FNCE 3304-SampleFinalExam(1)

xlsx

School

Mount Royal University *

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Course

3304

Subject

Finance

Date

Jan 9, 2024

Type

xlsx

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Uploaded by GrandKnowledge6430

Instructions: Be sure to put your name on each sheet!!!! You have until 6:00pm to complete this Exam. You will be told at 5:45 to wrap up your work, save y check with the Professor to see that your solution was successfully submitted. Each problem is worth 25 points – the model is worth 18 of the points, the answers to the question problem is worth 7 points. You may use the excel functions and formula sheets that are given, however you may not u any other website, or Email or any type of instant messenger, cell phone or P electronic file other than this quiz file. If you do so, your exam will not be acc syllabus and MRU's policies on academic integrity will be followed. Simply open the exam workbook and IMMEDIATELY save your file to the desktop of the compute you have done this as you may lose your work when you finally go to submit the file at the end. Yo save multiple files since this will get confusing and you only have on shot at turning your file in. Simply build functional spreadsheets as instructed and answer the questions in the appropriate pla textbox for your answers if you run out of space but do not move the text box around the spreadsh Your model will be graded on functionality and how well the model is structured in terms of creativi robustness, You should also include the cell referencing and formulas wherever possible.

your file and to submit it to the examination dropbox. You may ns and any accompanying explanation on how you solved the use any on-line resources including our website or PDA's. You may not open any Excel, Word,or other cepted and the course policy as outlined in the er you are working on. DO NOT begin working on your exam until ou may want to save your file periodically just to be safe. Don't ace in textbox along with your explanation. You may resize the heet. ity, clarity/transparency/readability, use of excel feature and

Cramer Corp Notes Income Statement For the Year Ended Dec. 31, 2014 2012 2013 2014 Sales 3,432,000 3,850,000 Cost of Goods Sold 2,864,000 3,250,000 Gross Profit 568,000 Selling and G&A Expenses 240,000 330,300 Fixed Expenses 100,000 100,000 Depreciation Expense 18,900 20,000 EBIT 209,100 Interest Expense 62,500 76,000 Earnings Before Taxes 146,600 Taxes 0 Net Income 146,600 Balance Sheet #REF! Assets Cash and Equivalents 57,600 52,000 Accounts Receivable 351,200 402,000 Inventory 715,200 836,000 Total Current Assets Plant & Equipment 491,000 527,000 Accumulated Depreciation 146,200 Net Fixed Assets Total Assets Liabilities and Owner's Equity Accounts Payable 145,600 175,200 Short-term Notes Payable 200,000 225,000 Other Current Liabilities 136,000 140,000 Total Current Liabilities Long-term Debt 323,432 424,612 Total Liabilities Common Stock 460,000 460,000 Retained Earnings 203,768 225,988 Total Shareholder's Equity Total Liabilities and Owner's Equity

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Statement of Cash Flows #REF! Cash Flows from Operations Net Income Depreciation Expense Change in Accounts Receivable Change in Inventories Change in Accounts Payable Change in Other Current Liabilities Total Cash Flows from Operations Cash Flows from Investing Change in Plant & Equipment Total Cash Flows from Investing Cash Flows from Financing Change in Short-term Notes Payable Change in Long-term Debt Change in Common Stock Cash Dividends Paid to Shareholders Total Cash Flows from Financing Net Change in Cash Balance

Retirement Planning Average annual interest rate Amount allocated each year Retirement fund amounts Beginning End Total at end Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Year 16 Year 17 Year 18 Year 19 Year 20 . . . . .

Goal You are 30 years old and, in planning for your retire begin, you assume that you will need $40,000 in yo subsequent years at a 2% rate of inflation. You also point you will suffer a mysterious case of spontaneo You currently have $10,000 invested in a diversified to earn an average of 11% per year. All pre-retireme but after retirement, you will become very conserv will earn 4.5% per year. 1. Prepare a model for your retirement planning th 2. How much will you need at retirement to provide 3. What constant annual contributions need to be a 4. Using the table format given, show how your reti years. Chart this growth . (You may include additio Answers: 1. No Entry - your model will be evaluated for this s 2. 3. 4. No Entry - your model will be evaluated for this s

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ement, you must make some assumptions. To our first year of retirement which will grow in o expect that you will live till age 90 years at which ous combustion resulting in death. d portfolio of equity mutual funds, which you expect ent contributions will be invested in this portfolio, vative and shift it all to bond funds that you expect hat can adjust for different retirement ages. e the retirement income you desire? allocated to meet this goal? tirement account will grow in your pre-retirement onal columns to the table if you wish) step. step.

