• Q : Bonds related journal entries....
    Finance Basics :

    Higher Corporation owned 51 percent of the voting common stock of Manato, Inc. The parent’s interest was acquired several years ago on the date that the subsidiary was formed.

  • Q : Calculating fv, pv, and simple interest rate....
    Finance Basics :

    Calculate the amount of each payment to be made to a sinking fund with 10 annual payments compounded at 14% yearly, in order that enough money will be available to pay off a loan of $5,000.

  • Q : Calculating yield to maturity at current market price....
    Finance Basics :

    Heymann firm bonds havefour (4) years left to maturity. Interest is paid yearly, and the bonds have a $1,000 par value and a coupon rate of 9%.

  • Q : Default risk premium....
    Finance Basics :

    The real risk-free rate is 2.5%. Inflation is expected to average 2.8% a year for the next 4 years, after which time inflation is expected average 3.75% a year.

  • Q : Calculating yield on treasury securities....
    Finance Basics :

    The real risk-free rate is 3%. Inflation is expected to be 2% this year and 4% during the next 2 years. Suppose that the maturity risk premium is zero.

  • Q : Find whether to invest in fixed assets or in borrow funds....
    Finance Basics :

    If a company in creating money from operations & is heavily investing in fixed assets, what conclusion can you make from it?

  • Q : Determine annual after-tax cost of debt....
    Finance Basics :

    Claus & firm is planning a zero coupon bond issue. The bond has a par value of $1,000, matures in two (2) years, and will be sold at a price of $826.45.

  • Q : Objective questions based on market price and stocks....
    Finance Basics :

    Makeover Inc. believes that at its current stock price of $16.00 the firm is undervalued in the market. Makeover plans to repurchase 2.4 million of its 20 million shares outstanding.

  • Q : Finding retained earnings with increase in sales....
    Finance Basics :

    Find Cranberry Corporation's addition to retained earnings with a 10% increase in sales? Suppose the dividend payout ratio and profit margin remains fixed.

  • Q : Decision making question on capital structure....
    Finance Basics :

    An understanding of the concepts of complete markets & spanning are essential for an understanding of the literature on unanimity & several other topics covered in this course.

  • Q : After-tax cash flows, payback npv, pi, irr....
    Finance Basics :

    Fabulous Fashions is thinking to purchase of computerized clothes designing software. The software is expected to cost dollar 160,000, have a useful life of five (5) years

  • Q : Impact of leverage on creditors....
    Finance Basics :

    In finance, as in accounting, two (2) sides of the balance sheet must be equal. To value the other side, we must value the debt & the equity, and then add them together.

  • Q : Calculate indifference level of ebit....
    Finance Basics :

    Moon and Chittenden are considering a new Online Internet venture to sell used textbooks. The project requires dollar 300,000 in Financing.

  • Q : Calculate time interest earned ratio....
    Finance Basics :

    Morton Company is considering opening a new subsidiary in Boston, to b operated as a separate firm. The firm's financial analysts expect the company is considering the following two (2) financing plan

  • Q : Selecting optimal source of finance....
    Finance Basics :

    Morton Company is considering opening a new subsidiary in Boston, to b operated as a separate firm. The firm's financial analysts expect the company is considering the following two (2) financing plan

  • Q : Computing ebit-eps indifference point....
    Finance Basics :

    Emco Products has a present capital structure consisting only of common stock of 10 million shares. The firm is planning a major expansion.

  • Q : Using graph to determine ebit-eps indifference point....
    Finance Basics :

    One piece of information the firm desires for its decision analysis is an EBIT-EPS indifference point. Use graph to determine the EBIT-EPS indifference point. Suggestion: use EBIT= $10 million and $25

  • Q : Compute ebit-eps indifference point....
    Finance Basics :

    Emco Products has a present capital structure consisting only of common stock of 10 million shares. The firm is planning a major expansion.

  • Q : Determine fixed operating costs....
    Finance Basics :

    Rodney Rogers, a recent business school graduate, plans to open a wholesale dairy products firm. The business will be completely financed with equity.

  • Q : Increasing of capital....
    Finance Basics :

    Assume you believe that the economy is just entering a recession. Your company must increase capital immediately & debt that will be used. 

  • Q : Analyze the financial performance....
    Finance Basics :

    Make a report explaining how you would examine the financial performance of a publicly traded corporation [A Corporation] if you were provided with three (3) years

  • Q : Calculate the approximate rate of interest....
    Finance Basics :

    Coverall Carpets Inc. is considering borrowing $12,000 from the bank. The bank offers the choice of a 12% discount interest loan or a 10.19% add-on, one-year installment loan, payable in four (4) equa

  • Q : Calculate yield to maturity and yield to call....
    Finance Basics :

    70% of the company's sales are on credit. Past experience shows that 40% of accounts receivable are collected in the month after sale, & the remainder is collected in the 2nd month after sale.

  • Q : Direct and indirect techniques....
    Finance Basics :

    Both the direct and indirect techniques will produce the similar cash flow from operating activities.

  • Q : Total annual savings....
    Finance Basics :

    Apply future value computations to compute the amount that must be saved yearly for their emergency fund, car, college, and remodeling goals. suppose Kevin and Stacy can earn 3.5 percent after taxes o

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