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!
VolWorld Communications Inc., a large telecommunications company, is evaluating the possible acquisition of Bulldog Cable Company (BCC), a regional cable company. VolWorld's analysts project the following post-merger data for BCC (in thousands of dollars, with a December 31 year-end):If the acquisition is made, it will occur on January 1, 2005. All cash flows shown in the income statements are assumed to occur at the end of the year. BCC currently has a capital structure of 40 percent debt, which costs 10 percent, but VolWorld would increase that to 50 percent, also costing 10 percent, if the acquisition were made. BCC, if independent, would pay taxes at 20 percent, but its income would be taxed at 35 percent if it were consolidated. BCC's current market-determined beta is 1.40. The cost of goods sold is expected to be 65 percent of sales. Required retentions are net of depreciation-that is, they are gross retentions minus depreciation charged.a. What is the appropriate discount rate for each of the cash flows when valuing the acquisition?b. What are the free cash flows and interest tax shields for the first 4 years? c. What is BCC's horizon value?d. What is the value of BCC's equity to VolWorld's shareholders if BCC has $300,000 in debt outstanding now?
At an interest rate of 10% per year compounded semiannually, determine the annual worth of the purchase over a 10 year amortization period.
What are the financial plans prepared by managerial accountants called?
You already have a well-diversified portfolio of domestic assets. You are considering reallocating some of the money in your domestic portfolio to a global equity fund that invests in foreign firms in Europe and Asia.
what would be the current value of these collection payments: a) at a 4% rate of return? b) at a 14% rate of return?
It appears that George is running a profitable business. George is aware you are in an MBA Managerial Finance class and comes to you for advice on his working capital practices. More specifically George asks you to do the following:
The Friendly National Bank holds $50 million in reserves atits Federal Reserve District Bank. The required reserves ratio is12 percent.
Imagine that you are a financial manager researching investments for your client that align with its investment goals. Use the Internet to research any U.S. publicly traded company that you may consider as an investment opportunity for your c..
The owner of a U.S. company that produces sound systems for home entertainment theaters is considering the establishment of an Australian-based company to produce and sell the systems there.
What are the underlying assumptions from the perspective of an investment analyst faced with the circumstances in the case-where do you see them?
if the investors required rate of return is 14.5 then price of a preferred stock that pays dividend of 1200 per year
What type of information would you expect to find about non-current (fixed) assets in the financial statements and notes of a major UK listed company?
What is the value of the firm according to M&M Proposition I with taxes? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)
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