Structuring Corporate Financial Policy: Diagnosis of Problems and Evaluation of Strategies

Estimate the cost of capital for financing (Hint: Interest expense and total debt – Ascertain the return on equity to provide measures for the interest rate and the return to stockholders.

An assessment of the company’s financial statements will highlight the firm’s management of its risk and opportunities.

Differential diagnoses are developed by a clinician upon learning of the chief complaint. One must begin to develop the possibility of potential diagnoses mentally to guide the care provided to the patient. These potential diagnoses are developed by the care provider and are often based on one’s past clinical experiences, awareness of the illness and a clear understanding of the patient’s complaint (Goolsby & Grubbs, 2014). The care provider with experience may develop these diagnoses independently and others with less experience may utilize evidence-based resources and clinical guidelines to aid in this process (Goolsby & Grubbs, 2014). The process for reaching a final diagnosis requires further investigation and use of physical assessment

In November 2001, the costs of required rates of return on debt in the capital market are as follows:

Cost of Debt – To find the cost of debt, we use the details of the bonds issued by Rollins Instruments.

As the financial analyst of the company, this report is written in respect to how the financial position of the company can be improved. This report is aimed for the senior management team.

3. An analysis of stock market conditions including recent returns on stock market indexes and average valuation ratios such as P/E ratios of stock market indexes.

3) What is the weighted average cost of capital and why is it important to estimate it? Is the

The cost of debt (kd) rate of 13% was used after we assessed the key industrial financial ratios and compared them with that of Wrigley’s (See Appendix 2) to conclude that it was in the range between the BB rate of

1. Brigham, Eugene F. and Michael C. Ehrhardt. Financial Management Theory and Practice, 13th Edition, Thompson South-Western, ISBN-13# 978-14390-7809-9, ISBN-10#1-4390-7809-2

The most important is Enterprise value/EBIDTA. Helps to estimate the offer of KKR, inc and gives the answer to Question N4. (See the following table)

You can make use of three different ratios to evaluate company and measure its financial strength. Two of the ratios viz. debt and debt-equity ratios are very common measurements. The third one, capitalization ratio, gives a proper insight in evaluating the company’s capital structure.

WACC = (Weight of Equity * Equity Cost of Capital) + (Weight of Debt * Debt Cost of Capital)

BIBLIOGRAPHYBrigham, Eugene F., and Joel F. Houston. Fundamentals of Financial Management. "D'Leon Inc., Chapter 8 spreadsheet module". Made available on July 17, 2008 by Dr. Richard Constand.

The purpose of this assignment is to study the finance sources available to a company. Here according to the assignment requirement, we have to select a British public company to study the available sources of finance from where the firm collects its capital requirement. Following the guidelines we have to analyze various sources with their potentiality and then we make viable analysis of Cash and sales budget. Here some salient financial ratios are employed for the purpose of analyzing the financial statement of the company.