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# Finance

### ACCOUNTING.

Joe's Lawn Service has asked you to create various financial spreadsheets and a written memo to help him understand his finances for his business. Create an Excel spreadsheet with formulae to demonstrate the following examples. Be sure to clearly label each example by using a different spreadsheet tab: ·

### Effective rate / EPS

1. John Fleming has been shopping for a loan to finance the purchase of a used car. He has found three possibilities that seem attractive and wishes to select the one with the lowest interest rate. The information available with respect to each of the three \$5,000 loans is shown in the following table: Loans Principal Ann

### Rate of return/project selection

Please see the attached file. 1. Your firm makes the most popular widgets for vacuum cleaners. Your operations manager has suggested that due to an economic slowdown, he could re-tool some of the widget machines so that rather than manufacturing widgets for vacuums, you could manufacture either airplane widgets or snow mobile

### Financial Statements

On Your Mark is preparing to release its first Annual Stockholder Report since the company's recent initial public offering (IPO). The accounting department has already prepared and provided the financial statements and ratios (see below) for the most recent year. Now all the division managers are meeting to help create the writ

### Stock price, Beating the Market & Market Efficiency

1. A stock market analyst is able to identify mispriced stocks by comparing the average price for the last 10 days to the average price for the last 60 days. If this is true, what do you know about the market? 2. What are the implications of the efficient market hypothesis for investors who buy and sell stocks in an attempt

### Compute cost of work in process and cost of jobs completed

Job Materials Direct Labor 789 2,000 6,000 790 9000 10000 791 14000 8000 Uses job costing system. #789 was the only job in process Jan 1 with costs of 22,500. Direct matls and labor above #791 was the only job in production as of Jan 31 Question: Compute cost of work

### Howton & Howton Worldwide: Additional Funds Needed (AFN)

Scenario: Howton & Howton Worldwide (HHW) is planning its operations for the coming year, and the CEO wants you to forecast the firm's additional funds needed (AFN). Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 10% that was used in the past

### Major Types of Financial Intermediaries

Different financial institutions offer a variety of similar services, but with different levels of competence. What are some explanations for this? What are major types of financial intermediaries? How are they similar and different?

### Finance: Actions to minimize cash flow problems - both inflows and outflows

1. What actions can you take to minimize the cash flow problems that were identified in the simulation? Look at the problem from both the inflow and outflow of cash to determine what actions you can conceivably take to assure adequate cash availability.

### Pretax Required Return

The Gecko Company and the Gordon Company are two firms whose business risk is the same but they have different dividend policies. Gecko pays no dividends and Gordon has an expected dividend yield of 6 percent. Suppose the capital gains tax rate is zero, whereas the dividend tax rate is 35 percent. Gecko has an expected earnings

### Finance - Discuss CVP (Cost-Volume-Profit) analysis

Discuss CVP (Cost-Volume-Profit) analysis. How can it be used to analyze the data in the PDA sim to help understand the behaviors of the products and the profitability of each product from year to year? Does using this for Breakeven Analysis have any benefit or value? What other possible financial techniques do think

### The Kranberry kids Kompany is in the volatile garment business.

The Kranberry kids Kompany is in the volatile garment business. The firm has annual revenues of \$250 million and operates with a 30% gross margin on sales. Bad debt losses average 3% of revenues. Kramberry is contemplating an easing of its credit policy in an attempt to increase sales. The loosening would involve accepting a low

### Questions on Cost-Plus Pricing, Profit, Maximizing Price, etc.

8-4 RoverPlus, a pet product superstore, is considering pricing a new RoverPlus labeled dog food. The company will buy the premium dog food from a company in Indiana that packs the product with a RoverPlus label. Rover pays \$6 for a 50-pound bag delivered to its store. The company also sells Royal Dog food (under the royal dog f

### Determine the economic conditions

Condition PRobability StockA Stock B Weak 10% 10.00% 17.00% Below Average 20% 18.50% (21.29%) Normal 40% 38.67% 44.25% Above Average 20% 14.33% 11.6

### Cost amd break even (See attached)

1-14 thru 1-22 (See attached) 1-14 Gina Fox has started her own company, Foxy Shirts ... 1-15 Ray Bond sells handcrafted yard decorations ... 1-16 Ray Bond from problem 1-15 is trying to find a new supplier ... 1-17 Katherine D'Ann is planning to finance her college education ... 1-18 Katherine D'Ann fromproblem 1-17 has

