Find the break even annual income

Assignment Help Finance Basics
Reference no: EM1344532

1. Company is purchasing new equipment for $120,000. You estimate the life of this equipment is 6 years and you will depreciate it in a straight line over 5 years to be conservative and assume no terminal value. The administration, maintenance and insurance cost for the equipment to be estimated to be $8,000 per year. If your cost of borrowing is 8% and your tax rate is 32%, what is the break even annual income made in advance at the beginning of the year?

2. You have two offers for an office photocopier. Copier A cost $700, will cost $100 a year to run and will last four years. Copier B costs $600, costs $120 a year to run and will last for three years. Your cost of capital is 12%. Which is better deal?

3. KLM Ltd has the following structure:$100,000,000 three year bonds with a coupon of 7% trading at 95% and 2.5 million shares trading at $4.55. The market risk premium is 8% and the risk free rate of return is 4%. KLM has a beta of 1.3 and pays tax at 35%. Calculate the WACC of KLM?

4. There is a US treasury bond with coupon 4.5% and maturing in mid March 2015. Interest rates are flat at 3%. What's the price of the bond (ignoring transaction costs and other distortions)?

 

Reference no: EM1344532

Explain the economic exposure to the eur

Explain the economic exposure to the EUR from the perspective of the Tunisian JV partner and provide one recommendation how the French company could hedge its exposure to the

Find annual savings for community hospital

Community Hospital has yearly net patient revenues of 150 million dollar. At present time, payments received by the hospital are not deposited for six days on average.

Determine maximum loss risk

John has just begun investing, & one of his friends was mentioning how he could use short selling as an effective method to drive up his returns when market started to go down

Find the market return for an asset

Find the market return for an asset with a required return of 16% and a beta of 1.10 when the risk-free rate is 9% and find the beta for an asset with a required return of 15

Find the net community profit

A hospital incurs 10 million dollar of cost to treat Medicaid patients and receives $7 million in payment. Actual charges for these Medicaid patients were 20 million dollar.

Find the profit received by the nursing home

A not-for profit nursing home has total expenses of $20 million, sales tax in the state is 7 percent, expenses are broken down into salaries (12 million dollar), supplies (6 m

Establish pmpm rate for primary care physicians

Actuarial estimates project 2,500 visits per 1,000 persons per year. You have contracted with a Primary Care Medical group at dollar 45.00 per visit with a dollar 5.00 co-paym

Standard deviation or coefficient of variation

Based solely on coefficient of variation, which investment is less risky and given that the expected rates of return are not equal, which is a better measure - standard devi

Reviews

Write a Review

 
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