The fiscal year 2011 balance sheet (i.e., the year ended on January 29th, 2011) indicates that shareholders’ equity is $0.6143 billion. Compare this amount to the Leonard Green & Partners’ offer to Jo-Ann’s shareholders of $1.6 billion, and to $1.19 billion, which was the pre-offer value of Jo-Ann’s stock. There seems to be some disparity between the stock market’s evaluation and the balance sheet representation of Jo-Ann’s equity. Why are the two versions of the value of the firm’s equity different?

A project has fixed costs of $1,500 per year, depreciation charges of $500 a year, annual revenue of $9,000, and variable costs equal to two-thirds of revenues.

a. If sales increase by 13%, what will be the percentage increase in pretax profits? (Round to 2 decimal places)

b. What is the degree of operating leverage of this project? (round to 2 decimal places)

Revenue and expense data for Bluestem Company are as follows:

Year 2 Year 1

administrative expenses 37,720 20,300

COGS 360,000 319,900

Income tax 41,000 32,200

Sales 820,000 700,000

Selling expense 154,160 109,900

1) Required: (a) Prepare a comparative income statement, with vertical analysis, stating each item for both years as a percent of sales. Round your percentages to one decimal place. Enter all amounts as positive numbers. Refer to the Accounts and Amount Descriptions for correct wording of text entries. (b) Comment upon significant changes disclosed by the comparative income statement.

2) Comment upon significant changes disclosed by the comparative income statement.

There was an (increase/decrease) the cost of goods sold and a 1.7% (increase/decrease) in administrative expenses. However, the more significant of 3.1% in selling expenses offset the 1.8% (increase/decrease) in the cost of goods sold and contributed greatly to the 3.4% (increase/decrease) in net income.

A person deposits $12,000 per year for 5 years, with the first deposit made one year from the present. One year after the last deposit, the person makes continuous withdrawals of $2,000 for the next 15 years. Find the effective annual ERR being earned on this investment.

Thank you very much to whomever can give me the solution and answer! ?

Suppose the interest rate on a one-year bond today is 6% per year, the interest rate on a one-year bond one year from now is expected to be 4% per year, and the interest rate on a one-year bond two years from now is expected to be 3% per year. Assuming risk neutral investors, what is the interest rate today on a two-year bond?

On a three-year bond?

What is the shape of the yield curve?

Gustav owns a perpetuity which pays 200 per year starting at the end of year 2. Ingrid owns a perpetuity that pays deposits X at the end of each 6 months, beginning 6 months from now. Assume a nominal annual interest rate of 8%. For what value of X is the present value of the two perpetuities equal.

The data is for stock ZZZ; price and dividend history are as follows:

Year     Beginning-of-Year Price          Dividend Paid at Year-End

2015               $118                                       $3       

2016                126                                          3       

2017                110                                          3       

2018                115                                          3       

What are the arithmetic and geometric average time-weighted rates of return for the investor?

Connie and Doris form calendar year Wolf Corporation on January 1 of the current year through the following

transfers of property and services:

From Connie:   

a.

How much income or gain, if any, must Connie recognize? What is its character if recognized?

b.

What basis will Connie have in her Wolf stock?

c.

What holding period does Connie take in the Wolf stock?

d.

Assuming the professional services qualify as organizational expenses and an appropriate

elections is made, how much can Wolf deduct in the current year?

e.

How much gain or loss does Doris recognize? What is its character if recognized?

f.

What basis will Doris have in the Wolf stock?

g.

What holding period will Doris have in the stock?

h.

What basis will Wolf Corporation have in the land?

i.

What holding period will Wolf have in the land?

1. You are considering taking a 1-year certificate in stock trading or a 1-year certificate in financial analytics. The certificate in trading will cost you $25,000 and will increase your salary by $8,000 a year for the next 5 years. The certificate in analytics will cost $40,000, and will increase your salary by $12,000 a year for the next 5 years. Based on your calculation of NPV and IRR and MIRR, which certificate will you choose? Use 10% as your discount rate.

Last year, Jane identified $62,200 as a nonbusiness bad debt. In that tax year before considering the tax implications of the nonbusiness bad debt, Jane had $124,400 of taxable income, of which $6,220 consisted of short-term capital gains. This year, Jane collected $12,440 of the amount she had previously identified as a bad debt. Hint: Section 111(c) applies in this situation. Jane treats the $62,200 nonbusiness bad debt as of which $ is carried over to the current year. Jane would have to include $ of the collection in gross income in the current year, resulting in a remaining carryover of $ .