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Assume that you have been hired as a consultant by CGT, a major producer of chemicals and plastics, including plastic grocery bags, styrofoam cups, and fertilizers, to estimate the firm's weighted average cost of capital. The balance sheet and some other information are provided below. Assets Current Assets Net, plant, property, and equipment Total assets $ $ $ Liabilities and Equity Accounts payable Accruals Current Liabilities Long-term debt (40,000 bonds, $1,000 par valu $ Total liabilities $ Common stock (10,000,000 shares) $ Retained earnings Total shareholders equity Total liabilities and shareholder's equity $ $ $ $ $ $ 38,000,000 101,000,000 139,000,000 10,000,000 9,000,000 19,000,000 40,000,000 59,000,000 30,000,000 50,000,000 80,000,000 139,000,000 The Stock is currently selling $15.25 per share, and its noncallable $1000 par value, 20 year, 7.25% bonds semiannual payments are selling for $875. The beta is 1.25, the yield on a 6-month treasury bill is 3.50% and the yield on a…

You are a researcher and an investment advisor with an investment bank. Your company is planning to develop its own financial statement analysis to track the performance of its portfolios in a particular listed company in the Ghana Stock exchange. So far, the company has portfolios which consist of the equities of companies in the following sectors of the economy ⚫ Financial - Manufacturing The manufacturing category includes all companies that are non- financial. You have been asked to calculate financial ratios for a five-year period of the chosen company based on the following: Profitability ratios > Efficiency/Activity Ratios Liquidity Ratio Financial Leverage/Debt Rations > Investment/Market Ratios You are required to prepare a report for the company. The report should have the following features: (a) Beautiful back-page with appropriate title (b) Executive Summary (c) Table of Content (d) Introduction in terms of what the document is about The introduction should talk about the…

3. Corporate finance, capital markets, and investments Finance professionals make decisions that fall into three distinctive areas: corporate finance, capital markets, and investments. Below is a set of decisions made by finance professionals. Categorize the decisions according to the area of finance to which they belong. Capital Corporate Finance Decision Markets Investments Radford is a small company that manufactures automobile bearings. Managers at the company must make decisions on the kind and the cost of equipment to buy. Jackson works for an investment bank and makes decisions about the sale of new common stock by ABCL Inc. Tyler works for a financial advising firm. He must create a financial plan and come up with a list of securities in which his client can invest. Tyler must make decisions regarding the investments that he should recommend to his clients to include in their portfolio.

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You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year Assets     Current assets:     Cash $ 870,000 $ 1,110,000 Marketable securities 0 300,000 Accounts receivable, net 2,340,000 1,440,000 Inventory 3,510,000 2,100,000 Prepaid expenses 240,000 180,000 Total current assets 6,960,000 5,130,000 Plant and equipment, net 9,340,000 8,960,000 Total assets $ 16,300,000 $ 14,090,000 Liabilities and Stockholders' Equity     Liabilities:     Current liabilities $ 3,920,000 $ 2,800,000 Note payable, 10% 3,600,000 3,000,000 Total liabilities 7,520,000 5,800,000 Stockholders' equity:     Common stock, $70 par value…

You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year Assets     Current assets:     Cash $ 870,000 $ 1,110,000 Marketable securities 0 300,000 Accounts receivable, net 2,340,000 1,440,000 Inventory 3,510,000 2,100,000 Prepaid expenses 240,000 180,000 Total current assets 6,960,000 5,130,000 Plant and equipment, net 9,340,000 8,960,000 Total assets $ 16,300,000 $ 14,090,000 Liabilities and Stockholders' Equity     Liabilities:     Current liabilities $ 3,920,000 $ 2,800,000 Note payable, 10% 3,600,000 3,000,000 Total liabilities 7,520,000 5,800,000 Stockholders' equity:     Common stock, $70 par value…

