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Widgets world earned $187,500 this years. The company strictly follows the residual dividend policy when paying dividends. WW had determined that it needs a total of $250,000 for investment in capit
The firm has hired an underwriter who arranges a full commitment underwriting and suggests an initial selling price of $25 a share with a 7 percent spread.
You have 36 years left until retirement and want to retire with $4.9 million. Your salary is paid annually, and you will receive $78,000 at the end of the current year. Your salary will increase at
A 10-year annuity pays $1,250 per month, and payments are made at the end of each month. If the interest rate is 12 percent compounded monthly for the first five years, and 8 percent compounded mon
A collector bought a painting by Henri Matisse for $100,000 in 1970 and sold it for $28 million in 2010. What annual return has been earned on this art investment?
Given the following changes in Current Assets and Current Liabilities, what is the change in NWC? The change in Accounts Receivables was $3,005; the change in Inventory was $2,421;
Smaltz's capital structure is comprised of 75% equity (based on current market prices) and 25% debt on which the firm pays a yield of 5.125% before taxes at 25%.
You are planning to make monthly deposits of $440 into a retirement account that pays 9 percent interest compounded monthly. If your first deposit will be made one month from now, how large will yo
Robin wants to purchase 1,000 shares of Anatop, Inc., which is selling for $5 per share. Anatop does not pay dividends because all earning are reinvested in the firm to maintain its successful R&
What is the net present value (NPV) of the acquisition to DM shareholders if it costs an average $30 per share to acquire all of the outstanding shares?
Negus Enerprises has aan inventory conversion period of 50 days, an average collection period of 35 days and a payable deferral period of 25 days. assume hat cost of goods sold is 80% of sales.
Plush Pilots, Inc., has balance sheet equity of $5.2 million. At the same time, the income statement shows net income of $743,600. The company paid dividends of $423,852 and has 130,000 shares of st
CBA Inc has 400,000 shares o/s with a $5 par value. The shares were issued for $12/share. The stock is currently selling for $34/share. CBA has $5,000,000 in Ret.
Sales on an account become uncollectible and must be written off as bad debts.Given this possibility, why do companies extend credit to customers?
You are considering a project which has been assigned a discount rate of 8%. If you start the project today, you will incur an initial cost of $480 and will receive cash inflows of $350 a year for t
Phoebe realizes that she has charged too much on her credit card and has racked up $5,500 in debt. If she can pay $250 each month and the card charges 17 percent APR (compounded monthly), how long w
We also looked at dividend policy. What incentive is there for a company to pay dividends? What signals does dividend policy provide to investors?
Assume that you have $330,000 invested in a stock that is returning 11.50%, $170,000 invested in a stock that is returning 22.75%, and $470,000 invested in a stock that is returning 10.25%. What is
In April 2013, Apple issued $17 billion of bonds as a part of plan to finance $100 billion cash, used to return shareholders by the end of 2015. Apple owns $145 billion of cash and much of its cash
Yosef Company began operating on January 1, 2012. At the end of the first year of operations, Yosef reported $750,000 income before income taxes on its income statement but only $660,000 taxable inc
Harold has decided to keep Danka in his portfolio, even though it has experienced financial difficulties and performed very poorly last year, because he expects a significant turnaround that will ge
Today, the one-year U.S. interest rate is 3%, while the one-year interest rate in Mexico is 8%. The spot rate of the Mexico peso (MXP) is $.08 The one-year forward rate of the MXP exhibits a 11% dis
The inflation rate in the U.S. is 3%, while the inflation rate in Japan is 2%. The current exchange rate is $1 equal to 78 Janpanese yen. If purchasing power parity condition is exited, what is the
The Lo Sun Corporation offers a 6.0 percent bond with a current market price of $809.50. The yield to maturity is 8.24 percent. The face value is $1,000.