Question: : (TCO D) On December 31, 2010, Irey Co. has $2,000,000 of short-term notes payable due on February 14, 2011. On January 10, 2011, Irey arranged a line of credit with County Bank which allows Irey to borrow up to $1,700,000 at one percent above the prime rate for three years. On February 2, 2011, Irey borrowed $1,700,000 from County Bank and used $300,000 additional cash to liquidate $1,700,000 of the short-term notes payable. The amount of the short-term notes payable that should be reported as current liabilities on the December 31, 2010 balance sheet which is issued on March 5, 2011 is 9. Question: : (TCO D) Tender Foot Inc. is involved in litigation regarding a faulty product sold in a prior year.
| Math 103 Final Project – Parts 1, 2, and 3 | | | Math 103 Instructor: Toni Robertson December 11, 2010 Math 103 Instructor: Toni Robertson December 11, 2010 Part 1: 1a. What is the shortest loan (36 months, 48 months, 60 months or 72 months) that has a monthly payment within your $500 budget that will allow you to buy the $15,000 car? Answer: Through Bank of America, I found a rate of 2.99% for the 36, 48 and 60 month loans. We are able to put down 20% and will need to finance $12,000. The shortest loan period for the $15,000 car that would be under our $500 limit is the 36 month loan at a rate of $348.93 per month.
If the firm decides to use its cash for the notes payable it will then have to obtain financing to maintain the cash balance. The firm may need to renegotiate its notes payable and obtain additional financing to maintain the minimum cash balance of $15,000. 5-1A (Compound Interest) To what amount will the following investments accumulate? a. $5,000 invested for 10 years at 10 percent compounded annually rate (i)= 10% number of periods (n) = 10 Payment (PMT) = $0 present value (PV) = $5,000 type (0 at end of = period) = 0 Future value (FV) =
How does these cards compare to each other? 2. Utilize the table below to evaluate the various credit card offers. It is possible that not all information is available for all cards. Card Name | Interest Rate on Purchases | Cash Advance Rate | Annual Fee | Penalty APR | Grace Period | Late Payment Fee | Over Credit Limit Fee | Minimum Annual Income | Cash Back | Citi Platinum Select | 8.99% | 19.99% | No Fee | N/A | 20-Day | $15,$25 or $35 | $35 | $12,000 | No | Blue Cash from American Express | 0% first 6 months8.99-13.99% after 6 months | 18.99% | No Fee | 23.99% | If balance is paid in full each billing cycle | $15, $29 or $35 | $29 | Undisclosed minimum | Up to 5% | Collegiate Visa | 14.75% | 14.75% | $12 waived the first year | 18.75% | N/A | $20 | $20 | N/A | N/A | Discover Card for Students | 17.99% | 22.99% | No Fee | 19.99-24.99% | 25-Day | $15-$35 | $15-$35 | N/A | 1%or 2% | 3.
Your firm is trying to determine its cash disbursements for the next two months (June and July). In any month, the firm makes purchases of 60% of that month’s sales, which are paid the following month. In addition, the firm incurs the following costs every month and pays for them in the month the expenses are incurred: wages and salaries of $10,000, rent of $4,000, and miscellaneous cash expenses of $1,000. Depreciation amortized on a monthly basis is $2,000. June’s sales are expected to be $100,000, and July’s sales are expected to be $150,000.
What assumptions can you use to arrive approximately at the share price of $273,000 that was estimated by the dissenting shareholders? Show how these assumptions impact your valuation. 4. What is the maximum share price at which Herbert Kohler should be willing to settle with the dissenting shareholders in order to stop the trial on April 11, 2000? Assume that (i) if the trial proceeds it is expected to last less than a month and result in two possible outcomes in terms of the price per share established in court: the $273,000 claimed by the plaintiffs, or the $55,400 being defended by Herbert Kohler; (ii) Kohler estimates the probabilities of these outcomes at 30% and 70%, respectively.
Week 4 Case Study Fresh &Fruity Foods Inc. 1. Average Collection Period =Accounts Receivable/ Average daily credit sales Accounts receivable =$209,686 Average daily Credit sales =$1,179,000/360 =$3,275 Average collection Period =$209,686/$3,275 =64.02 days 2. Cost of forgoing the cash discount: Kdis=2%/100%-2% x 360/f(67)-d(10)= .1307= 13.07% The formula tells us that Fresh and Fruity is effectively paying 13.07% interest to delay paying the discounted amount for 57days (the 67 days on which they pay less the 10 day discount period). 3. Average Collection Period x Average Daily credit Sales= New Accounts receivable 32x 3,275=$104,800 Freed-up Cash = old accounts receivable $209,686 - new accounts receivable $104,800
PLANNING DOCUMENT FOR VIKING INVESTMENTS Role: SANDY WOOD, WoodCrafters, Inc. What issue is the most important to you? (List in order of importance) 1. To persuade Pat Olafson, the owner of Viking Investments, to pay entire outstanding invoice in cash within 15 days. Alternatively, aim for invoice payment of $700,000 in 15 days, the rest in 30 days 2. To persuade Pat not to recall the $200,000 loan 3.
Gena instructs that the cash receipts ledger to remain open for an additional day, as a $150,000 payment will post to the bank on July One from Oconto Distributors, and recorded as part of June’s receivables, which fulfills the requirements of the loan agreement, but misrepresents true closing receivables (Weygandt, 2008, p. 382). Misrepresentation of financials and noncompliance of generally accepted accounting principles (GAAP), whether small or large has unpleasant and costly consequences to all parties associated with the company;
Using the estimate of 4.5 million gallons per month, how would you construct a futures hedge for the next 12 months? How would you construct a commodity-swap hedge? In order to construct a future hedge, J&L should short a future contract. (in order to gain from the price decrease) In order to construct a commodity- swap hedge, J&L need to sell a floor while simultaneously buy a cap 4. Should Craft consider using a cap as a hedge?