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Balance Sheet Analysis

I am a little lost here are my problems please show me how to calculate 1. In March 2005, General Electric (GE) had a book value of equity of $113 billion, 10.6 billion shares outstanding and a market price of $36 per share. GE also had a cash of $13 billion and total debt of $370 billion. Four years later in early 2009, GE

About lower cost market

Steel Company, a wholesaler that has been in business for two years, purchases its inventories from various suppliers. During the two years, each purchase has been at a lower price than the previous purchase. Steel uses the lower of FIFO cost or market method to value inventories. The original cost of the inventories is above

3 short finance questions.

I've posted the problems here and in the attachment. Get back to me, thanks. 9-1 DPS CALCULATION Warr Corporation just paid a dividend of $1.50 a share (that is, D0 = $1.50). The dividend is expected to grow 7% a year for the next 3 years and then at 5% a year thereafter. What is the expected dividend per share for each of th

Financial options

United Hospital has received a leasing proposal from Leasing, Inc., for a Siemens cardiac catheterization unit. The terms are: â?¢ Five-year lease â?¢ Annual payments of $200,000 payable one year in advance â?¢ Payment of property tax estimated to be $23,000 annually â?¢ Renewal at end of year 5 at fair market val


Profit margins and turn over ratios vary from one industry to another. What differences would you expect to find between a grocery chain such as a Safeway and steel company? Think particularly about the turnover ratios, the profit margin and Du Pont equation.

Floor Price of a Convertible Bond

Valdes Enterprises is considering issuing a 10-year convertible bond that would be priced at its $1,000 par value. The bonds would have an 8.00% annual coupon, and each bond could be converted into 20 shares of common stock. The required rate of return on an otherwise similar nonconvertible bond is 10.00%. The stock currently se

Financial Forecasting

Hello, I've been doing some trial on this specific problem, and have spent quite some time on it, but I still can't figure out the answers. I was actually wondering If I could have an hand in resolving the problem .

Corporate finance

Paradise Enterprises has gathered projected cash flows for two projects. At what interest rate would the company be indifferent between the two projects? Which project is better if the required return is above this interest rate? Why? Year Project(I) Project(J) Difference ----------------------------------------------------

Stocks and their Beta's: Example Problem

A recent paper examined a Security Market Line analysis of eight Blue Chip stocks. The analysis determined the beta for each firm, the required return for stocks with that beta, and the currently expected return for that stock as follows: Firm Beta Required Return Currently Expected Return 1 0.9

Linear Programming Model

(Hospital Expansion Problem) Mt. Siani Hospital in New Orleans is a large, private, 600-bed facilty, complete with laboratories, operating rooms, and x-ray eqipment. In seeking to increase revenues, Mt. Sinai's administration has decided to make a 90-bed addition on a portion of adjacent land currently used for staff parking. Th

Value of annual cash flow

Beverly Enterprises owns a nursing home that is currently earning $2.0 million in cash flow on an annual basis, but this amount is expected to drop in the future. The nursing home has a book value of $20 million, a replacement cost of $40 million, and a current sale value of $10 million. If Beverly Enterprises has a cost of capi

Cost Plus Pricing

Document attached. Cost-Plus Pricing. Emerson Ventures is considering producing a new line of hang gliders. The company estimates that variable costs will be $325 per unit and fixed costs will be $330,000 per year. Required a. Emerson has a pricing policy that dictates that a product's price must be equal to full cost plus 6

Continuous Probablility distributions

1. For the following normal distributions with parameters as specified, calculate the required probabilities: a) &#956; &#8776; 5, &#963; = 2; calculate P( 0<x<8) b) &#956; &#8776; 5, &#963; = 4; calculate P( 0<x<8) c) &#956; &#8776; 3, &#963; = 2; calculate P( 0<x<8) d) &#956; &#8776; 4, &#963; = 3