You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year Assets     Current assets:     Cash $ 870,000 $ 1,110,000 Marketable securities 0 300,000 Accounts receivable, net 2,340,000 1,440,000 Inventory 3,510,000 2,100,000 Prepaid expenses 240,000 180,000 Total current assets 6,960,000 5,130,000 Plant and equipment, net 9,340,000 8,960,000 Total assets $ 16,300,000 $ 14,090,000 Liabilities and Stockholders' Equity     Liabilities:     Current liabilities $ 3,920,000 $ 2,800,000 Note payable, 10% 3,600,000 3,000,000 Total liabilities 7,520,000 5,800,000 Stockholders' equity:     Common stock, $70 par value…

1. Assume that you have been hired as a consultant by CGT, a major producer of chemicals and plastics, including plastic grocery bags, styrofoam cups, and fertilizers, to estimate the firm's weighted average cost of capital. The balance sheet and some other information are provided below. Assets Current assets $ 38,000,000 Net plant, property, and equipment 101,000,000 Total assets $139,000,000 Liabilities and Equity Accounts payable $ 10,000,000 Accruals 9,000,000 Current liabilities $ 19,000,000 Long - term debt (40, 000 bonds, $1,000 par value) 40,000,000 Total liabilities $ 59,000,000 Common stock (10,000,000 shares) 30, 000, 000 Retained earnings 50, 000, 000 Total shareholders' equity 80,000,000 Total liabilities and shareholders' equity $139, 000, 000 The stock is currently selling for $15.25 per share, and its noncallable $1,000 par value, 20 - year, 7.25% bonds with semiannual payments are selling for $ 875.00. The beta is 1.25, the yield on a 6-month Treasury bill is 3.50%,…

Required information [The following information applies to the questions displayed below.] You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company's financial statements, including comparing Lydex's performance to its major competitors. The company's financial statements for the last two years are as follows: Lydex Company Comparative Balance Sheet This Year Last Year Assets Current assets: Cash Marketable securities Accounts receivable, net Inventory Prepaid expense Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Note payable, 10% Total liabilities Stockholders' equity: Common stock, $70 par value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Lydex Company $ 910,000 0 2,500,000 3,550,000 250,000 7,210,000 9,420,000 $ 16,630,000 $ 1,150,000…

You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year Assets     Current assets:     Cash $ 890,000 $ 1,020,000 Marketable securities 0 300,000 Accounts receivable, net 2,420,000 1,520,000 Inventory 3,530,000 2,300,000 Prepaid expenses 240,000 180,000 Total current assets 7,080,000 5,320,000 Plant and equipment, net 9,380,000 8,980,000 Total assets $ 16,460,000 $ 14,300,000 Liabilities and Stockholders' Equity     Liabilities:     Current liabilities $ 3,960,000 $ 2,860,000 Note payable, 10% 3,620,000 3,020,000 Total liabilities 7,580,000 5,880,000 Stockholders' equity:     Common stock, $70 par value…

You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year Assets     Current assets:     Cash $ 980,000 $ 1,220,000 Marketable securities 0 300,000 Accounts receivable, net 2,780,000 1,880,000 Inventory 3,620,000 2,200,000 Prepaid expenses 260,000 200,000 Total current assets 7,640,000 5,800,000 Plant and equipment, net 9,560,000 9,070,000 Total assets $ 17,200,000 $ 14,870,000 Liabilities and Stockholders' Equity     Liabilities:     Current liabilities $ 4,030,000 $ 3,020,000 Note payable, 10% 3,680,000 3,080,000 Total liabilities 7,710,000 6,100,000 Stockholders' equity:     Common stock, $75 par value…

CASE INFORMATION RK Corp, a publically traded NASDAQ company (symbol ARK), is a manufacturer of electrical automobiles. Based in Chicago, the company has been operating since 1996. The company sells their electric automobiles to auto manufacturers as well as the retail market on a worldwide basis. Its major clients are Ford, General Motors and Toyota. Ark has captured about 10 percent of the world market of the electrical automobile sales. Its stock sells at 25 US Dollars per share, and its 52-week price range is between 19.75 and 27.15 US Dollars, with a market cap of 10.6 billion dollars. Their financial statements presented below for the year ending December 31, 2011 has been prepared using GAAP (Tables 1 and Table 2). The controller would like to see the effect of IFRS treatment of leases on the financial statements, and you have been assigned this task. In particular, the controller would like to see the impact GAAP and IFRS differences have on balance sheet, income statement and…

