PAGE 1: 1. (TCO D) Return on investment (ROI) is equal to the margin multiplied by (Points : 5) Ans: turnover (b) 2. (TCO D) Given the following data‚ what would ROI be? Ans: 20% (b) 3. (TCO D) Last year‚ the House of Orange had sales of $826‚650‚ net operating income of $81‚000‚ and operating assets of $84‚000 at the beginning of the year and $90‚000 at the end of the year. What was the company’s turnover‚ rounded to the nearest tenth? (Points : 5) Ans: 9.5 (a) Page 2: 1. (TCO D)
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ACG 6425 Case 22-4 Abstract Enager Industries‚ Inc. 1. McNeil’s new product proposal was rejected because the project was projected to make a return (using ROA - $130‚000 EBIT sales and total projected asset investment of $1‚000‚000) of 13%. While this exceeds Hubbard’s original goal for each division of earning a 12% return on assets‚ it does not meet the 15% goal set by Hubbard for all new investments. According to CNN Money‚ the industry average ROA for Household and Personal Products
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Assume that initial LIBOR is set at 2.51% and is fixed for three months (through February 2009)‚ beginning the swap date (November 5‚ 2008). Be sure to take into account the 2% haircut on the repo. KTC is a fixed rate leg/payer and as that it pays fixed and receive floating rates. Moreover‚ KTC purchased a U.S. treasury bond of the same maturity and financed it with an overnight repo. Thus‚ the initial transactions should include the swap agreement which initially costs nothing and the purchased
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in the form of financial statements‚ so costs affect net profit of the company. In deciding whether to lease or purchase of the machine it is necessary to learn what each option‚ and the cash flows of the parameters to select will give the highest return of investment-related cash flow. Net present value (NPV) is used to decide whether to buy or lease of machines‚ and represents the cash flow associated with each option’s spreadsheet model to help. Here is the information considered by the management
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COMPUTER ASSIGNMENT FINS2624 Session 1‚ 2012 Instructions Please read these instructions carefully before you start. Groups You may cooperate on this assignment in groups consisting of up to three students. If you prefer to work alone or with only one other student that is fine‚ too. Either way‚ make sure to enter the student IDs (including the letter) and names of all students in your group in the appropriate cells (B1:B6) on the Answers sheet. There will be draconian punishments for
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management involves studying the intricacies of the brand‚ identifying the target audience‚ devising the event concept‚ planning the logistics and coordinating the technical aspects before actually launching the event. Post-event analysis and ensuring a return on investment have become significant drivers for the event industry.[1] The recent growth of festivals and events as an industry around the world means that the management can no longer be ad hoc. Events and festivals‚ such as the Asian Games‚ have
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time. A secondary market is a subsequent trading of previously issued securities” (Mayo‚ 2012). Risk-return trade-off: risk is the analysis of the propensity for a “possible loss” or on the company’s investments verses the anticipation that the return will benefit the company (Mayo‚ 2012). Futhermore‚ the company will not take on additional risk unless the end result will be additional return. (chp4‚ Mayo‚ 2012) Agency (principal and agent problems): “Financial markets and intermediaries borrow
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On the other hand she gets a steady income at the rate of 13% per annum. 2. Ray Cahn‚ who is currently a commodities broker‚ is also considering an investment‚ although he believes that there is only an 11% chance of success. What do you recommend? Since‚ Ray Cahn believes that there is only 11 percent of success‚ in case of preferred stocks his expected returns is 11% X 4 = 44% plus 50% = 94%. In case of common stocks his expected returns is only 88%. So‚ Ray Cahn should go in for corporate
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to Ogilvie (2002) the practice of establishing a specialist treasury function in the finance department can be traced back to the late 1960s. Technological developments‚ the breakdown of exchange controls and increasingly volatile interest rates and exchange rates‚ combined with the globalisation of business‚ have all created greater opportunities and risks for businesses over the past three decades. To survive in today’s complex financial environment‚ businesses must be able to manage both their ability
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assumptions. First‚ assume that Ocean Carriers is a U.S. firm subject to a 35% statutory (and effective) marginal tax rate. Second‚ assume that Ocean Carriers is domiciled in Hong Kong for tax purposes‚ where ship owners are not required to pay any tax on profits made overseas and are also exempted from paying any tax on profit made on cargo uplifted from Hong Kong‚ i.e.‚ assume a zero tax rate. The investment is not viable from the finance perspective. According to the analysis‚ Linn should not
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