Explain & Show Work:

Georgia Office Supplies recently reported $12,500 of sales, $7,250 of operating costs other than depreciation, and $1,250 of depreciation. The company had no amortization charges and no non-operating income. It had $8,000 of bonds outstanding that carry a 7.5% interest rate, and its federal-plus-state income tax rate was 40%. The firm had 1000 shares outstanding

a) How much was the firm's taxable income, or earnings before taxes (EBT)?

b) What is the firm’s EPS assuming a Dividend of $ 100

Part 2 of 5 - Part 2 The Outdoor Furniture Corporation manufactures two products, benches and picnic tables, for use in yards and parks. The firm has two main resources: its carpenters (labor force) and a supply of redwood for use in the furniture. During the next production cycle, 1,200 hours of labor are available under a union agreement. The firm also has a stock of 3,500 feet of good-quality redwood. Each bench that Outdoor Furniture produces requires 4 labor hours and 10 feet of redwood; each picnic table takes 6 labor hours and 35 feet of redwood. Completed benches will yield a profit of $9 each, and tables will result in a profit of $20 each.

Question 5 of 11

10.0 Points

The optimal production of benches is ______________ and the optimal production of tables is_____________ . (Please only enter an integer and include no units. Hint: Because of the resource constraints, you may not be able to produce 4 tables even if the solution is 3.8; you may have to just produce 3 tables.)

Part 5 of 5 -

Part 5

Mt. Sinai Hospital in New Orleans is a large, private, 600-bed facility, complete with laboratories, operating rooms, and x-ray equipment. 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. The administrators feel that the labs, operating rooms, and x-ray department are not being fully utilized at present and do not need to be expanded to handle additional patients. The addition of 90 beds, however, involves deciding how many beds should be allocated to the medical staff for medical patients and how many to the surgical staff for surgical patients.

The hospital’s accounting and medical records departments have provided the following pertinent information. The average hospital stay for a medical patient is 8 days, and the average medical patient generates $2,280 in revenues. The average surgical patient is in the hospital 5 days and receives a $1,515 bill. The laboratory is capable of handling 15,000 tests per year more than it was handling. The average medical patient requires 3.1 lab tests and the average surgical patient takes 2.6 lab tests. Furthermore, the average medical patient uses one x-ray, whereas the average surgical patient requires two x-rays. If the hospital was expanded by 90 beds, the x-ray department could handle up to 7,000 x-rays without significant additional cost. Finally, the administration estimates that up to 2,800 additional operations could be performed in existing operating room facilities. Medical patients, of course, do not require surgery, whereas each surgical patient generally has one surgery performed.

Assume that the hospital is open 365 days a year. Round off your answers to the nearest integer.

Quisco Systems has

6.9 billion shares outstanding and a share price of

$ 18.84

Quisco is considering developing a new networking product in house at a cost of

$ 458 million.​ Alternatively, Quisco can acquire a firm that already has the technology for

$ 959

million worth​ (at the current​ price) of Quisco stock. Suppose that absent the expense of the new​ technology, Quisco will have EPS of

$ 0.96

a. Suppose Quisco develops the product in house. What impact would the development cost have on​ Quisco's EPS? Assume all costs are incurred this year and are treated as an​ R&D expense,​ Quisco's tax rate is

25 %

and the number of shares outstanding is unchanged.

b. Suppose Quisco does not develop the product in house but instead acquires the technology. What effect would the acquisition have on​ Quisco's EPS this​ year? (Note that acquisition expenses do not appear directly on the income statement.

Assume the firm was acquired at the start of the year and has no revenues or expenses of its​ own, so that the only effect on EPS is due to the change in the number of shares​ outstanding.)

c. Which method of acquiring the technology has a smaller impact on​ earnings? Is this method​ cheaper? Explain.

a. Suppose Quisco develops the product in house. What impact would the development cost have on​ Quisco's EPS? Assume all costs are incurred this year and are treated as an​ R&D expense,​ Quisco's tax rate is

25 %​,

and the number of shares outstanding is unchanged.​Quisco's new EPS would be.