### Bonds, risk, ratios

1) A bond manager who wishes to hold the bond with the greatest potential volatility would be wise to hold a. short-term, high-coupon bonds. b. long-term, low-coupon bonds c. long-term, zero-coupon bonds d. short-term, zero-coupon bonds e. short-term, low-coupon bonds 2) A financial institution can h

### Corporate Finance Questions

1. A firm's balance sheet shows current assets of \$95, net fixed assets of \$250, long-term debt of \$40, and owners equity of \$200. What is the value of the firm's current liabilities if that is the only remaining balance sheet item? A) -\$ 50 B) \$ 50 C) \$105 D) \$145 E) \$545 2. Calculate net income u

### Finance

1. For a typical business, what are some external variables that influence the reversion rate? 2. What action can management take to exploit an overpriced share price of the corporation? 3. What action can management take to exploit an under-priced share price of the corporation? 4. What is one red flag in

### Alley Company: compute various financial ratios

Alley Company Comparative balance sheet December 31, 2009 Assets 2009 2008 Cash \$35,000 \$40,000 Marketable securities 15,000 60,000 Accounts receivable (net) 40,000 30,000 Inventory

### Loras Corp: Real Cost of Hedging Payables for New Zealand imported goods

Real Cost of Hedging Payables Assume that Loras Corp imported goods from New Zealand and needs 100,000 New Zealand dollars 180 days from now. It is trying to determine whether to hedge this position. Loras has developed the following probability distribution for the New Zealand dollar: Possible Value of New Zealand Dolla

### Explain business plans, sources of finance, and market identification.

As a veteran entrepreneur, you have been asked from Zach Johnson, a recently new entrepreneur, the following questions: * What advice would you offer to Zach who is interested in expanding his current business and launching a global business effort? * Explain the statement "For each benefit gained by regulation, ther

### Price Analysis

(5). Which of the following is not a common source of prices for a price analysis? (a). Catalog prices, (b). Internet prices, (c). The grapevine, (d). Independent cost estimates. (6). Which of the following is not a category of discounts? (a). Trade discounts, (b). Quantity discounts, (c). Credit card d

### Companies accepting a level of risk: compare the cost of compliance vs degree of risk

Companies are constantly making business decisions based on accepting a certain level of risk. Discuss a situation where a company has accepted a certain degree of risk. Compare and contrast the cost of compliance against the degree of risk of noncompliance. What considerations may a company take into account when determining

### Selecting an alternative

The Hand-to-Mouth Company needs a \$10,000 loan for the next 30 days. It is trying to decide which if three alternatives to use: Alternative A: Forgo the discount on its trade credit agreement that offers terms of 2/10, net 30. Alternative B: Borrow the money from Bank A, which has offered to lend the firm \$10,000 for 30

### Stock valuation: constant growth model

IP Inc is expected to pay \$1.70 dividends next year. The dividend growth rate is expected to be 7% forever. If the required rate of return for IP is 10%, calculate the price of the stock using the constant growth model. If the stock is currently selling for \$63, indicate whether the stock is under priced or overpriced. Plea

### Johnson Controls Inc Stock Evaluation: market cap, risk, premium, beta, value

The stock chosen is Johnson Controls INC (JCI). The calculations should be done in excel. Please answer the following questions. Market Capitalization Rate. What is your market capitalization rate? What did you choose for a risk free rate? Why? What did you choose for a market risk premium? Why? How did yo

### A man walks into a New York City bank and asks for a \$5000

Here's an old story: A man walks into a New York City bank and asks for a \$5000 loan, offering his Ferrari, worth \$250,000 as collateral. He tells the loan officer that he needs the money for two weeks for an important venture. The loan officer, having the car as security and after checking references, gives the man the money he

### Affordable Mortgage And Purchase Price

I need to estimate the affordable mortgage and the affordable purchase price for the Bergholts. Please show all work and give an explanantion of how you got it. Here is their information: Kim and Dan Bergholt are both government workers. They are considering purchasing a home in the Washington D.C. area for about \$280,000.

### Cost of the preferred stock

Ten years ago, Stigler Company issued \$100 par value preferred stock yielding 8%. The preferred stock is now selling for \$97 per share. What is the current yield or cost of the preferred stock? (disregard flotation cost) a. 7.76% b. 8% c. 8.25% d. there is not enough information to answer the question

### Financial Management - Charles Schwab and Co.

Using the Internet, research a company to analyze. Prepare a report including the following information: Please research Charles Schwab and Co. What is the history of this company? How did it begin? What differentiates this company from its competitors? Compute the following ratios for this company: - current rati