After successfully completing your corporate finance class, you feel the next challenge ahead is to serve on the board of directors of Cornwall Enterprises. Unfortunately, you will be the only person-voting for you. If the company has 440,000 shares outstanding, and the stock currently sells for $53, how much will it cost you to buy a seat if the company uses straight voting? (Do not round intermediate calculations.) Total cost

After successfully completing your corporate finance class, you feel the next challenge ahead is to serve on the board of directors of Cornwall Enterprises. Unfortunately, you will be the only person-voting for you. If the company has 440,000 shares outstanding, and the stock currently sells for $53, how much will it cost you to buy a seat if the company uses straight voting? (Do not round intermediate calculations.) Total cost

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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1- Assume that you are appointed as a finance manager of a FMCG company. How you will design the capital structure of the company if company needs to raise capital from $100,000 to $10,00,000 with the mix of Equity and Debt. Determine the EPS in each case and evaluate the best possible actions for the company 2- During the production process if company needs to raise $ 300,000 more capital then which option suits to company? Through Debt or Equity? Can please someone help me solve this? I dont really know how and my assignment due date is after three hours? please someone help?
The analysis that we have to provide is as follows: Review the specifics of the IPO, including underwriting spread and other expenses. Consider the concept of underpricing and a higher than normal first day spike in stock price. What does this mean for the issuing company? What does this mean for the underwriter? The Mini Case we have to go off of is: Mutt.Com was founded in 2015 by two graduates of the University of Wisconsin with help from Georgina Sloberg, who had built up an enviable reputation for backing new start-up businesses. Mutt.Com's user-friendly system was designed to find buyers for unwanted pets. Within 3 years, the company was generating revenues of $3.4 million a year and, despite racking up sizable losses, was regarded by investors as one of the hottest new e-commerce businesses. Therefore, the news that the company was preparing to go public generated considerable excitement. The company's entire equity capital of 1.5 million shares was owned by the two founders…
John Tye has just been hired as the new corporate finance analyst at I-Ell Enterprises and has received his first assignment. John is to take the $25 million in cash received from a recent divestiture and use part of these proceeds to retire an outstanding $10 million bond issue and the remainder to repurchase common stock. However, the bond issue cannot be retired for another two years. If John can place the funds necessary to retire this $10 million debt into an account earning 6 percent compounded monthly,how much of the $25 million remains to repurchase stock?
After learning how to value a stock in his Corporate Finance class, Mark Stark decided to put his knowledge into practice and use the constant growth rate model to value El Tomate Feliz Co. He found that the company was severely undervalued. The stock was trading at $50 per share, but he valued it at $120 per share. Mark complained: “I thought that El Tomate Feliz was a steal and bought as many shares as I could, but the price didn’t go up. I have waited a year, and the price has not changed that much.” Lower necessary rate of return - Mark would have estimated his cost of equity or required rate of return at lower levels, resulting in better intrinsic values as a result of the lower discount rate. What does this mean,” …Mark would have estimated his cost of equity or required rate of return at lower levels"
Nikul
You are considering a position as the director of finance in a company listed on the Lusaka Securities Exchange Plc. Since the firm is still new, the salary is not that great but your package will include call options on 5,000 shares of the company. The shares are currently selling for K5 per share. The call options granted to you if you accept the job have an exercise price of K5 and expire in three years. The call options cannot be exercised before maturity. The stock volatility is 28% and the three-year risk free rate is 3.6%.A call with a strike price of K30 costs K3. Required: Calculate the value of the call option.
Assume you have just been hired as a business manager of PizzaPalace, a regional pizza restaurant chain. The company’s EBIT was $120 million last year and is not expected to grow. PizzaPalace is in the 25% state-plus-federal tax bracket, the risk-free rate is 6 percent, and the market risk premium is 6 percent. The firm is currently financed with all equity, and it has 10 million shares outstanding. When you took your corporate finance course, your instructor stated that most firms’ owners would be financially better off if the firms used some debt. When you suggested this to your new boss, he encouraged you to pursue the idea. If the company were to recapitalize, then debt would be issued, and the funds received would be used to repurchase stock. As a first step, assume that you obtained from the firm’s investment banker the following estimated costs of debt for the firm at different capital structures: Percent Financed with Debt, Wd Rd 0% 20% 8.0% 30% 8.5% 40% 10.0%…
Give typing answer with explanation and conclusion 1. To incentivize our employees, we are considering issuing them employee equity. The average employee would be issued stock options to purchase 800 shares at our current stock price of $210 per share. We are hopeful that the Smoothie business will catapult us to $230 per share in the future but recognize the risks. If an employee exercises the options at $210 per share, how much would the employee make before taxes?
You are very optimistic about the personal computer industry, so you buy 200 shares of Microtech Inc. at $45 per share. You are very pessimistic about the machine tool industry, so you sell short 300 shares of King Tools Corporation at $55. Each transaction requires a 40 percent margin balance. a. What is the initial equity in your account? b. Assume the price of each stock is as follows for the next three months (month-end). Compute the equity balance in your account for each month: Month Microtech Inc. King Tools Corp. October $51 $48 November 39 62 December 37 40
Assume that you are consulting the board of directors for a start-up firm. The firm is expecting small profits and possible losses in the next couple of years, but significant growth over the next 10 years. They have asked your opinion on a dividend policy for the firm. In your initial post, provide your opinion on a dividend policy along with reasoning using terminology and business factors discussed in this module.
Sydney Rangers Inc operates remote parking lots near major airports. The board of directors of this family-owned company believes that Sydney Rangers could earn an additional $2 million income before interest and taxes by expanding into new markets. However, the $5 million that the business needs for growth cannot be raised within the family. The directors, who strongly wish to retain family control of the company, must consider issuing securities to outsiders.Sydney Rangers’s Plan 1 is to borrow at 6%. Plan 2 is to issue 100,000 common shares. Plan 3 is to issue 100,000 non-voting, $3.75 preferred shares ( $3.75 is the annual dividend paid on each preferred share).Sydney Rangers currently has net income of $3.5 million and 1 million common shares outstanding. The company’s income tax rate is 25%.Requirements:1. Prepare an analysis to determine which plan will result in the highest earning per common share.2. Recommend one plan to the board of directors. Explain your reasons.
Complete all the parts pls or skip.

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