If your firm has a debt issue outstanding with 7 years to maturity at 87 percent of face value paying semi-annually at 6.5%, what is the cost of debt? Assume a 35% tax rate. Is there a debt to equity ratio that will maximize the value of the firm? Why or why not?
Andy has five barbers working for him. Each Barber is paid $9.90/hr & works 40/hr week & a 50/wk year regardless of # of haircuts. Rent & other fixed expenses are $1750 per month. Hair shampoo used on all clients costs .40 per client. Assuming they are on ly doing haircuts the unit price is $12. 1 Find contribution margin per
Apex Limited Income Statement For the Year Ended December 31 2006 2005 Net Sales $2,535,000 $2,412,000 Cost of goods sold 1,329,500 1,297,500 Gross profit 1,205,500 1,114,500 Selling/admin expenses 756,000
Walmart Stores, Inc: On Becoming the World's Largest Company (2002) I am doing a strategic audit on this case. I have done the EFAS, IFAS, and a partial TOWS Matrix that needs a couple of additions. I'd really appreciate it if someone could help me with the write up of the case. The strategic audit needs to be written in outline
Please use these companies: www.ge.com & www.tyco.com. Using each companies annual reports/financial information from moneycentral.msn.com; please help answering the following: 1. Divide each company's market capitalization by that company's shareholders' equity. This market-to-book ratio provides one measure of shareho
1. In ratio analysis, an individual organization is usually compared to an appropriate industry average. How can one tell if the entire industry is doing poorly or well? 2. In deciding to continue (or discontinue) a service whose revenue do not cover total cost, which is more important in the short run, variable cost or fi
P15−2 Compute ratios from balance sheet and income statement. (SO 5) The comparative statements of Taylor Tool Company are presented below. Taylor Tool Company Income Statement For the Year Ended December 31 2006 2005 Net sales $1,818,500 $1,750,500 Cost of goods sold 1,011,500 996,000 Gross profit 807,000 754,
Brady Corporation is a leader in identification, safety, and material solutions. In 1998, the firm was hit hard by faltering foreign markets, so it embarked upon an aggressive campaign to redesign its cost structure. The firm believes this will help it to enhance future stockholder value. Brady follows the concept of Shareholder
0. Ratio of fixed assets to long-term liabilities 1. Acid-test ratio 2. Current ratio 3. Working capital 4. Accounts receivable turnover 5. Rate earned on total assets 6. Rate earned on common stockholders' equity 7. Number of times interest charges earned 8. Earnings per share on common stock
For each category of financial ratios, give some examples of who would be likely to examine these ratios and why. Category 1.Liquidity Analysis ie-current Ratio, Quick Ratio, Net working capital 2. Profitability Analysis Ratios ie- Return on Assets,Return on equity, EPS, Profit Margin 3. Acti
The Bruggs & Strutton Company manufactures an engine for carpet cleaners called the "Snooper." Cost and revenue data for the "Snooper" are given below, based on sales of 40,000 units. Sales $1,600,000 Less: Cost of goods sold 1,120,000 Gross margin $ 480,000 Less: Operating expenses 100,000 Op
There are two ways to produce electric screwdrivers and each has a different cost structure though they could be sold for the same price: Process A Process B Unit sales price = $30.00 Unit sales price= $30.00 Unit variable cost = $15.00 Unit variable cost = $10.00 Fixed cost = $4,500 Fixed cos
Please provide help with the following questions: SCENARIO: You and your small group have been asked to create an informative slide presentation to managers, most of whom do not have a technical knowledge of accounting. QUESTIONS: 1. First, you will discuss key elements with top executives. 2, How will investor
Constance's Vacation to New York Projected expenses broken down into 2 categories: "living expenses" (for food and lodging) and "vacation expenses" (for travel and internment). For planning purposes: plans to spend $90 per day for food and $ 170 per day for lodging. Travel costs a lump sum of $375 (including airli
Attached financial statements over the period 2002-2005 for R&E Supplies, Inc. A. Use these statements to calculate as many of the ratios in Table 2.2 as possible. B. What insights do these ratios provide about R&E's financial performance? What problems, if any, does the company appear to have?
