Firm A, under Chapter 11 bankruptcy proceedings, has an estimated going-concern reorganization value of $3.0 million. The last pre-bankruptcy balance sheet of the firm is below (this shows the “old” capital structure). Assume that there are no other claims from any party.
LAST PRE-BANKRUPTCY BALANCE SHEET
ASSETS
Current Assets $1,250,000
Fixed Assets 3,500,000
TOTAL ASSETS $4,750,000
LIABILITIES and NET WORTH
Senior Debt 1,000,000
Subordinated Debt 3,000,000
Common Stockholders Equity 750,000
TOTAL LIABILITIES and NET WORTH $4,750,000
Assume that the reorganized “new” capital structure must be 2/3 debt and 1/3 common equity, with $1,500,000 of the new debt subordinated to senior debt. After the fair distribution of the new securities under the reorganization:
a.
the “old” Senior Debt of $1,000,000 in the last pre-bankruptcy balance sheet will after the reorganization end up with “new” Senior Debt of $1,000,000.
b.
The “old” Common Stockholders Equity of $750,000 in the last pre-bankruptcy balance sheet will after the reorganization end up with “new” Common Stockholders Equity of $750,000.
c.
The “old” Subordinated Debt of $3,000,000 in the last pre-bankruptcy balance sheet will after the reorganization end up with “new” Subordinated Debt of $1,000,000, and “new” Common Stockholders Equity of $1,000,000.
In: Finance
Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost.
Last year, the company sold 32,000 of these balls, with the following results:
| Sales (32,000 balls) | $ | 800,000 |
| Variable expenses | 480,000 | |
| Contribution margin | 320,000 | |
| Fixed expenses | 211,000 | |
| Net operating income | $ | 109,000 |
5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company’s new CM ratio and new break-even point in balls?
6. Refer to the data in (5) above.
a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $109,000, as last year?
b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage.
In: Accounting
Please answer these questions in detail. With formulas
A new blood clotting drug has been developed and researcher are interested to see if the new drug out performs the most commonly used treatment. 6 patients were given the new drug and 7 patients were given the old drug. The clotting times were recorded (lower times are better). The data are:
| new drug | old drug | |
| 8.8 | 9.9 | |
| 8.4 | 9 | |
| 7.9 | 11.1 | |
| 8.7 | 9.6 | |
| 9.1 | 8.7 | |
| 9.6 | 10.4 | |
| 9.5 |
1: What is the null hypothesis?
a: there is no difference in clotting times
b: the old drug clots faster
c: the new drug clots faster
d: there is a difference in clotting times
2: What is the value of the test statistic?
3: How many degrees of freedom are there?
4: What we conclude if we ran a two tailed test?
a: there is no evidence of a difference in clotting times
b: there is evidence that the new drug results in faster clotting
c: there is evidence that the old drug results in faster clotting
5: What would we conclude if we had instead used a one-tailed test?
a: there is no evidence of a difference in clotting times
b: there is evidence that the new drug results in faster clotting
c: there is evidence that the old drug results in faster clotting
In: Math
42, 31, 48, 12, 21, 17, 27, 22, 35, 19, 17
Let's include one more data point in the data set. Suppose this new data value lies between the values 12 and 48, inclusively.
Find the smallest possible value of the median of the new data set
Find the largest possible value of the median of the new data set
In: Statistics and Probability
A medical trial gives participants either the standard medicine for migraines, the other group gets the new medicine. There are 14 who are getting the standard medicine, and 15 getting the new medicine. If 5 are picked at random find the following
create a probability distribution of the people who get the new medicine (M)
| M | P(M) |
| 0 | |
| 1 | |
| 2 | |
| 3 | |
| 4 | |
| 5 |
In: Statistics and Probability
Your company is evaluating a new factory that will cost $23
million to build. Your target debt-equity ratio is 1.7. The
flotation cost for new equity is 9% and the flotation cost for new
debt is 5%. The company is planning to use retained earnings for
80% of the equity financing.
What are the weighted average flotation costs as a fraction of the
amount invested?
What are the flotation costs (in $ million)?
In: Finance
The speech recognition software used by Mr. Smith's company can transcribe 130 words per minute. He will purchase a new product only if it can be shown to increase the speed. 41 tests were ran on the new software resulting in a mean of 135 and standard deviation of 4.5 words per minute with alpha= .01, Should he purchase the new software?
In: Statistics and Probability
Please explain and show all work:
A double-blind study was performed on consumers comparing a new formulation of a diet soft drink with the original formulation. Of 100 subjects, 57 preferred the new formulation, 38 preferred to original formulation, and 5 were undecided or could not tell the difference. Use the sign test to decide whether consumers prefer the new formulation at the 5% level.
In: Statistics and Probability
Discuss your experiences with links opening new web pages in the same window and tab, and in a new window or tab. Which way do you prefer? Do your preferences depend on the situation in which you are following a link? What do you consider to be the disadvantages of opening target web pages in new windows or tabs?
Please explain your reasoning.
In: Computer Science
Suppose the stock of Host Hotels & Resorts is currently trading for $ 15 per share.
a. If Host issued a 20 % stock dividend, what will its new share price be?
b. If Host does a 3 : 2 stock split, what will its new share price be?
c. If Host does a 1 : 3 reverse split, what will its new share price be?
In: Finance