Smashed Pumpkins Company paid $136 in dividends and $568 in interest over the past year. The company increased retained earnings by $474 and had accounts payable of $594. Sales for the year were $16,265 and depreciation was $720. The tax rate was 21 percent. What was the company's EBIT? Options: $984 $1,333 $1,340 $6,181 $1,823
Q: Consider the following information for Vine Inc.: Beta: 1.39 Risk-free rate: 7% Market Risk Premium:…
A: According to Capital asset pricing model ( CAPM), ke = Rf + [beta × ( Rm - Rf)] Where, ke = cost of…
Q: Finance State Probability Stock ABC Stock DEF Depression .3 -.10 - .05 Normal .3 .10 .12 Boom .4…
A: The expected return of a stock refers to the average return that the investor receives for their…
Q: What is the alpha of a portfolio with a beta of 2, an actual return of 22%, market- return of 12%,…
A: The risk free rate, market return and beta of a portfolio is given. And, the required return is…
Q: Green Tea House has a tax rate of 25 percent and an interest tax shield valued at $8,046 for the…
A: Tax Rate = 25% Interest = $8046
Q: You can save a significant amount of mortgage interest paid if you make one additional principal and…
A: The monthly payment is the payment that has to be paid every month until the loan amortized which…
Q: How to analysis the forex market
A: Introduction: Forex market-It is a place where banks, investment management firms, hedge funds,…
Q: 3) Carlos and Rosa applied for the same credit card from the same bank. The bank checked both of…
A: Given that, Carlos and Rosa applied for the same credit card from the same bank. Carlos was given a…
Q: %
A: a) The modified duration can be calculated as: Modified Duration = Duration / (1 + Yield) Given…
Q: A company has a financial structure where equity is 70 % of its total bedt plus equity it's cost of…
A: WACC is also known as weighted average cost of Capital. It includes all the cost which is incurred…
Q: Use the typical personal financial life cycle to present the; situation, financial needs and an…
A: The personal financial life cycle refers to the various stages individuals go through in their…
Q: Many companies still go ahead to undertake capital projects even when these projects have a negative…
A: The net present value method is used to evaluate projects for investment by the companies. The…
Q: Bond A is a municipal bond and Bond B is a corporate bond. If you pay a very high tax rate, which…
A: Investors often include bonds in their portfolios as a means of generating income, diversifying…
Q: Emerald City Umbrellas sells umbrellas and rain gear in Seattle, so its sales are fairly level…
A: Working capital refers to the financial term used for showing the difference between the current…
Q: Miller Hardware paid an annual dividend of $1.10 per share recently. Today, the company announced…
A: The Dividend Discount Model refers to a model which is being used in order to predict or find out…
Q: You were recently hired by Scheuer Media Inc. to estimate its cost of capital. You obtained the…
A: Cost of Equity: cost of equity is the minimum required rate of return that is expected to be…
Q: Consider the following two projects: Project A B C. 1.7% d. Year 0 Cash Flow -100 -73 17.3% Year 1…
A: Incremental IRR Increment investment=Investment A-Investment B=100-73=$27 Incremental cash…
Q: . Calculate the payback period. 2. Calculate the accounting (simple) rate of return. 3. Calculate…
A: First, we need to build the cash flow over the years using the formula below:Year 0 = Initial…
Q: XYZ bank currently has 600 million in transaction deposits on its balance sheet. The current…
A: The required reserve is the portion of transaction deposits that banks are required to hold in…
Q: Phoenix Company is considering investments in projects C1 and C2. Both require an initial investment…
A: The present value is the concept wherein the future cash flows are discounted at a specified…
Q: Determine the modified B/C ratio for the following information at 8% interest per year. Cost…
A: Interest rate = r = 8% Initial Investment = $6,000 M & O cost = $1,000 years 1-5 and $1,500…
Q: O $3,433.89 O $3,630.56 $3,636.11 $3,793.72
A: In period less than one simple ordinary interest is applied and computations is done based on number…
Q: When discounting Free Cash Flow to Firm (FCFF), should the Weighted Average Cost of Capital (WACC)…
A: Introduction: Free cash flow to firm (FCFF)-This is the amount of cash flow available to all the…
Q: The independent auditor's report A. describes which financial statements (FS) are covered by the…
A: It is a report which is given by the independent auditor. He is the person who examining the books…
Q: Data table Operating Income New York $ Chicago Assets Current 2,150,000 $15,500,000 $ 2,550,000…
