Reference no: EM132862119

Questions -

Q1) Prepare balance sheet for Cornell Corp. based on the following information: cash = $125,000; accounts payable & accruals = $200,000; accounts receivable = $105,000; net fixed assets = $1,750,000; inventory = $290,000; notes payable = $160,000; Retained Earninigs = $665,000; Common Stock (par value + paid in Cap) = $400,000.

1. Prepare the balance sheet.

2. Calculate the long term debt of the firm.

3. Calculate the NWC (Net Working Capital) and Debt to Equity (D/E) ratio.

Q2) ABC Corp. issued a 30-year maturity bond in 1990 with 6.5 percent coupon paid semi-annually. The bond has a face value of $1,000. You bought the bond in 1996 when the yield to maturity on this bond was 7.8 percent. You sold the bond in 2008 when the yield to maturity on the same bond increased to 10.6 percent. What is the percentage change in the price of this bond from 1996 to 2008?

Q3) You make $10,000 deposit 1 year from now, $15,000 deposit 3 years from now and $20,000 deposit 5 years from now in real dollars. You plan to retire 30 years from now. What monthly income you will receive due to these deposits, in real dollars, over five years after the retirement? The first payment would be received at the end of the first month after the retirement and the last payment on the month ending the fifth year. The nominal rate is 8.5% and the inflation expectations are 3.2%.