BUAD 306 spring2008 Homework_1

BUAD 306 spring2008 Homework_1 - BUAD 306 Homework 1 1 What...

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BUAD 306 Homework # 1 1. What is the goal of a firm? 2. What is an agency problem ? Do agency problems exist between a CEO and shareholders ? 3. Using the rule of 72, how long does it take an average investor to double their money if they invest in large cap stocks ? 4. What is the equation for CFFA ? What is the CFFA identity ? 5. Given the income statement and following information calculate CFFA and cash flow to creditors, Income Statement Net Sales $600 Cost of Goods Sold 300 Depreciation 150 EBIT $150 Interest Paid 30 Taxable Income $120 Taxes 41 Net Income $ 79 Dividends $30 Addition to RE 49 What is OCF ?
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If beginning net fixed assets are $500 and ending net fixed assets are $750, what was net capital spending for the year? If current assets starting the year were $2130 and current liabilities were $1620 and the ending figures were $2,260 (CA) and $1710 (CL); what was the change in NWC ? If the company did not raise any new money thru equity, what is the cash flow to creditors and to stockholders ? 6.
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BUAD 306 spring2008 Homework_1 - BUAD 306 Homework 1 1 What...

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