What is firm yyy net borrowing cost after savings

Assignment Help Financial Accounting
Reference no: EM132911196

Assume Firm XXX can borrow USD for 10 years at 5% and can borrow at a variable rate of Libor + 2%.

  • Firm YYY can borrow USD for 10 years at 5.5 % and can borrow at a variable rate of Libor.
  • Firm XXX wants to borrow at a variable rate and Firm YYY wants to borrow at a fixed rate.

Assume that a swap dealer puts a swap together and profits by 0.3%. The rest of the savings is shared equally by Firm XXX and Firm YYY.

Problem 1: What is Firm YYY's net borrowing cost after savings.

Reference no: EM132911196

Questions Cloud

What monthly deposits do need to make : You want to buy a house in your dream city 30 years from today. What monthly deposits do you need to make for the first 30 years, in order to fulfill this goal?
Should sales resulting from renewed agreement be included : Should sales and associated costs of 180,000 pairs of roller blades to be sold in Thailand under existing agreement be included in capital budgeting analysis
Computer-based patient record institute : How did the Institute of Medicine (IOM) and Computer-Based Patient Record Institute (CPRI) lead the way in the conceptualization of EHRs?
What is the effective annual rate for dealer b : What is the Effective Annual Rate (EAR) for Dealer B? Dealer A offers you a car with monthly payments of $ 330 for 60 months, starting 1 month from today.
What is firm yyy net borrowing cost after savings : What is Firm YYY's net borrowing cost after savings. Assume Firm XXX can borrow USD for 10 years at 5% and can borrow at a variable rate of Libor + 2%.
What is the break-even salvage value of this project : Over the next three years, the project will generate total operating cash flows of $ 3.5 million, What is the break-even salvage value of this project
Calculate the free cash flow of the project for each year : Calculate the free cash flow of the project for each year. Your company has a equity beta of 1.2. There are 4 million shares outstanding. Stock price is $15.
Data protection responsibilities : You will prepare a RACI matrix that outlines roles of key players in the organization who have data protection responsibilities
Prepare adjusting journal entryfor consolidation worksheet : In relation to the above intragroup transactions prepare adjusting journal entries for the consolidation worksheet at 30 June 2020 and 30 June 2021

Reviews

Write a Review

Financial Accounting Questions & Answers

  How much was comprehensive income for the year

Equity increased by $800,000 during the year including net income of $600,000 and other comprehensive loss of ($150,000). The company had no stock transactions during the years (issues or repurchases). How much was comprehensive income for the year?

  Prepare ife and financial ratios for hershey company

Prepare IFE and Financial Ratios for Hershey's Company. For the Financial Ratios make sure to use the revenue statement and balance sheet

  Prepare adjusting entries for the month ended november

Prepare adjusting entries for the month ended November 30 assume Heartland has a policy of adjusting accounts on monthly basis.

  Prepare opening balance sheet for cookie creating

Determine and Prepare the opening balance sheet for Cookie & Coffee Creations Inc. as of November 1, 2018, including the journal entries

  What would be the total assets for the new company xy

What would be the total assets for the new company XY. Assume that Firm X acquires Firm Y by issuing long-term debt to purchase all the shares outstanding.

  Characteristics of relevance and comparability of accounting

Compare and assess the qualitative characteristics of ‘relevance' and ‘comparability' of accounting information of a listed company for the financial statements between year 2009 and 2010

  Which machine should mercil buy and why

Each machine meets the specifications for a particular task in the company. Mercil's tax rate is 30 percent and its cost of capital is 15 percent -Which machine should Mercil buy and why?

  Which cash conversion cycle is the length of time from

Which cash conversion cycle is the length of time from? the payment for the purchase of raw materials to manufacture a product until the sale of that product

  What amounts as calculated respectively will be

Value of the renegotiated debt plus payments made with the amount of the obligation forgiven. These amounts, as calculated respectively, will be

  Two divisions and the common communications network

Single versus Dual Rates (LO 12-6) Packages-2-Go has two divisions, air express and ground service, that share the common costs of the company’s communications network, which are $4,070,000 a year. You have the following information about the two div..

  Ds inc sells widgets for 3200 per unit the variable cost

ds inc sells widgets for 32.00 per unit. the variable cost per unit is 25.00. if the total fixed cost are 335000

  Determine how is refund between savings and checking account

The Matthews want to split their refund between savings and checking accounts. Determine How is this accomplished, if possible?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd