O’brien ltd.’s outstanding bonds have a $1,000 par value, and they

 All Finance Questions Solution In Excel Sheet (***** 100 % Correct *****)



3. How multifarious years would it accept $50 to triple if you endowed it in a bank that pays 8.25% per year?


4. You neglect to buy a new sports car 4 years from now, and you artifice to reserve $4,400 per year,commencement instantly. You obtain produce 4 guards in an representation that pays 5.75% profit. Under these assumptions, how considerable obtain you feel 3 years from today?



5. What’s the introduce estimate of a 5-year plain annuity of $2,250 per year plus an appended $3,500 at the end of Year 5 if the profit objurgate is 6%?



6. What’s the coming estimate of $2,500 behind 5 years if the divert profit objurgate is 7.5%, compounded semiannually?



7. An bombardment promises the forthcoming specie run general: $1500 at Season 0; $2,750 at the end of Year 1 (or at t = 1); $3,150 at the end of Year 2; and $4,800 at the end of Year 3. At a confessance objurgate of 10.0%, what is the introduce estimate of the specie run general?





8. Suppose you are buying your leading scion for $250,000, and are making a $50,000 down acquittal. You feel shapely to finance the cherishing sum delay a 10-year, monthly acquittal, amortized hypothecation at a 3.4% pretended profit objurgate. What obtain your similar monthly acquittals be?



9. You artifice to hypothecate $30,000 at an 8% annual profit objurgate. The conditions exact you to amortize the mortgage delay 10 similar end-of-year acquittals. How considerable profit would you be paying in Year 4?



10. You directly guarded $4,000 in a bank representation that pays a 6% pretended profit objurgate, compounded quarterly. If you also add another $9,000 to the representation one year (12 months) from now and another $7,500 to the representation two years from now, how considerable obtain be in the representation three years (12 quarters) from now?


 11. Your sister turned 35 today, and she is artificening to reserve $6,000 per year for solitude, delay the leading guard to be made one year from today. She obtain endow in a interchangeable hoard that obtain cater a repay of 8.5% per year. She artifices to retreat 30 years from today, when she turns 65, and she rely-ons to feed for 25 years behind solitude, to age 90. Under these assumptions, how considerable can she bestow in each year behind she retreats? Her leading delaydrawal obtain be made at the beginning of her leading solitude year.




12. You rely-on that you obtain demand $2,000,000 when you retreat 40 years from now. You artifice to produce 40 guards, commencement today, in a bank representation that obtain pay 7% profit, compounded annually. You rely-on to accept annual raises of 4%, so you obtain growth the sum you guard each year by 4%. (That is, your 2nd guard obtain be 4% important than your leading, the 3rd obtain be 4% important than the 2nd, etc.) How considerable must your 1st guard be if you are to coalesce your motive?




14. Medium Size Retailers, Inc. (MSR) has EBIT of $225,000, profit payment of $30,000, dividend proceeds of $15,000, inextensive promise important gains of $15,000, and covet promise important losses of $18,000. What is MSR’s proceeds tax obligation?




15. Frederickson Office Supplies of-tardy reputed $12,500 of sales, $7,250 of gratuitous demands other than derogation, and $1,750 of derogation. The association had no amortization mandible and no non-gratuitous proceeds. It had $8,000 of manacles uncollected that push a 9.0% profit objurgate, and its federal-plus-state proceeds tax objurgate was 40%. How considerable was the steadfast's taxable proceeds, or rights antecedently taxes (EBT)?




16. Aggravate the years, Janjigian Corporation's hoardholders feel caterd $19,250 of important, multiply when they purchased new issues of hoard and multiply when they confessed conduct to restrain some of the steadfast's rights. The steadfast now has 1,500 distributes of spiritshort hoard uncollected, and it retails at a figure of $48.00 per distribute. How considerable estimate has Janjigian's conduct borrowed to hoardholder plenty aggravate the years, i.e., what is Janjigian's MVA?


 18. HHH Inc. reputed $14,500 of sales and $7,025 of gratuitous demands (including derogation). The association had $18,750 of endowor-supplied gratuitous property (or important), the weighted mean demand of that important (the WACC) was 9.5%, and the federal-plus-state proceeds tax objurgate was 35%. What was HHH's Economic Estimate Borrowed (EVA), i.e., how considerable estimate did conduct add to hoardholders' plenty during the year?




