Kenney Corporation reported the following income statement for the most recent year(numbers are in millions of dollars): Sales $7,000 Total operating costs 3,000 EBIT $4,000 Interest 200 Earnings before tax (EBT) $3,800 Taxes (40%) 1,520 Net income available to common shareholders $2,280 The company foreca
CALCULATE THE ARITHMETIC AND GEOMETRIC RETURNS OF THESE NUMBERS: year price dividend 1 $ 44.97 --- 2 47.37 $0.55 3 52.24
13) The Corporation has 1,000,000 of 8% bonds outstanding. Interest is payable each July and January 1 and the maturity date is 10 years from today. If the current market rate of interest is 10%, what is the current market value of the bonds? 14) The Corporation has just borrowed $100,000 from the bank. The term of the loan
See attached files. Consider the performance (in thousands of dollars) of Economy Airlines for a given year in the table below. The static (master) budget had been based on a budget of $.20 per revenue passenger kilometer. An average passenger kilometer is one paying passenger who has flown one kilometer. An average airf
Parks Canada prepared the following budget for one of its national parks for 2002: Revenue from fees $5,000,000 Variable costs (miscellaneous) 500,000 Contribution margin $4,500,000 Fixed costs (miscellaneous) 4,500,000 Operating income $ 0 The
Suppose you are considering purchasing a new car. The dealer offers to loan you $20,000 in exchange for a payment of $5,000 at the end of each of the next five years. What is the present value of the loan if the interest rate is 7%?
See attached file for full problem description regarding the Harmon Company. --- Given this income statement, compute the following: a. Degree of operating leverage. b. Degree of financial leverage. c. Degree of combined leverage. d. Break-even point in units. ---
Moe & Chris' Delicious Burgers, Inc., sells food to University Cafeterias for $15 a box. The fixed costs of this operation are $80,000, while the variable cost per box is $10. Questions: a. What is the break-even point in boxes? b. Calculate the profit or loss on 15,000 boxes and on 30,000 boxes. c. What is the degree of o
If an output level is 14,000 units the degree of operating leverage= 1.45 (round to 6 decimal places) , and the OCF= 19,600 but if: a. output rises to 16,000 units the DOL will be ? b. output falls to 13,500 units the DOL will be? i did DOL= 1 + FC / OCF 1 + ? / 19,600 yet i do not know how to f
Use a spreadsheet software (for example, MS Excel), construct an amortization table for the following mortgage. In the amortization table, provide all the information listed below. (Assuming interest is compounded monthly and payments are due at the end of the month). For a 15-year variable-rate-level-payment mortgage (VRM) o
TIME VALUE OF MONEY Please show all work, or inputs on the financial or graphing calculator, to receive credit for your answers. No credit will be given for answers without calculations or inputs. You must include a timeline with each problem 1. You would like to buy a house, and have researched the mortgage market. Your
What is the proportion of debt financing for a firm that expects a 24% return on equity, a 16% return on assets, and a 12% return on debt? Ignore taxes. A) 54.0% B) 60.0% C) 66.7% D) 75.0% A firm has an expected return on equity of 16% and an after-tax cost of debt of 8%. What debt-equity ratio should be
17. You are in the business of selling widgets. You retail these fine looking widgets for $25.00 a piece and you have 1,000 of them in inventory. If your total fixed costs are $150,000 and your total variable costs are $10,000 what is: Your breakeven in units________________________
19. A firm has 40,000,000 in revenues, 12,500,000 in fixed costs, 10,250,000 in variable costs, and interest of 2,000,000. Compute: a) DOL b) DFL c) DCL Please provide response in Excel.
You are offered two jobs. One initially pays $100,000 annually, and your salary will grow annually at 11.5%. The other pays pays $97,000 annually, but your salary will grow at 12%. After ten years, which job pays the higher salary?
An investment is expected to generate $2,000,000 each year for four years. If the firm's cost of funds is 5%, what is the maximum amount the firm should pay for the investment? Please respond in Excel.
1) Calculate the average returns, variances, & the standard deviations for X and Y. For average return and s.d. (Input answers rounded to 2 decimal places. For variance round answers to 4 decimal places). Returns Year X Y 1 20 % 21 %
A company issued 10%, 10-year, $10,000,000 par value bonds that pay interest semiannually on April 1 and October 1. The bonds are dated April 1, 2004 and are issued on that date. The market rate of interest for such bonds on April 1, 2004 is 8%. The company uses the effective interest rate method of amortization. 1. Prepar
Search for three public companies that you may want to invest in. You may want to consider three companies in the same industry. Make sure they provide their financial information online. You could go to each company's website and look in the investor relations area. A better way is to research Yahoo Finance [http://finance.yaho
51. Pick the statement that is most correct. 1. The SML relates required returns to firm's systematic or market risk. The slope and intercept of this line cannot be controlled by the financial manager. 2. The slope of the SML is determined by the value of the beta. 3. If you plotted the returns of a given stock agai
Most correct Statement. 1. If you add enough randomly selected stocks to a portfolio, you can completely eliminate all the market risk from the portfolio 2. If you formed a portfolio which included a large number of low beta stocks (less than 1.0 but greater than -1.0), the portfolio would itself have a beta coefficient
30. Given the following info. Stockholders' equity = $1250.00; price/earning rate = 5; shares oustanding = 25; market/book ration =1.5. The market price of a share of the company's stock is 33.33 75.00 10.00 166.67 133.32
Using the income statement for Paste Management Company compute the following ratios: a. The interest coverage. b. The fixed charge coverage. The total assets for this company equal $80,000. Set up the equation for the Du Pont system of ratio analysis, and compute c, d, and e. c. Profit margin. d. Total asset turnover.
One statement is correct. 1. Given the multi-owner nature of most large corporations, agency costs associated with perquisite consumption are not really a problem. 2. Shareholder agency costs include the opportunity costs associated with constraining managerial freedom but don not include managerial salaries. 3. An ag
Jan-05 Jan-04 Jan-03 Jan-02 Jan-01 Current Ratio Current Assets 1.69 1.55 1.59 1.37 1.16 Current Liabilities Quick (Acid-Test) Ratio Current Assets-Inventory 1.04 0.91 0.95 0.74 0.49 Current Liabilities Inventory Turnover Cost of Goods Sold
Why is it so difficult for most small business owners to raise the capital needed to start, operate, or expand their ventures? How can a firm employ bootstrap financing to stretch its current capital supply?
To accumulate $8,000 by the end of 5 years by making equal annual end-of-year deposits for the next 5 years. If earning 7% on the investments, how much must be deposited at the end of each year to meet the goal?
See the attached stock file. All data is already adjusted for dividends and splits; do not worry about them. 1) Calculate the weekly returns for each of the 11 data series. You should use log returns: for example if the stick prices are $51 in Jan 1 and $53 on Jan 8, the return for that week is in (53/51) = .038466, about 3
(See attached file for full problem description) --- 3. Ensco Lighting Company has fixed costs of $100,000, sells its units for $28, and has variable costs of $15.50 per unit. a. Compute the break-even point. b. Ms. Watts comes up with a new plan to cut fixed costs to $75,000. However, more labor will now be required,
You have contracted to purchase a $10,000,000 multi-family property with $2,000,000 cash down payment as equity and an $8,000,000 mortgage loan. Assume mortgage rates for this type of investment property are 8.50% fixed rate, fully amortized over 30 years, with monthly payments of interest and principal. (1) Construct an