Q: i need the answer quickly
A: As per company policy it is only possible to solve one question in case of multiple questions. so so...
Q: i need the answer quickly
A: Annual inflation rate can be defined as that inflation rate which is expected to be prevailing in ec...
Q: True or False Suppose that a project has a unique IRR=20%. The hurdle rate is 25%. Your boss says t...
A: Hurdle rate is very useful in capital budgeting problems. This rate is also known as discount rate. ...
Q: Project planning is usually a function of the following personnel __________ top manager, ...
A: project planning is the process to determine the cost by managers, planning is the first step of the...
Q: Find the Net Present Value (NPV) for Oman Computer company if the initial investment is 15000 OMR an...
A: Given information: NPV is the difference between the present value of expected cash flows and the in...
Q: Treet Corporation is expanding rapidly, and it currently needs to retain all of its earnings, hence ...
A: Constant growth rate is the rate at which dividends are expected to grow each year.
Q: The Richard Scott paper company has a maximum of $100m to invest. From this limited money they need ...
A: Company should invest in Option A.
Q: The returns of Al Maha Ceramics for the last four years are Year 1=(-35), Year 2=10, Year 3=25, Year...
A: Variance measures the change in actual asset price in relation to its average price. It is calculate...
Q: answer these question in just two sentences. a..“If a firm sold some inventory on credit, its curren...
A: The financial ratios refer to the ratios that are calculated using the financial data from the finan...
Q: The company capital structure consists of debt 250000 at 0.076, preferred stock 230000 at 11% and co...
A: Cost of capital is the sum of cost of capital from all the sources of finance. Weighted average cost...
Q: on of Ooredoo
A: The standard deviation can be calculated as follows :
Q: The returns of Oman Bottling Company is as follows. Year 1=12, Year 2=(-10), Year 3=18, Year4=20. Th...
A: Returns are as follows: Year 1-12, Year 2-(-10), Year 3-18, Year4- 20
Q: How COVID-19 affect international capital market. In general, does the market value of companies red...
A: The (COVID-19) flare-up is causing inescapable concern and monetary difficulty for shoppers, organiz...
Q: Which of the following is not a capital budgeting technique? Select one: a. Net present value b. D...
A: Capital budgeting: Capital budgeting is the technique used for analyzing the investment in long term...
Q: Salalah Wind Energy has taken up a new project with an initial investment of 50000 OMR.The expected ...
A: The Profitability Index is the present value of future cash-flows divided by the initial investment ...
Q: What are options in strategy? Options may involve the organisation in diversifying away from its ori...
A: Definition: "Options are financial derivatives that give buyers the right, but not the obligation, t...
Q: 8. The present value of an annuity of $5,000 to be received at the end of each of the next six month...
A: The present value of cash flows is the value of future cash flows today. If we are expecting to rece...
Q: The company's capital structure is as follows: Debt Weight 25%, Preferred Stock Weight 25%, Common e...
A: WACC is an abbreviation used for Weighted average cost of capital which can be referred as the avera...
Q: Find the Discounted Payback Period (DPP) for Oman Sofa Company if the initial investment is 12000 OM...
A: Here, Initial Investment is OMR 12,000 Cash Inflows are as follows: Year 1 - OMR 5,000 Year 2 - OMR ...
Q: If you are expecting to get OMR 60633 at the end of 3 years. Calculate its present value if the inte...
A: Given information: Future value : OMR 60633 Time period : 3 years Interest : 9%
Q: Discuss the real-world factors that would encourage firms to follow a high dividend policy.
A: Dividend is the regular income paid by the company to the shareholders. These are given to the equit...
Q: QUESTION 1 You have a sum of $100,000 and wish to withdraw a certain (unknown) amount in year 1 and ...
A: Annuity is a concept of cash flow series where equal instalments are paid at equal time interval whe...
Q: If you deposit OMR 8141 in your account in a bank. Suppose the bank pays 8% compound interest half y...
