award option you feel is beneficial to the client. Scenario: Company A currently buys CDs from many Vendors at various rates per pack. They do not have guaranteed orders with any vendors, and are looking to make consolidated order(s) and reduce overall price. T

Default Risk: Realized Return on Investment Example Problem

You buy a very risky bond that promises a 9.5% coupon and return of the $1,000 principal in 10 years. You pay only $500 for the bond. a. You receive the coupon payments for three years and the bond defaults. After liquidating the firm, the bondholders receive a distribution of $150 per bond at the end of 3.5 years. What is th

Constant growth model

Medtrans is a profitable firm that is not paying a dividend on its common stock. James Weber, an analyst for A. G. Edwards, believes that Medtrans will begin paying a $1.00 per share dividend in two years and that the dividend will increase 6% annually thereafter. Bret Kimes, one of James' colleagues at the same firm, is less o

Preferred Stock Returns: Bruner Aeronautics

Bruner Aeronautics has perpetual preferred stock outstanding with a par value of $100. The stock pays a quarterly dividend of $2, and its current price is $80. a. What is its nominal annual rate of return? b. What is its effective annual rate of return?

Earnings and Leverage

Uppose that River Cruises, which currently is all-equity-financed, issues $250,000 of debt and uses the proceeds to repurchase 16,667 shares. Assume that the firm pays no taxes and that debt finance has no impact on its market value. Rework the table given below to show how earnings per share and share return now vary with opera

Financial Management: Stocks, Inventory Period, and Portfolio Beta

1.I have a $1,000 portfolio which is invested in stocks A and B plus a risk-free asset. $400 is invested in stock A. Stock A has a beta of 1.3 and stock B has a beta of .7, how much needs to be invested in stock B if i want a portfolio beta of .90? a. $0 b. $268 c. $482 d. $543 e. $600 2. I am comparing stock A to stoc

Expected return and Standard Deviation of a Portfolio..

Suppose Johnson & Johnson and the Walgreen Co. have expected returns and volatilities shown below, with a correlation of 22%. Calculate a) the expected return and b) the volatility (standard deviation) of a portfolio that is equally invested in Johnson & Johnson's and Walgreen's stock. E[R] SD[R] Johnson & Johnson 7% 16%

Value of investment portfolio after price changes, RRI

You are considering how to invest part of your retirement savings. You have decided to put $200,000 into three stocks: 50% of the money in GoldFinger (currently $25/share), 25% of the money in Moosehead (currently $80/share), and the remainder in Venture Associates (currently $2/share). If Goldfinger stock goes up to $30/shar

Fixed Rate Mortgage Payment

Please help with the following problem. Your family recently obtained a 30 (360 month) $100,000 fixed rate mortgage. Which of the following statements is most correct and why? (ignore taxes and transactions costs). A. The remaining balance after 3 years will be $100,000 less the total amount of interest paid during the fi

Constant growth stock for ABC company

The last dividend paid by ABC company was $2.00. ABC's growth rate is expected to be a constant 4 percent. ABC's required rate of return on equity (KS) is 9 percent. What is the current price of ABC's common stock?

Collegiate Tuxedo Opportunity Cost of Instant Electronic Checks

Collegiate Tuxedo rents apparel throughout the year. They have experienced non-payment by about 15% of their customers with an average loss of $200. Collegiate wants to stem their losses by using an instant electronic credit check on the customer. These checks will cost them $7 on each of the 1,000 customers. The opportunity cos

Break-even Analysis Case

I need to design and develop a financial model that arrives at a correct answer/estimation for the specified problem, and supports future decision-making. In addition to solving the problem and creating the model, I need to prepare a spreadsheet/model map that documents use of the model for future users. The project will be gr