Using Excel, and the Gitman chapters 6 and 7 Excel resource, if needed, complete the
following problems from chapters 6 and 7 in Principles of Managerial Finance:
1. P6-1
2. P6-10
3. P6-13
4. P6-20
5. P7-1
6. P7-6
7. P7-15
P61 Interest rate fundamentals:

Future value is the value at a given future date of an amount placed on deposit today and earning interest at a specified rate.
The general equation for the future value is given below:
FVn = PV * (1 + r)n
FVn -> future value at the end of period n
PV ->

Liability comparisions - Merideth Harper has invested $25,000 in Southwest Development Com
declared bankruptcy and has $60,000 in unpaid debts. Explain the nature of payments, if any, b
situations .
A) Southwest Development Compnay is a sole proprietorshi

Brekeven Analysis- Paul Scott has a 2008 Cadillac that he wants to update
with a GPS system so that he will have access to up-to-date road maps and
directions. Aftermarket equipment can be fitted for a flat fee of $500, and
service provider requires month

Payback period - Jordan Enterprises is considering a capital expenditure that requires an initial
investment of $42,000 and returns after tax cash inflows of $7,000 per year for 10 years. The firm
has a maximum acceptable payback period of 8 years.
A) Det

Rate of Return- Douglas Keel, a financial analyst for Orange Industries, wishes
to estimate the rate of return for two similar-risk investments, X and Y
.
Douglas's research indicates that the immediate past returns will serve as
reasonable estimates of f

Interest rate fundamentals: The real rate of return Carl Foster, a trainee at a investment
banking firm, is trying to get an idea of what real rate of return investors are expecting in
today's marketplace. He has looked up the rate paid on 3- month U.S. T

A)
Earnings available for common stockholders
Earnings Per Share=
Number of shares of common stock outstanding
EPS=
$436,000
170,000
EPS=
$2.56
B) If the firm paid common stock dividends of $0.80 per share, how
many dollars would go to retained earnings?

Case A
Future Value at the end of
period 2
=
1x(2+.12)
Future Value at the end of
period 2
=
2.12
Case B
Future Value at the end of
period 3
=
Future Value at the end of
period 3
=
3.06
Future Value at the end of
period 2
=
1x(2+0.09)
Future Value at the