Financial leverage:
increases the potential return to the shareholders.
Cash flow to stockholders is defined as:
dividends paid minus net new equity raised.
Which one of the following is the tax rate that applies to the next dollar of taxable income that
The stock of Southern United is priced at $40 a share and has a dividend yield of 2.1 percent. The firm pays constant annual
dividends. What is the amount of the next dividend per share?
$0.875
$0.210
$0.840
$0.021
$0.871
2) A stock has had returns of 18.
You expect to receive $20,000 at graduation one year from now. You plan on investing it at 6 percent until you have $100,000.
How long will you wait from now?
28.62 years
By definition, a bank that pays simple interest on a savings account will pay intere
Chapter5ConnectHomeworkAssignment
1. Cromwell Enterprises is acquiring Athens, Inc. for $899,000. Athens has
agreed to accept annual payments of $210,000 at an interest rate of 8.5 percent.
How many years will it take Cromwell Enterprises to pay for this
The annual interest divided by the face value of a bond is referred to as the:
coupon rate
A bond has a $1,000 face value, a market price of $1,045, and pays interest payments of $80 every year. What is the
coupon rate?
8.00 percent
Coupon rate = $80/$1,0
Julie is borrowing $12,800 to purchase a car. The loan terms are 36 months at 7.5 percent interest. How much interest will
she pay on this loan if she pays the loan as agreed? Round your answer to the nearest whole dollar.
$1,534
Total interest paid = ($3
FIN 5320 Financial Management CHAPTER 5
Week Five Assignment
Your assignment for this week is to complete the following questions and problems from Chapter 5. Please submit
your complete assignment in the course room by the due date.
Chapter 5 Questions
(
1.
Award: 10.00 points
Problem 6-3 Bond Prices [LO 2]
Lycan,Inc.,has7.2percentcouponbondsonthemarketthathave10yearslefttomaturity.Thebonds
makeannualpayments.
Required:
IftheYTMonthesebondsis9.2percent,whatisthecurrentbondprice?(Donotroundintermediate
cal
1) Your portfolio has a beta of 1.33. The portfolio consists of 14 percent U.S. Treasury
bills, 25 percent stock A, and 61 percent stock B. Stock A has a risk level equivalent to
that of the overall market. What is the beta of stock B?
0.56
0.87
5.32
1.44
3. The weighted average cost of capital is defined as the weighted average of a firm's.
B. cost of equity and its aftertax cost of debt
5. Kate is the CFO of a major firm and has the job of assigning discount rates to each project
that.consideration. Kate
Kyle Electric has three positive net present value opportunities. Unfortunately, the firm has not been able to find financing for
any of these projects. Which one of the following terms best describes the firm's situation?
Capital rationing
The net workin
5) Phil's Carvings, Inc. wants to have a weighted average cost of capital of 8.4 percent.
The firm has an aftertax cost of debt of 5.2 percent and a cost of equity of 10.4 percent.
What debt-equity ratio is needed for the firm to achieve their targeted we
Question 1.1. Determining what consumer attitudes are with regard to a particular product
and its advertising would be part of the _ function in marketing research. (Points : 2)
descriptive
diagnostic
predictive
forecasting
none of the these
Question 2.2.
Exam 2: Chapters 6,9,10,11,12
CHAPTER 6 DEFINITIONS:
Continuous Probability Distribution
Realized Rate of Return- (r hat) (little line over r)Risk
Risk Aversion- basic premise that investors like returns and dislike risk
Risk- in Websters as hazard; a per
QUIZ 6
1. Willard Mortuary bonds have 10 years remaining to maturity. Interest is paid semiannually. The
bonds have a $1000 par value and a 9% coupon rate. The bonds have a price of $850.
a. What is the current yield?
b. What is the yield to maturity?
N
I
Quiz 5 (B)
This is your last semester of school and it is time to start considering you student loan balance. You have
borrowed $44,000 with a stated annual rate of 6.5% for 10 years (monthly payments).
a. Your monthly payments will be?
N
I
PV
PMT
FV
b. I
Quiz 5 (A)
This is your last semester of school and it is time to start considering you student loan balance. You have
borrowed $44,000 with a stated annual rate of 6% for 10 years (monthly payments).
a. Your monthly payments will be?
N
I
PV
PMT
FV
b. If
Quiz 4 (A)
A. Your monthly payment is $675 per month. You financed this over 20 years at 6% (monthly
payments). How much did you borrow?
N
I
PV
PMT
FV
B. You want to save for retirement. You can save $1000 a month for 40 years. You expect to earn
5.5%, co
Quiz 4 (B)
A. Your monthly payment is $675 per month. You financed this over 25 years at 6% (monthly
payments). How much did you borrow?
N
I
PV
PMT
FV
B. You want to save for retirement. You can save $1000 a month for 30 years. You expect to earn
5%, comp
FINA 5320.001
Quiz 1
1. What are the four financial statements?
2. What are retained earnings?
3. Where can this years depreciation be found?
ANSWERS:
1. What are the four financial statements?
Income Statement
Balance Sheet
Statement of Owners Equity
Quiz 9-14-15
FINA 5320
II. (2 pts for each ratio) Given the financial statements provided, calculate the ratios below:
(show numbers used)
a. Current Ratio
CA
CL
$ 115,750
=2.5
$ 46,300
i. Return on Assets
TA
$ 8,000
=.05
$ 150,950
b. Gross Profit Margin
FINA5320.001
Managerial Finance Fall 2015
Instructor:
Phone:
Email:
Office:
Eugene Bland, Ph.D., CFM, CTP, CFA
(361) 825-2829
Eugene.bland@tamucc.edu
OCNR 326
Office Hours: By appointment. Official times will be posted during the first week of the semeste
Windswept, Inc. 2010 Income Statement ($ in
millions)
Net sales
$ 9,810
Less: Cost of goods sold
7,960
485
Less: Depreciation
Earnings before interest and taxes
$ 1,365
112
Less: Interest paid
Taxable Income
$ 1,253
Less: Taxes
439
Net income
$ 814
Windsw
FORMULA SHEET FOR FINAL
Average tax rate = total taxes due/taxable income
Return on assets or ROA=net profit margin x total asset turnover = earnings available to common
shareholders/total assets
Return on equity or ROE = net profit margin x total asse
FINA3310-Final exam review
50 multiple choice, true false or problems - 1 point each
Theoretical
Goal of the firm, characteristics, advantages and disadvantages of the various forms of businesses
(i.e. partnerships, sole proprietorships, corporations)
Fin
Review for midterm 4
20 multiple choice, true/false and problems each worth 1 point.
Theoretical
Cost of capital, sources of long term funds, factors that affect the different sources of
capital, flotation costs, cost of retained earnings, WACC
Breakeve