Beginning on March 1, 2013 and ending on June 1, 2016 monthly payments of $100 were deposited into an account which earns 12% compounded monthly. Then, beginning on July 1, 2016 and ending on September 1, 2017 monthly payments of $200 were deposited. Determine the balance of the account on February 1, 2019.
please show work
In: Finance
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Forecasted Statements and Ratios Upton Computers makes bulk purchases of small computers, stocks them in conveniently located warehouses, ships them to its chain of retail stores, and has a staff to advise customers and help them set up their new computers. Upton's balance sheet as of December 31, 2016, is shown here (millions of dollars):
Sales for 2016 were $325 million and net income for the year was $9.75 million, so the firm's profit margin was 3.0%. Upton paid dividends of $3.9 million to common stockholders, so its payout ratio was 40%. Its tax rate was 40%, and it operated at full capacity. Assume that all assets/sales ratios, (spontaneous liabilities)/sales ratios, the profit margin, and the payout ratio remain constant in 2017. Do not round intermediate calculations.
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In: Finance
Problem 12-01 AFN equation Broussard Skateboard's sales are expected to increase by 25% from $9.0 million in 2016 to $11.25 million in 2017. Its assets totaled $5 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 5%, and the forecasted payout ratio is 70%. Use the AFN equation to forecast Broussard's additional funds needed for the coming year. Round your answer to the nearest dollar. Do not round intermediate calculations. $
In: Finance
You are eyeing an investment in a corporate bond which has a YTM of 5.00%, and a stated rate of interest of 13.00% with a maturity of 1 years. What is the price of this bond?
a. $1,014.29
b. $1,202.38
c. $1,076.19
d. $1,077.10
In: Finance
Step 1: Pick stock you would like to invest in for the long-term (10 or more years)
Step 2: What is the CAGR (compound annual growth rate) for this stock over the past 10 years
Step 3: Does this stock pay dividends? If so, what is the dividend history over the past 10 years
Step 4: Write a paragraph about what this company does, how it makes money, including main products/services/users/etc, and why this is a good investment. Defend your "long" position, both quantitatively and qualitatively.
Please show your work.
In: Finance
Constant Growth Valuation
Woidtke Manufacturing's stock currently sells for $18 a share.
The stock just paid a dividend of $1.00 a share (i.e.,
D0 = $1.00), and the dividend is expected to grow
forever at a constant rate of 5% a year. What stock price is
expected 1 year from now? Round your answer to the nearest
cent.
$
What is the estimated required rate of return on Woidtke's stock? Do not round intermediate calculations. Round the answer to three decimal places. (Assume the market is in equilibrium with the required return equal to the expected return.)
In: Finance
A T-bond with semi-annual coupons has a coupon rate of 3%, face value of $1,000, and 2 years to maturity. If its yield to maturity is 4%, what is its Macaulay Duration? Answer in years, rounded to three decimal places
In: Finance
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We are evaluating a project that costs $660,000, has a five-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 69,000 units per year. Price per unit is $58, variable cost per unit is $38, and fixed costs are $660,000 per year. The tax rate is 35 percent, and we require a return of 12 percent on this project. Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within ±10 percent. |
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Calculate the best-case and worst-case NPV figures. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) |
| NPV | ||
| Best-case | $ | |
| Worst-case | $ | |
In: Finance
In: Finance
1. Consider the following Balance Sheet for Total Caribbean Bank(TCB) (in millions)
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ASSETS |
LIABILITIES |
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Floating rate mortgages |
120 |
Demand deposits |
110 |
|
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(currently 12% annually) |
(currently 3% annually) |
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30 years fixed rate loans |
1 year CD |
50 |
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(currently 7% annually) |
80 |
(currently 6% annually) |
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Equity |
40 |
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|
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 and decline by 2% on liabilities.
In: Finance
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Your company is deciding whether to invest in a new machine. The new machine will increase cash flow by $316,000 per year. You believe the technology used in the machine has a 10-year life; in other words, no matter when you purchase the machine, it will be obsolete 10 years from today. The machine is currently priced at $1,690,000. The cost of the machine will decline by $106,000 per year until it reaches $1,160,000, where it will remain. |
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If your required return is 13 percent, calculate the NPV today. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
|
NPV |
$ |
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If your required return is 13 percent, calculate the NPV if you wait to purchase the machine until the indicated year. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) |
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NPV |
|
|
Year 1 |
$ |
|
Year 2 |
$ |
|
Year 3 |
$ |
|
Year 4 |
$ |
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Year 5 |
$ |
|
Year 6 |
$ |
|
Should you purchase the machine? |
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If so, when should you purchase it? |
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In: Finance
In: Finance
You must evaluate the purchase of a proposed spectrometer for the R&D department. The base price is $110,000, and it would cost another $22,000 to modify the equipment for special use by the firm. The equipment falls into the MACRS 3-year class and would be sold after 3 years for $44,000. The applicable depreciation rates are 33%, 45%, 15%, and 7%. The equipment would require a $14,000 increase in net operating working capital (spare parts inventory). The project would have no effect on revenues, but it should save the firm $51,000 per year in before-tax labor costs. The firm's marginal federal-plus-state tax rate is 40%.
What are the project's annual cash flows in Years 1, 2, and 3? Round your answers to the nearest cent.
In Year 1 $
In Year 2 $
In Year 3 $
In: Finance
In: Finance
19. What is the NPV of the project? Which you accept the project?
In: Finance