A: Given information: Deposit (Present value) : OMR 8141 Rate of interest : 8% Time Period : 5 years Co...
Q: Find the Payback Period for Oman Packaging company if the initial investment is 15000 OMR and the ca...
A: payback period is the term in which the company can recover its cost of investment in the project. I...
Q: Raya is saving for a new car. He needs to have OMR 21000 for the car in three years. How much will h...
A: Present worth refers to the current value of the amount or series of cash inflows which an investor ...
Q: The Richard Scott paper company has a maximum of $100m to invest. From this limited money they need ...
A: The capital budgeting decision is helping the company in choosing the better project after the evalu...
Q: A manufacturer required rs 2020 to purchase machinery hr borrowed money from the bank for 6 years at...
A: Given information: Amount borrowed (Principal amount) : Rs. 2020 Interest rate : 5% Time period : 6 ...
Q: Suppose an investor wants to invest either in the common stock of Square Corporation or Beximco Corp...
A: In this question coefficient of variation should be solved in order to analyse the risk to return re...
Q: Find the Net Present Value (NPV) for Oman Computer company if the initial investment is 5000 OMR and...
A: Net Present Value is the capital budgeting technique that can be used by investors for evaluating va...
Q: If the initial investment is $200,000, what would be the nominal annual rate of interest compounded ...
A: Nominal annual interest rate is the rate of return offered to the depositor or paid by borrower. It ...
Q: Where capital availability is unlimited and the projects are not mutually exclusive, for the same co...
A: Capital Budgeting is a process in which the compay identifies projects which will add value to the b...
Q: Which of the following is a financial instrument? Select one: a. All the options b. Merchant banke...
A: Since, you asked multiple questions, we will answer the first question for you as per guidelines, Ki...
Q: Which of the following is not true with a broker Select one: a. Safeguards the interests of the in...
A: Broker is appointed by investors for buying or selling of their securities.
Q: Discuss the real-world factors that would encourage firms to follow a high dividend policy.
A: Dividend are paid by the stock issuing companies to their shareholders. It is paid out of free cash ...
Q: Discuss the real-world factors that would encourage firms to follow a high dividend policy.
A: Company is earning profit every year mostly which will be divided into two ways. Firstly, the regula...
Q: Find the profitability index for Oman Air conditioner Company if the initial investment is 4000 OMR ...
A: Profitability index helps in determining the attractiveness of a project. It is calculated by dividi...
Q: Find the profitability index for Oman Air conditioner Company if the initial investment is 4000 OMR ...
A: Profitability index is a part of capital budgeting decision where present value of cash inflows and ...
Q: The credit manager of ABC Company has to decide on a proposal for liberal extension of credit which ...
A: Accounts receivables are the firm's debtor to which the firm gives its selling products on credit. I...
Q: 1. RM X was deposited in a savings account at 4.8% interest compounded monthly. 56 months later, RM4...
A: The present value is the value of the sum received at time 0 or the current period. It is the value ...
Q: Abdullah has OMR 5000 to invest in a small business venture. His partner has promised to pay him bac...
A: Solution- Return on Investment=(Promised Sum/ Amount Lent)^(1/years)-1 Return on Investment=(8200/50...
Q: Omantel is installing new equipment at a cost of 250000 OMR. Expected cash flows from this project o...
A: Capital budgeting is a financial process that analysis investment in a capital project. This process...
Q: True or false Suppose that a project has a unique IRR=20%. The hurdle rate is 25%. Your boss says t...
A: Introduction : A hurdle rate can be understood as the minimal rate of return demanded by a managemen...
Q: Dhofar Insurance Company has made an investment in another company that will guarantee it a cash flo...
A: Given information: Cash flows: OMR 37,250 Discount rate : 15% Time period : 5 years
Q: Norton Company has a 12% interest rate. If the firm invests $60,000 today, how much will have accum...
