Strickler Technology is considering changes in its working capital policies to improve its cash flow cycle. Strickler's sales last year were $3,130,000 (all on credit), and its net profit margin was 7%. Its inventory turnover was 5.0 times during the year, and its DSO was 39 days. Its annual cost of goods sold was $1,750,000. The firm had fixed assets totaling $505,000. Strickler's payables deferral period is 41 days. Assume a 365-day year. Do not round intermediate calculations.

1. Calculate Strickler's cash conversion cycle. Do not round intermediate calculations. Round your answer to two decimal places.

     days

2. Assuming Strickler holds negligible amounts of cash and marketable securities, calculate its total assets turnover and ROA. Do not round intermediate calculations. Round your answers to two decimal places.

   Total assets turnover:  ×

   ROA:   %

3. Suppose Strickler's managers believe the annual inventory turnover can be raised to 8 times without affecting sale or profit margins. What would Strickler's cash conversion cycle, total assets turnover, and ROA have been if the inventory turnover had been 8 for the year? Do not round intermediate calculations. Round your answers to two decimal places.

   Cash conversion cycle:   days

   Total assets turnover:    ×

   ROA:    %

analyses and explain amazon stock price in June

List and describe ways managers can create firm value through financing alternatives. 175 words

Two companies have $1M in assets and the same basic earning power ratio of 25 percent. Neither company owns securities, so each company’s income will be comprised solely of operating income. The only difference between the two companies is the fact that Company A’s assets are 100 percent equity financed whereas Company B’s assets are 45 percent debt financed with that debt carrying an 8 percent interest rate. If both companies have a 40 percent tax rate, find each company’s ROE and ROA.

Problem 5: Bond A pays 12% coupon annually, has a par value of $1,000 and will mature in 3 years. Using a 10% discount rate (Yield-to-Maturity), what is the value of the bond?

Problem 6: Using your information on Bond A above, calculate the (Macaulay) duration of the bond.

Problem 7: What is the (Macaulay) duration of a bond with the following characteristics: N = 5, PMT = 90, FV = 1000, I/Y = 12%?

Problem 8: What is the duration of a bond with the following characteristics: N = 5, PMT = 10, FV = 1000, I/Y = 12%?

Problem 9: The modified duration of a bond is 9.27 Years. What is the approximate change in the value of the bond if interest rates drop by 3 percentage points (3%)?

Problem 10: A bond portfolio has a (Macaulay) duration of 7.23 years. Using a yield-to-maturity of 18%, what is the approximate change in the value of the bond portfolio if interest rates increase by 5%?

Wendy's boss wants to use straight-line depreciation for the new expansion project because he said it will give higher net income in earlier years and give him a larger bonus. The project will last 4 years and requires $1,730,000 of equipment. The company could use either straight-line or the 3-year MACRS accelerated method. Under straight-line depreciation, the cost of the equipment would be depreciated evenly over its 4-year life. (Ignore the half-year convention for the straight-line method.) The applicable MACRS depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%. The project cost of capital is 10%, and its tax rate is 25%.

1. What would the depreciation expense be each year under each method? Enter your answers as positive values. Do not round intermediate calculations. Round your answers to the nearest dollar.

   Year	Scenario 1 (Straight Line)	Scenario 2 (MACRS)
   1	$	$
   2	$	$
   3	$	$
   4	$	$

2. Which depreciation method would produce the higher NPV, and how much higher would it be? Do not round intermediate calculations. Round your answer to the nearest cent.

   The NPV under -Select-Scenario 1Scenario 2Item 9 will be higher by $   .

The earnings, dividends, and stock price of Shelby Inc. are expected to grow at 4% per year in the future. Shelby's common stock sells for $23 per share, its last dividend was $2.50, and the company will pay a dividend of $2.60 at the end of the current year.

1. Using the discounted cash flow approach, what is its cost of equity? Round your answer to two decimal places.

     %

2. If the firm's beta is 1.8, the risk-free rate is 7%, and the expected return on the market is 11%, then what would be the firm's cost of equity based on the CAPM approach? Round your answer to two decimal places.

     %

3. If the firm's bonds earn a return of 11%, then what would be your estimate of r_s using the own-bond-yield-plus-judgmental-risk-premium approach? (Hint: Use the mid-point of the risk premium range.) Round your answer to two decimal places.

     %

4. On the basis of the results of parts a–c, what would be your estimate of Shelby's cost of equity? Assume Shelby values each approach equally. Round your answer to two decimal places.

     %

Your division is considering two investment projects, each of which requires an up-front expenditure of $23 million. You estimate that the investments will produce the following net cash flows:

1. What are the two projects' net present values, assuming the cost of capital is 5%? Do not round intermediate calculations. Round your answers to the nearest dollar.

   Project A: $  

   Project B: $  

   What are the two projects' net present values, assuming the cost of capital is 10%? Do not round intermediate calculations. Round your answers to the nearest dollar.

   Project A: $  

   Project B: $  

   What are the two projects' net present values, assuming the cost of capital is 15%? Do not round intermediate calculations. Round your answers to the nearest dollar.

   Project A: $  

   Project B: $  

2. What are the two projects' IRRs at these same costs of capital? Do not round intermediate calculations. Round your answers to two decimal places.

   Project A:      %

   Project B:      %

It is now January 1. You plan to make a total of 5 deposits of $400 each, one every 6 months, with the first payment being made today. The bank pays a nominal interest rate of 12% but uses semiannual compounding. You plan to leave the money in the bank for 10 years. Do not round intermediate calculations. Round your answers to the nearest cent.

1. How much will be in your account after 10 years?

   $  

2. You must make a payment of $1,432.04 in 10 years. To get the money for this payment, you will make five equal deposits, beginning today and for the following 4 quarters, in a bank that pays a nominal interest rate of 12% with quarterly compounding. How large must each of the five payments be?

   $  

You are 25 years old and decide to start saving for your retirement. You plan to save $5,000

at the end of each year​ (so the first deposit will be one year from​ now), and will make the last deposit when you retire at age 65.

Suppose you earn 8% per year on your retirement savings.

a. How much will you have saved for​ retirement? The amount that you will have accumulated for retirement is _____

b. How much will you have saved if you wait until age 35 to start saving​ (again, with your first deposit at the end of the​ year)? ______

​(Round to the nearest​ dollar.)

Blunderbluss Manufacturing's balance sheets report $305 million in total debt, $64 million in short-term investments, and $65 million in preferred stock. Blunderbluss has 5 million shares of common stock outstanding. A financial analyst estimated that Blunderbuss's value of operations is $850 million. What is the analyst's estimate of the intrinsic stock price per share? Round your answer to the nearest cent.