Over time many large companies in the US have increased exponentially the amount of long-term debt...

Over time many large companies in the US have increased exponentially the amount of long-term debt taken out to finance operations. What are some other alternatives to long-term financing needs in an organization and is it less expensive than long term debt?

Solutions

Expert Solution

Here is solution of your question. If you have any query please comment in comment Box and will definitely resolve your query Thank you

jeff jeffy answered 8 months ago

Next > < Previous

Related Solutions

Most companies borrow money for long term projects and in addition to this long term debt...

Most companies borrow money for long term projects and in addition to this long term debt they also have other long term commitments (such as a lease). What types of long term commitments might a company have and how do we gauge their ability to pay these commitments in the future?

Let us say that long-term debt has an interest rate and short-term debt does not. Then...

Let us say that long-term debt has an interest rate and short-term debt does not. Then why not finance your entire operation with non interest bearing short-term payables? Could save you money! What does the current ratio really measure and should it vary depending on the certainty of sales revenue? Note: textbooks probably get this wrong in my opinion.

Companies can use three basic type of financing in their business – short-term debt, long-term debt...

Companies can use three basic type of financing in their business – short-term debt, long-term debt and equity. Briefly discuss the nature of each and give examples. What are the possible consequences if a company uses short-term debt to fund long-term projects, and uses long-term debt or equity to pay current liabilities?

Many believe that jobs in the US have changed a great deal over time. In two...

Many believe that jobs in the US have changed a great deal over time. In two time periods (1989 and 1998) adults in the US were asked about their jobs on the General Social Survey. Respondents were asked how much they agree with the following statements: my income is high; my job is secure; my opportunities for advancement are high; my job is interesting; I can work independently. Higher numerical responses reflect greater agreement with each statement (1=strongly disagree, 2=disagree,...

What are the realized returns for the stock market, for Small Companies, Large Companies; long term...

What are the realized returns for the stock market, for Small Companies, Large Companies; long term Bonds, Long Term Gov Bonds, and US T Bills? What investment portfolio would you select (do not include names of mutual funds or stocks, just overall types of investments.)?

Large US trade deficits have persisted for a long period of time. Provide a brief background...

Large US trade deficits have persisted for a long period of time. Provide a brief background on this issue and your assessment on the long-term implications for the value of the US dollar.

I. Cost of Debt Type of Debt Amount ($million) Weight Interest rate (%) Short-term debt US$...

I. Cost of Debt Type of Debt Amount ($million) Weight Interest rate (%) Short-term debt US$ 13,600 11.27% Existing long-term debt US$ 5,262 9.75% Sub. Increasing-rate notes (Class I) US$ 1,250 13.00% Sub. Increasing-rate notes (Class II) US$ 3,750 14.00% Senior convertible debentures US$ 1,800 14.50% Partnership debt securities US$ 500 11.20% Total US$ 26,162 After-tax cost of debt (tax rate @35.5%)

The Smathers Company has a long-term debt ratio (i.e., the ratio of long-term debt to long-term...

The Smathers Company has a long-term debt ratio (i.e., the ratio of long-term debt to long-term debt plus equity) of .43 and a current ratio of 1.27. Current liabilities are $2,395, sales are $10,465, profit margin is 11 percent, and ROE is 16 percent. What is the amount of the firm’s long-term debt? (Do not round intermediate calculations and your answer to 2 decimal places, e.g., 32.16.) What is the amount of the firm’s total debt? (Do not round intermediate...

Suppose the amount of time to finish assembling a component is exponentially distributed with an average...

Suppose the amount of time to finish assembling a component is exponentially distributed with an average of 2 minutes. (a) What is the probability that it takes more than 5 minutes to assemble a component? (b) If 100 components are randomly selected, what is the probability that the average amount of time to assemble these100 components is more than 2.3 minutes?

a. What is trend in long-term debt paying ability of over the last three years for...

a. What is trend in long-term debt paying ability of over the last three years for CVS - using ratios? b. What is trend in long-term debt paying ability of over the last three years Walgreens - using ratios? c. Which company has had better long-term debt paying ability over the last 3 years? Explain with ratios. Income Statement for CVS Revenue 12/31/2017 12/31/2016 12/31/2015 Total Revenue 184,765,000 177,526,000 153,290,000 Cost of Revenue 156,220,000 148,669,000 126,762,000 Gross Profit 28,545,000 28,857,000...

Subjects