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Ratios and Financial Planning: East Coast Yachts

RATIOS AND FINANCIAL PLANNING AT EAST COAST YACHTS Dan Ervin was recently hired by East Coast Yachts to assist the company with its short-term financial planning and also to evaluate the company?s financial performance. Dan graduated from college five years ago with a degree in finance, and he has been employed in the treasur

Portfolio expected return, variance, standard deviation, risk premium

Consider the following information about three stocks: State of Economy Probability of State of Economy Rate of Return if State Occurs Stock A Stock B Stock C Boom .4 .20 .35 .60 .4 .20 .35 .60 Normal .4 .15 .12 .05 .4 .15 .12 .05 Bust .2 .01 -.25 -.50 .2 .01 -.25 -.50 a. If your portfolio is invested 40% each in A a

Expected return and standard deviation

Based on the following information, calculate the expected return and standard deviation: State of Economy Probability of State of Economy Rate of Return if State Occurs Depression .10 -0.045 Recession .20 0.044 Normal .50 0.120 Boom .20 0.207 Please do not respond in Excel.

Hedging Transaction- MCQ

1. Your company will receive C$600,000 in 90 days. The 90-day forward rate in the Canadian dollar is $.80. If you use a forward hedge, you will- a. receive $750,000 today. b. receive $750,000 in 90 days. c. pay $750,000 in 90 days. d. receive $480,000 today. e. receive $480,000 in 90 days 2. With regard to hedgin

Financial management

1)The earnings for Crystal Cargo Inc. have been predicted for the next 5 years and are as follows. There is 1 million shares outstanding. Determine the yearly dividend per share to be paid if the following policies are enacted: a. A constant dividend payout ratio of 50 percent. b. A stable dollar dividend targeted at 50 perc

Kenya - Exchange Rates and Money Supply

Kenya is a state that is a part of the African Nation. Talk about the exchange rates and their money supply. Also write about whether or not Kenya has a promising future. What is there macroeconomic policy?

Ratios

For each of the ratios listed below, indicate by the appropriate code letter, whether it is a liquidity ratio, a profitability ratio, or a solvency ratio. Code: L = Liquidity ratio P = Profitability ratio S = Solvency ratio 1. Price-earnings ratio 2. Free cash flow 3. Debt to total assets ratio 4. Earnings

Unique Risk (Firm-specific risk) vs Market Risk (Systematic risk)

In financial theory, the total risk (stand alone risk) is composed of the unique risk and the market risk. The total risk is usually measured as the standard deviation whereas the market risk is measured as the beta associated with the market portfolio. Please see the following two different stocks. For

Business finance

Mini Case: Dan Barnes, financial manager of Ski Equipment Inc. (SKI), is excited, but apprehensive. The company's founder recently sold his 51 percent controlling block of stock to Kent Koren, who is a big fan of EVA (Economic Value Added). EVA is found by taking the net after-tax operating profit and then subtracting t

Hermes Inc

Please help with the attached two questions. Instructions - Journalize transactions for investments in stocks. Q.1.) Hermes Inc. had the following transactions pertaining to investments in common stock. Jan. 1 Purchased 2,000 shares of Lanier Corporation common stock (5%) for $140,000 cash plus $2,100 broker's comm

Expectations Theory

Assume that a one-year Treasury securities yield 5%.The market anticipates that 1 year from now, one-year Treasury securities will yield 6%. So if the pure expectations theory is correct, what is the yield today for 2-year Treasury securities?

Good news versus bad news from annual report

This is a finance problem. I know that the net income has increased and that would be classified as good news. The problem is as follows: Kwik Express specializes in the transportation of medical equipment and laboratory specimens overnight. The company has selected the following information from its most recent annual report

Suppose you pay 15% as a nominal annual

This is a multiple choice question. Suppose you pay 15% as a nominal annual rate on your credit card. If you make monthly payments with monthly compounding, what is your effective annual rate? A. 1.25% B. 15.00% C. 16.08% D. 18.80% E. 19.24%

Beta of a Diversified Portfolio

You hold a diversified portfolio consisting of a $5,000 investment in each of 20 different common stocks. The portfolio beta is equal to 1.15. You have decided to sell one of your stocks, a lead mining stock whose b is equal to 1.0, for $5,000 net and to use the proceeds to buy $5,000 of stock in a steel company whose b is equ

You have $2,000 invested in a bank account

This is a multiple choice question. You have $2,000 invested in a bank account that pays a 4 percent nominal annual interest with daily compounding. How much money will you have in the account in 132 days from today? (Assume there are 365 days in each year.) a) $2,029.14 b) $2,028.93 c) $2,040.00 d) $2,023.44 e) 2,023.

Financial Management

1)John invested $1,000 in a risky investment and Bill invested $1,000 in a less risky investment. One year later, Bill's investment is worth $1,030. Which of the following statements is most correct? A)John's investment must be worth more than $1,030 because of the risk-return tradeoff, given that John's investment was more

Amortization Schedule

There are seven years remaining on a ten year car loan. The interest rate is 10.25%. The monthly payments are $450.00. The credit union is willing to accept the present value of the loan as a pay off. develop an amortization schedule Using excel that shows how much will need to be paid at the end of each of the ten years. design

Accounting - Juan's Taco Company has restauraunts in five college towns.

I am stuck and need help with the following problem: Problem P4-20 Chapter 4, Block & Hirt, Finance and Accounting 11th edition Juan's Taco Company has restauraunts in five college towns. Juan wants to expand into Austin and College Station and needs a bank loan to do this. Mr. Bryan, the banker, will fin

Financial management

1) The prices for the Guns and Hoses Corporation for the first quarter of 2005 are given below. Find the holding period return for February. Month End Price January $135.28 February 119.40 March 141.57 2) If a corporation has operating income of $10,500,000 and it receives $245,000 in interest income and $312,00

Break-Even Analysis and Costs

Barry Carter is considering opening a music store. He wants to estimate the number of CDs he must sell to break even. The CDs will be sold for $13.98 each, variable operating costs are $10.48 per CD, and annual fixed operating costs are $73,500. a. Find the operating breakeven point in number of CDs. b. Calculate the total ope

Financial management

1) Made-It common stock currently sells for $22.50 per share. The company's executives anticipate a constant growth rate of 10 percent and an end of year dividend of $2. A) What is your expected rate of return if you buy the stock for $22.50. B) If you require a a 17 percent return, should you purchase the stock? 2) Pio

Financial Management

The LOGOS Corporation is planning on issuing bonds that pay no interest but can be converted into $1,000 at maturity, 7 years from their purchase. To price these bonds competitively with other bonds of equal risk, it is determined that they should yield 9%, compounded annually. At what price should the LOGOS corporation sell the

Finance - For markets to be in equilibrium:

For markets to be in equilibrium (that is, for there to be no strong pressure for prices to depart from their current levels), a. The expected rate of return must be equal to the required rate of return; that is, . b. The past realized rate of return must be equal to the expected rate of return; that is, . c. The required r

Finance : Depreciation and Amortization

Value of the vehicle V depreciates T Months later V=10,000(.95)^t [for 0<T<36] How much is the depreciation? (those are less than or equal to signs) I already did the amort. portion. I need help with the depreciation. *The value should be 10,000 not 1000 as indicated in the problem. I have a Finance problem. It is time t