​(Round to the nearest​ cent.)

You purchased a new 2020 Honda Accord. You borrowed $30,710 to make the purchase. A bank lends you the money at an annual fixed interest rate of 3.75% for 5 years. The terms of the amortization loan include making monthly payments. Build the loan amortization schedule in Excel

You are an employee of University Consultants, Ltd and have been given the following information. You are to present an investment analysis of a new small income-producing property for sale to a potential inventor. The asking price for the property is $8.5 million. You determine that the building was worth $7.225 million and could be depreciated over 39 years (use 1/39 per year). NOIs are estimated to be $901,375 for year 1, $900,681 for year 2, $899,962 for year 3, $943,700 for year 4, $961,855 for year 5 and expected to increase by 3.16% thereafter. A fully amortizing 70 percent loan can be obtained at 10 percent interest for 20 years (total annual payments will be monthly payments *12). The property is expected to be sold for $9,360,805 after 5 years. Capital gains from price appreciation will be taxed at 15 percent and depreciation recapture will be taxed at 25 percent. Your ordinary income will be taxed at 35 percent. Assume that there is no selling cost and equity discount rate is 13%.

a. What is mortgage loan balance by the end of year 5?

b. What is the annual interest dollar amount in year 2?

c. What is the debt service for year 4?

d. What is the first-year debt coverage ratio?

e. What is the first-year equity dividend rate?

Curtis and Kathy filed a joint return for Year One on April 15, Year Two. The return claimed bogus deductions related to Curtis’s cattle-raising business. After their divorce in Year Three, the Internal Revenue Service discovered the bogus deductions and issued a notice of deficiency to both Curtis and Kathy.

While they were married, Kathy often visited Curtis’s farmland and on occasion helped out with some chores related to the business. Kathy collected all of Curtis’s receipts and sent them to their accountant to prepare their tax returns. Kathy saw that the receipts for Year One were unusually large, but she did not question Curtis with respect to any of the receipts. Kathy had no other involvement in Curtis’s business.

If Kathy files a request for innocent spouse relief under § 6015, how should the Service respond?

A stock has a required return of 8%, the risk-free rate is 3%, and the market risk premium is 3%.

1. What is the stock's beta? Round your answer to two decimal places.
   
   
2. If the market risk premium increased to 8%, what would happen to the stock's required rate of return? Assume that the risk-free rate and the beta remain unchanged. Do not round intermediate calculations. Round your answer to two decimal places.
   1. If the stock's beta is less than 1.0, then the change in required rate of return will be greater than the change in the market risk premium.
   2. If the stock's beta is greater than 1.0, then the change in required rate of return will be less than the change in the market risk premium.
   3. If the stock's beta is equal to 1.0, then the change in required rate of return will be greater than the change in the market risk premium.
   4. If the stock's beta is equal to 1.0, then the change in required rate of return will be less than the change in the market risk premium.
   5. If the stock's beta is greater than 1.0, then the change in required rate of return will be greater than the change in the market risk premium.
   
   -Select - ____?
   
   New stock's required rate of return will be ____%.

Small business owners usually focus on the cash balance in their bank accounts and may not use the statement of cash flows to analyze how their businesses are generating or using cash. Discuss what information is found on the statement of cash flows that is just as important as the bank balance (or more so) for the purpose of understanding the financial position of a company.

