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Broussard Skateboard’s Sales Are Expected To Increase By 20% From $8.4 Million In 2016

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Broussard Skateboard’s sales are expected to increase by 20% from $8.4 million in 2016 to $10.08 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 4%, and the forecasted payout ratio is 75%. What would be the additional funds needed? Do not round intermediate calculations. Round your answer to the nearest dollar.

You Have Been Asked To Assess The Expected Financial Impact Of Each Of The

You have been asked to assess the expected financial impact of each of the following proposals to improve the profitability of credit sales made by your company. Each proposal is independent of the other. Answer all questions. Showing your work may earn you partial credit. Proposal #1 would extend trade credit to some customers that previously have been denied credit because they were considered poor risks.   Sales are projected to increase by $200,000 per year if credit is extended to these new customers. Of the new accounts receivable generated, 7% are projected to be uncollectible. Additional collection costs are projected to be 3% of incremental sales (whether they actually end up collected or not), and production and selling costs are projected to be 80% of sales. Your firm expects to pay a total of 30% of its income after expenses in taxes. Compute the incremental income after taxes that would result from these projections: Compute the incremental Return on Sales if these new credit customers are accepted: If the receivable turnover ratio is expected to be 4 to 1 and no other asset buildup is needed to serve the new customers… Compute the additional investment in Accounts Receivable Compute the incremental Return on New Investment If your company requires a 20% Rate of Return on Investment for all proposals, do the numbers suggest that trade credit should be extended to these new customers? Explain. Proposal #2 would establish local collection centers throughout the region to decrease the time it takes to convert credit payments that are mailed in by check to cash. It is estimated that establishing these collection centers would reduce the average collection time by 2 days. If the company currently averages $60,000 in collections per day, how many dollars will this suggested cash management system free up? If all freed up dollars would be used to pay down debt that has an interest rate of 5%, how much money could be saved each year in interest expense? Do the numbers suggest that this new system should be implemented if its total annual cost is $5200? Explain.

1. What’s The Operating Cash Flow For The Company? 1,598 1,322 1,620 2. What’s

1. What’s the operating cash flow for the company? 1,598 1,322 1,620 2. What’s the amount of capital spending? 191 810 170 3. What’s company’s cash flow to creditors? 81 105 91 4. What is the company’s cash flow to stockholders? 225 231 261

WaFlo Co Is A -based Company Which Has The Following Expected Transactions.. One Month:

WaFlo Co is a -based company which has the following expected transactions.. One month: Expected receipt of         240,000 One month: Expected payment of    140,000 Three months: Expected receipts of    300,000 As the Corporate Finance Manager for WaFlo CO. you collect the following information: Spot rate (K per K):             1.7820 ± 0.0002 One month forward rate (K per K):     1.7829 ± 0.0003 Three months forward rate (K per K):     1.7846 ± 0.0004 Money market rates for WaFlo Co:                         Borrowing         Deposit One year Kwacha interest rate:             4.9%             4.6 One year dollar interest rate:             5.4%             5.1 Assume that it is now 1 April. Required: (a) Discuss the differences between transaction risk, translation risk and economic risk.  (b) Explain how inflation rates can be used to forecast exchange rates.  (c) Calculate the expected Kwacha receipts in one month and in three months using the forward market. (d) Calculate the expected Kwacha receipts in three months using a money-market hedge and recommend whether a forward market hedge or a money market hedge should be used.  (e) Discuss how Kwacha currency futures contracts could be used to hedge the three-month dollar receipt. Zambian based company

Can Bankruptcy Be Considered As A Legitimate And Ethical Management Vehicle To Be Used

Can Bankruptcy be considered as a  legitimate and ethical management vehicle to be used for the benefit of the company’s stakeholders?