CASE INFORMATION RK Corp, a publically traded NASDAQ company (symbol ARK), is a manufacturer of electrical automobiles. Based in Chicago, the company has been operating since 1996. The company sells their electric automobiles to auto manufacturers as well as the retail market on a worldwide basis. Its major clients are Ford, General Motors and Toyota. Ark has captured about 10 percent of the world market of the electrical automobile sales. Its stock sells at 25 US Dollars per share, and its 52-week price range is between 19.75 and 27.15 US Dollars, with a market cap of 10.6 billion dollars. Their financial statements presented below for the year ending December 31, 2011 has been prepared using GAAP (Tables 1 and Table 2). The controller would like to see the effect of IFRS treatment of leases on the financial statements, and you have been assigned this task. In particular, the controller would like to see the impact GAAP and IFRS differences have on balance sheet, income statement and…

You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows: Lydex CompanyComparative Balance Sheet   This Year Last Year Assets     Current assets:     Cash $ 960,000 $ 1,260,000 Marketable securities 0 300,000 Accounts receivable, net 2,700,000 1,800,000 Inventory 3,900,000 2,400,000 Prepaid expenses 240,000 180,000 Total current assets 7,800,000 5,940,000 Plant and equipment, net 9,300,000 8,940,000 Total assets $ 17,100,000 $ 14,880,000 Liabilities and Stockholders' Equity     Liabilities:     Current liabilities $ 3,900,000 $ 2,760,000 Note payable, 10% 3,600,000 3,000,000 Total liabilities 7,500,000 5,760,000 Stockholders' equity:     Common stock, $78 par value…

Green Leaf Limited is an IT company operating in Ghana. The main business of Green Leaf is assembling of personal computer from components that are imported from India and China. Recently, the company has expanded its business activities to include the assembling of smartphones. Its shares are actively traded on the Ghana Stock Exchange. The beta of Green Leaf Company Limited’s equity is 20% higher than the beta of the whole market. The company’s current debt-to-equity ratio is 50%. Green Leaf’s management has projected income statements for the next four fiscal years. These projections are given in the table below. In addition, Green Leaf’s management plans to have capital expenditures and changes of net working capital in the coming four fiscal years as stated in the second table. Green Leaf’s outstanding debt is risk-free. Risk free rate of return is 3% p.a. and the stock market is expected to earn a 12% return p.a. corporate tax is 30%.  The management assumes that Green Leaf’s…

Green Leaf Limited is an IT company operating in Ghana. The main business of Green Leaf is assembling of personal computer from components that are imported from India and China. Recently, the company has expanded its business activities to include the assembling of smartphones. Its shares are actively traded on the Ghana Stock Exchange. The beta of Green Leaf Company Limited’s equity is 20% higher than the beta of the whole market. The company’s current debt-to-equity ratio is 50%. Green Leaf’s management has projected income statements for the next four fiscal years. These projections are given in the table below. In addition, Green Leaf’s management plans to have capital expenditures and changes of net working capital in the coming four fiscal years as stated in the second table. Green Leaf’s outstanding debt is risk-free. Risk free rate of return is 3% p.a. and the stock market is expected to earn a 12% return p.a. corporate tax is 30%.  The management assumes that Green Leaf’s…

You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year Assets         Current assets:         Cash $ 910,000 $ 1,150,000 Marketable securities   0   300,000 Accounts receivable, net   2,500,000   1,600,000 Inventory   3,550,000   2,000,000 Prepaid expenses   250,000   190,000 Total current assets   7,210,000   5,240,000 Plant and equipment, net   9,420,000   9,000,000 Total assets $ 16,630,000 $ 14,240,000 Liabilities and Stockholders' Equity         Liabilities:         Current liabilities $ 3,960,000 $ 2,880,000 Note payable, 10%   3,640,000   3,040,000 Total liabilities   7,600,000   5,920,000…

Metallica Heavy Metal Mining Corporation wants to diversify its operations. Some recent financials information on the company is listed below: Stock Price $73 # of Shares 40,000 Total Assets $ 7,600,000 Total Liabilities $2,200,000 Net Income $440,000 The company is considering an investment that has the same PE Ratio as the firm. The cost of investment is $800,000 and it will be financed with a new equity issue. The return on investment will equal the company's current ROE. Current Book Value Per Share $135.00 New Book Value Per Share $121.30 Current market To Books .5407 New Market to Books .5409 Current EPS $11.00 New EPS $9.89 What is the NPV of the investment? If negative please note with minus sign and be rounded to nearest who dollar.

