Reference no: EM131063479
1. Ultimately, a firm's cost of capital is determined by: (select the best answer)
a. What the board of directors of the company decides it should be
b. Its cost of debt and equity capital
c. Its sources of capital
d. What investments a company makes
2. A company has target values of debt, preferred and common of $23MM, $16MM and $85MM. It has book values of debt, preferred and common of $66MM, $7MM and $18MM. It also has liquidation values of debt, preferred and common of $38MM, $19MM and $6MM. What weights should it use for purposes of estimating WACC?
a. Debt 18.6%; Preferred 12.9%; Common 68.5%
b. Debt 23.4%; Preferred 46.2%; Common 31.4%
c. Debt 60.3%; Preferred 30.2%; Common 9.5%
d. Debt 72.5%; Preferred 7.7%; Common 19.8%
|
Classify each of given the items as asset and liability
: Asset Liability Neither An Asset Nor A Liability.. Classify each of the items in the following list as: asset; liability; neither an asset nor a liability.
|
|
Determine the effect of its inventory and receivables
: Carmen and Vanessa's Corporation wants to determine the effect of its inventory and receivables management on its cash flow cycle. Carmen and Vanessa's sales last year (all on credit) was $200,000, and earned a net profit % of 10%.
|
|
Target weights of debt-preferred and common equity
: A company has target weights of debt, preferred and common equity of 20%, 10% and 70%, respectively. It has liquidation values of debt, preferred and common equity of 30%, 15% and 55%. Its book values of debt, preferred and common equity are 40%, 10%..
|
|
Difference between entering into a long forward contract
: What is the difference between entering into a long forward contract when the forward price is $50 and taking a long position in a call option with a strike price of $50?
|
|
Firms cost of capital is determined
: Ultimately, a firm's cost of capital is determined by: What the board of directors of the company decides it should be. Its cost of debt and equity capital. A company has target values of debt, preferred and common of $23MM, $16MM and $85MM. It has b..
|
|
Improvements to organizational management
: Taylor's Management theory brought numerous improvements to organizational management during a period when an autocratic management style was the norm. What were some of the developments that resulted from the Taylor theory of management?
|
|
What is the net present value of this project
: A company is considering a 6-year project that requires an initial outlay of $26,000. The project engineer has estimated that the operating cash flows will be $4,000 in year 1, $6,000 in year 2, $7,000 in year 3, $7,000 in year 4, $7,000 in year 5, a..
|
|
Compute the net operating incomes that would be realized
: Suppose actual production is 160,000 units. Compute the net operating incomes that would be realized under the traditional and new methods if actual sales are 150,000 units and everything else turns out as expected.
|
|
Importance of the hows row
: Verify the calculations in the Importance of the Hows row, and Percentage of Importance of the Hows row by showing the detailed calculations used to arrive at these figures.
|