I need help with these problems

Please help me solve these problems. Problem The following are the information on the income statements of an Oil firm, for 2007 and 2008 (all dollar figures are in millions): 2007 Sales: $12,200.00, cost of goods sold: 72% of sales, depreciation: $850.00, additional CAPEX: $900.00, additional investment in net working ca

Managerial Decisions for Firms with Marketing Power

Antitrust authorities at the Federal Trade commission are reviewing your company's recent merger with a rival firm. The FTC is concerned that the merger of the two rival firms in the same market will increase market power. A hearing is scheduled for your company to present arguments that your firm has not increased its market p

Accounting for stock dividends and stock splits

An electronics corporation's common stock is selling for $44 per share, and its common stockholders' equity is shown here. a. Show the impact of a 50% stock dividend. b. Show the impact of a 3-for-2 stock split. c. Describe how the stock market would react to each event. How would you explain the difference in reaction? P


AC556 Week 6 Problem Proforma Statements NOTE: It is expected that this problem will be completed using an Excel spreadsheet using formulas. Please see the Excel Tutorial that is available under the course home tab. The Duncan Company has just completed a number of budgets for the coming year. The cost of goods manufacture

Price help

Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Beedles Inc., the terms were as follows: Price to public: $5 per share Number of shares: 3 million Proceeds to Beedles $14,000,000 The out-of-pocket expenses incurred by Security Brokers in the design and distribution of

Purchase Decision / Degree of Financial Leverage

5. You are considering the purchase of new equipment for your company and you have narrowed down the possibilities to two models which perform equally well. However, the method of paying for the two models is different. Model A requires $5,000 per year payment for the next five years. Model B requires the following payment sched

Calculating the NPV and IRR of a Project

Please help with the following problem: Your company is considering investing in a new plant. The initial investment is $220 million, obtainable at the end of the plant's useful life in ten years. Your company uses straight line depreciation (seven years). The net income from the project is expected to be $28 million per y

Present value

What is the present value of $10,000 received. 1) 12 years from today when the interest rate is 4% per year? 2) 20 years from today when the interest rate is 8% per year? 3) 6 years from today when the itnerest rate is 2% per year?

Alice Bates: Capital Budgeting

Alice Bates needs to reduce prices to her companies operating system software since its getting strong competition from a number of competitors. If she institutes a 30% discount she can probably increase next year's sales 25%. But if she reduces the price 60%, she can get it installed on notebook computers which is expected to i

Help with balance sheet, I really need help

Complete the following balance sheet for the Range Company using the following information: Debt to Assets = 60 percent Quick Ratio = 1.1 Asset Turnover = 5x Fixed Asset Turnover = 12.037x Current Ratio = 2 Average Collection Period = 16.837 days Cash Current Liabilities ______ Receivables ______

CVP and Financial Statements

Procter & Gamble Company is a Cincinnati-based company that produces household products under brand names such as Gillette, Bounty, Crest, Folgers, and Tide. The company's 2006 income statement showed the following (in millions): Net sales $68,222 Costs of products sold 33,125 Selling, general, and administrative expense 21

A) The after-tax weighted average cost of capital (WACC) is given by: b) If a firm borrows $50 million for one year at an interest rate of 9%, what is the present value of the interest tax shield? c) If a firm permanently borrows $100 million at an interest rate of 8%, what is the present value of the interest tax shield?

23a.The after-tax weighted average cost of capital (WACC) is given by: (Corporate tax rate = TC) A. WACC = (rD)(D/V) + (rE)(E/V) B. WACC = (rD)(D/V) + [(rE)(E/V)/(1 - TC)] C. WACC = [(rD)(D/V) + (rE)(E/V)]/(1 - TC) D. WACC = (rD)(1 - TC)(D/V) + (rE)(E/V) 23b. If a firm borrows $50 million for one year at an inte

Calculating Bond Prices

Please help with the following problem. Provide step by step calculations. You own a 20-year, $10,000 par value bond paying 7% interest annually. The market price of the bond is $875, and your required rate of return is 10%. A) Compute the bond's expected rate of return B) Determine the value of the bond to you, given y