18. Marble Campground is considering adding a driving range to its facility. The range would cost $60,000, would be depreciated on a straight-line basis over its 6-year life, and would have a zero salvage value. The anticipated revenue from the project is $46,000 a year with $10,000 variable cost. The fixed cost would be $6,000. The project will require $6,000 of net working capital each year, which is recoverable at the end of the project. What is the internal rate of return on this project at a tax rate of 20 percent?
a. 30.62 percent
b. 32.74 percent
c. 38.42 percent
d. 26.17 percent

19. A project required the initial investment of $750,000 on its equipment. It will be depreciated to the book value of $0 after six years. However, the equipment can be sold for $100,000 at the end of the six years. What is the after-tax gain by selling the equipment at the end of the six years if the tax rate is 20%?
a. $75,000
b. $37,000
c. $80,000
d. $53,300

Purpose of Assignment The purpose of this assignment is to allow the students to become familiar with and practice the measurement of Net Present Value (NPV), payback, and Weighted Average Cost of Capital (WACC) using Microsoft Excel. Assignment Steps Resources: Microsoft® Excel®, Capital Budgeting Decision Models Template, Calculate the following problems using Microsoft® Excel®: Calculate the NPV for each project and determine which project should be accepted.

Project A Project B Project C Project D Inital Outlay (105,000.000) (99,000.00) (110,000.00) (85,000.00) Inflow year 1 53,000.00 51,000.00 25,000.00 45,000.00 Inflow year 2 50,000.00 47,000.00 55,000.00 50,000.00 Inflow year 3 48,000.00 41,000.00 15,000.00 30,000.00 Inflow year 4 30,000.00 52,000.00 21,000.00 62,000.00 Inflow year 5 35,000.00 40,000.00 35,000.00 68,000.00 Rate 7% 10% 13% 18%

Your company is considering three independent projects. Given the following cash flow information, calculate the payback period for each. If your company requires a three-year payback before an investment can be accepted, which project(s) would be accepted?

Project D Project E Project F Cost 205,000.00 179,000.00 110,000.00 Inflow year 53,000.00 51,000.00 25,000.00 Inflow year 2 50,000.00 87,000.00 55,000.00 Inflow year 3 48,000.00 41,000.00 21,000.00 Inflow year 4 30,000.00 52,000.00 9,000.00 Inflow year 5 24,000.00 40,000.00 35,000.00 Using market value and book value (separately), find the adjusted WACC, using 30% tax rate. Component Balance Sheet Value Market Value Cost of Capital Debt 5,000,000.00 6,850,000.00 8% Preferred Stock 4,000,000.00 2,200,00.00 10% Common Stock 2,000,000.00 5,600,000.00 13%

Assume that you are working as an Accounts Manager in AB ACCESS LIMITED, a company engaged in providing supervision services for construction projects. The management of the company is concerned about cash flow of the business and have asked you to prepare a statement of cash flow showing how much cash flow occurred in the operating, investing and financing activities of the business during the financial period ended 30 June 2018.

Companies use strategic plans as a course of action for success. What components would you consider necessary for creating a strategic plan? What ethical considerations should you include in the strategic plan? Why?

1. “U.S. Treasury and Agency Securities.” =181,248,000

Use this amount and assume these investments are recorded at face value. Now, assume the following characteristics and calculate the duration of these investments. Explain the meaning of duration and your duration calculation.

• 2.50% Coupon Rate
• Coupons Paid Semi-Annually
• 7 years to maturity
• For YTM=1.85

What investments should you have in your 401k? If you don't have a 401k (or 403b), what are your options? Everyone has their own unique situation but the goal is the same: satisfying choices in retirement. Share your challenges and solutions.

Calculate the duration for the 25-year, 9% coupon bond with semiannual coupon payments. The bond is purchased when the YTM is 7%. Calculate the duration by using nonExcel equation. Calculate the duration by using Excel Duration function

7. Bond 1 and Bond 2 both have a face value of $1,000. Bond 1 pays a 5% coupon (annual payments) while Bond 2 is a zero coupon bond. On November 30, 2014 (immediately after the annual coupon payment), Bond 1 had exactly 20 years to maturity, while Bond 2 had 15 years to maturity. The yield to maturity for each bond was 10% on November 30, 2014, and was 8% on November 30, 2015.

A. What was the price of each bond on November 30, 2014?

B. What was the duration of each bond on November 30, 2014?

C. What was the price of each bond on November 30, 2015?

D. What was the one-year return on each bond if the bond was purchased on November 31, 2014 (immediately after the coupon was paid) and was sold on November 31, 2015 (immediately after the coupon was received)?

E. Which bond was more “sensitive” to this interest rate change, and why? In your answer to this question, address the following items:

• Based upon “time to maturity,” which bond should be more sensitive to the interest rate change? • Based upon the relative size of the coupon payments, which bond should be more sensitive to the interest rate change?

write two pages reflection paper on financial management that covered in your class ( Analysis of Financial statements, Time value of money, Bonds valuation and interest rate, Risk , Return and CAPM, Corporate Valuation and Stock Valuation, The cost of capital, and The Basics of Capital Budgeting )

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a rate of 5.8%. The probability distribution of the risky funds is as follows:

The correlation between the fund returns is 0.18.

Solve numerically for the proportions of each asset and for the expected return and standard deviation of the optimal risky portfolio. (Do not round intermediate calculations and round your final answers to 2 decimal places. Omit the "%" sign in your response.)

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a rate of 5.8%. The probability distribution of the risky funds is as follows:

The correlation between the fund returns is 0.18.

Solve numerically for the proportions of each asset and for the expected return and standard deviation of the optimal risky portfolio. (Do not round intermediate calculations and round your final answers to 2 decimal places. Omit the "%" sign in your response.)

The return on shares of Valley Transporter is predicted under the following various economic conditions: Recession -0.12 Normal +0.09 Boom +0.20 If each economy state has the same probability of occurring, what is the variance of the stock?

The return on shares of the Orange Company are predicted under the following states of nature. The states of nature are all equally likely, and because there are a total of three states, each state has a 33.333% chance of occurring.

Recession -0.11
Normal +0.05
Boom +0.24

What is the standard deviation of Orange?

Toyota Corp.'s stock is $32 per share. Its expected return is 24% and variance is 12%. Honda Corp.'s stock is $20 per share. Its expected return is 19% and variance is 7%. Benz Corp.'s stock is $45 per share. Its expected return is 12% and variance 7%. What would be the expected return of a portfolio consisting of 50% Toyota and 50% Honda?

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.5%. The probability distributions of the risky funds are:   

The correlation between the fund returns is .0385.

Suppose now that your portfolio must yield an expected return of 14% and be efficient, that is, on the best feasible CAL.

What is the standard deviation of your portfolio? What is the proportion invested in the T-bill fund? What is the proportion invested in each of the two risky funds?

What substantive step may be required if the client does not prepare bank reconciliations?