Hello, I am a moderator for this topic. I sent your requested professional a message to follow up with you here, when they are back online. If I can help further, please let me know, otherwise, no need to reply. Thank you for your patience.

1. (TCO A) Which of the following does NOT always increase a company's market value? (Points : 5)

Increasing the expected growth rate of sales Increasing the expected operating profitability (NOPAT/Sales) Decreasing the capital requirements (Capital/Sales) Decreasing the weighted average cost of capital Increasing the expected rate of return on invested capital

2. (TCO F) Which of the following statements is correct? (Points : 5)

The MIRR and NPV decision criteria can never conflict. The IRR method can never be subject to the multiple IRR problem, while the MIRR method can be. One reason some people prefer the MIRR to the regular IRR is that the MIRR is based on a generally more reasonable reinvestment rate assumption. The higher the WACC, the shorter the discounted payback period. The MIRR method assumes that cash flows are reinvested at the crossover rate.

3. (TCO D) The Ramirez Company's last dividend was $1.75. Its dividend growth rate is expected to be constant at 25% for 2 years, after which dividends are expected to grow at a rate of 6% forever. Its required return (r_{s}) is 12%. What is the best estimate of the current stock price?

a. $41.58 b. $42.64 c. $43.71 d. $44.80 e. $45.92

(Points : 20)

4. (TCO G) Singal Inc. is preparing its cash budget. It expects to have sales of $30,000 in January, $35,000 in February, and $35,000 in March. If 20% of sales are for cash, 40% are credit sales paid in the month after the sale, and another 40% are credit sales paid 2 months after the sale, what are the expected cash receipts for March?

a. $24,057 b. $26,730 c. $29,700 d. $33,000 e. $36,300

(Points : 20)

5. (TCO G) Chua Chang & Wu Inc. is planning its operations for next year, and the CEO wants you to forecast the firm's additional funds needed (AFN). The firm is operating at full capacity. Data for use in your forecast are shown below. Based on the AFN equation, what is the AFN for the coming year?

Last year's sales = S_{0}

$200.000

Last year's accounts payable

$50,000

Sales growth rate = g

40%

Last year's notes payable

$15,000

Last year's total assets = A_{0}*

$135,000

Last year's accruals

$20,000

Last year's profit margin = PM

20%

Target payout ratio

25%

a. -$14,440 b. -$15,200 c. -$16,000 d. -$16,800 e. -$17,640 (Points : 30)

1. (TCO H) Your consulting firm was recently hired to improve the performance of Shin-Soenen Inc, which is highly profitable but has been experiencing cash shortages due to its high growth rate. As one part of your analysis, you want to determine the firm's cash conversion cycle. Using the following information and a 365-day year, what is the firm's present cash conversion cycle?

Average inventory = Annual sales = Annual cost of goods sold = Average accounts receivable = Average accounts payable =

$75,000 $600,000 $360,000 $160,000 $25,000

a. 120.6 days b. 126.9 days c. 133.6 days d. 140.6 days e. 148.0 days (Points : 30)

2. (TCO C) Your company has been offered credit terms of 4/30, net 90 days. What will be the nominal annual percentage cost of its nonfree trade credit if it pays 120 days after the purchase? (Assume a 365-day year.)

a. 16.05% b. 16.90% c. 17.74% d. 18.63% e. 19.56%

(Points : 30)

3. (TCO E) Sapp Trucking's balance sheet shows a total of noncallable $45 million long-term debt with a coupon rate of 7.00% and a yield to maturity of 6.00%. This debt currently has a market value of $50 million. The balance sheet also shows that the company has 10 million shares of common stock, and the book value of the common equity (common stock plus retained earnings) is $65 million. The current stock price is $22.50 per share; stockholders' required return, r_{s}, is 14.00%; and the firm's tax rate is 40%. The CFO thinks the WACC should be based on market value weights, but the president thinks book weights are more appropriate. What is the difference between these two WACCs?

a. 1.55% b. 1.72% c. 1.91% d. 2.13% e. 2.36%

(Points : 30)

4. (TCO B) A company forecasts the free cash flows (in millions) shown below. The weighted average cost of capital is 13%, and the FCFs are expected to continue growing at a 5% rate after Year 3. Assuming that the ROIC is expected to remain constant in Year 3 and beyond, what is the Year 0 value of operations, in millions? Year: 1 2 3 Free cash flow: -$15 $10 $40

a. $315 b. $331 c. $348 d. $367 e. $386

(Points : 35)

5. (TCO G) Based on the corporate valuation model, the value of a company's operations is $1,200 million. The company's balance sheet shows $80 million in accounts receivable, $60 million in inventory, and $100 million in short-term investments that are unrelated to operations. The balance sheet also shows $90 million in accounts payable, $120 million in notes payable, $300 million in long-term debt, $50 million in preferred stock, $180 million in retained earnings, and $800 million in total common equity. If the company has 30 million shares of stock outstanding, what is the best estimate of the stock's price per share?

It did help. Thanks for following up. I just got back from small office trip so I did not get a chance to leave you a feedback. Sorry for the little delay. You are awsome