A: WACC represents the firm's average cost of raising funds from investors. WACC also represents the…
Q: Sub : Finance Pls answer very fastt.I ll upvote. Thank You The Rusty Auto Parts Company has…
A: Cost of Inventory = Sales - Markup amount
Q: Stated Rate (APR) % % % % Number of Times Compounded Semiannually Monthly Weekly Daily Effective…
A: APR is a percentage that expresses the real annual cost of borrowing money throughout the course of…
Q: Which of the following describes delta? The ratio of the option price to the stock price None of…
A: The simplest form of delta hedging entails an investor purchasing or disposing of options, and then…
Q: a) A Zero Coupon Bond with face value £100 and maturity in 4 years is sold for £85. Find its (gross)…
A: Here, Particulars Values Present value of bond (PV) £85.00 Face value (FV) £100.00 Time…
Q: Finance Find the savings plan balance after 18 months with an APR of 6% and monthly payments of…
A: As per the given information: Monthly payments - $800APR - 6%Period - 18 months To determine:…
Q: You have just received notification that you have won the $2.19 million first prize in the…
A: Present value is current value of future cash flow discounted at an appropriate discount rate; in…
Q: In keeping with the increasingly popular merchandising theme of customization an entrepreneurial…
A: Internal rate of return is a capital budgeting techniques which help in decision making on the basis…
Q: A currency speculator wants to speculate on the future movements of the €. The speculator expects…
A: In future contracts there are daily settlements of margin and amount is required to be made in…
Q: You have the choice amount the five projects below. Which project should be selecte the projects are…
A: Independent project refers to the type of capital budgeting that defines the project which is not…
Q: ou want to open a checking account with a $500 deposit. You estimate you will write 16 checks a…
A: We open bank accounts so that we can deposit our money there, write checks to pay our bills etc.…
Q: Give typing answer with explanation and conclusion Project S requires an initial outlay at t = 0 of…
A: NPV analysis helps identify projects that are expected to generate the highest net benefit. By…
Q: The value in pounds of a fund at time t = 0 is V0 = 50, 000. After one year (at t = 1) it has…
A: The time-weighted rate of return is the geometric mean of return for each period.
Q: (a) Mr Adani invests in two risky securities with the following details: Security 1: r₁=0.16;…
A: I ) 40% in Security 1 and 60% in Security 2: Return Return of Portfolio = Return from Security 1 *…
Q: nomas has started working, and he is wondering how much he needs to put aside every mont TV IN 2…
A: Due to the compounding of interest over the period of time large amount is being accumulated over…
Q: The price of a European call option on a non-dividend-paying stock with a strike price of $50 is $6.…
A: 1. According to put - call parity, C + Present value of K = S + P where, C = call premium K =…
Q: (a) Mr Adani invests in two risky securities with the following details: Security 1: r1=0.16;…
A: A portfolio is a combinations of various securities in one basket. A portfolio is created to reduce…
Q: 25 The Western Pipe Company has the following capital section in its balance sheet. Its stock is…
A: Stock Dividend Stock Dividend - It is a process wherein company distributes the shares to its…
Q: Increase (decrease) in gross margin due to change in units sold A. (P4,800) B. P6.000 D. P16,000 D.…
A: 2020 2021 change sales 80000 97200 selling price 8 8 units 10000 12000 2000…
Q: (a) Compute the present value of an annuity immediate that pays £50 per year for 10 years at an…
A: Present value refers to the current worth of the expected sum of the amount. It is computed by…
Q: Question 31 RWJ 9-8 MC Given the forecast cash flows of the Covina Donuts, what is the…
A: According to bartleby guidelines, if multiple questions are asked, then 1st question needs to be…
Q: Suppose intel stock has a beta of 0.80, whereas Boeing stock has a beta of 1.15. If the risk-free…
A: Intel Beta = ib = 0.89 Boeing Beta = bb = 1.15 Risk free rate = rf = 3.1% Market return = rm = 10.1%
Q: Fey Fashion paid the following dividends from 2013 to 2019: 2013 2014 2015 2016 2017 2018 2019 $1.00…
A: Please note that under Answering Guidelines only 1 question can be solved. Kindly repost the 2nd…
Q: Ingram Electric Products is considering a project that has the following cash flow and WACC data.…
A: The financial indicator known as MIRR, or Modified Internal Rate of Return, is used to properly…
Q: We are considering an investment opportunity with the following projected cashflow Year CF Plan A…
A: Net present value refers to the method of capital budgeting used for estimating the difference…
