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Corporate Finance

2. Suppose the market portfolio has an expected return of 10% and a volatility of 20%, while Microsoft's stock has a volatility of 30%. a. Given its higher volatility, should we expect Microsoft to have an equity cost of capital that is higher than 10%? b. What would have to be true for Microsoft's equity cost of capital to be

Corporate Finance (University Level Question)

My subject is not listed. Looking for help with Corporate Finance, university level. ( 2nd year) The question is as follows: Snail corporation wants to purchase Bug corporation. The financial manager of Snail corporation forecasted the following free cash flows (FCFs) for Bug corporation for year 1-6 : $3.3mil, $3.6mil,

Kirkland Inc - Ratios for Publicly Traded Company

Pick any publicly traded company that their financials are published on the SEC website. For the purpose of this assignment we have selected Kirkland's Inc. Kirkland is specialty retailer of home décor in the United States, operating 299 stores in 34 states and offers a broad selection of distinctive merchandise. 1. Do

Break-even point and degree of leverage

Healthy Foods, Inc., sells 50-pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss on 12,000 bags and on 25,000 bags. c. What is the degree of operat

Corporate Finance Fully Depreciated

This exercise is designed to refresh your understanding of basic accounting concepts and test your knowledge of income statements and balance sheets and the impact of various transactions and them. Show the effect of the following transactions listed below on the total assets, current ratio and net income of the firm. Use (+)

MBA Finance questions (CAPM, stock prices and more)

1) Assume that the CAPM is a good description of stock price returns. The market expected return is 7% with 10% volatility and the risk-free rate is 3%. New news arrives that does not change any of these numbers but it does change the expected return of the following stocks: Expected R

Calculating Expected Value of the Gamble for the Lottery

You have just won the Wisconsin lottery! You have been offered (1) $0.5 million, or (2) a gamble in which you would receive a $1 million if a head were flipped and $ 0 if a tail came up. a. What is the expected value of the gamble? b. Would you take the sure $0.5 million or take the gamble? Why? c. If you choose the sure $0

Apple Inc Ratios (Tax rate, Beta, WACD, etc)

I am working on a Financial Analysis for Apple Inc. I have attached the 10K Income statement and Balance Sheet for 2009. I need assistance in finding the Risk Free Rate ( 3 month T-Bill Rate), Beta, Tax Rate, Weighted Average Cost of Debt. Please use the excel formula so i can see how this was calculated or if some of the info s

Total Assets, EPS, EBIT, Debt Ratio and Amortization of Loan

As at 1 January 2009, ABC Ltd has the following information: 1. Retained earnings of 200,000 2. Current liabilities of $600,000 3. 50,000 ordinary shares issued at $22 per share 4. 10,000 units of coupon bonds with a coupon rate of 7% per annum paid semi-annually at the sale price of $878 per unit of $1000 The only non-

Calculating book value per share

Atlantic Coast Resources Company: Balance Sheet Data December 31, 2010 Accounts payable $ 64,400 Notes payable 71,400 Long- term debt 151,200 Common stock ( 30,000 authorized 20,000 shares outstanding) 364,000 Retained earnings 336,000 Total assets $ 987,000 Total liabilities and equity $ 987,000 Atlantic Coast Resources

What are the final answers to this word problem?

Trident Food Corporation generated th following income statement for the most recent fiscal year. Trident December 31, 2008 Sales Revenue $150,000 Variable Cost of Sales (112,500) Gross profit 37,500 Fixed Operating Cost 24,000 Net Operating Income (EBIT) 13,500 Interest (10,000) Earnings Before Taxe

Research Method Quantitative Approach

Please answer below questions in detail: What is a quantitative research? When do we use quantitative approach? and what is the advantages and disadvantages when using a quantitative research? What is a deductive approach? When do we use deductive approach? and what are the advantages and disadvantages when adopting a ded

Credit worthiness of the company

B2. (Choosing financial targets) Sanderson Manufacturing Company would like to achieve a capital structure consistent with a Baa2/BBB senior debt rating. Sanderson has identified six comparable firms and calculated the credit statistics shown here. a. Sanderson's return on assets is 5.3%. It has a total capitalization of $6

