Homework Answers
| 1) | Net Income | 300000 | ||
| Interest at 9% of 500,000 | 45000 | |||
| Net income after interest | 255000 | |||
| Ke | 10% | |||
| Equity value | 2550000 | |||
| Debt value | 500000 | |||
| Total value of firm | 3050000 | |||
| 2) | Years | CF | Cumul CF | |
| Initial CF | -30000 | -30000 | ||
| 1 | 4000 | -26000 | ||
| 2 | 7000 | -19000 | ||
| 3 | 11000 | -8000 | ||
| 4 | 14000 | 6000 | ||
| 5 | 8000 | 14000 | ||
| 6 | 4000 | 18000 | ||
| So pay back happens in 4 year | 3.571 | |||
Add Answer to:
1. A Company expects a net income of 300,000dhs. It has 500,000dhs, 9 % debentures.The equity...
at UU you mean by capital structure? A Company expects a net income of 600,000 dhs....
at UU you mean by capital structure? A Company expects a net income of 600,000 dhs. It has 500,000 dhs, 9% debentures The equity capitalization rate of the company is 11%. Calculate the value of the firm and overall capitalization rate according to the net income approach
22. An all-equity firm has net ind um has net income of $ 200 deration of...
22. An all-equity firm has net ind um has net income of $ 200 deration of $7.500, and taxes of $2,050. What is the firm's operating cash flow! A) $17.850 B) $21.950 C) $26,250 D) $35,800 E) $36,750 23. year project is expected to generate annual revenues of $114,500, variable, costs of $73,600, and fixed costs of $14,000. The annual depreciation is $3,500 and the tax rate is 34 percent. What is the annual operating cash flow? B) C) $14,301...
Alaskan Markets has a target capital structure of 40 percent debt and 60 percent equity. The...
Alaskan Markets has a target capital structure of 40 percent debt and 60 percent equity. The pretax cost of debt is 6.3 percent, the tax rate is 35 percent, and the cost of equity is 14.6 percent. The firm is considering a project that is equally as risky as the overall firm. The project has an initial cash outflow of $1.92 million and annual cash inflows of $562,000 at the end of each year for 4 years. What is the...
The comparative financial statements for Prince Company are below: Year 2 Year 1 Income statement: Sales...
The comparative financial statements for Prince Company are below: Year 2 Year 1 Income statement: Sales revenue Cost of goods sold Gross profit Operating expenses and interest expense $190,000 112,000 $167,000 100,000 67,000 53,000 14,000 4,000 10,000 78,000 56,000 Pretax income 22,000 8,000 14,000 Income tax Net income Balance sheet: $ 4,000 14,000 40,000 ,000 $103,000 $ 16,000 Cash Accounts receivable (net 7,000 18,000 34,000 38,000 97,000 Inventory Property and equipment (net) Total assets Current liabilities (no interest) Long-term liabilities...
SUinvestments is considering four investments. Investment 1 will yield a net present value (NPV) of $16,000;...
SUinvestments is considering four investments. Investment 1 will yield a net present value (NPV) of $16,000; investment 2, an NPV of $22,000; investment 3, an NPV of $12,000; and investment 4, an NPV of $8,000. Each investment requires a certain cash outflow at the present time: investment 1, $5,000; investment 2, $7,000; investment 3, $4,000; and investment 4, $3,000. Note that no partial investments are allowed. Currently, $14,000 is available for investment. Formulate an integer linear programming model that will...
39. A project has expected cash flows as shown below: Year 0 1-4 Net Cash Flow...
39. A project has expected cash flows as shown below: Year 0 1-4 Net Cash Flow -25,000 5,000 4,000 8,000 7,000 If the firm's discount rate is 12 percent, what is the NPV of this project?
A company reported net income in 2012 of $232.9 million. In 2016, the company expects net...
A company reported net income in 2012 of $232.9 million. In 2016, the company expects net income to be $439.5 million. Estimate the annual compound growth rate of net income. The annual compound growth rate of net income is %. (Round to two decimal places.)
