Reference no: EM132904644
1. Suppose you own shares in a company. The current price per share is $25. Another company has just announced that it wants to buy your company and will pay $35 per share to acquire all the outstanding shares. Your company's management immediately begins fighting off this hostile bid. Is management acting in the shareholders' best interest? Why or why not?
2. Why is it important that we sub-divide cash flow into its three categories: operations, finance, and investing? If a company's operating cash flow has been negative for several years, is that a good sign or a bad sign? Explain.
3. What is the difference between EFN and sustainable growth rate? Give a hypothetical situation where one measure would be a more important measure to a company's management than the other.
4. You and a friend are an advisor to a growing corporation with some employees. Your friend suggests that to eliminate the principle-agent problem, all employees must also be granted stock. Do you agree or disagree with this advice? Explain
Problem-solving
1. A proposed cost-saving device has an installed cost of $111,700. It is in Class 43 (30% rate) for CCA purposes. It will function for 6-years, at which time it will have no value.
a. Calculate UCC at the end of 6-years.
b. What are the tax implications when the asset is sold? Explain and state any assumptions you make.
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What is the OCF for each year of this project
: The project is estimated to generate $2,730,000 in annual sales, with costs of $864,000. If the tax rate is 35%, what is the OCF for each year of this project
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Record the adjusting journal entry
: NKPM Company purchases a factory machine at a cost of $30,000 on January 1, 2010. Record the adjusting journal entry
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Hypothesize two companies
: Write a paper in which you hypothesize two companies that could be candidates to be allies or to be acquired by the other.
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Complete absorption costing income statement for Presidio
: Fixed manufacturing overhead per unit ($334,320 ÷ 2,800 units) 119.40. Complete absorption costing income statement for Presidio
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Management acting in shareholders best interest
: Your company's management immediately begins fighting off this hostile bid. Is management acting in the shareholders' best interest?
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Assess the profitability of the firm
: Using the attached financial statements for Best Buy Co., Inc. complete the financial statement analysis and ratio analysis by answering the questions below.
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What would be Victoria shares intrinsic value per share
: Victoria Company's beta is exactly 1.5, and the market risk premium is 10%, with a risk-free rate of 4%. What would Victoria shares intrinsic value per share
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Accomplishing organizational strategic objectives
: You learned about the relationship between project management and accomplishing organizational strategic objectives
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Unavailability of staff to fill in for the two people
: Consider the following scenario: In Florida, Clara, an active 94-year-old great-grandmother who still worked as a hospital volunteer two days a week, was admitt
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