Ocean Carrier Case Study Summary In order to accept the recently submitted leasing contract proposal‚ Ocean Carriers would have to purchase a new ship. The purchasing of a new ship is a considerable investment. We have analyzed whether or not Ocean Carriers should make this investment using Free Cash Flow and Net Present Value (NPV) analysis. Given the details of the contract‚ the forecasted daily time charter rates‚ and the costs data; we have concluded that Ocean Carriers should not accept
Premium Net present value Cash flow Depreciation
Ocean Carriers Inc. A Case Study By ab Introduction • Ocean Carriers Inc. owned and operated cape-size dry bulk carriers worldwide. • Major Cargo type : Iron ore. • Vessel sizes : 80000 DWT to 210000 DWT. • Cape-size carriers travel around Cape Horn rather than the Panama Canal due to size constraints. Operations Maintenance Maintaining Supplies And on board Stores Supply of Lubricants Cargo Operations Repairs Insurance Business Model • Mostly chartered
Premium Net present value Ship
(a) Statement of Problem. Ocean Carriers is evaluating a proposed three year lease of a ship. Currently‚ no ships in Ocean Carrier’s fleet meet the requirements of the customer. Since the new ship requires an investment of $39 million‚ Mary Linn‚ the Vice President of Finance for Ocean Carriers‚ needs to evaluate the proposal’s NPV and determine whether or not to accept the proposal by considering expected cash flows‚ tax implications‚ and future market conditions. (b) Statement
Premium Supply and demand
Introduction Continental Carriers Inc is a trucking company which specialises in transporting general commodities. Since its establishment in 1952 the company operates within the district of the Pacific Coast and from Chicago to various points in Texas. It was noted that the company maintains an overall low debt policy‚ whereby they obtain infrequent short term loans and avoid long term debt. Furthermore with the appointment of Mr. Evans as president‚ the company became more profitable and experienced
Premium Stock Financial ratio Stock market
“Maud Martha” Bonnie Holloway By Gwendolyn Brooks p.2  Gwendolyn Brooks’ intense passage from her novel “Maud Martha” emphasizes the impact change can have through difficult situations. Maud Martha‚ mama and Helen wait on their front porch for Papa to come home with news of whether they are capable to keep their house. Papa then comes home with information that they will not lose
Premium Gwendolyn Brooks The Speaker
Ocean Carriers Objectives • Forecast pro-forma cash flows for a project • Estimate project values using Net Present Value (NPV) • Conduct sensitivity analysis for the forecast inputs Setting • January 2001 • Customer offering attractive terms on 3-year lease for a capesize carrier • Would require purchase of new carrier since existing fleet does not fulfill customer needs • Should it be purchased? Industry Dynamics • Revenue Drivers • Outlook in the: –
Premium Generally Accepted Accounting Principles Net present value Cash flow
Continental Carriers‚ Inc. Advanced Financial Management Continental Carriers‚ Inc. (CCI) should take on the long-term debt to finance the acquisition of Midland Freight‚ Inc. for a few reasons. The company is heavy on assets‚ the debt ratio will only grow to 0.40 with the added $50M in debt. Also‚ the firm will benefit from an added $2M in a tax shield and be able to return $12.7M a year to its stockholders and investors‚ instead of $8.9M if equity is raised to finance the acquisition
Premium Stock Stock market
1. As Martha McCaskey‚ what is your plan of action for finishing the Silicon 6 project? Please map out your detailed plan of action. Alternative #1 Ask Chuck Kaufman‚ the senior associate to do it instead This is a better option because he is a professional in terms of this type of work‚ he feels a personal obligation to do it for his managers and managing the overall project is preparing McCaskey for her promotion and the type of work she would encounter there. For finishing
Premium Ethics Virtue Integrity
Introduction Martha Rinaldi‚ an enthusiastic and over-ambitious Marketing MBA graduate‚ accepted position at Potomac Waters over Deep Dive Pizza. She made this after carefully analyzing both the organizations (Exhibit 1) and then choosing her career growth and development over the monetary benefits. An intelligent career decision turned out to be a struggle as her relations worsened with her teammate and manager leading towards the decision of whether to stay or to switch internally or accept the
Premium Motivation
Martha Rinaldi: Should She Stay or Should She Go? Situation Summary: Martha Rinaldi from Iowa City earned a MBA in May 2008 from a business school in Chicago. After her first year of MBA program‚ she had the opportunity to do an internship at the Deep Dive Pizza located in Chicago as an assistant to the director of Promotions. She was doing so well in her responsibilities that the CEO himself was interested of having her in the company. He even proposed her to lead a new and special project in
Premium Good and evil Problem Decision making