BA 313
Homework Solutions
Chs. 8,9, and 10
1.
To calculate the payback period, we need to find the time that the project has
recovered its initial investment. After two years, the project has created:
$2,000 + 2,700 = $4,700
in cash flows. The project sti
Problem 11-1
Mower
Attachments
Painting
Garage/ Facility
Total for t0
Problem 11-6
End of Year t0
End of Year t1
End of Year t2
End of Year t3
End of Year t4
End of Year t5
End of Year t6
$5,000
$6,000
$300
$12,000
$23,300
$(375,000)
$120,000
$90,000
$70,
Problem 9-1 Part A
(i) AT kd =
(ii) AT kd =
(iii) AT kd =
4.20%
6.60%
7.80%
(i) AT kd =
(ii) AT kd =
(iii) AT kd =
4.62%
7.26%
8.58%
Problem 9-1 Part B
Problem 9-7
7.92%
Problem 9-12 Part A
17.90%
Problem 9-12 Part A
18.04%
Problem 9-14
15.00%
Problem 9-1
Calculations Problem #4
Year
2012
Net Sales
$90,000.00
Cost of Goods Sold
$48,000.00
Gross Profit
$42,000.00
Selling and Marketing Expenses
$13,000.00
Depreciation
$2,000.00
General Expenses
$5,000.00
Operating Income
$22,000.00
Interest Expense
$800.00
B
[Weeks 1 & 2] Assignment 1 Solution Set
This assignment covers materials in Chapters 1 and 2. This assignment is worth 10 points.
You are to complete the following problems at the end of the designated chapters:
Chapter 1 (problems start on page 21) - Pro
[Weeks 1 & 2] Assignment 2 Solution Set
This assignment covers materials in Chapter 4. This assignment is worth 10 points.
You are to complete the following problems at the end of Chapter 4, the problems begin on
page 84: 2, 9, 16, and 17.
Chapter 4
Probl
[Weeks 3 & 4] Assignment 4 Solution Set
This assignment covers materials in Chapter 6. This assignment is worth 10 points.
You are to complete the following problems at the end of Chapter 6: Problems 4 and 5
6-4.
Sugar Cane Alley
Financial Status and Fore
Barbara Kellar
Assignment 3
BA 313
AFLAC
As a Manager I would want to look at performances ratios. Its essential to know more than how
to calculate a gross profit margin. Very often youre asked to compare scenarios, so merely
identifying one as having a h
Chapter 1 Homework
1. Financial analysts wotk with the bigger picture of numbers. They utalize reasearch
skills to asses the financial health of an individual, business or organization. Decisions
made by financial analysts effect the entire organization.
Problem #2
Sales
COGS
Gross Profit
Operating Expenses
Operating Income (EBIT)
Interest Expense
Income before Taxes (EBT)
Tax Expense (40%)
Net Income
Case A
Case B
500,000
250,000
200,000
100,000
300,000
150,000
60,000
60,000
240,000
90,000
10,000
10,000
BA313 Fall 2013
Chapter 2 Homework Solutions 15, 16, 18, and 21
15. Here we need to work the income statement backward. Starting with net income, we know
that net income is:
Net income = Dividends + Addition to retained earnings
Net income = $1,150 + 2,60
BA313
Homework Solutions for Chs. 3, 4, and 5
15.
To calculate the common-size balance sheet, we divide each asset account by total assets, and
each liability and equity account by total liabilities and equity. For example, the commonsize cash percentage
Chapter 7 Homework Solutions
1.
The constant dividend growth model is:
Pt = Dt (1 + g) / (R g)
So, the price of the stock today is:
P0 = D0 (1 + g) / (R g)
P0 = $1.95(1.041) / (.102 .041)
P0 = $33.28
The dividend at Year 4 is the dividend today times the
Problem 12-2
A)
B)
C)
Problem 12-4
$120.00
$711.90
$729.20
$992.95
Problem 12-6
A) The YTM will be less than since the current market
price is higher than the par value of the bond.
B)
10%
C) The YTM would have to be 12% for face and par
value to be equal