Assume you are considering a portfolio containing two​ assets, L and M. Asset L will represent 56 % of the dollar value of the​ portfolio, and asset M will account for the other 44 %. Assume that the portfolio is rebalanced at the end of each year. The expected returns over the next 6​ years, 2018dash2023​, for each of these assets are summarized in the following​ table:

a. Calculate the expected portfolio​ return, r Subscript p​, for each of the 6 years. b. Calculate the average expected portfolio​ return, r overbar Subscript p​, over the​ 6-year period. c. Calculate the standard deviation of expected portfolio​ returns, s Subscript p​, over the​ 6-year period. d. Assume that asset L represents 44 % of the portfolio and asset M 56 %. Calculate the average expected return and standard deviation of expected portfolio returns over the​ 6-year period. e. Compare your answers to the answers from parts b and c.

Assume you are considering a portfolio containing two​ assets, L and M. Asset L will represent 44 % of the dollar value of the​ portfolio, and asset M will account for the other 56 %. The projected returns over the next 6​ years, 2018-2023​, for each of these assets are summarized in the following​ table: a. Calculate the projected portfolio​ return, r p​, for each of the 6 years. b. Calculate the average expected portfolio​ return, r overbar Subscript p​, over the​ 6-year period. c. Calculate the standard deviation of expected portfolio​ returns, s Subscript p​, over the​ 6-year period. d. How would you characterize the correlation of returns of the two assets L and​ M? e. Discuss any benefits of diversification achieved through creation of the portfolio.

Two friends, Kyle and Wes, graduated college and started working on their career at the same time. Both friends were 25 at the time.

As soon as Kyle was eligible for the 401K benefit he started depositing $100 per month for the next ten years.

Wes decided he so enjoyed having a real income that he wanted to spend it on fast cars, awesome threads, the most recent smart phone and video game system, and clubbing every weekend. Wes chose not to invest in his 401K for a while.

After ten years, Kyle decided to buy a house and couldn't afford to invest in his 401K anymore, so he stopped with his $100 per month deposit, but never touched his balance.

After ten years, Wes's party days were slowing down, he no longer needed the fancy clothes, and didn't need the newest gadgets as much, so he started investing $100 per month in his 401K for the next twenty years.

Both friends averaged 8% over the life of their investment in a mixed mutual fund.

At age 55, the friends decided to see where they stood for retirement savings. Calculate the following:

1. What is Wes' total investment after investing $100 per month for 20 years?

2. Who has the higher balance?

3. What does this tell us about the time value of money?

Respond to the following paragraph :

The features that drive the valuations that differ in Vegas Chips are: The forecasted rate of growth of earnings per year, the way the ratios change over the years and the dividend pay ratio of earnings.

The additional information that would be required by the investors to gain confidence in the projections would be to look at the reports done by the analysts and see the connection in the investing pattern. With that information they should plan whether to invest in the project or not. They should see what factors are affecting the companies growth, the competition in the industry, the probability of multiple projections, earning and dividend payouts.

Note: This problem is for the 2018 tax year.

On November 1, 2008, Janet Morton and Kim Wong formed Pet Kingdom, Inc., to sell pets and pet supplies. Pertinent information regarding Pet Kingdom is summarized as follows:

Pet Kingdom's business address is 1010 Northwest Parkway, Dallas, TX 75225; its telephone number is (214) 555-2211; and its e-mail address is [email protected].

The employer identification number is 11-1111111, and the principal business activity code is 453910.

Janet and Kim each own 50% of the common stock; Janet is president and Kim is vice president of the company. No other class of stock is authorized.

Both Janet and Kim are full-time employees of Pet Kingdom. Janet's Social Security number is 123-45-6789, and Kim's Social Security number is 987-65-4321.

Pet Kingdom is an accrual method, calendar year taxpayer. Inventories are determined using FIFO and the lower of cost or market method. Pet Kingdom uses the straight-line method of depreciation for book purposes and accelerated depreciation (MACRS) for tax purposes.

During 2018, the corporation distributed cash dividends of $250,000.

Pet Kingdom's financial statements for 2018 are shown below.

*Depreciation for tax purposes is $136,000.

During 2018, Pet Kingdom made estimated tax payments of $56,000 each quarter to the IRS.

If an answer is zero, enter "0".

Enter all amounts as positive numbers.

If required, round final answers to the nearest dollar.

