Business Finance Help for College and University Students

Economic Order Quantity

A large consulting firm orders photocopying paper by the carton. The firm pays $30 delivery charge on each order. The total cost of storing the paper, including forgone interest, storage space, and deterioration, comes to about $1.50 per carton per month. The firm uses 1,000 cartons of paper per month. See attached for fur ...continues

Trade credit and receivables

A firm offers terms of 2/15,net 30. Currently, two thirds of all customers take advantage of the trade discount; the raminder pay bills at the due date. A. What will be the firm's typical calue for its accounts recievable? B. What is the average investment in accounts receivable if annual sales are $20 million? C. Wh ...continues

Credit Policy

A firm currently makes only cash sales. It estimates that allowing trade credit on terms of net 30 would increase monthly sales from 200 to 220 units per month. The price per unit is $101 and the cos (in present value terms) is $80. The interest rate is 1 percent per month. A. Should the firm change its credit policy? ...continues

Cash Budget for Ritewell Publishers

The following data are from the budget of Ritewell Publishers. Half the company's sales are transacted on a cash basis. The other half are paid for with a 1-month delay. The company pays all of its credit purchases with a 1-month delay. Credit purchases in January were $30 and total sales in January were $180. Fe ...continues

Annual Growth; Target Revenue; Percentage Sales Method to Forecast

The attached selected financial statements for Apple Computer are taken from the company's SEC filings. Answer questions 1 and 2 as follows based on this data: 1. Determine the year-to-year percentage annual growth in total net sales. 2. Based only on your answers to question #1, do you think the company will hit its sales ...continues

Don't understand regression analysis & Beta, CAPM and Cost of Capital Analysis

Apply regression analysis to estimate beta Apply CAPM to estimate cost of equity capital Avoid the most common errors in cost of capital analysis

Capital Budgeting- 30 questions on Capital Budgeting- Discounted Payback, NPV, Investment, IRR, modified , point of indifference, internal rate of return (MIRR), WACC, risk-adjusted discount rate

Please assist me with the following problems relating to discounted payback, NPV, investments and more. 1. Haig Aircraft is considering a project which has an up-front cost paid today at t = 0. The project will generate positive cash flows of $60,000 a year at the end of each of the next five years. The project’s NPV is ...continues

Interest rate levels

Explain how a decrease in the general level of interest rates affects the valuation of a firm's bonds. To prove this statement solve and answer the following: I have $1,000 bind paying 12 percent interest that has 10 years to maturity. If the current interest rates are 10 percent, will a prudent investor pay me more than $1 ...continues

Risk and Expected Return

What is the relationship between risk and expected return, and how do companies employ diversification to reduce risk?

Please help answer!

Eastern Digital Corp. has a convertible bond outstanding with a coupon rate of 9 percent and a maturity date of 20 years. It is rated Aa, and competitive, non convertible bonds of the same rick class carry a 10 percent return. The conversion ratio is 40. Currently teh common stock is selling for $18.25 per share on the New Y ...continues