• Q : A consolidation criterion led....
    Finance Basics :

    When is consolidation considered inappropriate even though the parent holds a majority of the voting common shares of another company? How has reliance on legal control as a consolidation criterion le

  • Q : Preparation for comparable transaction analysis....
    Finance Basics :

    Company A shares are currently trading at $50 per share. A survey of Wall Street analysts reveals that EPS expectations for Company A for the full year 2003 are $2.50 per share.

  • Q : Analyzing financial decisions....
    Finance Basics :

    Jim Brock was an accountant with Hubbard Inc., a large corporation with stock that was publicly traded on the NYSE. One of Jim's duties was to manage the corporate reporting department, which was resp

  • Q : Difference between a call and a put....
    Finance Basics :

    What is the difference between a "call" and a "put?" Which party in a bond transaction would prefer the "call" and which the "put?"

  • Q : Computation of capital gains yield....
    Finance Basics :

    One year ago, you purchased 400 shares of Analog Devices, Inc. stock for $13.95 a share. You received a total of $120 in dividends and sold the stock for $7,072 today.

  • Q : Calculate profit on exchange rate....
    Finance Basics :

    Suppose your company imports computer motherboards from Singapore. The exchange rate is currently 1.5803S$/US$. You have just placed an order for 30,000 motherboards at a cost to you of 170.90 Singapo

  • Q : Conflicts between two mutually exclusive projects....
    Finance Basics :

    Conflicts between two mutually exclusive projects should generally be resolved in favor of the one with the higher NPV

  • Q : Computing conversion rates....
    Finance Basics :

    Today, you can get either 121 Canadian dollars or 1,288 Mexican pesos for 100 U.S. dollars. Last year, 100 U.S. dollars was worth 115 Canadian dollars or 1,291 Mexican pesos.

  • Q : Computation of sustainable growth rate....
    Finance Basics :

    If it does grow at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio?

  • Q : Define new issue market and registration statement....
    Finance Basics :

    Define each of the following terms: a. Going public; new issue market; initial public offering (IPO), b. Public offering; private placement, c. Venture capitalists; roadshow;

  • Q : Calculation of irr....
    Finance Basics :

    Jacob has an opportunity to invest in a new retail development in his building. The initial investment is $50,000 and the expected cash-flows are as follows:

  • Q : Determine probable causes of undervaluation....
    Finance Basics :

    Starbucks opened its first store in Zagreb, Croatia in October 2010. The price of a tall vanilla latte in Zagreb is 25.70kn. In New York City, the price of a tall vanilla latte is $2.65.

  • Q : Make an investment analysis....
    Finance Basics :

    Please establish an estimated growth rate in earnings and dividends for British Petroleum (BP). Note, in the dividend growth model, "g" is the growth rate for earnings AND dividends.

  • Q : Components of a complete grant proposal....
    Finance Basics :

    What are the components of a complete grant proposal? How can you convince the funder of your need for funding? What are some tips in developing a well-written needs statement?

  • Q : Calculate the payback period and internal rate of return....
    Finance Basics :

    Seth Bullock, the owner of Bullock Gold Mining, is evaluating a new gold mine in South Dakota. Dan Dority, the company's geologist, has just finished his analysis of the mine site. He has estimated th

  • Q : Determine coupon rate on the bond....
    Finance Basics :

    Is the yield to maturity on a bond the same thing as the required return? Is YTM the same thing as the coupon rate? Suppose today a 10% coupon bond sells at par? Two years from now the required return

  • Q : Calculating coupon rate on the bonds....
    Finance Basics :

    Ozzy Corp. has bonds on the market with 10.5 years to maturity, a YTM of 9.4%, and a current price of $945. The bonds make semi-annual payments.

  • Q : Computing dividend growth rate....
    Finance Basics :

    Delphin's Marina is expected to pay an annual dividend of $0.58 next year. The stock is selling for $8.53 a share and has a total return of 12 percent. What is the dividend growth rate?

  • Q : Determination of current yield....
    Finance Basics :

    $1,000 face amount bonds of Stalwart Development Corp. are quoted at a price of 102.2 and carry a 6.50 percent coupon. The bonds pay interest semiannually. What is the current yield on one of these bo

  • Q : Calculation of cash conversion cycle....
    Finance Basics :

    Strickler technology is considering changes in its working capital policies to improve its cash flow cycle. Strickler's sales last year were $3,250,000 (all on credit), and its net profit margin was 7

  • Q : Estimating pv of future financial requirements....
    Finance Basics :

    Beginning three months from now, you want to be able to withdraw $1,700 each quarter from your bank account to cover college expenses over the next 4 years.

  • Q : Computing present value of cash flows....
    Finance Basics :

    You just signed a consulting contract that will pay you $38,000, $52,000, and $85,000 annually at the end of the next three years, respectively. 

  • Q : Computing break-even quantity for the manual process....
    Finance Basics :

    Zan Azlett and Angela Zesiger have joined forces to start A&Z Lettuce Products, a processor of packaged shredded lettuce for institutional use. Zan has years of food processing experience, and Ang

  • Q : Determination of ytm....
    Finance Basics :

    Martin Software has 9.4 percent coupon bonds on the market with 19 years to maturity. The bonds make semi-annual payments and currently sell for 107.5 percent of par.

  • Q : Describe the possible forms in common and preferred stock....
    Finance Basics :

    With all investments, there are an expected percentage return and certain types of return that can be expected. Describe the possible forms in which a return could be received for bonds, common stock,

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