1. The Veblen Company and the Knight Company are identical in every respect except that Veblen is not levered. The market value of Knight Company's 6-percent bonds is $1 million. Financial information for the two firms appears below. All earnings streams are perpetuities. Neither firm pays taxes. Both firms distribute all earni
The financial statements of Garcia Company include the following data: Please see attached document. Compute the inventory turnover ratio for 2006. Round answer to two decimal places. Compute the debt to total assets ratio for 2006. Round answer to the nearest percentage. Use all the debt to calculate the ratio.
"Who can figure bankers?" Pehr Weisengraf mumbled as he returned to the office of his small candy manufacturing business, Professional Confectioners. "They're willing to lend money only to those business owners who don't really need it. If you can prove you don't need it, they'll throw it at your feet. Unfortunately, we need it,
Kent Company prepared the following table detailing its operating percentages for last year: Sales.................................... 100% Cost of sales: Variable............................ 50% Fixed................................. 10% 60% Gross profit.......................... 40% Other operating expenses
Last year Easton Company reported sales of $720,000, a contribution margin ratio of 30% and a net loss of $24,000. Based on this information, the break-even point was: $640,000 $880,000 $744,000 $800,000
Given the financial statements for Johnson Corporation and Simpson Corporation shown here: a. To which company would you, as credit manager for a supplier, approve the extension of (short-term) trade credit? Why? Compute all relevant ratios before answering. b. In which one would you buy stock? Why? See attached file
Who uses financial ratio analysis information? How can you determine if an organization will be unable to pay its bills? How can you determine if an organization is using too much debt?
C-V-P Equations. 9. What is the basic C-V-P equation? What is a more detailed version of this equation? 10. What is the contribution margin, and why is it important for managers to know the contribution margins of their products? 11. How much will profits increase for every unit sold over the break-even point? 12. What is
7.10 7.12 Direct write-off method versus allowance method 7.13 Accounting for Uncollectible Receivables?Percentage of Sales Method 7.14 Comparing the Percentage of Sales and Percentage of Sales 7.15 R
Recording sales transactions. See attached file for full problem description. 7.10 Aging of Accounts Receivable Madariaga Company's accounts receivable reveal the following balances: Operating Activities Age of Accounts Receivable Balance Current . . . . . . . . . . . . . . .
Tetrangle Manufacturing has fixed costs of $2,160 per day. The firm manufactures bicycle component upgrade kits. The kits have a short-run average variable cost of $48 and are sold for $66 each. (i) What is the break even level of daily output for the firm? (ii) What is the degree of operating leverage when daily output is
Parkins Company produces and sells a single product. The company's income statement for the most recent month is given below: Sales (6,000 units at $40 per unit) $240,000 Less manufacturing costs: Direct materials $48,000 Direct labor (variable) 60,000 Variable factory overhead 12,000 Fixed factory overh
NBS Company has guaranteed a $1,000,000 bank note for XY Company. How would this influence the liquidity ratios of NBS Company? How should this situation be considered?
See attached file for full problem description. If the figures are not accurate please help with that too. 1. From Investor Relations sections of websites of Wal-Mart and Robinsons May (use Google), compile dividend (annual) information and net income figures of each company for the years 1998, 1999, 2000, 2001, 2002, and 20
Annie McCoy, a student at Tech, plans to open a hot dog stand inside Tech's football stadium during home games. There are seven home games scheduled for the upcoming season. She must pay the Tech athletic department a vendor's fee of $3,000 for the season. Her stand and other equipment will cost her $4,500 for the season. She es
National Bank has the following balance sheet (in millions) and has no off-balance-sheet activities. (See attached file for full problem description) Assets Liabilities and Equity Cash $20 Deposits $980 Treasury bills 40 Subordinated debentures 40 Residential mortgage 600 Common Stock 4