Option two is the choice because the $2,716 savings difference in total interest from option two outweighs the $1,043 in interest savings from option one. Here the simulator reveals that loan option one is the correct choice. Loan option one is the best choice to solve the working capital shortfall because even though it has a higher interest rate, there is no prepayment limitation and has a total interest payment of only $32,603 after three months. The Financial Dictionary explains that “prepayment is good for the borrower because it relieves him/her of the debt, but it deprives the lender of interest he/she would have received otherwise” (Financial Dictionary, p. 1,
FIN 3010 – Chapters 1-3 Homework ______________________________________________________________________________ Chapter 1: Questions: 7. What are the significant financial advantages and disadvantages of the sole proprietorship/ partnership form in comparison with the corporate form? 1 ) The profits are shared only by sole proprietor or in between the partners , while in corporate form the profits are searched with the number of shareholders that the company holds. 2) In sole proprietor and partnership the level of investments are not that large so the amount can easily be built through profits. 3) Sole proprietorships and partnerships cost less to establish while corporate forms have hugh legality that costs.
Review the article: Is your own buying behavior influenced by coupons and sales? Why do you think J.C. Penney’s pricing strategy has not been successful as compared to other “low price” proponents like Walmart? Will Ron Johnson’s four-year plan be successful over the long-term? Why or why not? BUS 620 Week 4 DQ 1 Purchase here http://chosecourses.com/BUS%20620%20/bus-620-week-4-dq-1
This moderate policy approach for investing uses more than about one-half of the short-term debt that is left but also uses more working capital when having to finance the policy. The moderate policy approach also only uses about half the debt and only about half the assets when it comes to funding the investment. It makes somewhat of a moderate risk of not having to risk to much or for that matter to little since not that much can be lost as opposed to an aggressive policy type approach. Moderate EBIT-$6,000,000 Minus Interest-1,460,000 EBT-$4,540,000 Minus Tax Rate of 40%-1,816,000 EAT-$2,724,000 Return on Equity-6.81.00% Conservative investment policy type uses a majority of working capital and also uses little if any short-term debt. Taking about $2,691,000 and dividing it by $40,000,000 dollars would result in a return of equity of some 6.73.00%.
ECON151 1) The figure above shows the market for gasoline. The government has imposed a tax on gasoline. a. What is the amount of the tax per gallon of gasoline? b.
$30.0 FI504 Final Exam Business - General Business 1. (TCO A) An advantage of the corporate form of business is that _____. (Points : 5) it has limited life its owner's personal resources are at stake its ownership is easily transferable via the sale of shares of stock it is simple to establish 2. (TCO A) The Dividends account _____. (Points : 5) is increased with a debit is decreased with a credit is not an expense account All of the above 1.
The adjustments for 2010, 3rd quarter earnings will reduce to $98 million, down from $101.5 million, and 4th quarter will be reduced to $43 million from $114.2 million (Savitz, 2011). AMSC also stated that cash and equivalents were at $240 million quarter end, down from $260.5 million on quarter earlier (Savitz, 2011). Sinovel has no intentions of paying AMSC. This is AMSC biggest client because this client contributes to 80% of its revenues. Not good news for investors or anyone with interest in
Week Four Reflection Summary In week four, the objectives were to analyze the influence of deficit, surplus, and debt on the health of the U.S. macroeconomy. Mike, Cindy, Stephanie, Sheila, and I had a good understanding of this week’s objectives, and did not struggle with comprehending the reading materials. In our reading material we learned that a deficit in the long run frame work is when there are more expenditures than revenue, and this can lower economic growth, reduce ability to save, and potential income. A surplus is any monies left over when a debt is paid or excess of revenues. A surplus provides additional saving.
Financing decisions determine how the firm raises money to pay for the assets in which it invests (p. 19). Sarah Lehn, chief financial officer of Merit Enterprise Corp., had identified two option for the board to consider. There are several advantages and disadvantages to both. Option 1 is to approach JPMorgan Chase and ask for a $4 billion loan. Since JP Morgan Chase and Merit Enterprise Corp have a well established relationship, that will most likely make an application process easier and Merit might be able to negotiate a low interest rate.
However, PepsiCo uses assets more efficiently and the return on stockholders’ equity is higher than Coca-Cola. We thank you for affording us the opportunity to work with you on this project. We will be glad to discuss any questions you may have at our meeting next week. Sincerely Learning Team A A REPORT OF COCA-COLA COMPANY AND PEPSICO, INC. Submitted: May 27, 2014 Prepared by: L. BELFORT R. ARNOLD E. WATSON V. ROBINSON Executive Summary Assigned to the task of comparing financial analysis of two companies; The Coca-Cola Company and PepsiCo, Inc., team A calculated three sets of ratios to test and compare liquidity, solvency, and profitability.