What is beers forecasted total assets turnover

Assignment Help Financial Management

Reference no: EM131448470

1. Beer Brothers Inc. forecasts that its year-end assets will be $3,000, its sales will be $3,500, its operating costs will be $2,650, its interest charges will be $100, and its tax rate will be 40%. Its total current liabilities are $250 consisting of $60 of accruals and $190 of notes payable. Its long-term debt is $950. Beer's capital structure consists of only debt and common equity. What is Beer's forecasted total assets turnover?

a. 1.17 b. 1.29 c. 1.42 d. 1.56 e. 1.71

2. 5-year Treasury bonds yield 4.4%. The inflation premium (IP) is 1.9%, and the maturity risk premium (MRP) on 5-year T-bonds is 0.4%. There is no liquidity premium on these bonds. What is the real risk-free rate, r*?

2.10% 2.39% 2.21% 2.58% 1.91%

Reference no: EM131448470

Questions Cloud

Break-even purchase price in terms of present value : The Cornchopper Company is considering the purchase of a new harvester. Cornchopper has hired you to determine the break-even purchase price in terms of present value of the harvester. This break-even purchase price is the price at which the project’..

What is the present worth of savings if nominal interest : The benefit of a revised production schedule for a seasonal manufacturer will not be realized until the peak summer months. Net savings will be $1,000, $1,100, $1,200, $1,300, and $1,400 at the ends of months 4, 5, 6, 7, and 8, respectively. It is no..

Calculate amount of costs you will need to cut to break even : Using the data from the self-quiz problem on cost shifting, assume those who pay charges will allow a maximum charge of $2,100. Calculate the amount of costs you will need to cut to break even.

Which project has the higher equivalent annual net benefit : The company you work for is trying to decide between two projects. Project 1 costs dollar 150,000 up front, and has an expected life of 4 years, over which it will return dollar 47,000 each of the four years. Project 2 would last for 20 years, costs ..

What is beers forecasted total assets turnover : Beer Brothers Inc. forecasts that its year-end assets will be $3,000, its sales will be $3,500, its operating costs will be $2,650, its interest charges will be $100, and its tax rate will be 40%. Its total current liabilities are $250 consisting of ..

Does this investment make sense : An investment costs dollar 1000 up front, but won't start paying off until three years from now, at which time it will return dollar 150 per year for a period of ten years. If your hurdle rate is 6 percentage, does this investment make sense?

How much should you deposit each month to reach your goal : After graduating from IU, you are hired by a company that offers a 401(k) retirement plan. You would like to save enough in this plan so that when you retire in 43 years you have an account balance of dollar 1 million. You plan to make monthly contri..

Proportion with credit cards and for the average balance : A department store wants to know what fraction of its customers in a certain market have store credit cards, and what their average balance might be. Find 98% confidence intervals for the proportion with credit cards and for the average balance.

Addition of financial distress and agency costs change : HOw does the addition of financial distress and agency costs change the MM (with corporate taxes) model and the Miller model? (Express your answer in both equation and graphical forms, and also discuss the results.

User Account

All Pages