Questions
Consider the following stock price and shares outstanding information. DECEMBER 31, Year 1 DECEMBER 31, Year...

Consider the following stock price and shares outstanding information.

DECEMBER 31, Year 1 DECEMBER 31, Year 2

Price
Shares
Outstanding

Price
Shares
Outstanding
Stock K $23 110,000,000 $34 110,000,000
Stock M 82 2,100,000 50 4,200,000a
Stock R 36 29,000,000 38 29,000,000
aStock split two-for-one during the year.
  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.

              PWIYear 1:

              PWIYear 2:

              VWIYear 1:

              VWIYear 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.

      %

In: Finance

Year cost to be depreciated depreciation exp. per year Accumulated depreciation net remaining undepreciated cost 1...

Year cost to be depreciated depreciation exp. per year Accumulated depreciation net remaining undepreciated cost
1
2
3
4
5
6
7
8
9
10

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

In: Finance

Cold Goose Metal Works Inc. Balance Sheet for Year Ending December 31 (Millions of Dollars) Year...

Cold Goose Metal Works Inc. Balance Sheet for Year Ending December 31 (Millions of Dollars)

Year 2 Year 1 Year 2 Year 1
Assets Liabilities and equity
Current assets: Current liabilities:
Cash and equivalents    $1,845 Accounts payable $0 $0
Accounts receivable 844 675 Accruals 117 0
Inventories 2,475 1,980 Notes payable 664 625
Total current assets $5,625 $4,500 Total current liabilities    $625
Net fixed assets: Long-term debt 2,344 1,875
Net plant and equipment    $5,500 Total debt $3,125 $2,500
Common equity:
Common stock 6,094 4,875
Retained earnings    2,625
Total common equity $9,375 $7,500
Total assets $12,500 $10,000 Total liabilities and equity $12,500 $10,000

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.

In: Finance

Mr tan is considering 2 potential investment projects that have similar capital requirements: Year 0 year...

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

Year 0 year 1 year 2 year 3 year 4
project A 4,000,000 1,600,000 1,800,000 2,000,000 2,100,000
Project B 4,200,000 500,000 1,700,000 1,900,000 2,000,000

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

In: Finance

A three-year old 10-year 8% semi-annual coupon bond is selling at $1,200 today. If the yield...

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)

In: Finance

A three-year old 10-year 8% semi-annual coupon bond is selling at $1,200 today. If the yield...

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)

In: Finance

Category Prior Year Current Year Accounts payable ??? ??? Accounts receivable 320,715 397,400 Accruals 40,500 33,750...

Category Prior Year Current Year
Accounts payable ??? ???
Accounts receivable 320,715 397,400
Accruals 40,500 33,750
Additional paid in capital 500,000 541,650
Cash 17,500 47,500
Common Stock 94,000 105,000
COGS 328,500 430,273.00
Current portion long-term debt 33,750 35,000
Depreciation expense 54,000 54,201.00
Interest expense 40,500 42,805.00
Inventories 279,000 288,000
Long-term debt 339,570.00 398,024.00
Net fixed assets 946,535 999,000
Notes payable 148,500 162,000
Operating expenses (excl. depr.) 126,000 162,475.00
Retained earnings 306,000 342,000
Sales 639,000 847,787.00
Taxes 24,750 48,472.00

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

The answer is 22.98% but i dont know how to get to it, i try dividing long term debt into common sized balance but it was wrong, so can someone show me how to get to that answer? thank~

In: Finance

Taxpayer (“T”) a 59 year-old calendar year individual taxpayer purchased an annuity from an insurance company...

  1. Taxpayer (“T”) a 59 year-old calendar year individual taxpayer purchased an annuity from an insurance company for $100,000 in 2019. The terms of the annuity were that the company would pay T $5,000 a year to T for the rest of T’s life. How much income will T include in T’s personal income tax return as a result of receiving the $5,000 payment

in 2020?   _____________

In 2050? ______________

In: Accounting

Category Prior Year Current Year Accounts payable ??? ??? Accounts receivable 320,715 397,400 Accruals 40,500 33,750...

Category Prior Year Current Year
Accounts payable ??? ???
Accounts receivable 320,715 397,400
Accruals 40,500 33,750
Additional paid in capital 500,000 541,650
Cash 17,500 47,500
Common Stock 94,000 105,000
COGS 328,500 430,380.00
Current portion long-term debt 33,750 35,000
Depreciation expense 54,000 54,221.00
Interest expense 40,500 42,028.00
Inventories 279,000 288,000
Long-term debt 335,365.00 400,331.00
Net fixed assets 946,535 999,000
Notes payable 148,500 162,000
Operating expenses (excl. depr.) 126,000 161,395.00
Retained earnings 306,000 342,000
Sales 639,000 852,776.00
Taxes 24,750 48,765.00

In: Finance

Fey Fashions expects the following dividend pattern over the next seven​ years: Year 1 Year 2...

Fey Fashions expects the following dividend pattern over the next seven​ years:

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
1.5 1.62 1.75 1.89 2.04 2.2 2.38

. The company will then have a constant dividend of​$2.60 forever. What is the​ stock's price today if an investor wants to earn

a.  

16​%?

b.  

23%?

In: Finance