# A calculate christies cash conversion cycle 11 what

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a. Calculate Christie’s cash conversion cycle. 11. What are the some costs associated with low inventories? 12. What is the aging schedule and what can be learned from it? 13. What are two principal reasons for holding cash? 14. What are the four elements of firm’s credit policy? 15. What is the cash conversion cycle? What is its equation? Initial Public Offering, Investment Banking and Financial Restructuring 16. Describe three advantages of going public for companies (Initial Public Offering) 17. Describe three disadvantages of going public for companies (Initial Public Offering) 18. What exactly investment banks do for the companies that are willing to go public (IPO) 19. A company is planning an IPO. Its underwriters have said the stock will sell at \$50 per share. The underwriters will charge a 7% spread. How many shares must the company sell to net \$93 million, ignoring any other expenses? 20. Define and explain 2 investment banking activities? (page 804) 21. What is the difference between roadshow and book-building? 22. Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Beedles Inc., the terms were as follows: Price to public \$5 per share

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Number of shares 3 million Proceeds to Beedles \$14,000,000 The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were \$300,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following average price? a. \$5 per share 23. The Beranek Company, whose stock price is now \$25, needs to raise \$20 million in common stock. Underwriters have informed the firm’s management that they must price the new issue to the public at \$22 per share because of signaling effects. The underwriters’ compensation will be 5% of the issue price, so Beranek will net \$20.90 per share. The firm will also incur expenses in the amount of \$150,000. How many shares must the firm sell to net \$20 million after underwriting and flotation expenses? 24. Why investment banks have strong incentives to underprice the issue? 25. A company is planning an IPO. Its underwriters have said the stock will sell at \$50 per share. The underwriters will charge a 7% spread. How many shares must the company sell to net \$93 million, ignoring any other expenses. Goals and Corporate Governance of the Firm 26. What is a firm’s fundamental or intrinsic value? What might cause a firm’s intrinsic value to be different than its actual market value? 27. Agency Problems are mitigated by good systems of Corporate Governance. Do you agree with it? Please explain you answer. 28. Should managers look after only the interests of their shareholders? Please give broader explanation. 29. Corporations increase value by accepting all investment projects that earn more than the opportunity cost of capital. Define opportunity cost of capital in this case. How this statement relate with shareholder’s decision on investment project.
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• Summer '14
• Prof Gter
• Economics, Ratio, total assets, inventory turnover ratio

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