19. Wells Water Systems of-tardy reputed $8,750 of sales, $4,750 of gratuitous demands other than derogation, and $1,100 of derogation. The association had no amortization mandible, it had $3,250 of uncollected manacles that push a 6.75% profit objurgate, and its federal-plus-state proceeds tax objurgate was 35%. In direct to stay its operations and thus geneobjurgate sales and specie runs in the coming, the steadfast was exactd to bestow $750 to buy new agricultural property and to endow $250 in net gratuitous afloat important. How considerable generous specie run did Wells originate?




An endowor is because starting a new trade. The association would exact $500,000 of property, and it would be financed truly delay spiritshort hoard. The endowor obtain go presumptuous simply if she thinks the steadfast can cater a 17.5% repay on the endowed important, which instrument that the steadfast must feel an ROE of 17.5%. How considerable net proceeds must be rely-oned to justify starting the trade?




23. Helmuth Inc.'s ending net proceeds was $1,250,000, and it had 295,000 distributes uncollected. The association neglects to pay out 40% of its proceeds as dividends. What dividend per distribute should it state?




24. Heaton Corp. retails on conditions that confess customers 45 days to pay for goods. Its sales ultimate year were $525,000, and its year-end receivables were $70,000. If its DSO is short than the 45-day reputation duration, then customers are paying on season. Otherwise, they are paying tardy. By how considerable are customers paying future or tardy? Base your counter-argument on this equation: DSO - Reputation duration = days future or tardy, and use a 365-day year when cautious the DSO. A express counter-argument indicates tardy acquittals, timeliness a indirect counter-argument indicates future acquittals.



25. Ultimate year Mason Inc. had a sum property turnaggravate of 1.33 and an equity multiplier of 1.75. Its sales were $195,000 and its net proceeds was $8,549. The CFO believes that the association could feel operated more efficiently, lowered its demands, and growthd its net proceeds by $4,950 delayout changing its sales, property, or important constitution. Had it cut demands and growthd its net proceeds in this sum, by how considerable would the ROE feel modifiable?



Rick Kish has a $100,000 hoard portfolio. $32,000is endowed in a hoard delay a beta of 0.85 and the leavings is endowed in a hoard delay a beta of 1.75. These are the simply two bombardments in his portfolio. What is his portfolio’s beta?




29. ABC Company's hoard has a beta of 1.40, the induce-generous objurgate is3.75%, and the traffic induce enhancement is6.50%. What is ABC's exactd objurgate of repay using CAPM?




31. Hocking Manufacturing Association has a beta of 0.65, timeliness Levine Industries has a beta of 1.70. The exactd repay on the hoard traffic is 10.00%, and the induce-generous objurgate is 4.25%. What is the contrariety between Hocking's and Levine's exactd objurgates of repay?




32. Rodriguez Roofing's hoard has a beta of 1.30, its exactd repay is 11.50%, and the induce-generous objurgate is4.00%. What is the exactd objurgate of repay on the hoard traffic?




35. Garvin Enterprises’ manacles generally retail for $875. They feel a 6-year manliness, an annual coupon of $65, and a par estimate of $1,000. What is their general submit?



36. Sadik Inc.'s manacles generally retail for $1,250 and feel a par estimate of $1,000. They pay a $135 annual coupon and feel a 15-year manliness, but they can be designated in 8 years at $1,135. What is their submit to circumvent (YTC)?



37. Moerdyk Corporation's manacles feel a 20-year manliness, a 6.25% coupon objurgate delay profit compensated semiannually, and a par estimate of $1,000. The pretended exactd objurgate of repay on these manacles is 8.25%. What is the manacle’s inherent estimate?

38. Niendorf Corporation's 5-year manacles submit 7.75%, and 5-year T-bonds submit 4.80%. The legitimate induce-generous objurgate is r* = 2.75%, the inflation enhancement for 5-year manacles is IP = 1.65%, the failure induce enhancement for Niendorf's manacles is DRP = 1.50% versus naught for T-bonds, and the manliness induce enhancement for all manacles is establish delay the formula MRP = (t – 1) x 0.1%, where t = sum of years to manliness. What is the liquidity enhancement (LP) on Niendorf's manacles?



39. A 20-year, $1,000 par estimate manacle has an 8.5% coupon objurgate delay profit compensated semiannually. The manacle generally retails for $800. What is the important gains submit on these manacles?



40. O'Brien Ltd.'s uncollected manacles feel a $1,000 par estimate, and they aged in 15 years. Their pretended submit to manliness is 9.75%, they pay profit semiannually, and they retail at a figure of $900. What is the manacle's pretended (annual) coupon profit objurgate?