Which are the following may a military Tech spared the duck if they do not itemize How does the military thrift savings plan different from the uniform service retirement plan
In: Finance
If a soup kitchen has marginal revenues of $3.00 per meal delivered, marginal expenses of $4.00 per meal, $50,000 of annual fixed costs and annual donations of $150,000, it will...
Select one:
a. never reach its break-even quantity.
b. need additional donations of $1 per meal to reach its break-even quantity.
c. reach its break-even quantity when it serves 100,000 meals.
In: Finance
please i need answer asap thank u
You own 100 acres of timberland,with young timber worth 20,000 if logged today this represent 500 cords of wood at $40 per cord. after logging the land can be sold today for 10,000($100 per acre). the opportunity cost of capital is 10%. you have made the following estimates: a) the price of a cord of wood will increase by 5% per year? b) the price of land will increase by 3% per year. c) the yearly growth rate of the cords of wood on your land are :
years 1-2: 15%:
year 3-4 :10%:
year 5-8 : 5%
years thereafter 2% please find the present value of the optimal decision.
In: Finance
Problem 12-09
Financing Deficit
Garlington Technologies Inc.'s 2016 financial statements are shown below:
Balance Sheet as of December 31, 2016
| Cash | $ 180,000 | Accounts payable | $ 360,000 | |
| Receivables | 360,000 | Notes payable | 156,000 | |
| Inventories | 720,000 | Line of credit | 0 | |
| Total current assets | $1,260,000 | Accruals | 180,000 | |
| Fixed assets | 1,440,000 | Total current liabilities | $ 696,000 | |
| Common stock | 1,800,000 | |||
| Retained earnings | 204,000 | |||
| Total assets | $2,700,000 | Total liabilities and equity | $2,700,000 |
Income Statement for December 31, 2016
| Sales | $3,600,000 |
| Operating costs | 3,279,720 |
| EBIT | $ 320,280 |
| Interest | 18,280 |
| Pre-tax earnings | $ 302,000 |
| Taxes (40%) | 120,800 |
| Net income | 181,200 |
| Dividends | $ 108,000 |
Suppose that in 2017 sales increase by 20% over 2016 sales and that 2017 dividends will increase to $170,000. Forecast the financial statements using the forecasted financial statement method. Assume the firm operated at full capacity in 2016. Use an interest rate of 10%, and assume that any new debt will be added at the end of the year (so forecast the interest expense based on the debt balance at the beginning of the year). Cash does not earn any interest income. Assume that the all new-debt will be in the form of a line of credit. Round your answers to the nearest dollar. Do not round intermediate calculations.
| Garlington Technologies Inc. Pro Forma Income Statement December 31, 2017 |
|||
| Sales | $ | ||
| Operating costs | $ | ||
| EBIT | $ | ||
| Interest | $ | ||
| Pre-tax earnings | $ | ||
| Taxes (40%) | $ | ||
| Net income | $ | ||
| Dividends: | $ | ||
| Addition to RE: | $ | ||
| Garlington Technologies Inc. Pro Forma Balance Statement December 31, 2017 |
|||
| Cash | $ | ||
| Receivables | $ | ||
| Inventories | $ | ||
| Total current assets | $ | ||
| Fixed assets | $ | ||
| Total assets | $ | ||
| Accounts payable | $ | ||
| Notes payable | $ | ||
| Accruals | $ | ||
| Total current liabilities | $ | ||
| Common stock | $ | ||
| Retained earnings | $ | ||
| Total liabilities and equity | $ | ||
In: Finance
In: Finance
rom Rubin, Problem 13.3: A 120. MW coal
plant wants to add a SOX emissions control system to reduce its emissions. The emission
control system has a capital cost of $815 per kW and reduces SOX emissions by 98% to
0.0918 kg/MWh. Assume the life of the emission control system is 20 years and the power
plant produces 650 GWh/y.
a)What is the annualized cost of this system in dollars per year if the discount rate (interest
rate) is 7.0 percent/year? What if the discount rate is 4.0 percent/year?
b)What is the cost per 1.0399 x 10^4kWh of electricity usage (the average annual U.S.
residential electricity consumption in 2017 according to the EIA) at each of the discount
rates specified in part (a)?
c) What is the cost per metric ton of SOXremoved?
(1 metric ton = 1,000 kg = 10^6g)
In: Finance
A firm has the following project (assume that the expenditures
are at the end of the year in question):
1) The land will be acquired for $ 500,000 in year zero
2) The first year, $ 1 million will be spent on the construction of
the plant.
3) The equipment will be purchased on year 2 at a cost of $1.5
million.
4) The third year, $ 500,000 will be disbursed to start operating
the plant.
5) The plant and equipment will depreciate in a straight line for
the next 10 years, beginning year 4 (project ends in year 13). The
equipment and the physical construction will be worthless after
these 10 years, but the land can be sold at its original cost, when
the plant is closed.
6) The annual income (during the 10 years, that is, from the 4th to
the 13th year) is 2 million.
7) The annual fixed cost (excluding depreciation) will be $
200,000
8) The variable costs are annually of $ 300,000, assuming that the
plant operates at its maximum capacity during the 10 years
9) The tax rate will be 50 percent as it will be treated as if it
were a private business of the state itself (i.e. treat the state
as a company, that is, pure neoliberalism)
Calculate the Net Present Value of the Project, if the discount rate is 14%.
