Mini Cases: Cost of Capital Part A: Cost of Debt Mini Case 1: Cost of perpetual/Irredeemable debt Ashok Leyland issued Rs 100 Lakhs 12% debentures of Rs. 100 each. Calculate the cost of debt in each of the following cases. (Assume corporate tax rate being 40%). Case (a) If debentures are issued at par with no floatation cost. Case (b) If debentures are issued at par with 5% floatation cost. Case (c) If debentures are issued at 10% premium with 5% floatation cost. Case (d) If debentures are issued
Premium Finance Investment Corporate finance
Why has Wal-Mart viewed international expansion as a critical part of its strategy? Wal-Mart has viewed international expansion as a critical part of its strategy because of a number of reasons. First‚ Wal-Mart saw the potential for increased profits and sales in new markets.“After rapid expansion during the 1980s and 1990s‚ Wal-Mart faces limits to growth in its home market and has been forced to look internationally for opportunities”(Ball‚ 2007). Second‚ Wal-Mart saw the need “to protect their
Free United States
( Answers to Mini-Case Questions BioCom Inc. This mini-case provides a review of the methodology and rationale associated with the various capital budgeting evaluation methods such as payback period‚ discounted payback period‚ NPV‚ IRR‚ MIRR‚ and PI. 1. Compute the payback period for each project. |Time of Cash Flow |Nano Test Tubes |Microsurgery Kit | |Investment |−$11‚000.00 |−$11‚000.00
Premium Net present value
In my opinion Emperor Yuan is far-sighted and wise but‚ foolish at the same time. He strives to do what’s best for the future of he’s dominion. “Who is to say that some day just such a man‚ in just such an apparatus of paper and reed‚ might not fly in the sky and drop huge stones upon the Great Wall of China?” said the Emperor. The shows us that Emperor Yuan is far-sight‚ the fact that he cares about the future of his town‚ demonstrates to us that he wants a safe environment for the future generations
Premium World War II Nuclear weapon Atomic bombings of Hiroshima and Nagasaki
In order to decide on an IPO price‚ we must look at the current financial position of the company‚ as well as make projections for possible future scenarios. From the data given‚ we know that Prairie Home Stores (PHS) has a current book value of $80‚000‚000. With 400‚000 outstanding shares‚ the book equity per share is $200. There are two possible paths for future performance to consider. The first‚ a constant growth scenario‚ assumes that PHS will continue on its current trajectory of paying
Premium Stock market Dividend yield Dividend
1. What appears to be the problem areas in the Hobby Horse Company? The problem with Hobby Horse Company is that they were having a tough year throughout 2011. The company has $45 million loan that is due at the end of September‚ however the company does not have the means to cover the cost of the loan. Looking at the financial statement the company has fairly high leverage where their equity is not as strong. In addition‚ their current assets don’t cover current liabilities—meaning that the company
Premium Debt Financial ratios Money
these royalties are paid in yen. Financial Situation Exhibit 1 shows the Income Statement and Exhibit 2 shows the assets and borrowings of The Walt Disney Co.‚ (year ended September 30‚ in thousands‚ except per share data). Figure 1: Overall financial development Some facts affecting the Income Statement in the year 1984: * Consolidated Revenues for the Walt Disney Company and its
Premium Foreign exchange market The Walt Disney Company Walt Disney
Internet Mini Case #2 Tech Data Corporation Maryanne M. Rouse The Company TECH DATA CORPORATION’S (TECD) AGGRESSIVE GROWTH HAD TAKEN THE COMPANY from 10 employees and $2 million in sales in 1983 to approximately 8‚000 employees and $15.7 billion in sales for fiscal 2002 (fiscal year ended January 31‚ 2003) and secured the company’s position as a leading distributor of information technology (IT)‚ logistics management‚ and other value-added services to “solution providers‚” including value-added
Premium Customer service Strategic management Logistics
“The Yuan Goes Global” 1) How does the Chinese government limit the use of the Chinese currency‚ the RMB‚ on the global currency markets? Through the settlement of trade transactions‚ Chinese government can limit the use of currency on global currency markets. In the past‚ US dollars was the denominator of Chinese exports that back in 2009 there were only 1% of the $1.2 trillion Chinese exports were denominated in RMB while in 2011 the percentage had risen to 7%. This shows the Chinese government
Premium Foreign exchange market Currency United States dollar
and compassion.” (Yen Mah xii). Later in Adeline Yen Mah’s life‚ she learned that she could turn all of her hurt and abuse into bravery. In her childhood‚ Adeline was unwanted and lonely. Adeline was mostly lonely at home. Adeline’s self esteem was very low‚ and she even wrote down the word “nothing” as what her best quality was. Being an unwanted child certainly played a role in her low self esteem. For example‚ “I’m afraid I’ve forgotten your Chinese name. Is it Jun-quing?” (Yen Mah 124). To begin
Premium Family English-language films Chinese Cinderella