QUESTION Float. General Products writes checks that average $20,000 daily. These checks take an av- erage of 6 days to clear. It receives payments that average $22,000 daily. It takes 3 days be- fore these checks are available to the firm. a. Calculate payment float, availability float, and net float. b. What would be General […]
QUESTION Vertical analysis (common size) percentages for Osborne Hot Dogs sales, cost of goods sold, and expenses are as follows:Vertical Analysis200720062005Sales100.0100.0100.0Cost of goods sold59.262.464.5Expenses25.026.627.5Did Osbornes net income as a percent of sales increase, decrease, or remain unchanged over the three-year period? Provide numerical support for your answer. For making the Vertical Analysis, we have taken […]
QUESTION Real v e r sus Nominal Rates. You will receive $100 from a savings bond in 3 years. The nominal interest rate is 8 percent. a. What is the present value of the proceeds from the bond? b. If the inflation rate over the next few years is expected to be 3 percent, what […]
QUESTION Mom and Pop Groceries has just dispatched a years supply of groceries to the government of the Central Antarctic Republic. Payment of $250,000 will be made one year hence after the shipment arrives by snow train. Unfortunately there is a good chance of a coup dA?tat, in which case the new government will not […]
QUESTION The management of the Book Warehouse Company wishes to apply the Miller-Orr model to manage its cash investment. They have determined that the cost of either investing in or selling marketable securities is $100. By looking at Book Warehouses past cash needs, they have determined that the variance of daily cash ows is $20,000. […]
QUESTION Kose, Inc. has a target debt-equity ratio of 1.40. Its WACC is 8.3 percent, and the tax rate is 38%.If Koses cost of equity is 15%, what is the pre-tax cost of debt? (final answer should be rounded to 2 decimal places)If instead you know that the aftertax cost of debt is 3.9%, what […]
QUESTION The nancial manager of the Villard Electric Company, Fred Taylor, has presented his estimates of cash ows resulting from the possible investment in a new computer system, the Webnet. Mr. Taylors esti- mates of net cash ows immediately and over the following four years are as follows: Item Initial First Y ear Second Y […]
QUESTION A Treasury Bond futures contract has a settlement priced of 8908. What is the implied annual yield? (Hint: You can use a financial calculator.) Assume this is a a 20-year bond with semiannual interest payments. The face value of the bond is $1,000, and the semiannual coupon payments are $30, which means the annual […]
QUESTION Mini Case Yanzhou (china) Bids for Felix Resources (Australia) Mini Case Yanzhou (china) Bids for Felix Resources (Australia) 1 When should stockholders doubt their own company?s support of a friendly acquisition? 2 What is your assessment of the stipulation placed on the acquisition by the Australian government? 3 Which of the various valuation techniques […]
QUESTION Q1)James Corporation is considering the credit application of a customer. The customer is expected to buy $5000 worth of material from James every month in future, and pay for it within a month. There is a 20% probability that the customer may default on his monthly payment. If that happens, then James will not […]