Suppose That The Current 1-year Rate (1-year Spot Rate) And Expected 1-year T-bill Rates

Suppose that the current 1-year rate (1-year spot rate) and expected 1-year T-bill rates over the following three years (i.e., years 2, 3, and 4, respectively) are as follows: 1R1 = 2.78%, E(2r1) = 4.10%, E(3r1) = 4.60%, E(4r1) = 6.10% Using the unbiased expectations theory, calculate the current (long-term) rates for 1-, 2-, 3-, and 4-year-maturity Treasury securities. Plot the resulting yield curve. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

For Part C Please Gove Answer Using The Sharpe Ratio And Provide A Verbal

for part c please gove answer using the sharpe ratio and provide a verbal explanation. thank you

The Annual Fixed Costs For A Production Unit Are $2,000,000. Variable Costs Are Related

The Annual Fixed Costs for a production unit are $2,000,000. Variable Costs are related to Production Quantity as: Variable Costs = $15 $.006 × Production Quantity. The Total Annual Cost = Fixed Costs Variable Costs × Production Quantity. If the price of 1 produced part is $150; a) Determine the Production Quantity that will minimize the Unit Cost of a produced part, and calculate the Annual Profit generated at this Production Quantity. 20 Marks b) Determine the Production Quantity that will maximize the Annual Profit, and calculate the Annual Profit generated by the plant at this Production Quanti

What Are The Three Major Objectives Of Technological Investments At FIs? What Are The

What are the three major objectives of technological investments at FIs? What are the major risks involved with these investments?

ACO Industries Established A Sinking Fund In Order To Accumulate Php50,000 By Depositing Equal

ACO Industries established a sinking fund in order to accumulate Php50,000 by depositing equal amounts of money at the end of every year for 3 years. If the fund was earning interest at 8% compounded quarterly, construct a sinking fund schedule to illustrate details of the fund.

Capital Structure Sucre Food Empire Holding Is A Food And Beverage Company. It Was

Capital Structure Sucre Food Empire Holding is a food and beverage company. It was incorporated in 23 March 2000 and was listed on Bursa Malaysia on 27th May 2001. The company’s principal activity is the manufacturer of instant beverages and food products, frozen food and snacks and others. Its products are exported to more than 40 countries including, Indonesia, Thailand, Vietnam, Australia, New Zealand, Korea, Japan, United States, Singapore and China. As the chief financial officer of a young company with lots of investments opportunities, Sucre’s CFO closely monitors the firm’s cost of capital. The target capital structure for Sucre is in the following manner: Source of Capital Weight (%) Long Term Debt 35 Preferred Stock 15 Common Stock Equity 50 At the present time Sucre can raise debt by selling 20 year bonds with a RM1000 par value and at an 11% annual coupon interest rate. Sucre corporate tax rate is 40%, and its bond generally require an average discount of RM35 per bond and floatation cost of RM40 per bond. Sucre’s outstanding preferred stock pays a 10% dividend and has a RM95 per share par value. The floatation cost is RM7 per share. Because Sucre is a young firm that requires lots of cash to grow it does not currently pay a dividend to common stock holders. To track the cost of common stock the CFO uses the capital asset pricing model (CAPM). The CFO and the firm’s investment advisors believe that the appropriate risk free rate is 4% and that the market’s expected return equal 14%. Using data from 2001 through 2015, Sucre CFO estimates the firm’s beta to be 1.2. Although Sucre’s current target capital structure includes 20% preferred stock, the company is considering using debt financing to retire the outstanding preferred stock, thus shifting their target capital structure to 50% long term debt and 50% common stock. If Sucre shifts its capital mix from preferred stock to debt, its financial advisors expects its beta to increase to 1.5. Required: i.​Calculate Sucre’s current after tax cost of long- term debt. ii.​Calculate Sucre’s current cost of preferred stock.       iii.​Calculate Sucre’s current cost of common stock.    iv.​Calculate Sucre’s current weighted average cost of capital.    v.​a) Assuming that the debt financing costs do not change, what effect would a shift to a more highly leveraged capital structure consisting of 50% long term debt, 0% preferred stock, and 50% common stock have on the risk premium for Sucre common stock? What would be Sucre’s new cost of common equity?    b) What would be Sucre’s new weighted average cost of capital? c) Which capital structure – the original one or this one- seems better? Why?    The answer is preferably manual

Canadian Bacon Inc. Financial Statements Are Presented In The Table Below. Based On The

