Question 1

(a) If Company A has a price per share of $40 and an earnings per share of $10, and Company B has a price per share of $30 and earnings per share of $3,what is the P/E  

multiple of each.Which Company has a higher expected future earnings growth rate and why?

(b) How do we calculate the Times Interest Earned Ratio ? What does it tell us ?

(c) Why might a lender be more focused on liabilities - to- Assets Ratio rather than Debt- to- Equity Ratio ?

1.what is your comment and thought for this paragraph ?

Can we agree that money is important?

Absolutely, we all can agree with moneys importance in our lives. Money brings security, allowing you to protect your family and yourself. You can build a better life and help give back to your community, also helping you worry less about financial issues. Money has been a big factor in my life, I had to take on a big responsibility at such a young age due to having a child at only 18 years old. Without money I wouldn't be able to pay rent, bills, insurance, car payments, food, and providing care for my child. Working long hours in order to make a certain amount at the end of the month is a struggle for many of us. I strongly believe we are underpaid for the amount of work and long hours we put in for our jobs, but at the same time after watching these two videos I feel like we have it better than so many people around the world. There is so many people in different countries getting paid so little for all the long hours and labor, earning only $400 dollars a month while some of us make $400 in a day, a week, or even two weeks. This all comes down to inhumane actions coming from government.

5 items of clothing from closet:

Hoodies (China)

Tights (US)

T-shirts (China)

Jeans (US)

My favorite clothing brands are usually H&M, Target, Banana Republic, Champion, Pink (Victoria Secret), and some small local businesses. I do not condone sweatshop labor, I believe this is inhumane and unsafe for people to be in such working conditions. The workers who make or sell my favorite products make a living by getting paid hourly wages. This does not affect me only because these people are not in hazardous factories, or getting underpaid for their labor. After watching and understanding where these products really come from it seems to open up your eyes and you learn so much information that you didn't know before. People should do research on all products that they purpose and make sure they are not supporting a company that treats their hard working employees unfairly and unsafe.

Do you notice the difference between fast food restaurants in preparing menu items?  Typically, Some produce menu items in advance of customer orders based on anticipated demand.  Others, however, produce menu items only in response to customer orders.  Give us an example company for each type of restaurant. Which system (MRP-II or lean manufacturing) does each company use?  What are the relative advantages and disadvantages of each system?   

Early in 2020, Dobbs Corporation engaged Kiner, Inc. to design and construct a complete modernization of Dobbs's manufacturing facility. Construction was begun on June 1, 2020 and was completed on December 31, 2020. Dobbs made the following payments to Kiner, Inc. during 2020:

In order to help finance the construction, Dobbs issued the following during 2020:

In addition to the 9% bonds payable, the only debt outstanding during 2020 was a $518,500, 12% note payable dated January 1, 2016 and due January 1, 2023, with interest payable annually on January 1.

Compute the amounts of each of the following:

Hoping to make his flight on time, Tom (the CEO of ABC Pty Ltd) signed a stack of paperwork on his desk without reading what he was signing. Unfortunately, one of the documents he signed authorised a high-risk investment which caused shareholders to lose millions of dollars.

Required:

(a) With reference to CA s 180, how does the court decide whether a director acted with care, skill and diligence?

(b) Analyse whether Tom breached his duty of care to the company.

(c) Analyse whether Tom qualifies for a defence under the business judgment rule. You must refer to relevant law

AUSTRALIAN LAW

Fajar Factory wants to build a rice processing factory that will take a year to build. $5 million is spent right away and another $5 million is spent next year. The company CEO is expecting that the factory will lose $1 million in its first year of operation and lose another half a million in its second year of operation. with that initial investment, the factory is expected to produce 8000 rice packs per month and sold fo $30 per unit for nest 20 years. meanwhile, the production cost for pack is $20.

If the discount rate is 4% ,what is the net present value of the investment ?

What if discount rate is 2%? Whould your decision different ?

1. This question is on capital structure.
   1. List and explain all the theories on capital structure.
   2. As the CEO of Pokebook, you are contemplating debt issuance. In particular, your CFO suggests a capital restructuring program where the company will issue $7 billion of perpetual debt. Beginning with the definition of a capital restructuring program, explain to your board of directors the reasons of issuing (or not issuing) debt and consequently to restructure the capital of Pokebook.
   3. What factors affect your decision to choose dividend or share repurchase as a way to distribute the money raised under the capital restructuring program?

2. You should highlight different factors (including those not covered in a) to get full credits. All parts have equal weights.

C&P Trading Inc. is considering a project, initial investment is $260,000. The company board of directors set the maximum requirements of return of pay back 3 years and has set the cost of capital is 10%, below is the cash flow: CF1= $75,800 , CF2= $78,960 , CF3= $82,278, CF4= $117,612. (15')

1. Would you accept the project based on NPV, IRR? (4')
2. Would you accept the project based on Payback rule if project cut-off period is 3 years? (3')
3. How would you explain to your CEO what NPV means? (4')
4. What are advantages and disadvantages of using only Payback method? (4')

C&P Trading Inc. is considering a project, initial investment is $260,000. The company board of directors set the maximum requirements of return of pay back 3 years and has set the cost of capital is 10%, below is the cash flow: CF1= $75,800 , CF2= $78,960 , CF3= $82,278, CF4= $117,612. (15')

1. Would you accept the project based on NPV, IRR? (4')
2. Would you accept the project based on Payback rule if project cut-off period is 3 years? (3')
3. How would you explain to your CEO what NPV means? (4')
4. What are advantages and disadvantages of using only Payback method? (4')

DISCUSSION :

We have pointed out that the value chain will indicate many support areas that could be candidates for outsourcing. These are not essential functions (accounting, human resources, training, support technology, facility maintenance, security, phone call center,etc.) for the company and perhaps could be or cheaper and better by an outside firm.

a. Is this a case of "its just business" or is it unethical to outsource certain functions meaning you lay off long term employees that are specialized?

b. Would this be a good reason to outsource? What about the community you are located in?

c. Your thoughts if you are the CEO or top management in the firm?

• Discuss the pro's and con's of these possible actions as if you were top management.