At December 31, 2014, Sager Co. had 1,200,000 shares of common stock outstanding. In addition, Sager had 450,000 shares of preferred stock which were convertible into 750,000 shares of common stock. During 2015, Sager paid $900,000 cash dividends on ..
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You’ve collected the following information about Odyssey, Inc.: Sales $ 165,000 Net income $ 14,800 Dividends $ 9,300 Total debt $ 68,000 Total equity $ 51,000. What is the sustainable growth rate for the company? What growth rate could be supported ..
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The risk-free rate of return is 4%, the required rate of return on the market is 10%, and High-Flyer stock has a beta coefficient of 2.0. If the dividend per share expected during the coming year, D1, is $4.60 and g = 6%, at what price should a share..
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Let V0 = the value of wood harvested this year; V1 = the value of wood harvested next year; DV = V1 - V0; C = harvest costs; r = the discount rate; S = the present value of all future net benefits when forest is harvested respecting an optimal rotati..
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Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain’s 2016 sales (all on credit) were $121,000; its cost of goods sold is 80% of sales; and it ..
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We are evaluating a project that costs $1,610,000, has a seven-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. What is the sensitivity of NPV to changes in the sales figure? What is..
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Allie forms Broadbill Corporation by transferring land (basis of $125,000, fair market value of $775,000), which is subject to a mortgage of $375,000. One month prior to incorporating Broadbill, Allie borrows $100,000 for personal reasons and gives t..
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At year-end 2013, Wallace Landscaping’s total assets were $1.5 million and its accounts payable were $380,000. Sales, which in 2013 were $2.4 million, are expected to increase by 15% in 2014. Total assets and accounts payable are proportional to sale..
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Tom Cruise Lines, Inc., issued bonds five years ago at $1,000 per bond. These bonds had a 25-year life when issued and the annual interest payment was then 15 percent. Assume that five years later the inflation premium is only 3 percent and is approp..
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What are the limitations on the repurchase alternative as an element of the firm's dividend policy? If most shareholders are in a very high marginal tax bracket, which alternative is favored?
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Analysis suggests that Jumpda LLC will pay a bill with the probability of 23.00%. They want to order 2,000 boxes of kitty litter at a net price per box of $46.00. Each box costs your company $27.00. You believe that the buyer (Jumpda LLC) will be a r..
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Find the future values of these ordinary annuities. Compounding occurs once a year. Round your answers to the nearest cent. Rework previous parts assuming that they are annuities due. Round your answers to the nearest cent.
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