Canadian Bacon Inc. financial statements are presented in the table below. Based on the information in the table, calculate the firm’s total assets turnover ratio. Round the answers to two decimal places Balance Sheet December 31, 2012 Cash and marketable securities $198,000 Accounts payable $288,000 Accounts receivable $469,000 Notes payable $65,000 Inventories $577,000 Accrued expenses $84,000 Prepaid expenses $15,700 Total current liabilities $437,000 Total current assets $1,259,700 Long-term debt $237,000 Gross fixed assets $1,954,000 Par value and paid-in-capital $199,000 Less: accumulated depreciation $476,000 Retained Earnings $1,864,700 Net fixed assets $1,478,000 Common Equity 2,063,700 Total assets $2,737,700 Total liabilities and owner’s equity $2,737,700 Income Statement, Year of 2012 Net sales (all credit) $7,546,600.00 Less: Cost of goods sold $6,112,746.00 Selling and administrative expenses $349,000.00 Depreciation expense $145,000.00 EBIT $939,854.00 Interest expense $49,500.00 Earnings before taxes $890,354.00 Income taxes $356,141.60 Net income $534,212.40 Your Answer:

Musical Instruments Business A Group Of Musicians Have Established A Company Selling Medieval Period

Musical Instruments Business A group of musicians have established a company selling medieval period musical instruments by mail order and appointed themselves company directors. The musicians have raised £750,000 of the capital required themselves and borrowed a further £500,000 in the form of a long-term bank loan. In order to establish the business, they have undertaken the following transactions. Bought premises for £850,000 (paid by cheque). Bought furniture and fittings for £100,000 (paid by cheque). Bought (on credit) stock of instruments for resale for £300,000. Bought a motor van for £20,000 (paid by cheque). The remaining £280,000 of the total initial funds provided is deposited in the business’s bank account. During the first year of trading, the following transactions occurred: instruments costing £1,400,000 were sold on credit terms for £2,000,000 more instruments were purchased on credit terms for £1,500,000 wages and other expenses of £300,000 were paid in cash cash totalling £1,250,000 was received from debtors cash totalling £1,400,000 was paid to creditors interest (paid cash) on the long-term loan was 10%. At the end of the year, the directors decided to make a provision for bad debts of 5% of the year end debtors’ figure. Closing stock (valued at cost) was £400,000. An allowance for depreciation is to be made as follows: buildings, 2% of cost = £17,000 furniture and fittings, 10% of cost = £10,000 motor van, 20% of cost = £4,000. Task Construct a cash flow statement and use the information provided by it. The purpose is to highlight the factors that determine an organisation’s liquidity. Refer to figures above for the Musical Instruments Business. You will need this information to prepare a cash flow statement for the business. During the first year of trading, the directors of Musical Instruments Business have frequently experienced serious cash shortages – even though the enterprise has made a profit. Advise them how to improve the business’s liquidity. To do this. use Table 2 to record your output. You will need, firstly, to prepare a cash flow statement for the business, for the first year of trading, and use the information this provides to make your recommendations. Not all of the different categories of cash flow given in the text example – Terrestrial Trading Company – will appear in the first year of trading for Musical Instruments Business. The template below (Table 1) provides you with the structure and content of the cash flow statement: all you have to do is fill in the numbers. Table 1 Cash flow statement for Musical Instruments Business first year of trading £ Cash received from customers – Cash paid to suppliers- Cash expenses — Cash flows from operations- Bank interest paid — Net cash flow- Table 2 Advice on improving liquidity for Musical Instruments Business Problem identification- Analysis (investigation)- Conclusion to the analysis (results of the investigation)- The solution, listed as a set of SMART recommendations- Strengths and weaknesses of the recommendations- The implications of the solution, if implemented- This should illustrate that profit does not equal cash (the profitability of an organisation does not automatically result in its liquidity). The cash flow statement you have prepared should indicate the main source of this organisation’s lack of liquidity. Such information should enable management to take appropriate remedial action, as well as enable other stakeholders (such as the providers of funds) to form an opinion about the financial management of the organisation. You may have noticed, in preparing the cash flow statement, that the net cash outflow for the year exceeded the business’s cash/bank balances at the beginning of the year; how do you think it financed this deficit?

15.20 A Canadian Bond Is Initially Priced At Its Face Value Of C$1,000. At

15.20  A Canadian bond is initially priced at its face value of C$1,000. At the end of the year, the bond is selling for C$1,100. If the Canadian dollar appreciates by 10%, with a 5.5% coupon, what will the U.S. dollar return on the bond equal at the end of the year? a)  1.05% b)  27.1% c)  15% d)  20% Ans:      b

What Is The Beta Of An Efficient Portfolio With E[r_pf ]=20%, If The Return

What is the beta of an efficient portfolio with E[r_pf ]=20%, if the return on the risk free asset, r_f=5%, the expected return on the market portfolio is E[r_m ]=12%, and the standard deviation of returns on the market portfolio, σ_m=17%? What is the standard deviation of returns on this portfolio? What is its correlation with the market?