Name: Investment Portfolio Cash flows per dollar invested SP/TSX T-Bill Rate 12/3/2012 17.99 12.76 12433.5 1.13 11/1/2012 17.99 12.07 12239.4 1.1 10/1/2012 18.6 11.52 12422.9 1.08 9/4/2012 18.47 11.07 12317.5 1.1 8/1/2012 18.46 10.31 11949.3 1.16 7/3/2012 17.42 9.94 11664.7 0.98 6/1/2012 17.03 10.24 11596.6 1 5/1/2012 17.34 10.28 11513.2 1.1 4/2/2012 18.53 12.34 12292.7 1.42 3/1/2012 17.86 12.34 12392.2 1.19 2/1/2012 20.06 11.31 12644 1.12 1/3/2012 20.83 10.59 12452.2 1.03 12/1/2011 19.49 9.81 11955.1 0.95 11/1/2011 17.98 9.94 12204.1 1.01 10/3/2011 19.07 11.77 12252.1 1.09 9/1/2011 16.83 10.68 11623.8 0.95 8/2/2011 19.32 11.98 12768.7 1.12 7/4/2011 21.24 13.44 12945.6 1.47 6/1/2011 22.64 15.12 13300.9 1.55 5/2/2011 24.57 15.29 13802.9 1.57 4/1/2011 26.28 14.93 13944.8 1.74 3/1/2011 26.31 15.1 14116.1 1.72 2/1/2011 24.2 16.14 14136.5 1.69 1/4/2011 21.98 15.23 13552 1.64 12/1/2010 21.15 14.97 13443.2 1.68 11/1/2010 22.31 12.47 12952.9 1.7 10/1/2010 20.05 11.17 12676.2 1.43 9/1/2010 19.97 11.23 12368.7 1.42 8/3/2010 19.67 10.27 11913.9 1.21 7/2/2010 20.75 14 11713.4 1.55 6/1/2010 20.77 13.23 11294.4 1.45 5/3/2010 22.04 15.41 11763 1.44 4/1/2010 23.24 15.58 12210.7 1.89 3/1/2010 23.01 17.05 12037.7 1.63 2/1/2010 21.12 16.43 11629.6 1.19 1/4/2010 20.71 16.51 11094.3 1.21 12/1/2009 22.33 16.33 11746.1 1.41 Canadian Oil Sands Manulife Financial

1. Using the data provided, covariance and adjusted be (MFC). 2. Create a model that will a portfolio formed from the dollar value of the portfolio 3. Approximately what sha have a beta of 1.3? Answers: 1. 2. No Entry - your model w 3.

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, determine the expected (average) returns, variances, pairwise etas for Canadian Oilsands (COS) and and Maulife Financial show what the expected return, variance and beta will be from ese two stocks. The model should allow a user to choose the o and the portfolio weights. ares are needed of COS and MFC to make a 10,000 portfolio will be evaluated for this step.

NPV - Go/No Go Decision Depreciation Rate Tax Rate Discount rate Year 0 Year 1 Year 2 Year 3 Beginning UCC Depreciation (CCA) Ending UCC Cash Flow Analysis Year 0 Year 1 Year 2 Year 3 Income: Sales Less: cost of goods sold Gross Profit Less: Fixed Costs Less: depreciation EBIT Less taxes Net Income Add: depreciation Operating Cash flows Less: Cap.Ex. Cash flows Total NPV Decision? IRR Decision? Less: D NWC

Year 4 Year 5 Year 4 Year 5 Q-Corp has asked you to evaluate an investment project. This pr for the required equipment and an investment in additional net a marketing analysis related to this investment and from the ana increased Sales of $550,000/yr for 5 years, have COGS of 35% of 5 years. At that time, the equipment will be able to be salvaged The equipment is subject to a CCA rate of 40%, Q-Corp‘s cost of % 1. Prepare a Capital budgeting model to determine whether to a schedule. 2. What is the NPV and IRR of this project? Should it be accepte 3.What would the NPV be if Sales was increasing by 2% each yea 4. Conduct a sensitivity analysis showing how NPV changes as th Answers: 1. No Entry - your model will be evaluated for this step. 2. 3. 4. No Entry - your model will be evaluated for this step.

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roject will require an immediate capital expenditure of $650,000 working capital of $11,000. Q-Corp has already spent $45,000 on alysis it has determined that the project will generate expected f Sales and incur additional fixed expenses of $150,000/yr for the for $50,544. capital is 11%, and the company has a corporate tax rate of 350 accept the project or not. Be sure to include the depreciation ed? ar? his growth rate changes.