One year ago Lerner and Luckmann Co. issued 15-year, noncallable, 5.2% annual coupon bonds at their par value of $1,000. Today, the market interest rate on these bonds is 5.5%. What is the current price of the bonds, given that they now have 14 years to maturity?

Last year Carson Industries issued a 10-year, 13% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,065 and it sells for $1,270.

1. What is the bond's nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places.
   %
   
   What is the bond's nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places.
   %
   
   Would an investor be more likely to earn the YTM or the YTC?
   -Select-Since the YTM is above the YTC, the bond is likely to be called.Since the YTC is above the YTM, the bond is likely to be called.Since the YTM is above the YTC, the bond is not likely to be called.Since the YTC is above the YTM, the bond is not likely to be called.Since the coupon rate on the bond has declined, the bond is not likely to be called.Item 3
   
2. What is the current yield? (Hint: Refer to Footnote 7 for the definition of the current yield and to Table 7.1.) Round your answer to two decimal places.
   %
   
   Is this yield affected by whether the bond is likely to be called?
   1. If the bond is called, the current yield will remain the same but the capital gains yield will be different.
   2. If the bond is called, the current yield and the capital gains yield will remain the same.
   3. If the bond is called, the capital gains yield will remain the same but the current yield will be different.
   4. If the bond is called, the current yield and the capital gains yield will both be different.
   5. If the bond is called, the current yield and the capital gains yield will remain the same but the coupon rate will be different.
   
   -Select-IIIIIIIVVItem 5
   
3. What is the expected capital gains (or loss) yield for the coming year? Use amounts calculated in above requirements for calcuation, if reqired. Round your answer to two decimal places. Enter a loss percentage, if any, with a minus sign.
   %
   
   Is this yield dependent on whether the bond is expected to be called?
   1. The expected capital gains (or loss) yield for the coming year depends on whether or not the bond is expected to be called.
   2. The expected capital gains (or loss) yield for the coming year does not depend on whether or not the bond is expected to be called.
   3. If the bond is expected to be called, the appropriate expected total return is the YTM.
   4. If the bond is not expected to be called, the appropriate expected total return is the YTC.
   5. If the bond is expected to be called, the appropriate expected total return will not change.

what is the current year's account payable balance?

what is the current year's return on assets (ROA)?

what is the current year's return on equity (ROE)?

what is the current year's entry for long-term debt on a common-sized balance sheet?

Last year Carson Industries issued a 10-year, 12% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,060 and it sells for $1,150.

1. What is the bond's nominal yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places.
   %
   
   What is the bond's nominal yield to call? Do not round intermediate calculations. Round your answer to two decimal places.
   %
   
   Would an investor be more likely to earn the YTM or the YTC?
   -Select-Since the YTC is above the YTM, the bond is not likely to be called.Since the coupon rate on the bond has declined, the bond is not likely to be called.Since the YTM is above the YTC, the bond is likely to be called.Since the YTC is above the YTM, the bond is likely to be called.Since the YTM is above the YTC, the bond is not likely to be called.Item 3
   
2. What is the current yield? (Hint: Refer to Footnote 7 for the definition of the current yield and to Table 7.1.) Round your answer to two decimal places.
   %
   
   Is this yield affected by whether the bond is likely to be called?
   1. If the bond is called, the current yield and the capital gains yield will both be different.
   2. If the bond is called, the current yield and the capital gains yield will remain the same but the coupon rate will be different.
   3. If the bond is called, the current yield will remain the same but the capital gains yield will be different.
   4. If the bond is called, the current yield and the capital gains yield will remain the same.
   5. If the bond is called, the capital gains yield will remain the same but the current yield will be different.
   
   -Select-IIIIIIIVVItem 5
   
3. What is the expected capital gains (or loss) yield for the coming year? Use amounts calculated in above requirements for calcuation, if reqired. Round your answer to two decimal places. Enter a loss percentage, if any, with a minus sign.
   %
   
   Is this yield dependent on whether the bond is expected to be called?
   1. If the bond is expected to be called, the appropriate expected total return will not change.
   2. The expected capital gains (or loss) yield for the coming year depends on whether or not the bond is expected to be called.
   3. The expected capital gains (or loss) yield for the coming year does not depend on whether or not the bond is expected to be called.
   4. If the bond is expected to be called, the appropriate expected total return is the YTM.
   5. If the bond is not expected to be called, the appropriate expected total return is the YTC.

