320_Final_Exam_Review_Sheet_Spring_2011

# 320_Final_Exam_Review_Sheet_Spring_2011 - Depreciation...

This preview shows pages 1–2. Sign up to view the full content.

BUS 320 Final Exam Chapter # Questions Topics 3 1 Understanding of Financial Statements 4 2 Financial Ratios 7 4 Understanding Bonds and Bond Calculations 8 2 CAPM, Beta, Market vs. Diversifiable Risk, SML 10 3 11 3 IRR, NPV, MIRR, NPV Profile 12 5 15 4 Types of Short-Term Financing, Cash Management, Credit Policy, Types of Float 1 Financial Forecasting 25 ********* Final Exam: Wednesday, May 4 th , 1:00 – 4:00 pm Review Problems 1. Calculate the MIRR for the following cash flows if the cost of capital is 10%. Year: 0 1 2 3 4 CF: -1,000 200 -200 800 500 (Answer = 8.86%) 2. Annual revenues = \$200,000 beginning in 2010. Annual costs = \$120,000 beginning in 2010. Building purchased in 2009 for \$80,000. Equipment purchased in 2009 for \$20,000. Initial investment of working capital in 2009 = \$8,000 Tax rate = 30% and estimated life of project is 4 years (2010-2013). At end of 4 years, building will be sold for \$70,000 and equipment sold for \$2,000.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Depreciation rates: Year: 1 2 3 4 Building: 1.3% 2.6% 2.6% 2.6% Equipment: 20.0% 38.0% 25.0% 17.0% Calculate after-tax cash flows for years 2009 through 2013. Answers: 2009 = \$-108,000 2010 = \$57,512 2011 = \$58,904 2012 = \$58,124 2013 = \$137,860 3. Balance Sheet (12/31/2010) Current Assets \$1,200 A/P \$400 Fixed Assets 1,600 S-T Notes Payable 200 Total \$2,800 Long Term Debt 500 Common Stock 1,200 Retained Earnings 500 Total \$2,800 Income Statement (Year Ending 12/31/2010) Sales \$3,000 COGS 2,000 Depreciation 500 EBIT \$500 Taxes (34%) 170 NI \$330 Added to R/Es \$132 Dividends paid \$198 COGS for 2011 will remain 2/3 of Sales. Depreciation expense for 2011 is expected to be \$650 and the firm expects sales to grow by 40% in 2011. The tax rate will remain at 34% and the Board of Directors has decided to maintain the current payout ratio for 2011. What is the Additional Financing Needed (AFN) for 2011? (Answer: \$762.00)...
View Full Document

## This note was uploaded on 12/08/2011 for the course BUS 320 taught by Professor Sloan during the Spring '08 term at N.C. State.

### Page1 / 2

320_Final_Exam_Review_Sheet_Spring_2011 - Depreciation...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online