Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Debt Irrelevance
Digital Fruit is financed solely by common stock and has outstanding 29 million shares with a market price of $10 a share. It now announces that it intends to issue $200 million of debt and to use the proceeds to buy back common stock. There are no taxes.
a. What is the expected market price of the common stock after the announcement?
b. How many shares can the company buy back with the $200 million of new debt that it will issue? (Enter your answer in millions rounded to 1 decimal place.)
c. What is the market value of the firm (equity plus debt) after the change in capital structure? (Enter your answer in millions.)
d. What is the debt ratio after the change in capital structure? (Enter your answer as a whole percent.)
Firms HL and LL are identical except for their leverage ratios and the interest rates they pay on debt. Each has $18 million in invested capital, has $5.4 million of EBIT, and is in the 40% federal-plus-state tax bracket. Calculate the return on inve..
Compare the two loans what are their monthly payments and if you chose the loan with points, how long would it take for you to break even?
If inflation is increasing, it is expected that bond rates will increase.
Compute the percentage total return. What was the dividend yield? What was the capital gains yield?
Bobaflex Corporation has ending inventory of $686,373 and cost of goods sold for the year just ended was $4,765,135. What is the inventory turnover? What is the days’ sales in inventory? How long on average did a unit of inventory sit on the shelf be..
A bank has a profit margin of 5 percent, an asset utilization ratio of 11 percent, an equity multiplier of 12, and a retention ratio of 60 percent. What is this bank's ICGR? Which one of the following correctly applies to the average accounting rate ..
A leather cushion maker in Richmond requires a trade facility to pay for its import of $850,000 raw leather from Argentina.
How much of Anle's equity cost of capital is expected to be satisfied by dividend yield and how much by capital gain?
Find the most recent one-year dividend payment that is four most recent quarterly dividends paid by Kia Motors and 3M Corporation, if any. Add the most recent one-year dividend payment to your Culminating Project Report for both companies.
In 1901, the first Green Jacket Golf Championship was held. The winner's prize money was $210. In 2015, the winner's check was $1,550,000.
The Young household is looking at buying a house. Which of these houses can they afford with a 30-year mortgage at an interest rate of 3.5%?
Calculate the cost of new common equity financing of stock Q using Gordon Model.
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd