• Q : Determine interest expense using straight-line amortization....
    Finance Basics :

    A company issues 20,000,000, 7.8%, 20 year bonds to yield 8% on January 1, 2010. Interest is paid on June 30 and December 31. The proceeds from the bonds are 19,604,145.

  • Q : Computation of effective annual yield....
    Finance Basics :

    The treasurer of DeShack Company has approximately $1,000,000 to invest for the next 60 days. She is considering the purchase of a T-bill with the following characteristics: face value of $1,000,000,

  • Q : Determine average-risk project....
    Finance Basics :

    A company estimates that an average-risk project has a cost of capital of 8 percent, a below-average risk project has a cost of capital of 6 percent, and an above-average risk project has a cost of ca

  • Q : Fixed income securities into investment portfolio....
    Finance Basics :

    Your provided investment included some stocks from Hong Kong, India and US, but I would like my equity investment to stay in Hong Kong, US and France financial market.

  • Q : Opportunity cost into the buy decision....
    Finance Basics :

    How does opportunity cost enter into the make or buy decision? What would be an example of a decision that you might make in your personal life that would involve an opportunity cost?

  • Q : Sustainable mean in sustainable growth model....
    Finance Basics :

    What does the word sustainable mean in sustainable growth model? In what ways can the sustainable growth model highlight conflicts between a firm's competing objectives?

  • Q : Calculate projected profit under the guarantee deal....
    Finance Basics :

    You have decided to become a rock concert promoter and have made arrangements with Jerry Jones (and Arlington) to rent the new Texas Stadium for one night for a cost of $1,000,000 plus a $7 per ticket

  • Q : Estimate the total gross profit margin....
    Finance Basics :

    Nevada Company provided the following information regarding its only product: skateboards. What is the total gross profit margin (gross profit) for this product?

  • Q : Computing the percent return to the investment....
    Finance Basics :

    A new tax is levied on airline profits to finance improvements in the nation's airports. The current market rate of interest is 8%. However, airline profits are subject to a 50% tax.

  • Q : Roe and working capital policy....
    Finance Basics :

    Shanklin Inc. purchases merchandise on terms of 2/15, net 40, and its total gross purchases (i.e., purchases before taking off the discount) are $800,000 per year.

  • Q : Calculate current total annual inventory cost....
    Finance Basics :

    Novelty Gifts is experiencing some inventory control problems. The manager currently orders 10,000 units four times each year to handle annual demand of 40,000 units.

  • Q : Setup an income statement and a balance sheet....
    Finance Basics :

    Based on the financial information below, prepare an income statement and a balance sheet for Joe's-Fly-by-Night Oil company for the year ended December 31, 2011.

  • Q : Investment and managerial finance....
    Finance Basics :

    GRP Corporation has $500,000 in a bank account paying 0.35% annual interest. As an alternative to leaving the money in the account, the company is considering investing the entire amount for five year

  • Q : Calculate the present and future value of investment....
    Finance Basics :

    An investment scheme pays $200 at the end of each of the next 4 years, $400 at the end of year 5, $300 at the end of year 6 and $500 at the end of year 7.

  • Q : Calculate expected return of the combined portfolio....
    Finance Basics :

    A stock portfolio is equally allocated among Stock A, B, and C. Stocks A, B, and C have betas of 1.9, 1, and 0.57, respectively. The market has just risen 4%.

  • Q : Compute expected return on stock....
    Finance Basics :

    The beta of Microsoft's stock is 1.2, whereas the risk-free rate of return is 4 percent. Assume that the expected return on the market is 16 percent.

  • Q : Computing the variance and standard deviation....
    Finance Basics :

    The following table provides the share return forecasts and associated probabilities for Advanced Limited and Bright Limited.

  • Q : Calculation of minimum growth rate....
    Finance Basics :

    In singer Whitney Houston's will, she leaves her daughter, Bobbi Kristina, $20 million. Bobbi Kristina goes to the Body Guard Bank where her financial adviser, Frank Farmer, recommends that she use a

  • Q : Demand analysis to show limit on amount of reimbursement....
    Finance Basics :

    How do health care providers control expenditures for health care? Suppose reimbursement rates to physicians under all payers are limited by law. 

  • Q : Recalculate the replacement rate including medicare benefits....
    Finance Basics :

    A middle income worker, with a dependent spouse older than the normal retirement age, retired in January 2004. In the year prior to retirement, her gross monthly earnings were $1,500. Her Social Secur

  • Q : Preparing recommendations for discount rates....
    Finance Basics :

    In April 1988, the vice president of project finance at the Hilton Corporation , Christopher Nassetta, was preparing recommendations for discount rates that should be used to evaluate each of the firm

  • Q : Determine main sources of funds for commercial banks....
    Finance Basics :

    What are the main sources of funds for commercial banks? How an environment of low interest rates could pose problems for a commercial banks liquidity?

  • Q : Calculating total dollar return....
    Finance Basics :

    Suppose you bought 100 shares of stock at an initial price of $73 per share. The stock paid a dividend of $0.88 per share during the following year, and the share price at the end of the year was $82.

  • Q : Comparison for walmart industry....
    Finance Basics :

    What is Wal-Mart's position in the industry including a comparison of the company to its competitors. Good metrics to determine a company's position in the industry and its comparison to competitors i

  • Q : Computation of the opportunity cost....
    Finance Basics :

    RLJ Technologies provides custom servics to its loyalty customers from Monday through Friday. David Lee, the co-owner, believes it is important for the employees to have Saturday and Sunday off to spe

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