In: Finance
In: Finance
Use this scenario "How to turn a movie theater into a hotel franchise." Create of a operations plan that shows how the product or service will be delivered
In: Finance
It appears that George is running a profitable business. George is aware you are in an MBA Managerial Finance class and comes to you for advice on his working capital practices. More specifically George asks you to do the following:
View the following video: http://searchcenter.intelecomonline.net/playClipDirect.aspx?id=4870EEC7664070BB9D6744FDA7325EE44F45E0E47862343D60FAA8E3325D1A83C46D5C6FAB3D01A758FA30144214BB3D
Describe his working capital practices, including his methods of capital budgeting analysis techniques.
Analyze the potential pitfalls in his capital budgeting practices that George should be aware of.
Develop a simple statement of cash flows for George’s Trains using any information gleaned from the video. What areas of improvement do you recommend and why?
In: Finance
he following are estimates for two stocks.
| Stock | Expected Return | Beta | Firm-Specific Standard Deviation | ||||
| A | 8 | % | 1.10 | 25 | % | ||
| B | 16 | 1.60 | 36 | ||||
The market index has a standard deviation of 18% and the risk-free rate is 6%.
a. What are the standard deviations of stocks A and B? (Do not round intermediate calculations. Round your answers to 2 decimal places.)
b. Suppose that we were to construct a
portfolio with proportions:
| Stock A | 0.30 |
| Stock B | 0.45 |
| T-bills | 0.25 |
Compute the expected return, standard deviation, beta, and nonsystematic standard deviation of the portfolio. (Do not round intermediate calculations. Enter your answer for Beta as a number, not a percent. Round your answers to 2 decimal places.)
In: Finance
You are the consumer staples analyst for a large corporate and investment bank. The bank’s management has committed to shareholders to lift the bank ROE from the current 5% to 8% within a year and to 10% within 2 years.
Your institution can borrow money at the following maturity and cost:
Overnight 0.10% . 1-month 0.20% 3-month 0.25% 6-month 0.50%
1-year 0.75% . 3-year 1.50% . 5-year 2.00% . 7-year 2.50% 10-year 3.0%
You are looking at 2 loan applications for $200M each from Foodco and Safeco, two companies you know and cover for years, both of which have an established relationship with your bank. Foodco’s cost of borrowing in the market is UST +250 while Safeco’s UST+400. As Safeco is considered the riskier of the two, any loan towards Safeco will have to generate more loss reserves. Both loans will be senior secured and thus collateralized. Safeco pledges as collateral real estate holdings plus business receivables (50/50) while Foodco pledges delivery trucks plus $20M of cash deposits. The appraised value of the collateral covers the loan fully. For Foodco the loan reserve (based on its implied probability of default) is 30 basis points per annum while for Safeco is 60 basis points per annum. Both companies “leak” to you that they already have received bids from competitors in the neighborhood of 5.5% and 6.0% respectively for a 10yr loan. What do you do and why?
In: Finance
Assume that security returns are generated by the single-index model,
Ri = αi + βiRM + ei
where Ri is the excess return for security
i and RM is the market’s excess
return. The risk-free rate is 2%. Suppose also that there are three
securities A, B, and C, characterized by
the following data:
| Security | βi | E(Ri) | σ(ei) | ||
| A | 0.9 | 9 | % | 22 | % |
| B | 1.2 | 12 | 8 | ||
| C | 1.5 | 15 | 17 | ||
a. If σM = 18%, calculate the variance of returns of securities A, B, and C.
b. Now assume that there are an infinite number of assets with return characteristics identical to those of A, B, and C, respectively. What will be the mean and variance of excess returns for securities A, B, and C? (Enter the variance answers as a percent squared and mean as a percentage. Do not round intermediate calculations. Round your answers to the nearest whole number.)
In: Finance
1. Consider the following Balance Sheet for Total Caribbean Bank(TCB) (in millions)
|
ASSETS |
LIABILITIES |
|||
|
Floating rate mortgages |
120 |
Demand deposits |
110 |
|
|
(currently 12% annually) |
(currently 3% annually) |
|||
|
30 years fixed rate loans |
1 year CD |
50 |
||
|
(currently 7% annually) |
80 |
(currently 6% annually) |
||
|
Equity |
40 |
|||
|
200 |
200 |
a. What is TCB expected net interest income (NII) at year end? (1mark)
b. What is TCB expected net interest income at year end if interest rates grew by 500 basis points. (1 mark)
c. What is TCB expected net interest income at year end if interest rates fell by 200 basis points on assets, but decline by 2% on liabilities.
(2 marks)
In: Finance
Suppose that there are two independent economic factors, F1 and F2. The risk-free rate is 3%, and all stocks have independent firm-specific components with a standard deviation of 52%. Portfolios A and B are both well-diversified with the following properties:
| Portfolio | Beta on F1 | Beta on F2 | Expected Return | ||||||||
| A | 1.4 | 1.8 | 30% | ||||||||
| B | 2.4 | –0.18 | 27% | ||||||||
What is the expected return-beta relationship in this economy? Calculate the risk-free rate, rf, and the factor risk premiums, RP1 and RP2, to complete the equation below. (Do not round intermediate calculations. Round your answers to two decimal places.)
E(rP) = rf +
(βP1 × RP1)
+ (βP2 ×
RP2)
In: Finance