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Financial Management Questions on Net worth, Shares, exchange rates

1. Cash Equation: McConnell Corp. has a book net worth of $16,500. Long-term debt is $7,800. Net working capital, other than cash is, $1,900. Fixed assets are $20,700. How much cash does the company have? If current liabilities are $2,750, what are current assets?

2. Rights Offerings: Again, Inc., is proposing a rights offering. Presently, there are 450,000 shares outstanding at $90each. There will be 80,000 new shares offered at $84 each.
a. What is the new market value of the company?
b. How many rights are associated with one of the new shares?
c. What is the ex-rights price?
d. What is the value of a right?

3. Using Spot and Forward Exchange Rates: Suppose the spot exchange rate for the Canadian dollar is Can$1.02 and the six-month forward rate is Can$1.03.
a. Which is worth more, a U.S dollar or a Canadian dollar?

4. Cross-Rates and arbitrage: Suppose the Japanese yen exchange rate is Y93 =$1, and the British pound exchange rate is E 1 = $1.64.
a. What is the cross-rate in terms of yen per pound?

Please use attached excel template. Where numeric solutions are expected, please provide full detail of the process used to reach the solution using excel.

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Solution Summary

This Solution deals with calculation of related values in the capital structure, valuation in rights offering, exchange rates and cross currency rates.