Q: ABC Co. has the following data for 2021: Total Assets $100,000 Debt ratio Profit margin Tax rate The…
A: 1. Asset turnover ratio = sales ÷ Total assets 2. Profit margin = ( Net income ÷ sales) × 100 3.…
Q: Storico Company just paid a dividend of $2.10 per share. The company will increase its dividend by…
A: When the company receives profits and distributes them among the shareholders. That share of profit…
Sub : Finance
Pls answer very fast.I ll upvote. Thank You
Smashed Pumpkins Company paid $136 in dividends and $568 in interest over the past year. The company increased
Options: $984 $1,333 $1,340 $6,181 $1,823
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
- Strickler Technology is considering changes in its working capital policies to improve its cash flow cycle. Stricklers sales last year were 3,250,000 (all on credit), and its net profit margin was 7%. Its inventory turnover was 6.0 times during the year, and its DSO was 41 days. Its annual cost of goods sold was 1,800,000. The firm had fixed assets totaling 535,000. Stricklers payables deferral period is 45 days. a. Calculate Stricklers cash conversion cycle. b. Assuming Strickler holds negligible amounts of cash and marketable securities, calculate its total assets turnover and ROA. c. Suppose Stricklers managers believe the annual inventory turnover can be raised to 9 times without affecting sale or profit margins. What would Stricklers cash conversion cycle, total assets turnover, and ROA have been if the inventory turnover had been 9 for the year?Chasse Building Supply Inc. reported net cash provided by operating activities of $243,000, capital expenditures of $112,900, cash dividends of $35,800, and average maturities of long-term debt over the next 5 years of $122,300. What is Chasses free cash flow and cash flow adequacy ratio? a. $94,300 and 0.77, respectively c. $130,100 and 1.06, respectively b. $94,300 and 0.82, respectively d. $165,900 and 1.36, respectivelyThe Berndt Corporation expects to have sales of 12 million. Costs other than depreciation are expected to be 75% of sales, and depreciation is expected to be 1.5 million. All sales revenues will be collected in cash, and costs other than depreciation must be paid for during the year. Berndts federal-plus-state tax rate is 40%. Berndt has no debt. a. Set up an income statement. What is Berndts expected net income? Its expected net cash flow? b. Suppose Congress changed the tax laws so that Berndts depreciation expenses doubled. No changes in operations occurred. What would happen to reported profit and to net cash flow? c. Now suppose that Congress changed the tax laws such that, instead of doubling Berndts depreciation, it was reduced by 50%. How would profit and net cash flow be affected? d. If this were your company, would you prefer Congress to cause your depreciation expense to be doubled or halved? Why?
- The Moore Corporation has operating income (EBIT) of 750,000. The companys depreciation expense is 200,000. Moore is 100% equity financed, and it faces a 40% tax rate. What is the companys net income? What is its net cash flow?Value of Operations Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next 2 years, respectively; after the second year, FCF is expected to grow at a constant rate of 8%. The company’s weighted average cost of capital is 12%. What is the terminal, or horizon, value of operations? (Hint: Find the value of all free cash flows beyond Year 2 discounted back to Year 2.) Calculate the value of Kendra’s operations.The Raattama Corporation had sales of $3.5 million last year, and it earned a 5% return (after taxes) on sales. Recently, the company has fallen behind in its accounts payable. Although its terms of purchase are net 30 days, its accounts payable represents 60 days’ purchases. The company’s treasurer is seeking to increase bank borrowing in order to become current in meeting its trade obligations (that is, to have 30 days’ payables outstanding). The company’s balance sheet is as follows (in thousands of dollars): How much bank financing is needed to eliminate the past-due accounts payable? Assume that the bank will lend the firm the amount calculated in part a. The terms of the loan offered are 8%, simple interest, and the bank uses a 360-day year for the interest calculation. What is the interest charge for 1 month? (Assume there are 30 days in a month.) Now ignore part b and assume that the bank will lend the firm the amount calculated in part a. The terms of the loan are 7.5%, add-on interest, to be repaid in 12 monthly installments. What is the total loan amount? What are the monthly installments? What is the APR of the loan? What is the effective rate of the loan? Would you, as a bank loan officer, make this loan? Why or why not?
- 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.