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!
Eagle Industries feels that a lockbox system can shorten its accounts receivable collection period by 4 days. Credit sales are $2,700,000 per year, billed on a continuous basis. The firm has other equally risky investments with a return of 20%. The cost of the lockbox system is $8,000 per year. (Note: assume a 365-day year.)
A. What amount of cash will be made available for other uses under the lockbox system?
B. What net benefit (cost) will the firm realize if it adopts the lockbox system?
C. Should it adopt the proposed lockbox system? Yes or No.
Snider Industries sells on terms of 3/10, net 20. Total sales for the year are $934,500. Thirty percent of the customers pay on the 10th day and take discounts; the other 70% pay, on average, 36 days after their purchases. What are the days sales out..
Boehm Incorporated is expected to pay a $2.30 per share dividend at the end of this year (i.e., D1 = $2.30). The dividend is expected to grow at a constant rate of 9% a year. The required rate of return on the stock, rs, is 15%. What is the value per..
The futures price of a commodity such as corn is $1.00. The contracts are for 10,000 bushels, so a contract is worth $10,000. The margin requirement is $1,000 a contract, and the maintenance margin requirement is $600. How much must you initially rem..
Suppose that TipsNToes, Inc.'s capital structure features 75 percent equity, 25 percent debt, and its cost of equity is 12 percent, while its before-tax cost of debt is 8 percent. If the appropriate weighted average tax rate is 40 percent, what will ..
Patty Scheme lenberg, a 45-year-old woman, wishes to accumulate $300,000 over the next 15 years to supplement the retirement programs that are being funded by the federal government and her employer. She expects to earn an average annual return of ab..
Your client supplies water to a housing development. The company requires new customers to pay for the extension of the water lines to their homes. The water lines are the company's property. The client would like you to explain the tax consequences ..
You have just started a new job and one of the fringe benefits is a company contribution of $5,000 every year into a retirement savings account. Assuming the contribution amounts remain unchanged and that the account earns an average of 8% per year, ..
Garage, Inc., has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$ 28,000 –$ 28,000 1 13,400 3,800 2 11,300 9,300 3 8,700 14,200 4 4,600 15,800 a-1 What is the IRR for each of these projects? At what dis..
You can invest in a machine that costs $500,000. You can expect revenues net of any expense, except machine costs, of $150,000 at the end of each year for five years. You will subcontract the maintenance costs at a rate of $20,000 a year, to be paid ..
A bond with a par value of $1000 has annual coupons at the end of each year for 10 years. The initial coupon rate is 7% and each coupon is 3% greater than the preceding coupon. The bond is redeemed for $1200 at the end of 10 years. Find the price one..
The Jackson–Timberlake Wardrobe Co. just paid a dividend of $1.55 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year indefinitely. Investors require a return of 14 percent on the company's stock. What ..
discuss the following topic should a multinational firm risk overhedging? some have argued that exchange rate risk is
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