100/(1+.14)1 + 5‚100/(1+.14)2 + 5‚100/(1+.14)3 + 5‚100/(1+.14)4 + 5‚100/(1+.14)5 = -17‚100 + 4‚473.68421 + 3‚924.2844 + 3‚442.36403 + 3‚019.6097 + 2‚648.78649 = $408.73 In excel with same cash flows as above‚ IRR = 15% MIRR – using same cash flows as values and .14 as reinvestment rate‚ MIRR = 14.54% Accept. PULLEY – -22‚430 + 7‚500/(1+.14)1 + 7‚500/(1+.14)2 + 7‚500/(1+.14)3 + 7‚500/(1+.14)4 +
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Case Solutions Corporate Finance Ross‚ Westerfield‚ and Jaffe 9th edition CHAPTER 2 CASH FLOWS AT WARF COMPUTERS The operating cash flow for the company is: (NOTE: All numbers are in thousands of dollars) OCF = EBIT + Depreciation – Current taxes OCF = $1‚332 + 159 – 386 OCF = $1‚105 To calculate the cash flow from assets‚ we need to find the capital spending and change in net working capital. The capital spending for the year was: | |Capital spending
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EBay Case Analysis Step One: Read. Step 2: Dupont Ratio and Financial Analysis o Two year Financial Ratio o Short Term o Current Ratio 2002: 1‚468‚458/386‚224= 3.8 2001= 4.9 o Long Term o Total Debt Ratio Total ass. Total equity/ Total ass. 2002= .1377 2001= .1485771 o Asset Utilization‚ or turnover ratios o Total Asset Turnover Sales/ total assets 2002= .29 2001= o Profitability o Return on assets= net income/ total assets o 2002= .0117 o 2001= .053885
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1. What are the greatest opportunities and threats existing in eBay’s current external environment? In the current external environment the online sales are still a growth industry there are some opportunities for ebay‚ the actual global economic crisis it could be an opportunity due the unemployment and the decrease in the power purchasing parity and mortgage crisis generates two effects‚ first the buyers are look for discounts‚ and second the sellers by this channel could increases. The importance
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of corporate finance (European edition) by David Hillier Quartile 4 IBA Chapter 1 - 14 Chapter 1 Introduction to corporate finance 1.1 Corporate finance and the financial manager Corporate finance must be considered with three basic types of question: 1. What long-term investments to make 2. Where will we get the money for those investments from 3. How will we manage everyday financial activities 1. What long-term investment to make: To process of planning and managing long-term
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[pic] ADM 3350 M Winter 2010 CORPORATE FINANCE ANSWER KEY MIDTERM EXAMINATION – February 10th‚ 2010 Professor: Kaouthar LAJILI‚ PhD.‚ CGA Duration: 1 hour and 30 minutes | | | | |INSTRUCTIONS | | |
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initial market value of the unlevered equity? c. a. Suppose the initial $100‚000 is instead raised by borrowing at the risk-free interest rate. What are the cash flows of the levered equity‚ and what is its initial value according to MM? E ⎡C (1)⎤ = ⎣ ⎦ 1 (130‚ 000 + 180‚ 000) = 155‚ 000‚ 2 155‚ 000 NPV = − 100‚ 000 = 129‚167 − 100‚ 000 = $29‚167 1.20 155‚ 000 = 129‚167 1.20 b. c. Equity value = PV ( C (1)) = Debt payments = 100‚ 000‚ equity receives 20‚000 or 70‚000. Initial value‚ by MM‚ is
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Corporate Finance Revision List Topic | Study Program | The Realm of Corporate Finance and Efficient Market Hypothesis | * Overview of finance’s main functions & its importance to organisations. * Importance of value creation as the primary objective of managers * Efficient Market Hypothesis (EMH) | Financial Statement Analysis | * Overview of calculating & interpreting accounting & financial ratios from corporate financial statements & understanding their significance in corporate
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[pic] School of Management Studies Finance Advanced Topics [BUS4083W] Corporate Finance Test 23 September 2010 Time Allocation: 120 minutes Total Mark Allocation: 90 marks Case Study: Anglo American On the 20th of February 2009‚ Anglo American announced that it would cut 11% of its work force and suspend its share buyback and dividend in the face of a poor economic outlook marked by "unprecedented" uncertainty. The miner said it was reducing its headcount by
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IMBA -FIN 6425 – Quiz 1 Corporate Finance - Solution– Nimalendran This is an individual quiz and you should submit the answers on-line by the scheduled date. You are allowed to use any resources EXCEPT help from any other person. You are allowed to use EXCEL for the calculations. 1. Barkley Credit Union sets a low annual percentage rate (5%) for all its credit card customers instead of basing the interest rates on the customers’ credit scores. Consequently Barkley is exposed to ______________
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