1. Present value: Tommie Harris is considering an investment that pays 6.5 percent annually. How much must he invest today such that he will have $25,000 in seven years? (Round to the nearest dollar.) 2. PV of multiple cash flows: Jack Stuart has loaned money to his brother at an interest rate of 5.75 percent. He expects to receive $625, $650, $700, and $800 at […]

The corporate treasurer of Gator Electronics Corporation expects the company to grow at 4% in the future, and assumes debt securities at 6% interest (tax rate = 30%) to be a cheaper option to finance the growth. The current market price per share of its common stock is $39, and the expected dividend in one year is $1.50 per share. Calculate the cost of the […]

  1.        The Hollings Center was created by Congress in 2003.  Over the course of a few fiscal years, Congress appropriated a trust fund of $18.2M.  Congress intended for the Center to operate off of the interest of this trust fund (its highest yield was $733,000 during 2010).  Congress stipulated in law that the trust must be invested in U.S. Treasury bonds.  In 2011, rates […]

Assignment 2: LASA: Finding Your Best Bank For this assignment, you will take on the role of a personal financial advisor and create a personal financial portfolio. Step 1: Using the large National Bank, the Regional/Local Bank, and the Credit Union you identified in the Module 1 Assignment 2, compare and contrast each institution by completing the Module 3 Assignment 2 template. Step 2: Once […]

BUS 401 Week 2 Journal Present and Future Values, and Expected Returns   Present and Future Values, and Expected Returns. We examined two important topics in finance this week: (a) present and future values and (b) security valuation. Critically reflect on the importance of present and future values. What factors must be considered when calculating present and future values? What other qualitative factors play into […]

Homework 4   1.  Crave Co. uses departmental predetermined overhead rates for allocating overhead to jobs.  The rates are based on machine hours for the Machining department and on direct labor cost for the Assembly department.  The company estimated the following for 2009:                                                                    Machining                    Assembly Manufacturing overhead cost              $277,800                     $103,200 Machine hours                                     69,450 hrs                   10,150 hrs Direct labor hours                                3,000 hrs                     15,000 […]

Sources of Revenue Tenet Healthcare and HCA Holdings Inc. are major competitors in the healthcare industry. Visit the Web sites below to review the Income Statements for each healthcare organization.   Tenet Healthcare Corporation: http://www.dailyfinance.com/financials/tenet-healthcare-corporation/thc/nys/income-statement   HCA Holdings, Inc. http://www.dailyfinance.com/financials/hca-holdings-inc-common-stock/hca/nys/income-statement   Study the revenue source information contained in the report. Present in a bar graph a comparison of the selected healthcare providers’ revenue sources by […]

1. Which of the following is often cited as the most significant stumbling block in achieving  compliance goals within large financial organizations:  A. Poor data quality C. Inadequate funding  B. Lack of training D. Improper accounting system     2. Clayton recently invested $50,000 in an oil company. The company has agreed to use  Clayton’s investment strictly for exploration purposes. Rather than writing off $50,000 from  […]

Homework 9   The following account balances were taken from the records of Colin Company at the beginning of 2011:             Cash                                                                            $2,500                         Common stock                                                                        $2,250             Retained earnings                                                           $950             Raw materials inventory                                                 $300             Work in process inventory                                              $220             Finished good inventory (50 units @ $3.60/unit)                        $180   The following transactions occurred during 2011: 1.      Purchased […]

In the Finance textbook by Cornett, Adair, and Nofsinger discusses various criteria for calculating and analyzing the desirability of a capital budgeting project. This task is extremely important as these projects often entail very large cash outflows and may significantly determine the future profitability of the firm. Examine Chapter 13, with particular emphasis on each of the six capital budgeting techniques reviewed.   For this […]