1. We Find The Following Information On NPNG (No-Pain-No-Gain) Inc. (18 Marks Total) EBIT

1. We find the following information on NPNG (No-Pain-No-Gain) Inc. (18 marks total) EBIT = $2,000,000 Depreciation = $250,000 Change in net working capital = $100,000 Net capital spending = $300,000 These numbers are projected to increase at the following supernormal rates for the next three years, and 5% after the third year for the foreseeable future: EBIT: 10% Depreciation: 15% Change in net working capital: 20% Net capital spending: 15% The firm’s tax rate is 35%, and it has 1,000,000 outstanding shares and $6,000,000 in debt. We have estimated the WACC to be 15%. a.   Calculate the EBIT, Depreciation, Changes in NWC, and Net Capital Spending for the next four years.                                                                            (8 marks) b.   Calculate the CFA* for each of the next four years, using the following formula: CFA* = EBIT(1 – T) Depr – ΔNWC – NCS                                                   (4 marks) d.   Calculate the present value of growing perpetuity at Year 3.                   (1 mark) e.   Calculate the firm’s value at time 0 using the WACC of the firm as the discount rate. (Note that the first CFA* to be discounted is the cash flow from one year into the future.)                                                                                            (3 marks) f.   Calculate the firm’s equity value at time 0.                                                    (1 mark) g.   Calculate the firm’s share price at time 0.                                           (1 mark)

Your Goal Is To Use The Three-factor Model, Such As Fama And French. Suppose,

Your goal is to use the three-factor model, such as Fama and French. Suppose, the expected return on the portfolio mimicking HML factor is: E[R_HML ]=10% and the expected return on the portfolio mimicking the SMB factor is: E[R_SMB ]=12%. The expected return on S

1. Mr. Toriop Owns 5,000 Shares Of Stock In Yummy Corporation. The Company Has

1. Mr. Toriop owns 5,000 shares of stock in Yummy Corporation. The company has announced that it will pay a dividend of $5 per share in one year and a liquidating dividend of $50 per share in two years. The required return on Yummy stock is 12%.                                                                                                             (21 marks total) a. What is the current share price of your stock?                                 (1 mark) b. What will be the company’s share price in one year’s time?                     (1 mark) c.   Mr. Toriop wishes to have equal amounts of dividend income for the next two years. How can he use homemade dividends to achieve this goal? Check that the present value of the cash flows will be the same as it is before the homemade dividends. (Hint: Dividends will be in the form of an annuity.)                       (8 marks) d. Suppose Mr. Toriop is thinking about buying a house for $220,000 in one year. How can he use homemade dividends to achieve this goal? Check that the present value of the cash flows will be the same as it is before the homemade dividends.                                                                                                (5 marks) e. Suppose Mr. Toriop is thinking about postponing the house purchase for two years, by which time the price of the house will have increased by $46,800. How can he use homemade dividends to achieve this goal? Check that the present value of the cash flows will be the same as it is before the homemade dividends.                                                                                                                                (6 marks)

1. You Observe That A Treasury Bond Is Trading At A Significant Discount. Which

1. You observe that a treasury bond is trading at a significant discount. Which of the following statements is accurate? a. Yields have decreased since bond initiation b. Yields have increased since bond initiation c. The bond price has increased since initiation d. Insufficient information has been provided to answer this question

2. Which Of The Following Is True In Relation To A Fixed Rate

2. Which of the following is true in relation to a fixed rate lender that wishes to transform its position using an interest rate swap? a. they should enter into a long interest rate swap b. following the transformation, should the floating rate increase the lender receives more c. following the transformation, the fixed rate reception is offset by the pay-fixed leg of the interest rate swap d. all of the above

Broussard Skateboard’s Sales Are Expected To Increase By 20% From $8.6 Million In 2016

Broussard Skateboard’s sales are expected to increase by 20% from $8.6 million in 2016 to $10.32 million in 2017. Its assets totaled $3 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 4%, and the forecasted payout ratio is 65%. Use the AFN equation to forecast Broussard’s additional funds needed for the coming year. Round your answer to the nearest dollar. Do not round intermediate calculations.

The post Broussard Skateboard’s Sales Are Expected To Increase By 20% From $8.4 Million In 2016 appeared first on Smashing Essays.

 
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