Financial Management
Chapter 4 Case
After performing the ratio analysis, developing common-size financial statements, and
examining return on equity by the DuPont method, Warren Lynch presented his findings and
recommendations for CompU to Bill Jobs. Warr
Financial Management
Chapter 3 Case
CompU has been in business for 3 years now, and things are going well. Bill Jobs has been able
to expand the company onto two other campuses, and the companys sales and earnings have increased
quickly. Since Bills backg
Question 1
3.33 out of 3.33 points
The Fed refers to:
Selected Answer:
Correct
Answer:
the Federal Reserve
System.
Question 2
3.33 out of 3.33 points
An example of a personal opportunity cost would be:
Selected Answer:
Correct
Answer:
time comparing sev
Question 1
1. A person has $1,250 in liabilities, monthly saving of $200, and monthly gross income of
$2,500. What is the person's savings ratio?
0.08
Question 2
1. Amy Farmer has developed a budget that she follows each month. She went to the office
supp
Problem210A&B
PROBLEM 2-10
Given
Machine cost
Depreciation
Annual cost savings
Machine life
Salvage value (before tax)
Tax rate
Discount rate
Solution Legend
$760,000
Straight line
250,000
5
30%
9%
= Value given in problem
= Formula/Calculation/Analysis r
ConocoPhillips Natural Gas Wellhead Project
Given
ConocoPhillips's Cost of Capital for project
Project life
15.00%
10 years
Solution
Solution Legend
1.
Investment
Increase in NWC
MACRS Depr Rate (7 year)
Natural Gas Wellhead Price (per MCF)
Volume (MCF/da
PROBLEM 3-1: Clayton Manufacturing Company
Given
EBITDA (Year 1)
Growth Rate in EBITDA
Initial investment
Depreciation (Straight line) over
Estimated salvage value
Tax rate
Cost of capital
Solution Legend
$200,000
5%
$800,000
5 years
$35%
12%
= Value give
PROBLEM 8-2
Given
Solution Legend
Per Square Foot
A
Building size (Sq. ft.)
Rent
Maintenance (fixed cost)
Net Operating Income
% Change in NOI
Selling Price Information
Sales multiple for NOI/sq. ft.
Capitalization rate (1/Sales multiple)
Estimated proper
PROBLEM 8-2
Given
Solution Legend
Per Square Foot
A
Building size (Sq. ft.)
Rent
Maintenance (fixed cost)
Net Operating Income
$
B
100 $
(23)
77 $
$
120 $
(30)
90 $
Total Square Footage
A
B
80,000
90,000
8,000,000 $
10,800,000
(1,840,000)
(2,700,000)
6,16
PROBLEM 2-3
Given
Growth rate for years 1-5
EBIT (1)
CAPEX for year 0
CAPEX for years 1-5
Depreciation Expense
Tax rate
Debt Retirements for years 1-5
New working capital for years 1-5
$
$
$
$
Solution Legend
= Value given in problem
= Formula/Calculation
PROBLEM 4-4
Given
Liabilities and Owner's Capital
Current liabilities
Accounts payable
Notes payable
Other current liabilities`
Total current liabilities
Long-term debt (8.5% interest paid
semi-annually, due in 2015)
Total liabilities
December 31, 2006
Ba