Capital Budgeting Case StudyQRB/501April 8‚ 2014Capital Budgeting Case StudyThere are at least six capital budgeting tools a firm can use in analyzing a capital expenditure. They are: net present value (NPV)‚ internal rate of return (IRR)‚ profitability index (PI)‚ payback period (PB)‚ discounted payback period (DRP)‚ and modified internal rate of return (MIRR). This case study will focus mainly on NPV and IRR‚ in addition to the remaining four capital budgeting tools. Net Present Value (NPV) The
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Catawba Industrial Company Assignment Questions and Memo Instructions 1. Is the company correct in its practice of not manufacturing standard model compressors on Sundays because of the accounting loss incurred on each unit? 2. The compressor department and its manager are evaluated based on profit. Compute the compressor department profit with and without Sunday production. 3. If Marge McPhee decides to manufacture ten light-weight compressors each week and to sell them at a price of
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Investment Memo December 2‚ 2012 Having worked as a quant‚ I have a deep understanding of different quantitative strategies among several asset classes. In the equity world‚ quantitative strategies usually mean stock screens. While I believe in systematic investing‚ I also do recognize some pitfalls of algorithm-based stock screens. Thus‚ my investment goal is to develop a fusion strategy combining highly sophisticated quantitative and thorough fundamental portfolio management. The first step
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Loan Portfolio Management Introduction Background: L ending is the principal business activity for most commercial banks. The loan portfolio is typically the largest asset and the predominate source of revenue. As such‚ it is one of the greatest sources of risk to a bank’s safety and soundness. Whether due to lax credit standards‚ poor portfolio risk management‚ or weakness in the economy‚ loan portfolio problems have historically been the major cause of bank losses and failures. Effective
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Crystal Hoge Professor Jennifer Mullins Eng. 101 Bi-Term Processing Essay 29 October 2012 Bringing Baking Back from the Old Days Today’s society has become all about convience and how to get everything done cheaper and faster. However‚ my belief is that you should only take convience so far. Convience shouldn’t be brought anywhere near the kitchen. My favorite baked item is that of old-fashioned bread. I don’t mean that pre-packaged bread that you pick up from your local grocery store. I’m
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Estimate the required net working capital for each year and the cash flow due to investments in net working capital. The firm needs to increase its net working capital by 12% of incremental sales revenues. This amount is needed in the year before the sales revenue is earned. The amount for year 0 is 12% x $250‚000 = $30‚000.00‚ and that for year 1‚ 2‚ and 3 are $30‚900.00‚ $31‚827.00‚ and $32‚781.81 respectively. The cash flow due to the changes in the working capital is shown in Table 2. Year 0 1 2
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repricing interval. The basic mechanism behind this required Banc One to classify its assets and liabilities into differenct categories according to their relative repricing-adjusted time to maturity. Then‚ the maturity gap can be defined as the difference between assets dollar value and liabilities dollar value for each category. Therefore‚ if the bank had decided to use long-term fixed rate deposits to support its short-term floating-rate loans‚ this would result a positive maturity gap for the shorter
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not qualify as a rental property‚ as they have not met all the requirements‚ and therefore cannot deferred the gain of the sale or exchanged of property in Miami Beach. According to the tax court case‚ Barry E. Moore and Deborah E. Moore v. Commissioner.‚ U.S. Tax Court‚ CCH Dec. 56‚950 (M)‚ T.C. Memo. 2007-134‚ 93 T.C.M. 1275‚ the taxpayer were not allow to defer the gain from the exchanged of their vacation home due to code section 1031. Their vacation home was primarily used by the family as
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Radio One Inc. is a company that was founded in 1980 by Catherine Hughes who had learned the radio business while teaching at Howard University. Catherine and her husband purchased WOL-AM in Washington‚ D.C. for just under one million dollars. Hughes changed the format from R&B music and public affairs to talk radio. To cut back on expenses the Hughes became radio personalities. Expansion for Radio One began in 1987 when the Hughes’ purchased WMMJ-FM in Washington for about $7.5 million and
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Dell working capital case Dell’s build to order system created a very different balance sheet. We want to assess their competitive advantage in working capital at the time of the case‚ evaluate how they funded growth at the time (1996) and evaluate potential ways to fund projected sales growth of 50% in 1997 through use of internal funds. 1. Calculate their working capital advantage. To do this calculate days sales of inventory‚ payable days and receivables days to find their cash conversion
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