Accounting department at a major software manufacturer

Assignment Help Business Economics
Reference no: EM13996074

The head of the accounting department at a major software manufacturer has asked you to put together a pro forma statement of the company's value under several possible growth scenarios and the assumption that the company’s many divisions will remain a single entity forever. The manager is concerned that, despite the fact that the firm’s competitors are comparatively small, collectively their annual revenue growth has exceeded 50 percent over each of the last five years. She has requested that the value projections be based on the firm’s current profits of $4.9 billion (which have yet to be paid out to stockholders) and the average interest rate over the past 20 years (6 percent) in each of the following profit growth scenarios:

1. Profits grow at an annual rate of 8 percent.

a. The growth rate is not possible

b. The firm's value is infinite

c. The firm will have to shut down at this growth rate

d. The firm's value is zero

2. Profits grow at an annual rate of 4 percent ___billion

3. Profits grow at an annual rate of 0 percent. ___billion

4. Profits decline at an annual rate of 2 percent. ___billion

Reference no: EM13996074

Questions Cloud

Working on some organic chemistry lab : Working on some organic chemistry lab questions. We are using acetic acid and an unknown alcohol to complete a Fischer Esterification. We are instructed to reflux the reagents for an hour to push the reaction forward. My question is this " You are in..
Create a claim using the proven technique : Create a claim using the proven technique below to get venture capital money for a new product idea. Use your own new product idea or pick an innovative product that is already on the market and act like it’s a new idea for which you are trying to ge..
Is employer-based insurance unraveling : Medical costs are once again rising rapidly, forcing health care back into political prominence. This issue direct affects you as a student, family member, employer, and/or employee. The problem of medical costs is so pervasive that it underlies thre..
Lassaigne''s test for the detection of nitrogen : Which of the following compounds does not give Lassaigne's test for the detection of Nitrogen ? (A) Glycene (B) Urea (C) Aniline (D) Hydrazine
Accounting department at a major software manufacturer : The head of the accounting department at a major software manufacturer has asked you to put together a pro forma statement of the company's value under several possible growth scenarios and the assumption that the company’s many divisions will remain..
The procedure inform this expirement called for application : The procedure inform this expirement called for application of house vacuums in order to remove the ether. What would you feel if you touch the round bottom flask after applying the vacuum?why was the vacuum applied in addition to a warm water bath?
My organic chemistry lab : My organic chemistry lab. How do you extract vanillin from the vanilla bean. Can you use diethyl ether and heat the substance and then use vacuum filtration and heat to get rid of the ether and leave just the vanillin?
How do you go from a cyclohexanone to a 1-cyclohexenol : How do you go from a cyclohexanone to a 1-cyclohexenol?
Does a williamson ether synthesis result in enantiomers : Does a williamson ether synthesis result in enantiomers if the Oxygen has a sterocenter?

Reviews

Write a Review

 

Business Economics Questions & Answers

  Income effect of the price change on quantity demanded

You own a rock climbing gym. Ryan is one of your customers. Ryan receives utility from rock climbing and pizza (Ryan exhausts his income in each period on the two goods). Ryan has $100 of income. At a price of $20, Ryan buys 0 sessions. What is the i..

  Why did it end its fix to the us dollar

Within the past 5 years a certain country ended its almost 2-year peg (fixed) of its own currency to the US dollar. What country was this? What year did it end? Why did it end its fix to the US dollar?

  The giant modern corporation did more than transform busines

“But in real-life America, and especially in the America of railroad men and new industrialists, laissez-faire was a dangerous idea” Explain. The giant modern corporation did more than transform business into finance. It displaced classical ideas abo..

  Demand equation that represents demand for goods

Consider the following Demand equation that represents Demand for goods to your company produces q=100-2p. Total cost of production is cq. Given to your company's objective is to maximize profit

  Find and interpret the output elasticity

Suppose you are given the following Total Product Function: Q=100 K^3/2 L^4/2 M^4/7 ,where Q is total output or units produces; K, capital; L, labor; and M, materials.; that is, this is a input factor production function. Find and interpret the outpu..

  Using aggregate demand and aggregate supply analysis

Using aggregate demand and aggregate supply analysis, explain the happy coincidence of both low inflation and decreasing unemployment in the United States during the roaring nineties

  Road trip game and determine if the game is symmetric

Consider a group of 10 friends who are considering going on a road trip. In determining whether or not to go, each friend considers both how much they would enjoy the trip and how much it will cost them. The cost of the trip will be $500 total, and w..

  What will happen to nominal GDP and the price level

Suppose that the money supply is $750, nominal GDP is 2500, and real GDP is 1250. What is the velocity of money and what is the price level? Suppose that the velocity is constant, and the economy’s output of goods and services rises by 5% each year. ..

  The component of Planned quantity demanded of GDP

The component of Planned AE (the quantity demanded of GDP) MOST sensitive to a change in interest rates is....

  What factors might explain the price elasticity of demand

Based on your calculations in question 1, indicate whether the price elasticity of demand is elastic, inelastic or unit elastic for each time period given in Table 1. What factors might explain the price elasticity of demand for private car travel on..

  Qsmith and jones are stranded on a desert island each has

q.smith and jones are stranded on a desert island. each has in his possession some slices of ham h and cheese c. smith

  Building manufacturing plants

Companies want to expand their business and improve their sales and profits. Instead of building manufacturing plants and installing new machineries, companies look to buy other companies and integrate them into their current business.They have $22 m..

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