What was the firms 2014 operating cash flow

Reference no: EM133559820

Question 1. The price of Ervin Corp. stock will either be $60 or $81 at the end of the year. Call options are available with one year until expiration. Continuously compounded T-bills currently yield 5.66 %. Suppose the current price of Ervin stock is $78.

What is the value of the call option if the strike price is $75 per share

Question 2. The 2013 balance sheet of Maria's Tennis Shop, Inc., showed long-term debt of $1.9 million, and the 2014 balance sheet showed long-term debt of $2.6 million. The 2014 income statement showed an interest expense of $615,000. During 2014, Maria's Tennis Shop, Inc., had a cash flow to stockholders for the year of $317,000. Suppose you also know that the firm's net capital spending for 2014 was $791,000, and that the firm reduced its net working capital investment by $78,000

What was the firm's 2014 operating cash flow, or OCF?

Question 3. One of your customers is delinquent on his accounts payable balance. You've mutually agreed to a repayment schedule of $741 per month. You will charge 1.2 % per month interest on the overdue balance.

If the current balance is $14,982, how many years will it take for the account to be paid off?

Reference no: EM133559820

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