Consider the following stock price and shares outstanding information.

1. Compute the beginning and ending values for a price-weighted index and a market-value-weighted index. Assume a base value of 100 and Year 1 as the base period. Do not round intermediate calculations. Round your answers to two decimal places.

             PWI_{Year 1}:

             PWI_{Year 2}:

             VWI_{Year 1}:

             VWI_{Year 2}:

2. Compute the percentage change in the value of each index during the year. Do not round intermediate calculations. Round your answers to two decimal places.

   Percentage change in PWI:   %

   Percentage change in VWI:   %

3. Compute the percentage change for an unweighted index assuming $1,000 is invested in each stock. Do not round intermediate calculations. Round your answer to two decimal places.

     %

Complete the following: Depreciation expense per year, accumulated depreciation year, and net remaining undepreciated cost.

Assumptions are as follows:

Cost to be depreciated: 20,000 Estimated useful life of equipment: 10 years Year

Given the information in the preceding balance sheet—and assuming that Cold Goose Metal Works Inc. has 50 million shares of common stock outstanding—read each of the following statements, then identify the selection that best interprets the information conveyed by the balance sheet.

Statement #1: Cold Goose’s net collection of inventory items increased by more than the firm's sales between Years 1 and 2.

This statement is     , because:

The accruals balance decreased by $117 million between Years 1 and 2

Total inventories of raw materials, work-in-process, and final goods increased from $1,980 million to $2,475 million between Year 1 and Year 2

Total inventories of raw materials, work-in-process, and final goods decreased by $495 million between Year 1 and Year 2

Statement #2: In Year 2, Cold Goose Metal Works Inc. was profitable.

This statement is     , because:

Cold Goose’s total assets increased between Years 1 and 2

The cash and equivalents account increased between Years 1 and 2

Cold Goose’s retained earnings account increased between the end of Years 1 and 2

Statement #3: One way to interpret the change in Cold Goose’s accounts receivable balance from Year 1 to Year 2 is that more customers purchased new items on credit rather than paying off existing credit accounts.

This statement is     , because:

The change from $1,980 million to $2,475 million reflects a net accumulation of new credit sales

The $169 increase in accounts receivable means either that Year 1’s existing credit customers are not paying off their owed balances and new or existing customers are making additional purchases on credit, or that Year 1’s credit customers have repaid their owed balances and Year 2 credit sales have exceeded Year 1’s credit sales

The decrease from $844 million to $675 million implies a net decrease in accounts receivable and that more customers are paying off their receivables balances than are buying on credit

Based on your understanding of the different items reported in the balance sheet and the information they provide, which statement regarding Cold Goose Metal Works Inc.’s balance sheet is consistent with U.S. Generally Accepted Accounting Principles (GAAP)?

The company’s assets should be listed from those carrying the largest balance to those with the smallest balance.

The company’s assets should be listed in alphabetical order.

The company’s assets should be listed in the order in which they are to be converted into cash.

Mr tan is considering 2 potential investment projects that have similar capital requirements:

For project A,the company cost of capital is 14%.For project B,assessed as the riskier project of the two.,a risk adjusted cost of capital of 15% is considered appropriate.

1) calculate the NPV of the 2 projects and assess the projects using the investment appraisal technique of Net present Vale.

2)Calculate the IRR of the 2 projects and assess the projects using the investment appraisal technique of Internal rate of return.

3) Is the company cost of capital suitable in the evaluation of projects with different risks? Explain

A three-year old 10-year 8% semi-annual coupon bond is selling at $1,200 today. If the yield increases by 25 basis points, how much of the price change is due to

convexity of the bond? (Face Value = $1,000)

A three-year old 10-year 8% semi-annual coupon bond is selling at $1,200 today. If the yield increases by 25 basis points, how much of the price change is due to

convexity of the bond? (Face Value = $1,000)