Marriott Case Report

The standardized approach for calculating operational risk capital requirements uses beta factors for a given business line and annual gross income for business lines over a 3-year period. Which of the following business units has the highest beta factor? A. Trading and sales. B. Retail banking. C. Agency and custody services. D. Asset management.

Required information [The following information applies to the questions displayed below] The managers of the XYZ clubs, who have the authority to make investments as needed, are evaluated based largely on return on investment (ROI). The company's X Club reported the following results for the past year: Sales $ 840,000 Net operating income $ 24,360 Average operating assets $ 100,000 The following questions are to be considered independently. 2. Assume that the manager of the club is able to increase sales by $84,000 and that, as a result, net operating income increases by $7,056. Further assume that this is possible without any increase in average operating assets. What would be the club's return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI)

Alpesh

The managers of the XYZ clubs, who have the authority to make investments as needed, are evaluated based largely on return on investment (ROI). The company's X Club reported the following results for the past year: Sales Net operating income Average operating assets $ 730,000 $ 13, 140 $ 100,000 The following questions are to be considered independently. 2. Assume that the manager of the club is able to increase sales by $73,000 and that, as a result, net operating income increases by $5,329. Further assume that this is possible without any increase in average operating assets. What would be the club's return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) %

Mace Manufacturing is in the process of analyzing its investment​ decision-making procedures. Two projects evaluated by the firm recently involved building new facilities in different​ regions, North and South. The basic variables surrounding each project analysis and the resulting decision actions are summarized in the following​ table: ( see attached file) d. If the firm maintains a capital structure containing 40​% debt and 60​% ​equity, find its weighted average cost using the data in the table. e. If both analysts had used the weighted average cost calculated in part d​, what recommendations would they have made regarding the North and South​ facilities? f. Compare and contrast the​ analysts' initial recommendations with your findings in part e.Which decision method seems more​ appropriate? Explain why.

Macon Mills is a division of Bolin Products, Inc. During the most recent year, Macon had a net income of $40 million. Total assets were $470 million, non-interest-bearing current liabilities were $72,000,000. What are the invested capital and ROI for Macon? Solution What is the invested capital (Total Assets – Non-Interest-Bearing Current Liabilities)? What is the ROI (Net Income/Invested Capital)?

Medallion Cooling​ Systems, has total assets of $10,900,000​, EBIT of $1,990,000​, and preferred dividends of $205,000and is taxed at a rate of 40%.In an effort to determine the optimal capital​ structure, the firm has assembled data on the cost of​ debt, the number of shares of common stock for various levels of​ indebtedness, and the overall required return on​ investment:   Capital structure debt ratio Cost of​ debt, rd Number of common stock shares Required​ return, rs    0%          0% 198,000    12.1% 15    7.9 171,000 13.2 30    8.9 141,000 13.8 45 12.1 107,000 16.1 60 14.9 76,000 20.1   a. Calculate earnings per share for each level of indebtedness.   Debt Ratio   0% EBIT $ 1,990,000 Less: Interest $   EBT $   Taxes @40% $   Net profit $   Less: Preferreddividends $   Profits available to     common stockholders $…

As a recent graduate of the UWIOC, The General Manager of the company has hired you to work alongside the Financial Controller of the company to help determine whether the company should invest in the new product line. He has provided you with the following questions to guide you in your assessment of the project and to present your findings to the Company.  1. Determine the weighted average cost of capital (WACC) for Vigour Pharmaceuticals. (Formula to be used below)

During the past few years, Super Technologies has been too constrained by the high cost of capital to make many capital investments.  Recently, though, capital costs have been declining and the company has decided to look seriously at a major expansion program that had been proposed by the marketing department.  As the assistant to the financial vice-president, it is your task is to estimate Super’s weighted average cost of capital (WACC).  The VP has provided you with the following information:   The firms’ tax rate is 40%.             The current market price of Super’s outstanding bonds is $1,153.72.  The bonds have an annual coupon rate of 12% and make coupon payments semiannually.  The bonds mature in 15 years and have a par value of $1,000.             The current price of the firm’s preferred stock is $113.10 per share.  The stock has a $100 par value and a 10% annual dividend rate (paid annually).             The current price of the firm’s common stock is $50 per share.…

During the past few years, Super Technologies has been too constrained by the high cost of capital to make many capital investments.  Recently, though, capital costs have been declining and the company has decided to look seriously at a major expansion program that had been proposed by the marketing department.  As the assistant to the financial vice-president, it is your task is to estimate Super’s weighted average cost of capital (WACC).  The VP has provided you with the following information:   The firms’ tax rate is 40%.             The current market price of Super’s outstanding bonds is $1,153.72.  The bonds have an annual coupon rate of 12% and make coupon payments semiannually.  The bonds mature in 15 years and have a par value of $1,000.             The current price of the firm’s preferred stock is $113.10 per share.  The stock has a $100 par value and a 10% annual dividend rate (paid annually).             The current price of the firm’s common stock is $50 per share.…

Shaq Company operates with three segments: Louisiana, Orlando, and Los Angeles.Data regarding these segments is as follows:   LouisianaSegment OrlandoSegment Los AngelesSegment Contribution to indirect expenses $328,500 $207,600 $155,500 Assets directly used & identified with segment $1,858,700 $1,410,000 $742,600   1. Calculate the return on investment for each segment. Rank them from highest to lowest. Round percent to 1 decimal place.   LouisianaSegment OrlandoSegment Los AngelesSegment Segment Net Income       Investment base (assets)       ROI (%)       Rankings (1,2, or 3, where 1 is the best)       2. Assume the cost of capital is 14% for a segment. Calculate residual income for each segment. Rank them from highest to lowest. Round percent to 1 decimal place.   LouisianaSegment OrlandoSegment Los AngelesSegment Segment Net Income       Investment base (assets)       Cost of Capital (%)       Minimum Income       Residual Income…