Considering investing in security services

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1. You are considering investing in Nuran Security Services. You have been able to locate the following information on the firm: total assets are $31.35 million, accounts receivable are $2.50 million, ACP is 25 days, net income is $2.70 million, and debt-to-equity is 1.20 times.

Calculate the ROE for the firm.

2. Turquoise Electronics, Inc. paid a dividend of $1.87 last year. If the firm's growth in dividends is expected to be 10 percent next year and then zero thereafter, then what is its cost of equity capital if the price of its common shares is currently $25.71?

The problem is not solvable with the information that is given.

8.00%

7.27%

18.00%

Reference no: EM131904190

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