A: The Future Value: The value accumulated by an investment made today, at a given interest rate at the...
Q: How much money is needed now to establish a perpetuity that pays $2,000 at the end of every quarter ...
A: The value for perpetuity is known as the series of cash flows paying for infinite period of time. It...
Q: Under Net present value criterion, a project is approved if Select one: a. None of the option b. I...
A: Net Present Value: Net present value shows the values of an investment at current date. The present ...
Q: The NPV of a project when discounted using a discount rate of 6% is positive $ 40,000. When the sam...
A: Internal Rate of return (IRR) is the rate at which the NPV is zero.
Q: Abdullah is looking to invest for the next three years. He is looking to invest OMR 7500 today in a ...
A: Given: Present value = OMR 7,500 Interest annually = 5.75% Years = 3
Q: nonths nonths nonths
A: The payback period can be calculated as follows :
Q: The Salalah Golf Resorts is redoing its golf course at a cost of 2744320 OMR. It expects to generate...
A: Given: Cost is 2744320 OMR Discount rate = 13% Cash flow expected generation: To computation of Net...
No use of excel
Lawson Company invests $60,000 today and has $148,560 by the end of eight years. What is the firm's interest rate?
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Income, Cash Flow, and Future Losses On January L 2017, Cermack National Bank loaned 55,000,000 under a 2-year, zero coupon note to a real estate developer. The bank recognized interest revenue on this note of approximately $400,000 per year. Due to an economic downturn, the developer was unable to pay the $5,800,000 maturity amount on December 31, 2018. The bank convinced the developer to pay $800,000 on December 31, 2018, and agreed to extend $5,000,000 credit to the developer despite the gloomy economic outlook for the next several years. Thus, on December 31, 2018, the bank issued a new 2-year, zero coupon note to the developer to mature on December 31, 2020, for $6,000,000. The bank recognized interest revenue on this note of approximately $500,000 per year. The banks external auditor insisted that the riskiness of the new loan be recognized by increasing the allowance for uncollectible notes by $1,500,000 on December 31, 2018, and $2,000,000 on December 31, 2019. On December 31, 20201 the bank received $1,200,000 from the developer and learned that the developer was in bankruptcy and that no additional amounts would be recovered. Required: Prepare a schedule showing the effect of the notes on net income in each of the 4 years.Income, Cash Flow, and Future Losses On January L 2017, Cermack National Bank loaned 55,000,000 under a 2-year, zero coupon note to a real estate developer. The bank recognized interest revenue on this note of approximately $400,000 per year. Due to an economic downturn, the developer was unable to pay the $5,800,000 maturity amount on December 31, 2018. The bank convinced the developer to pay $800,000 on December 31, 2018, and agreed to extend $5,000,000 credit to the developer despite the gloomy economic outlook for the next several years. Thus, on December 31, 2018, the bank issued a new 2-year, zero coupon note to the developer to mature on December 31, 2020, for $6,000,000. The bank recognized interest revenue on this note of approximately $500,000 per year. The banks external auditor insisted that the riskiness of the new loan be recognized by increasing the allowance for uncollectible notes by $1,500,000 on December 31, 2018, and $2,000,000 on December 31, 2019. On December 31, 20201 the bank received $1,200,000 from the developer and learned that the developer was in bankruptcy and that no additional amounts would be recovered. Required: 1. Prepare a schedule showing annual cash flows fur the two notes in each of the 4 years.Income, Cash Flow, and Future Losses On January L 2017, Cermack National Bank loaned 55,000,000 under a 2-year, zero coupon note to a real estate developer. The bank recognized interest revenue on this note of approximately $400,000 per year. Due to an economic downturn, the developer was unable to pay the $5,800,000 maturity amount on December 31, 2018. The bank convinced the developer to pay $800,000 on December 31, 2018, and agreed to extend $5,000,000 credit to the developer despite the gloomy economic outlook for the next several years. Thus, on December 31, 2018, the bank issued a new 2-year, zero coupon note to the developer to mature on December 31, 2020, for $6,000,000. The bank recognized interest revenue on this note of approximately $500,000 per year. The banks external auditor insisted that the riskiness of the new loan be recognized by increasing the allowance for uncollectible notes by $1,500,000 on December 31, 2018, and $2,000,000 on December 31, 2019. On December 31, 20201 the bank received $1,200,000 from the developer and learned that the developer was in bankruptcy and that no additional amounts would be recovered. Required: Which figure, net income or net cash flow, does the better job of telling the banks stock-holders about the effect of these notes on the bank? Explain by reference to the schedules prepared in Requirements 1 and 2.