Financial Characteristics of J.P. Morgan Chase

Overall project: - Select a major financial institution. - Prepare a 1,250- to 1,750- word paper, describing characteristics of the institution's operations in the following areas: o Provided services o Main sources and uses of funds o How the institution competes or works with other financial institutions o Effect of f

Finance Question for Raptor Pharmaceuticals Corporation

After a banner year of rising profits and positive stock returns, the managers of Raptor Pharmaceuticals Corporation (RPC) decided to launch a seasoned equity offering to raise new equity capital RPC currently has 10 million shares outstanding and yesterday's closing market price was $75.00 per RPC share The company plans to sel

Overall financial Yield

The ABC Resort is considering hosting a prestigious corporate awards convention next year that will require 55% of the total rooms in the resort for 8 days and 7 nights during the resort's peak season. The convention group, comprised of professionals in their early 30s and 40s, will have all breakfasts, all lunches, and three di

Finance (Merges and Q.)

1,The book value of Nott's Nursery's total assets is $400,000. Suppose Golden Gardens Inc. acquires Nott's Nursery's assets for $1 million and finances the purchase by selling $ 600,000 in new stock, $ 300,000 in new debt, and reducing cash by $ 100,000. Describe how the acquisition affects Golden Gardens Inc., balance sheet.

Business portfolio theory expected return

I am looking for some formulas to calculate with this chart , ones to suit these questions please make them easy to understand and a clear explanation of the formula, so I can do the math myself, especially C and D. maybe make up your own examples so I watch how it's done and learn from an example (Portfolio returns and ri

Corporate Finance - Matrix Enterprises

Matrix Enterprises is considering offering both a stock dividend and a cash dividend in the upcoming year. The most recent balance sheet for Matrix (before any stock or cash dividend) is presented below (all amounts are in million $). Cash $114.5 Other Assets 2,835.5 Total Assets 3,250.0 Liabilities $1,750.0 Common shar

Operating, financial and total leverage

Use the following information to answer questions 1 and 2 Venture Inc. manufactures and sells headphones to airline and other passenger transportation companies. Each headphone sells for $5.50, and this year sales are expected to be 1,750,000 units. Variable manufacturing costs for this level of manufacturing and sales (Ventu

BCD Ltd. Case Study: Financial Analysis

You have been asked to find the value of BCD Ltd. and have been provided with thefollowing information: 2010 Sales 4,850,000 Cost of goods sold 3,260,000 Selling, general and admin (SG&A) 1,070,000 Depreciation 200,000 Interest 40,000 Other 30,000 Net income before taxes 250,000 Income taxes (@40%) 100,000 Net income

Financial reporting requirements for Boonville Public Health Center

In preparation for preparing the financial statements for Boonville Public Health Center, you need to review the financial reporting requirements for governmental and nonprofit organizations. Your assignment is to determine: (1) The governing authority for regulating the financial reporting of both governmental and nonprofit

Managerial Accounting and Finance

An artist creates original works on commission. She is likely to use what type of costing? job order process actual normal John Adams is a cash receipts clerk for Boro Company. He receives payments from customers and records the payments to the customers' accounts. John receives a p

Venture Capital Funding/Valuation

You are an entrepreneur whose business requires $10 million in investment. A venture capital organization undertakes due diligence and offers to provide the funds in exchange for 50% ownership of the company. From discussion, you learn that the venture fund believes your company will be maturing in three years. You also learn th

Information System in Accounting for Managing Change

The area that I am investigating in is Information System in Accounting and Finance. My problems are: Please use Systems Development Life Cycle to explain how would introducing a new payment technologies affect an organisations? How could the System Analysis stage be used to identify the advantages and disadvantages of introd

The Role of Financial Institutions in Financial Markets

? Write a paper, describing at least three major financial institutions. ? Describe possible markets those institutions, such as those in the following list, are involved with and explain interactions among them. Cite at least two sources. o Commercial banks o Insurance organizations o Investment banks o Pension funds o

Subsidiary issues additional stock under different assumptions

Primetime Corporation owns 2/3 (600,000 shares) of the outstanding $1 par common stock of Satellite company on January 1, 2006. In order to raise cash to finance an expansion program, Satellite issues an additional 100,000 shares of its common stock for $5 per share of January 3, 2006. Satellite's stockholder's equity before an