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Finance

Lewis Company Ratios

The financial statements of Lewis Company appear below: LEWIS COMPANY Comparative Balance Sheet December 31, Assets 2010 2009 Cash $ 25,000 $ 40,000 Marketable securities

Answer

See attachment Problem 4-14 - Refer to problems at the end of the chapter for details and instructions: Use template to complete the problem: Bradley Corporation COST FOR JULY, 201X Units Sold 13,000 Material $2 Price per Unit $16 Labor $4 Beginning Inventory 3,000 Overhead $2 Units Produced

Financing Operation with Bank Loan Vs Advanced Customer Payment

You are the CEO of a medium-sized U.S. manufacturing company that has received several inquiries from prospective buyers of your equipment abroad. Each item of equipment that you produce sells for about $20,000 in the United States and there are prospects for selling up to 50 units to one customer overseas. The problem is that

Macroeconomics: Opportunity Cost

You can either spend spring break working at home in Alabama for $100 a day for five days, or you can spend the week in Costa Rica where travel expenses will total $800 (food, hotel, and a plane ticket.) What is the opportunity cost of the trip to Costa Rica? Explain how you determined your answer.

Appropriate Discount and Inflation Rate

The fund you represent is a significant shareholder in Iron Man Industries which just paid a dividend of $5.25 per share is currently expected to grow in perpetuity at 5% each year. Management has proposed a significant re-structuring of the business which will cost a lot of capital, only part of which can be raised externally.

Three-Month Cash Budget with a Few Variables

See the attached file. Pharma Drug Store is a pharmacy in Portland, Maine, owned by Jane Smith, a local pharmacist. Pharma business has been good, but Ms. Smith finds that she frequently runs out of cash. To date, she has dealt with this cash shortfall by delaying payment to the drug suppliers, which is starting to cause proble

Stock Price, Risk Free Assets, Debt to Equity Ratio, Value

Company A and B are two identical companies with equal asset values of $50 million. Company A is financed by equity only and has 100,000 shares outstanding. Company B has perpetual risk-free debt in its capital structure with a market value of $20 million. Company B also has 100,000 shares outstanding. The risk-free rate is 1%.

Finance Tutorial: Efficient Markets and Informational Asymmetry

SQ3-3,4 Carefully explain what is meant by the term efficient market. Are there different levels of market efficiency? What are those levels? Explain what is meant by informational asymmetries. What problem can these asymmetries create for participants in the money and capital markets?

Financial Management of SAC Enterprise

As SACs corporate business financial analyst, you will be required to provide the SAC Board of Directors and executive management team with essential financial information on the management of the SAC enterprise. What are the basic financial statements you will submit to the Board and management? What information is contained in

Stock Valuation

1.)The Jackson-Timberlake wardrobe Co. just paid a dividend of $1.95 per share on its stock. The dividends are expected to grow on a constant rate of 6 percent per year indefinitely. If investors require an 11 percent return on the Jackson-Timberlake Wardrobe Co. stock, what is the current price? What will the price be in three

Finance

2. Find the adjusted monthly prices for the past year for both Novartis AG (NVS) and Pfizer (PFE). Assume you just inherited $3000. You plan to use half of your inheritance in Novartis AG and the other half in Pfizer. You purchase (go long) in Novartis and sell short Pfizer. Both transactions are done using margin where the

Construct both a price weighted and value weighted index

You have decided to construct your own index to measure consumer confidence. You have chosen the following three companies Wal-Mart Stores Inc (WMT), Target Corp (TGT) and Kroger Co. (KR). Using monthly prices from August 2008 through August 2010, Construct both a price weighted and value weighted index. Use a beginning index o

Modigliani-Miller Proof

Consider a Modigliani-Miller world with no taxes. In this world, consider a firm which is expected to generate constant cash flows in perpetuity. For this firm VU = VL = D+S and ks = k0 + (D/S)(k0 - kd). Now, assume that suddenly, a corporate tax at a rate T is imposed on the firm. Nothing else changes (i.e. the value of debt

