The ability to tap the capital markets as a new source of debt capital provided commercial and residential property owners with a new source of capital beyond traditional balance sheet lenders like life companies and banks and provided debt investors with a new structured-finance investment secured by real estate.

True

False

FUTURE OF REVENUE RECOGNITION

I. Do the new standards increase comparability across industries and capital

markets?

II. Do the new standards provide better disclosure, so investors and other

users of financial statements better understand the economics behind the

numbers?

III. Possibility of Fraud with new FASB standards

In the RSA public-key encryption scheme, each user has a public key, e, and a private key, d. Suppose Alice leaks her private key. Rather than generating a new modulus, she decides to generate a new public key and a new private key. Is this safe? why or why not?

OpenSeas, Inc., is evaluating the purchase of a new cruise ship. The ship would cost $400 million today. OpenSeas expects annual cash flows from the new ship to be $70 million and these cash flows will last forever. The cost of capital is 16%.

What is the IRR of the new cruise ship? Please make your answer in the unit of percent.

______%

Following question 4, suppose the company has a desired payback period of 5 years.

Which statement is true about applying the payback method to the new project?

JKL Company has a 40% tax rate. JKL's bonds presently carry a yield to maturity of 9.23%. The common stock just paid a dividend of $2.20, is expected to grow at 4% per year forever and costs $18.33 per share. Flotation costs for new common stock are 8%. The capital structure consists of 40% debt and 60% common equity.

a) What is the cost of equity if no new common or preferred stock is issued?

   b) What is the new cost of equity if new common must be issued?

To assess the effectiveness of a new diet formulation, a sample of 8 steers is fed a regular diet and another sample of 10 steers is fed a new diet. The weights of the steers at 1 yr are given in Table 5.14. Do these results imply that the new diet results in higher weights? (alpha=0.05)

Regular Diet: 831, 858, 833, 860, 922, 875, 797, 788

New Diet: 870, 882, 896, 925, 842, 908, 944, 927, 965, 887

**Please include R code

Recently, the effects from Accounting Standards Update 2014-09 Revenue from Contracts with Customers (Topic 606) have been seen in most public firms. While many firms indicated that adoption of the new revenue recognition principle had no effect upon the timing of their revenue recognition, some firms indicated the new principle had significant effects upon their statements. For the firms where the new principle affected the timing of revenue, did the new revenue recognition principle speed or slow revenue recognition. Explain.

CPP is interested in comparing if they should maintain the current lighting fixtures in Building 9 that has a life-cycle cost (NPV) of $50,000 or invest in new, indirect lighting fixtures in Building 9. The cost for the new fixture is $12,000 with savings of $1,000/year. A rebate will be granted after two years of operation for $1,500. Study period is 15 years. The university uses an annual rate of return of 4%. Calculate the life-cycle cost (i.e. NPV) for the new fixtures and advise if CPP should change the current fixture to the new ones.

create a new compnay/organiztion and explain the background, its market and product.

Then prepare pro forma/Budgeted Income statement & Retained Earning Statement of your new company/organization

then prepare Pro forma/Budgeted Balance sheet of your new company. The Budgeted Balance sheet is prepared like that of Balance sheet but only here you will use estimated amounts.

then Prepare pro forma/Budgeted Cash Flow statement of a new company.

Need to create a company and make up everything from sratch

HalHal

and

NickNick

are racing to develop a new brand of

tooth whitenertooth whitener.

They both believe that it will be

more effective than all othersmore effective than all others.

HalHal

and

NickNick

know that if they both develop the new​ product, they will make zero economic​ profit; if only one of them develops the new​ product, that firm will make an economic profit of

​$2.52.5

million a week and the other will incur an economic loss of

​$1.01.0

million a​ week; and if neither of them develops the new​ product, both will make an economic profit of​ $1.0 million.