Suppose you are 30 years old. You plan to retire at age 67 and live forever (Ok 100 years old). You want to be able to withdraw $100,000 per year during your retirement. Assume that you will earn a starting salary of $50,000, which will grow at a 2% annual rate. Your employer contributes 5% of your annual salary to your retirement fund. Further assume that your retirement fund will be invested in a basket of well diversified indices that collectively yield an annual investment return of eight percent. Upon retirement, you plan to move your investment fund to a safer investment vehicle that yields an annual investment return of two percent. Upon your death, you want to bequeath your wealth to your favorite charity.

a) If you plan to donate $500,000 to your favorite charity, what percent of your annual salary do you need to contribute each year in order to achieve your retirement goals?

b) Use Solver to maximize the amount of donation subject to the constraint that you contribute no more than 8% of your salary each year to the retirement fund.

The National Bank and Trust Company

The National Bank and Trust Company currently employs approximately 1,100 employees. It presently has fifty branch offices

*- located throughout the metropolitan area, each of which employs approximately fourteen individuals (Four supervisory personnel and ten tellers or clerical employees). The bank expects to add ten branch offices during the next twelve months, twelve the following year, and sixteen in the third year. Branches within the bank differ considerably in size so the figures given above represent averages.

During the past month, the bank has placed an order for thirty automated teller machines which will be placed in its old branch offices. These machines are scheduled to be in operation December 31, one year from now. The bank has found that for each new machine purchased, one fewer teller is needed, on average.

During the past few years, the bank has experienced very high turnover at it branches (approximately 30 percent for tellers and clerical employees and 20 percent for managerial personnel). Turnover at the bank’s main office (headquarters) has been about 10 percent. The bank expects that these rates will continue the next three years.

1. Determine the turnover for the main office, old branches and new branches for each of the next three years and for each of the major personnel categories.
2. Determine the number of new employees the bank will need to hire for each major personnel category for each of the next three years.
3. Determine the total number of employees who will be working for the bank as of the end of each of the next three years.

Answer questions with steps you would take in the process to find the answers to the questions asked about turnover and total employees.  

Please use the following information to answer the remaining problems: Able Corporation has a project with the following cash flows and an 9.6% cost of money: Numbers in parentheses are outflows. Both Year 0 and Year 3 cash flows are outflows. Year 0 1 2 3 4 5 6 Cash flow $(351,000) $ 95,000 $186,000 $(300,000) $ 280,000 $260,000 $268,000 23. Please calculate the net present value ______________ 24. Please calculate the profitability indexes (two decimals please)_________________ 25. Please calculate the modified profitability index using the terminal value approach in the textbook (two decimals please)_______________________ 26. Please calculate the internal rate of return (two decimals please)_____________________________ 27. Please calculate the modified internal rate of return (two decimals please and per the book)________________________ 28. Please calculate the payback period (two decimals please)________________________ 29. Please calculate the present value payback period (two decimals please)___________________ ___

Juicers Inc. is thinking of acquiring Fast Fruit Company. Juicers has determined that Fast Fruit's current cost of equity is 17.5%; Fast Fruit currently has no debt outstanding. In Year 1, Juicers expects Fast Fruit to generate $9 million in NOPAT and invest $50 million in total net operating capital. Fast Fruit will borrow to finance this expansion, with the first interest payment ($5 million) due at Year 2. (There will be no interest due at Year 1.) In Year 2, Fast Fruit will generate $25 million in NOPAT and invest $10 million in total net operating capital. Fast Fruit's marginal tax rate is 25%. After the second year, the free cash flows and the tax shields each will grow at a constant rate of 4%. Assume that all cash flows occur at the end of the year. If Juicers must pay $90 million to acquire Fast Fruit, what is the NPV of the proposed acquisition? (Report your answer in millions of dollars.)

You are given the following information from a T-Note quote:

Settlement date: September 15, 2017

Maturity date: September 15, 2032

Price Quote: 102:9

In excel, compute and graph the coupon rates and current yields for yields-to-maturity of 1% to 10%, in 1% increments. Which of the following accurately depicts this calculation?

Trevi Corporation recently reported an EBITDA of $31,200 and $9,700 of net income. The company has $6,700 interest expense, and the corporate tax rate is 35 percent. What was the company’s depreciation and amortization expense?