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!
The Presley Corporation is about to go public. It currently has aftertax earnings of $7,200,000 and 2,100,000 shares are owned by the present stockholders (the Presley family). The new public issue will represent 800,000 new shares. The new shares will be priced to the public at $25 per share, with a 5 percent spread on the offering price. There will also be $260,000 in out-of-pocket costs to the corporation. a. Compute the net proceeds to the Presley Corporation. b. Compute the earnings per share immediately before the stock issue. c. Compute the earnings per share immediately after the stock issue. d. Determine what rate of return must be earned on the net proceeds to the corporation so there will not be a dilution in earnings per share during the year of going public. e. Determine what rate of return must be earned on the proceeds to the corporation so there will be a 5 percent increase in earnings per share during the year of going public.
Caballos, Inc., has a debt to capital ratio of 14%, a beta of 1.92 and a pre-tax cost of debt of 7%. The firm had earnings before interest and taxes of $ 514 million for the last fiscal year, after depreciation charges of $ 253 million. Assume that t..
To finance some manufacturing tools it needs for the next 4 years, Waldrop Corporation is considering a leasing arrangement. Waldrop Corporation has no use for the machine beyond the expiration of the lease, and the machine has an estimated residual ..
Ignoring the commitment fee, what is the effective annual interest rate on this line of credit? Suppose your firm immediately uses $130 million of the line and pays it off in one year. What is the effective annual interest rate on this $130 million l..
Suppose a beverage company with a 13.4879% WACC is considering an investment in Stella’s Lemonade Stand. The project has the following cash flows: She needs $165,000; at time zero but expect the following cash flows: Based on IRR analysis should the ..
Based on the corporate valuation model, the value of Weidner Co.'s operations is $1,200 million. The company's balance sheet shows $80 million in accounts receivable, $60 million in inventory, and $100 million in short-term investments that are unrel..
A callable bond pays annual interest of $60, has a par value of $1,000, matures in 20 years but is callable in 10 years at a price of $1,100, and has a value today of $1055.84. What is the yield to call on this bond?
You recently approached your bank about establishing a credit line facility. The terms offered by your bank include a nominal rate of prime + 1.5% (prime is currently 5%) on the amount borrowed, a commitment fee of 25 basis points on the unused porti..
An investment project costs $10,000 and has annual cash flows of $2,970 for six years. What is the discounted payback period if the discount rate is zero percent? What is the discounted payback period if the discount rate is 6 percent?
Randy's tireland makes a product that sells for $69 per unit and has $53 per unit in variable costs. Annual fixed costs are $24,000. If Rambles sells 10 units less than breakeven, how much loss would the company recognize on its income statement?
The current value of the collateral Treasury bond is $98 and the Repo rate is 1.75% with haircut equal to 20%. What would you do, if you believe that the value of the bond may rise to $98.20? What if the price is expected to fall to $97.90?
If you are risk averse, you should choose an asset allocation that is:
Volbeat Corporation has bonds on the market with 16.5 years to maturity, a YTM of 10.6 percent, and a current price of $942. The bonds make semi annual payments. What must the coupon rate be on the bonds?
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