Suppose you take a 27-year mortgage of $280000. The annual interest rate is 4%, and the annual APR is 4.6%. Compounding done on yearly basis. Loan payments are made annually. Calculate the amortized fees and expenses for this loan (in dollars, provide your answer with $1 precision).
In: Finance
Eastern Electric currently pays a dividend of about $1.64 per share and sells for $27 a share.
a. If investors believe the growth rate of dividends is 3% per year, what rate of return do they expect to earn on the stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
b. If investors' required rate of return is 10%, what must be the growth rate they expect of the firm? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
c. If the sustainable growth rate is 5% and the plowback ratio is .4, what must be the rate of return earned by the firm on its new investments? (Enter your answer as a percent rounded to 2 decimal places.)
In: Finance
7-27. As auditor of the Star Manufacturing Company, you have noticed the following accounts on the trial balance taken from the books of Star one month before year-end:
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Account Name |
From Whom Confirm? |
Information to Confirm |
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Cash in bank |
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Trade accounts receivable |
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Notes receivable |
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Inventories |
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Land |
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Buildings, net |
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Furniture, fixtures, and equipment, net |
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Trade accounts payable |
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Mortgages payable |
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Capital stock |
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Retained earnings |
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Sales |
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Cost of sales |
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General and administrative expenses |
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Legal and professional fees |
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Interest expense |
In: Accounting
On August 27, 2015, Celgene Corporation acquired all of the outstanding stock of Receptos, Inc., in exchange for $7.6 billion in cash. Referring to Celgene’s 2015 financial statements and its July 14, 2015, press release announcing the acquisition, answer the following questions regarding the Receptos acquisition.
Why did Celgene acquire Receptos?
What accounting method was used, and for what amount, to record the acquisition?
What amount did Celgene include in pre-combination service compensation in the total consideration transferred? What support is provided for this treatment in the Accounting Standards Codification (see ASC 805-30-30, paragraphs 9-13)?
What allocations did Celgene make to the assets acquired and liabilities assumed in the acquisition? Provide a calculation showing how Celgene determined the amount allocated to goodwill.
Describe the nature of the in-process research and development product rights acquired by Celgene in its acquisition of Receptos.
How will Celgene account for the in-process research and development product rights acquired in the Receptos combination?
In: Accounting
In: Accounting
In: Accounting
90. The current stock price of KMW is $27, the risk-free rate of return is 4%, and the standard deviation is 30%. What is the price of a 63-day call option with an exercise price of $25?
In: Finance
Apply Algorithm split on the array 27 ،13، 31،18، 45 ،16، 17، 53 .
In: Computer Science
The Robinson Corporation has $27 million of bonds outstanding that were issued at a coupon rate of 10.950 percent seven years ago. Interest rates have fallen to 10.250 percent. Mr. Brooks, the Vice-President of Finance, does not expect rates to fall any further. The bonds have 17 years left to maturity, and Mr. Brooks would like to refund the bonds with a new issue of equal amount also having 17 years to maturity. The Robinson Corporation has a tax rate of 30 percent. The underwriting cost on the old issue was 2.70 percent of the total bond value. The underwriting cost on the new issue will be 1.80 percent of the total bond value. The original bond indenture contained a five-year protection against a call, with a call premium of 6 percent starting in the sixth year and scheduled to decline by one-half percent each year thereafter. (Consider the bond to be seven years old for purposes of computing the premium.) Use Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. Assume the discount rate is equal to the aftertax cost of new debt rounded up to the nearest whole percent (e.g. 4.06 percent should be rounded up to 5 percent)
a. Compute the discount rate. (Do not round intermediate calculations. Input your answer as a percent rounded up to the nearest whole percent.)
b. Calculate the present value of total outflows. (Do not round intermediate calculations and round your answer to 2 decimal places.)
c. Calculate the present value of total inflows. (Do not round intermediate calculations and round your answer to 2 decimal places.)
d. Calculate the net present value. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.)
In: Finance
In: Accounting