Chapter 3 & 4
DSO = 20 days; ADS = $20,000; AR = ?
AR = $400,000.
A/E = 2.5; D/A = ?
= 1 0.40 = 0.60 = 60%
TA = $10,000,000,000; CL = $1,000,000,000; LT
Homework 3 Bond Valuation with Annual Payments
5-1 Bond Valuation with Annual Payments
M = Par Value = $1,000
C = Maturity value. We can assume that it is the same as the par Value = $1,000
r = Coupon rate = 0.08
A. Why Corporate Finance is important to all managers?
It is important because it will maximize the value of the firm. It is vital that managers care for good and positive
B. There are three main forms of organ
Homework week 7
Inventory Turnover Ratio = cost of goods sold / average inventory.
Inventory Turnover Ratio I = 2
Sales I = $10 million
Sales II = Sales I = $10 million
Inventory Turnover Ratio II = 5
Chapter 10 Problems
2. LL Incorporated's currently outstanding 11% coupon bonds have a yield to maturity of 8%. LL believes
it could issue at par new bonds that would provide a similar yield to maturity. If its marginal tax rate is
35%, what is LL's after
11-7. New-Project Analysis
a) What is the net cost of the spectrometer (What is the Year-0 net cash flow?)
1. Data: Depreciable basis: $85,000
T = 40% = 0.4
MACRS percentage allowances are 0.33 for the first year