BADM 746: Test 2 Name: Student ID: Instructions: There are three parts in this paper. 1st part is worth 30%‚ 2nd part is worth 30% and 3rd part is worth 40% of all points in this test. Answer all the questions in each part to get full credit. Part I: Multiple choice questions Each question is worth 3 points. Please choose the best option that answers the question. 1. A conservative current operating asset financing approach will result in permanent current assets and some seasonal current
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ASSIGNMENT ON SUB: PROJECT APPRAISAL AND FINANCE ON M/s. BAHUBALI FERRO ALLOY LTD. (BFAL) UNDER THE GUIDENCE OF LECTURERS OF STATE BANK OF INDIA SUBMITTED BY Presented By Anil Kumar 10EM01 Chandan Singh 10EM04 Gulshan Kumar 10EM07 Harsh Gupta 10EM08 Sambit Gantayat 10EM15 Contents. 1)Basic information about the project. 2)Due diligence of the project 3)Calculation of various ratio
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110 14.878 D/A 744 1.078 2.097 3.260 3.098 Exh 5 Capital Expenditure -1.797 -2.619 -3.000 -3.500 -4.250 Exh 5 Net Working Capital -69 -1.521 661 -363 -167 Exh 5 FCF 4.181 4.554 8.690 10.507 13.559 Terminal Value 691.796 *13.599/(WACC-GrowthRate) Summe 705.355 Present Value 4.181 4.238 7.525 8.467 528.908 *Firm Free CF/ (1+WACC)^t DCF 553.318 Current Risk Free Rate 4‚15% Market Risk Premium 6‚50% CAPM Cost of Capital 8‚75% Cost of Dept 6‚00% Discount Rate 14‚75% βA (βU
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| | | |Accruals are "free" in the sense that no explicit interest is paid on these funds. | | | |A conservative approach to working capital management will result in most if not all permanent current operating assets being | | | |financed with long-term capital. | | | |The risk to a firm that borrows with short-term credit is usually greater
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Krispy Kreme DoughnutsQuestion 1: Analysts are predicting that Krispy Kreme will be able to perform highly effectively andcontinue to grow rapidly in the coming two years. Do you agree with their analysis? If so‚ why? If not‚why not? Key factors underlying growth: 1.Brand based on high quality product‚ highly differentiated products‚ high-volume production2.Fragmented (regional) competition with less brand recognition3.Strong opportunities to extend network of stores geographically.4.Great steps
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Chapter 18 Working Capital Management 18-1. As was done in Checkpoint 18.1 in the text‚ we can evaluate Deere & Co.’s liquidity using net working capital and the current ratio. Net working capital is simply the difference between current assets and current liabilities‚ while the current ratio can be found as (using 2008 as an example): current assets current ratio = current liabilities $9‚197‚400 = = 0.61. $15‚083‚300 Since Deere’s current ratio is less than 1‚ its current
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will be penalised by a deduction of 20% for each day late (or part thereof). Any late assignment should be submitted to the subject coordinator directly. Format: A written submission is required from each group of students‚ showing all relevant working and formulae. Nature: 1).This is a group assignment. Each group will consist of up to three students and each group will submit one joint report. Group members are expected to actively discuss and work among themselves but not refer to the work of
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SCHNEIDER - SQUARE D Strategic Rationale for a Combination of Schneider and Square D (1) 1. Historically‚ the industry has been segmented by country or by region. Barriers to entry in these different markets have been perpetuated by:- Fragmentation Differences in standards across countries and regions; Costs of R&D for new products and costs of translating technologies for different regional standards; Proprietary distribution networks; 2. Industry trends point towards increased globalization
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of non-payment from customers. In terms of where the cash they have made is going‚ we must look at how they are distributing their cash flow. Most cash was invested back into the business itself to build capital. It seems as if every dollar of profit was put towards more net working capital. Recommendation: Increasing the payable days or lowering the day’s receivable outstanding would reduce the cash conversion cycle. Although it is important to invest cash back into the company for growth
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increase by 3‚240‚000 per year for seven years. When analyzing their required net working capital‚ capital spending and operating cash flow over these 7 years‚ their NPV is positive at $6‚480‚747.29. Based on these projections adding the line of gold clubs is an acceptable project for the company. The internal rate of return is greater than 14%‚ it works out to be 28%‚ indicating that the project is acceptable. As capital rises‚ NPV will falls‚ this will also decrease IRR in turn. To give an example
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