A project has expected cash flows as shown below: Year Net Cash Flow 0 -25,000 1-4...
A project has expected cash flows as shown below: Year Net Cash Flow 0 -25,000 1-4 5,000 5-7 4,000 8 8,000 9 7,000 If the firm's discount rate is 12 percent, what is the NPV of this project?
1. Suppose a company has two mutually exclusive projects, both of which are three years in...
1. Suppose a company has two mutually exclusive projects, both of which are three years in length. Project A has an initial outlay of $7,000 and has expected cash flows of $3,000 in year 1, $4,000 in year 2, and $4,000 in year 3. Project B has an initial outlay of $10,000 and has expected cash flows of $2,000 in year 1, $4,000 in year 2, and $5,000 in year 3. The required rate of return is 12% for projects...
A company reported net income in 2012 of $314.5 million. In 2016 , the company expects...
A company reported net income in 2012 of $314.5 million. In 2016 , the company expects net income to be $578.6 million. Estimate the annual compound growth rate of net income. The annual compound growth rate of net income is
at UU you mean by capital structure? A Company expects a net income of 600,000 dhs. It has 500,000 dhs, 9% debentures The equity capitalization rate of the company is 11%. Calculate the value of the firm and overall capitalization rate according to the net income approach
22. An all-equity firm has net ind um has net income of $ 200 deration of $7.500, and taxes of $2,050. What is the firm's operating cash flow! A) $17.850 B) $21.950 C) $26,250 D) $35,800 E) $36,750 23. year project is expected to generate annual revenues of $114,500, variable, costs of $73,600, and fixed costs of $14,000. The annual depreciation is $3,500 and the tax rate is 34 percent. What is the annual operating cash flow? B) C) $14,301...
The comparative financial statements for Prince Company are below: Year 2 Year 1 Income statement: Sales revenue Cost of goods sold Gross profit Operating expenses and interest expense $190,000 112,000 $167,000 100,000 67,000 53,000 14,000 4,000 10,000 78,000 56,000 Pretax income 22,000 8,000 14,000 Income tax Net income Balance sheet: $ 4,000 14,000 40,000 ,000 $103,000 $ 16,000 Cash Accounts receivable (net 7,000 18,000 34,000 38,000 97,000 Inventory Property and equipment (net) Total assets Current liabilities (no interest) Long-term liabilities...
39. A project has expected cash flows as shown below: Year 0 1-4 Net Cash Flow -25,000 5,000 4,000 8,000 7,000 If the firm's discount rate is 12 percent, what is the NPV of this project?
A company reported net income in 2012 of $232.9 million. In 2016, the company expects net income to be $439.5 million. Estimate the annual compound growth rate of net income. The annual compound growth rate of net income is %. (Round to two decimal places.)
Most questions answered within 3 hours.
-
(Problem 1d). Leandro has 16 hours per day that he can allocate
to work or leisure....
asked 36 minutes ago -
Morganton Company
makes one product and it provided the following information to help
prepare the master...
asked 1 hour ago -
2Al + 3Cl2 --> 2AlCl3
If one mole Al is reacted w two moles Cl2, how...
asked 1 hour ago -
1. You will see some trends in the movement of each currency vs.
the US Dollar....
asked 1 hour ago -
9. (9 pts) An investor with a stock portfolio worth several
hundred thousand dollars sued his...
asked 2 hours ago -
Which statement is true?
a. Unless directed otherwise, the computer automatically
executes C. statements one before...
asked 2 hours ago -
When a new company is considering Speed to Market for a product
launch, which would provide...
asked 3 hours ago -
bacteria and their metabolites could either promote or protect from
cancer. Explain one of these cases...
asked 3 hours ago -
Use the sample data and confidence level given below to complete
parts (a) through (d).
A...
asked 4 hours ago -
During laser vision correction, a brief burst of 193 nm
ultraviolet light is projected onto the...
asked 3 hours ago -
1 ) How well does the initial speed, v0,calculated from Equation
4 agree with the value...
asked 4 hours ago -
1. What is the p-value for a right tail test for a single
proportion with a...
asked 5 hours ago