Residual income model; correlation between stocks; expected price of stock

See attached file full problems. Question # 1 Apply the residual income model to determine the intrinsic value of the stock for a firm with the financial data shown in this table. Question #2 Calculate the correlation between Stock A and Stock B. Question #3 A stock just paid a dividend of $2.00. Due to t

Excel Quantitative Methods: Example Problem

Comfortable Hands is a company that features a product line of winter gloves for the entire family â?" men, women, and children. They are trying to decide what mix of these three types of gloves to produce. Comfortable Hand's manufacturing labor force is unionized. Each full-time employee works a 40-hour week. In addition,

Minimum Cost Schedule

Can you help me get started with this project? A restaurant operates with two full-time employees who work 8 hours per day. The rest of the employees are part-time employees who are scheduled for 4 hours shifts. On Saturdays the restaurant is open 11:00 A.M. to 10:00 P.M. Management wants to develop a schedule for part-time e

Finance

1- Excalibur corporation has developed a model to predict sales revenues for its line of beach towels and swimwear based on long-range weather forecasts. The probability of means temperature and related sales of product line units are as indicated below: Unit sales Temperature Probability 10,000 75-79

Factor model for stock returns

Suppose a factor model is appropriate to describe the returns on a stock. The current expected return on the stock is 10.5 percent. Information about those factors is presented into eh following chart: Factor B Expected Value Actual Value Growth in gnp 2.04 1.8% 2.6% Inflation -1.15 4.3

Point to Determine When to Close Down

In deciding whether to start a new business, explain fully which factors you would include in your business plan? Assuming you open the business, at what point would you deem the business venture successful? At what point would you decide to close down if you were losing money?

Life insurance policy - received payments

You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $200,000 today or receive payments of $1,400 a month for 20 years. You can earn 6 percent on your money. Which option should you take and why? Ques

Evaluate Walmart's Financial Performance During the Past 2 Years

Evaluate Wal-Mart's financial performance during the past 2 years, using financial ratios. Calculate the ratios for each year: Current Debt Return on equity Average Collection Period Discuss the trend for each ratio and what it tells you about the organization's financial health.

An Analysis of the Financial Ratios for PepsiCo, Inc.

Data from Consolidated Statement of Income (page 60), Consolidated Statement of Cash Flows (page 61) and the Consolidated Balance Sheet (page 62) of the 2009 PepsiCo Annual Report and was used to determine that following ratios for both year 2009 and 2008 Please note that the numbers are in millions: 1. Current Ratio T

Prepayment risk & collateralized mortgage obligations

What is prepayment risk and how does it apply to collateralized mortgage obligations and other forms of securitized mortgages? What innovations has the mortgage lending industry developed to deal with prepayment risk?

Excel problem for Alice Barr Realty housing sale data.

You are an intern with the Regional Realty Service and are analyzing the claim made by Alice Barr Realty that "we get your price." You have prepared a spreadsheet that shows data relating to three months' sales by Alice Barr Realty. You are going to determine the percent of asking price for each home sold that month. Determiine

Finance: 5 multiple choice questions

(1) Suppose you have an investment that pays $75 at the end of the year for each of the next five. If your opportunity cost of money is 12%, how much is the investment worth? A) $270.36 B) $375.00 C) $132.18 D) $250.71 (2) In computing the terminal value on a piece of equipment that will be disposed of in 5 years,

Finance: Expected Rate of Return for Investment Scenarios

What is the expected rate of return for an investment that has the following expected scenario? If there is an 18% probability of a recession, 2.0% return; if there is a 65% probability of a moderate economy, 9.5% return; if there is a 17% probability of a strong economy, 14.2% return.

Financial Management - NPV

calculations must be shown in excel 1) Continuous Compounding: Compute the future value of $1,900 continuously compounded for: a: 5 years at a stated annual interest rate of 12 percent. b. 3 years at a stated annual interest rate of 10 percent. c. 10 years at a stated annual interest rate of 5 percent. d. 8 years at a s