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Personal finance

Personal Finance 1. If you credit application is denied, you a. are entitled to know the specific reason you were denied credit b. can have the police send a detective to investigate the lender c. don`t have any rights provided by law d. can take your case to small claims court for a jury trial 2. If creditors give you n

Personal Finance

Personal Finance 1. Of the following statements, which is not a huge disadvantage of using credit? a. it can be costly to use b. it can be difficult to use repay if overused c. it is more difficult to obtain than repay d. it may tempt you to make impulse purchases 2. Improper use of credit may a. increase your ability t

Compute an exponential smoothing forecast with a=0.20, an adjusted exponential smoothing forecast with a=0.20 and b=0.20 and a linear trend line forecast. Compare the three forecasts using MAD and average error (E) and indicate which forecast seems to be most accurate.

The Oceanside hotel is adjacent to city coliseum, a 24,000-seat arena that is home to the city's professional basketball and ice hockey teams and that hosts a variety of concerts, trade shows, and conventions throughout the year. The hotel has experienced the following occupancy rates for the nice years since the coliseum opene

Finance: Cost of Borrowing Alternatives

Exxon Mobil has a 34% tax rate and has decided to issue $100 million of seven-year debt. It has three alternatives. A U.S. public offering would require an 8% coupon with interest payable semiannually and $900,000 of flotation expense. A U.S. private placement would require an 8-3/8% coupon with interest payable semiannually a

distortions in common sizing and financial analysis

There are times when the data can give you some inaccurate predictions. Personally, when I audit a company, I typically use 5 years worth of data. I use 5 years because that is all that our computer software is programed to hold. But, the data is only useful if it is comparable. When a company is in a transition, the numbers

Effective Annual Rate..

First Choice Bank charges 9% APR compounded quarterly on its business loans. National Emerald Bank charges 3% APR compounded monthly. What are the EARs for the two banks, which bank is the better choice?

When is a trend better than year over year comparisons?

Vertical vs Horizontal analysis. Should someone put more emphasize on one type over the other? These two methods are only two methods in an entire arsenal of ways of analyzing a company. Both have benefits and limitations. Everybody has discussed what they are and some have expressed their purposes. But, how can they be use

How much money would the farmer receive from hedging

A farmer anticipates harvesting 50,000 bushels of wheat in September. How much money would the farmer receive from hedging by selling eight contracts of September wheat at a settlement price of $6.32 per bushel (a) today and (b) delivery?

Two robotic machines are available to make the cell phone

Your company, which is financed entirely with common equity, plans to manufacture a new product, a cell phone that can be worn like a wristwatch. Two robotic machines are available to make the phone, Machine A and Machine B. The price per phone will be $250.00 regardless of which machine is used to make it. The fixed and vari

Breakeven points for Machines A and B

"Assume that you and your brother plan to open a business that will make and sell a newly designed type of sandal. Two robotic machines are available to make the sandals, Machine A and Machine B. The price per pair will be $19.50 regardless of which machine is used. The fixed and variable costs associated with the two machines a

Annual payments - principal and loan

You have been approved for a $80,000 loan toward the purchase of a new home at 15% interest. The mortgage is for 30 years. 1. How much are the approximately annual payments of the loan? Hint: Assume you pay yearly. 2. How much of your first payment will go towards the principal and how much towards the interest in year 1?

Finance

You have been approved for a $70,000 loan toward the purchase of a new home at 10% interest. The mortgage is for 30 years. How much are the approximately annual payments of the loan? Hint: Assume you pay yearly. $7425 $8690 $5740 None of the above First Choice Bank pays 9% APR compound

Calculating expected return, risk-free rate and more...

1. A stock has an expected return of 13 percent, its beta is 0.55, and the risk-free rate is 7.15 percent. What must the expected return on the market be? 2. You own a portfolio equally invested in a risk free asset and two stocks. If one of the stocks has a beta of 1 and the total portfolio is equally as risky as the market,

Incremental analysis - Sally's spaghetti sauce

Can you help me get started with this assignment? ****************** Production Jars of sauce Ingredient cost (variable) 16,000 Labor cost (variable) 9,000 Rent (fixed) 4,000 Depreciation (fixed) 6,000 Other (fixed) 1,000 Total 36,000 Consider the production cost information for Sal

Company fare after his inevitable departure

In 1965, Warren Buffett acquired control of a New England textile business called Berkshire Hathaway for about $10 a share. Today the stock sells for around $135,000 a share and Mr. Buffett is the second richest person in America. The stock has never paid a dividend. How does this amazing success fit the theory that the value of

Capital Budgeting

1. Front up cost of plant is $100 million. Profits of $30million at the end of every year. Calculate the NPV if the cost of capital is 8%. Should you take the investment? Calculate the IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged. 2. Upfront costs

Mutual Funds Compared to Individual Stock

How do packaged products like mutual funds compare to individual stock ownership? Do people become less attached to a mutual fund compared to a stock or stock certificate? What does this say about possible long term returns the investor may earn?

Leverage and Break even

I have attached a file of the problems. Solve and submit problem 1. Be sure to show your work. 1. Carlsbad Machine Company is considering an expansion of its facilities. Its current income statement is as follows: Carlsbad Machine Company Income Statement Sales $4,000,000 Less: Variable expense (50% of sales) 2,000,

Bonds & Stock Value

Question 1 Blue Water Designs is preparing a bond offering with a 7 percent coupon rate and a face value of $1,000. The bonds will be repaid in 5 years. The company plans to issue the bonds at par value and pay interest semiannually. Given this, which one of the following statements is correct? The bonds will be sold at a

Perpetual system

Cash 8400 Inventory 2000 Common stock 8000 Retained Earnings 2400 During 2012, D & L Enterprises experienced the following events: 1. purchased inventory costing 5600 on account from Smoot Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of 500 were paid in cash. 2. Returne

Comprehensive accounting cycle problem

The following trial balance was prepared for Gifts, Etc. on Dec. 31, 2010, after the closing entries were posted. debit credit cash 110,000 Acct. Rec. 136,000 Allowance for doubtful accts.

Financial Management Schedules

10. (This problem combines material from Chapters 21 and 22.) The financial manager has determined the following schedules for the cost of funds: Cost of Debt Ratio Cost of Debt Equity 0% 5% 13% 1

Systematic and Unsystematic Risks

I need to know whether each of the following is mostly a systematic or unsystematic risk factor. a. Bernie Ebbers resigns unexpectedly as CEO of MCI Corporation b. Disney receives an unsolicited bid from General Electric. c. The United States reports an unexpected increase in the consumer confidence index level. d. Apple

How Much Should You Pay to Purchase Each Share of Stock?

Michelak's Maritime Industries has relatively stable earnings and pays an annual dividend of $2.50 per share. This dividend has remained constant over the past few years and is expected to remain constant for some time to come. If you want to earn 12% on an investment in the common stock of Michelak's, how much should you pay to

financial function positions and activity in organization

As an example take a look at the company or organization you work in and identify those people whose jobs involve a financial function. Describe those positions and the activity and discuss how vital the activity is to the organization. How could knowledge of financial maters, processes, and rules help a person involved in co

Financial Management of U.S. Companies

Which of the following statements is true regarding the goal of financial management? A U.S. company considering international operations will have a different goal than a company that only conducts operations in the U.S. The firm's structure (i.e. corporation, sole proprietorship, partnership) is not relevant to

Prior period adjustments/preferred stock

1. Prior period adjustments are reported in the: income statement. balance sheet. statement of retained earnings. statement of cash flows. 2. Preferred stock on which the right to receive dividends is forfeited for any year that the dividends are not declared is referred to as: Participating prefe