Hi-Lo Corporation is a publicly traded manufacturing company with a global presence. The company produces a range of consumer electronics and has a history of meeting or exceeding earnings expectations. The current financial year has been challenging due to increased competition, rising production costs, and fluctuations in currency exchange rates. Earnings Pressures and Executive Incentives 1. Earnings Expectations: As the end of the fiscal year approaches, High-Lo Corporation is facing pressure to meet market expectations for earnings per share (EPS). Analysts and investors have set high expectations for the company based on previous years' performance. 2. Executive Compensation Structure: The executive compensation structure at High-Lo Corporation includes significant bonuses tied to achieving specific financial targets, including meeting or exceeding earnings projections. Executives, including the CFO and CEO, are aware that their bonuses are directly linked to the reported…

Lease Case RK Corp, a publically traded NASDAQ company (symbol ARK), is a manufacturer of electrical automobiles. Based in Chicago, the company has been operating since 1996. The company sells their electric automobiles to auto manufacturers as well as the retail market on a worldwide basis. Its major clients are Ford, General Motors and Toyota. Ark has captured about 10 percent of the world market of the electrical automobile sales. Its stock sells at 25 US Dollars per share, and its 52-week price range is between 19.75 and 27.15 US Dollars, with a market cap of 10.6 billion dollars. Their financial statements presented below for the year ending December 31, 2011 has been prepared using GAAP (Tables 1 and Table 2). The controller would like to see the effect of IFRS treatment of leases on the financial statements, and you have been assigned this task. In particular, the controller would like to see the impact GAAP and IFRS differences have on balance sheet, income statement and…

Finance professionals make decisions that fall into three distinctive areas: corporate finance, capital markets, and investments. Below is a set of decisions made by finance professionals. Categorize the decisions according to the area of finance to which they belong. Decision Corporate Finance Capital Markets Investments Ethan must make a decision on how to cut costs so that his company can generate extra cash flow to acquire assets.         Radford works for an investment bank and makes decisions about the sale of new common stock by ABCL Inc.         Aakash works for a financial advising firm. He must create a financial plan and come up with a list of securities in which his client can invest. Aakash must make decisions regarding the investments that he should recommend to his clients to include in their portfolio.

Please answer the following requirements on this general accounting question

[The following information applies to the questions displayed below.]   You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company’s financial statements, including comparing Lydex’s performance to its major competitors. The company’s financial statements for the last two years are as follows:   Lydex CompanyComparative Balance Sheet   This Year Last Year   Assets           Current assets:              Cash $ 1,010,000     $ 1,250,000          Marketable securities   0       300,000          Accounts receivable, net   2,900,000       2,000,000          Inventory   3,650,000       2,000,000          Prepaid expenses   270,000       210,000                 Total current assets   7,830,000       5,760,000       Plant and equipment, net   9,620,000       9,100,000                 Total assets $ 17,450,000     $…

Exercise 11-5 (Static) Identify information used in an investment decision Look forward to the day when you will have accumulated $5,000, and assume that you have decided to invest that hard-earned money in the common stock of a publicly owned corporation.Required: What data about that company will you be most interested in? How will you arrange those data so they are most meaningful to you? What information about the company will you want on a weekly basis, on a quarterly basis, and on an annual basis? How will you decide whether to sell, hold, or buy some more of the firm's stock?

Imagine this Scenario:You are the CFO of the union representing a small manufacturer. You think that the company is making a large profit, and you would like to see your union members profit from their hard work. What will you look for in the financial statements to determine whether or not you should ask for a raise?

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