- Calvert Corporation expects an EBIT of $25,100 every year forever. The company currently has no debt, and its cost of equity is 15.2 percent. The company can borrow at 10 percent and the corporate tax rate is 24 percent. a. What is the current value of the company? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)b-1. What will the value of the firm be if the company takes on debt equal to 60 percent of its unlevered value? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)b-2. What will the value of the firm be if the company takes on debt equal to 100 percent of its unlevered value? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)c-1. What will the value of the firm be if the company takes on debt equal to 60 percent of its levered value? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g.,…Calvert Corporation expects an EBIT of $25,500 every year forever. The company currently has no debt, and its cost of equity is 15.4 percent. The company can borrow at 10.2 percent and the corporate tax rate is 21 percent. a. What is the current value of the company? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b-1. What will the value of the firm be if the company takes on debt equal to 50 percent of its unlevered value? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b-2. What will the value of the firm be if the company takes on debt equal to 100 percent of its unlevered value? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c-1. What will the value of the firm be if the company takes on debt equal to 50 percent of its levered value? (Do not round intermediate calculations and round your answers to 2 decimal places,…Ansel Accounting Firm rents an office space for $250,000 per year which is due at the beginning of each year. If the hurdle rate of Ansel Accounting Firm is 10%, how much is the present value of five years' worth of rent? a. $1,042,466.36 b. $402,627.50 c. $155,230.33 d. $170,753.36
- A firm has borrowed $5,000,000 for 5 years at 10% per year compound interest. The firm will make no payments until the loan is due, when it will pay off the interest and principal in one lump sum. What is the total payment?AZ Products is looking into buying a computer for $218,000, it will be depreciated straight-line to zero over 5 years. It will be worth $20,000 at the end of 5 years. The company will save $73,500 before tax per year in order processing cost and will reduce inventory by $18,600 on day 1. AZ Products has 140,000 shares of common stock outstanding at a market price of $27 a share. Next year's annual dividend is expected to be $1.43 a share and the dividend growth rate is 2 percent. The company also has 2,500 bonds outstanding with a face value of $1,000 per bond. The bonds have a pretax yield of 7.35 percent and sell at 98.2 percent of face value. The company's tax rate is 21 percent. should the company buy the computer?A business starts this year with 2,500,000 assets with no debt. The expected ROE equals 10%. Suppose the firm decides to have a payout of 40% for this year. How much is the expected total dividends for next year?
- Lakeside Inc. invested $735,000 at an 11.25% rate of return. The company sold their investment for $1,067,425. How much longer would Lakeside have had to wait if they had wanted to sell their investment for $1.25 million?Hunter Corporation expects an EBIT of $30,000 every year forever. The company currently has no debt and its cost of equity is 14 percent. The tax rate is 20 percent. The company is able to borrow at 8 percent. What will the value of the company be if it takes on debt equal to 60 percent of its levered value? [Note: the proceeds from issuing new debt are used to repurchase Hunter’s equity.] Group of answer choices $251,488.1 $171,428.6 $274,285.8 $194,805.2Fifteen years ago, Jackson Supply set aside $130,000 in case of a financial emergency. Today, that account has increased in value to $330,582. What rate of interest is the firm earning on this money?
