Fin 571 Week 5

Since different securities can have different payment period (for example, bond interest is paid semiannually but stock dividends are paid quarterly), direct comparisons can only be made when all yields are expressed as effective annual rates.

Problem 1: Jonathon Barrs is a manager for Easy Manufacturing, LLC. He wishes to evaluate three possible investments. These investments are for the purchase of new machine tools from Germany, Japan, and a local US manufacturer. The firm earns 10% on its investments and they have a risk index of 5%. The chart below lays out the expected return and expected risks of the three projects.

This course applies corporate finance concepts to make management decisions. Students learn methods to evaluate financial alternatives and create financial plans. Other topics include cash flows, business valuation, working capital, capital budgets, and long-term financing.

Recognizing an organization’s alternatives for growth is an important process for companies. By evaluating and selecting the competitive advantages within a market a company can distinguish themselves from their competition. For an organization the “grand strategies indicate the time period over which long-range objectives are to be

Our estimated cost of capital, 20.81%, is lower than Ricketts’ expected return, 30%-50%, thus the investment is worthy. However, it’s higher than other pessimistic members’ expected return, 10%-15%, making the decision more complex and requiring further valuation。

Confidence intervals allow us to pinpoint data to a degree of confidence. The intervals are used to estimate the reliability of an estimate. Usually, the confidence levels that are calculated are 90%, 95%, and 99%. The confidence intervals for my particular situation are as follows:

Summarize It! is a new company in the works which will summarize deposition transcripts for attorneys. To help ensure the success of the company, a strategic plan has been developed. In doing so, it is essential to incorporate an implementation plan. The implementation plan will outline steps such as identifying objectives, functional tactics, action items, milestones and deadlines, tasks and task ownership, and resource allocation. In addition, it is important to identify any areas in which organizational change management strategies can be put into place, as well as key success factors. A budget, forecasted financials, and

George C. Philippatos and William W. Sihler, 'Models of Dividend Policy', Financial Management (Allyn and Bacon), 228-229

Assignment from Sylabus: Prepare a 2-3 page narrative of your HR integaration project to explain you approach to the project’s sponsor, Hugh McCauley.

The closing capitals for both years are very similar and propose that not only is the business very profitable but it is also maintaining its financial position within the market. In 2011 the closing capital was £2,500,000 and for 2012 the closing capital was £2,425,000. This is interesting because as a business progresses you would think that the closing capital would increase not decrease although this is not too large a decrease when compared with the general current financial instability and the number of businesses which are struggling to stay afloat.

Dividend Policy | -Pay out dividend to shareholders in profitable period | -100% plowback to reinvest in the business |

Blackmores Ltd is one of the leading contenders in the Health Care sector. The company specialises in a range of products including herbal and vitamin supplements. The company has a major share in the Australian and New Zeeland’s market generating almost 85% of the revenue from this region. Blackmore’s capital structure has been analysed as requested by the Board of directors to assist them in optimizing the company’s current capital structure.

In July 2002, an investment banker advising Deluxe Corporation must prepare recommendations for the company’s board of directors regarding the firm’s financial policy. Some special considerations are the mix of debt and equity, maintenance of financial flexibility, and the preservation of an investment-grade bond rating. Complicating the assessment are low growth and technological obsolescence in the firm’s core business. The purpose is to recommend an appropriate financial policy for the firm and, in support of that recommendation, to show the impact on the firm’s cost of capital, financial flexibility (i.e., unused debt capacity), bond rating, and other considerations.

The fact that shareholders are taxed twice through this repayment methodology infers that dividends are not their repayment technique of choice. Furthermore, paying out cash reserves through dividends also has the effect of both reducing the company’s assets and also inhibited the company’s ability to fund future growth as Dividends reduce the company’s retained earnings.

This also concerned with liquidity. However it focuses on the long term financial stability of a business. In the year 2013 the ratio was 56.49% and in 204 it worsened to 57.9%. According to the data the company is “highly geared” as it over 50% ratio which exposes the risk of liquidation if interest cannot be paid. However, one of the advantages of also having a high gearing is the company taking a profitable project which will allow company to expand in future to reduce gearing. (www.tutor2u.net/business/accounts/ratio_gearing.html).