Please help with Schedule M-1, M-2, M-3

Assume that your father is now 50 years old, plans to retire in 10 years, and expects to live for 25 years after he retires - that is, until age 85. He wants his first retirement payment to have the same purchasing power at the time he retires as $55,000 has today. He wants all his subsequent retirement payments to be equal to his first retirement payment. (Do not let the retirement payments grow with inflation: Your father realizes that if inflation occurs the real value of his retirement income will decline year by year after he retires). His retirement income will begin the day he retires, 10 years from today, and he will then receive 24 additional annual payments. Inflation is expected to be 6% per year from today forward. He currently has $50,000 saved and expects to earn a return on his savings of 7% per year with annual compounding. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below. Open spreadsheet How much must he save during each of the next 10 years (with equal deposits being made at the end of each year, beginning a year from today) to meet his retirement goal? (Note: Neither the amount he saves nor the amount he withdraws upon retirement is a growing annuity.) Do not round intermediate calculations. Round your answer to the nearest dollar.

Required Annuity Payments Father's current age 50 Number of years until retirement 10 Number of years living in retirement 25 1st retirement payment, same purchasing power today as $55,000 Inflation rate 6.00% Current savings at t = 0 $50,000 Percentage return earned 7.00% Step 1. Calculate retirement payments, beginning at t = 10 Formulas Fixed retirement payments #N/A Step 2. Calculate the value of current savings at t = 10 Value of current savings, 10 years from today #N/A Step 3. Calculate the value of the annuity due of retirement payments at t = 10 Value of annuity due #N/A Step 4. Calculate the net amount that must be accumulated at t = 10 to receive desired retirement payments Net amount needed in 10 years #N/A Step 5. Calculate the value of annual deposit needed to meet desired retirement goal Value of annual deposit to meet retirement goal #N/A View comments (1)

Du Pont System of Ratio Analysis

1a) List the intuitive interpretations (names of the five components of the Return on Equity in the Du Pont System of Ration Analysis.

b) State whether a firms tax burden ratio will be higher or lower if it pays less taxes relative to pretax profit and give reason for your answer.

c) State whether a firms interest-burden ratio will be higher or lower if it pays more Interest relative to Earnings Before Interest and Taxes and give the reason for your answer.

• Suppose that Michael wants to have $250,000 saved by the time he has reached age 30. He is currently 21 and has no money in invested. Michael thinks that he can earn an annual return of 7% on his investments compounded monthly.
  • How much does he need to invest each month to reach his goal?
  • If his investments were compounded annually and not monthly, how much short was he on reaching his goal?

Calculate a​ one-year holding period return​ (HPR) for the following two investment​ alternatives: Which investment would you​ prefer, assuming they are of equal​ risk? Explain. The HPR for investment X is nothing​%. ​ (Enter as a percentage and round to two decimal​ places.)

Question 1

Comparative statement data for Whispering Company and Metlock Company, two competitors, appear below. All statement of financial position data are as of December 31, 2017, and December 31, 2016.

Prepare a vertical analysis of the 2017 income statement data for Whispering Company and Metlock Company in columnar form. (Round percentages to 1 decimal place, e.g. 12.1%. Enter all percentages as positive numbers.)

You just won the $87 million Ultimate Lotto jackpot. Your winnings will be paid as $2,900,000 per year for the next 30 years. If the appropriate interest rate is 6.2 percent, what is the value of your windfall?

You are an investor who bought 100 shares of a company at $35 per share with a stock on margin of 60%. The stock is now trading at $50 per share, and the initial margin require- ments has been lowered to 50%. You now want to buy 300 more shares of the stock. What is the minimum amount of equity that you will have to put up in this transaction?

Bonds often pay a coupon twice a year. For the valuation of bonds that make semiannual payments, the number of periods doubles, whereas the amount of cash flow decreases by half. Using the values of cash flows and number of periods, the valuation model is adjusted accordingly.

Assume that a $1,000,000 par value, semiannual coupon U.S. Treasury note with two years to maturity has a coupon rate of 3%. The yield to maturity (YTM) of the bond is 11.00%. Using this information and ignoring the other costs involved, calculate the value of the Treasury note:

$859,794.00

$730,824.90

$541,670.22

$1,031,752.80

Based on your calculations and understanding of semiannual coupon bonds, complete the following statements: • Assuming that interest rates remain constant, the T-note’s price is expected to_______ .

• The T-note described is selling at a_________.

• When valuing a semiannual coupon bond, the time period variable (N) used to calculate the price of a bond reflects the number of_________ periods remaining in the bond’s life.

JPJ Corp has sales of $ 1.05 ​million, accounts receivable of $ 52,000​, total assets of $ 5.13 million​ (of which $ 2.76 million are fixed​ assets), inventory of $ 154,000​, and cost of goods sold of $ 603,000. What is​ JPJ's accounts receivable​ days? Fixed asset​ turnover? Total asset​ turnover? Inventory​ turnover?