The firms financial break even point

Assignment Help Financial Management
Reference no: EM13942984

A corporation has $5,000,000 of 8% bonds and $3,000,000 of 10% preferred stock outstanding. The firm's financial break even (assuming a 40% tax rate) is?

Reference no: EM13942984

Questions Cloud

Reduction in profit contribution from decline in sales : A company is considering shortening its credit period from 30 days to 20 days and believes as a result of its change, its average collection period will decrease from 36 days to 30 days. Bad debt expenses are also expected to decrease from 1.2 percen..
European put on the futures with a strike price : A futures price is currently 55, its volatility is 20% per annum, and the risk-free rate is 6% per annum. What is the value of a 5-month European put on the futures with a strike price of 65?
Contemplating replacing current fleet of delivery vehicles : Your company is contemplating replacing their current fleet of delivery vehicles with Nissan NV vans. You will be replacing 5 fully-depreciated vans, which you think you can sell for $3,800 apiece and which you could probably use for another 2 years ..
Maximum initial cost of company would be willing to pay : Och, Inc., is considering a project that will result in initial aftertax cash savings of $1.76 million at the end of the first year, and these savings will grow at a rate of 3 percent per year indefinitely. What is the maximum initial cost of company..
The firms financial break even point : A corporation has $5,000,000 of 8% bonds and $3,000,000 of 10% preferred stock outstanding. The firm's financial break even (assuming a 40% tax rate) is?
With a quoted interest rate : With a quoted interest rate of 5% and a 10% compensating balance, what is the effective rate of interest (use $200,000 loans proceeds amount) 2. With the average accounts receivable of $5 million and credit sales of $24 million, you factor receivable..
Equally weighted portfolio of these three stocks : Consider the following information: Rate of Return if State Occurs State of Probability of Economy State of Economy Stock A Stock B Stock C Boom 0.62 0.09 0.17 0.35 Bust 0.38 0.20 0.10 − 0.06 a. What is the expected return on an equally weighted port..
Hedge through covered interest arbitrage : You are expecting to receive 10M Euros 3-months from now. The interest rates are 3% in the US and 5% in Germany. Current spot exchange rate: $1.20/Euro and 3-month Forward rates: $1.15/Euro. How much $ will you have 3-months from now if you hedge thr..
Which is best futures contract to hedge accounts payable : You would like to hedge your accounts payable due one-year from now of Indian Rupees (IR) 10 million in the Futures market. But there are no Futures contract available on Indian Rupees. However, Futures contract on Singapore dollar (S$) and Hong Kong..

Reviews

Write a Review

Financial Management Questions & Answers

  Construction vs. permanent loans

When are each obtained? What is the risk profile of each? What types of lenders participate in each? Why and how do construction and permanent lenders cooperate?

  The yield to maturity on one-year zero-coupon bonds

The yield to maturity on one-year zero-coupon bonds is 7.8%. The yield to maturity on two-year zero-coupon bonds is 8.8%. What is the forward rate of interest for the second year?  If you believe in the liquidity preference theory, is your best guess..

  Question 1assume a manufacturer incurs 2000000 hours of

question 1assume a manufacturer incurs 2000000 hours of direct productive labor in a year at a total direct labor cost

  Calculate answer to the nearest penny

You would like to have $43,440for the down payment on a house you plan to buy five years after you graduate. If your investments earn 3.3% APR compounded monthly, how much do you have to invest each month, starting next month, to meet your investment..

  Free cash flows and cost of equity-

Bandit Corporation has 10M shares outstanding and 25M in debt and 5M in excess cash at the end of 2012. Free cash flows for Bandit Corporation were $12M in 2012. You estimate that these will grow to $14M next year in 2013 and then grow at 4% in perpe..

  What is the value per share of the companys stock

A stock last paid dividends amounting to $10 and the dividends are expected to grow constantly into the foreseeable future by 5%, what is the value of the stock today if the required rate is 10% And Millard Brothers is expected today a $2 per share d..

  An exchange rate is currently 08000 the volatility of the

an exchange rate is currently 0.8000. the volatility of the exchange rate is quoted as 12 and interest rates in the two

  Estimate the implied equity risk premium in market

The Bovespa (Brazilian Equity Index) is at 15,000. The dividends on the Index last year were 5% of the Index value. Analysts expect them to grow at 15% a year in real terms for next 5 years. After the 5th year, the growth is expected to drop to 5% in..

  The return on a cash-and-carry gold is loaned

Suppose the gold spot price is $1700/oz, the 1-year forward price is 1760.54, and the continuously compounded risk-free rate is 4%. Calculate the following: the lease rate δ= 1T 1n F0,TS B. the return on a cash-and-carry if gold cannot be loaned C. t..

  What was the intrinsic value of this put

What was the premium on the Dec. BABA 118 put? Was this option in or out of the money? What was the intrinsic value of this put? What is the time value?

  What is current price of bond-zero-coupon bonds with value

Dark night inc just issued zero-coupon bonds with a par value of $1000. The bond has a maturity of 11 years and a yield to maturity of 9.64% compounded semi annually. What is the current price of the bond.

  What is the yield on five year corporate bond

An analyst evaluating securities has obtained the following information. The real rate of interest is 3% and is expected to remain constant for the next 5 years. Inflation is expected to be 2.1% next year, 3.1% the following year, 4.1% the third year..

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