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4 years ago

He most recent financial statements for Hailey Co. are shown here:

Business

1 answer:

Tasya [4]4 years ago

7 0

Answer:

$10,464.41

Explanation:

in order to answer this question we can use the external financing needs formula, except that we will have EFn = 0, and look for Δ Sales

EFN = (A/S) x (Δ Sales) - (L/S) x (Δ Sales) - (PM x FS x (1-d))

EFN = $0
A= assets = $155,000
S = current sales = $66,000
Δ = ???
L = current liabilities = $0
PM = profit margin = $30,300 / $66,000 = 0.4591
FS = current sales + Δ Sales = $66,000 + Δ Sales
1 - d = 1 - dividend payout ratio = 1 - 0.3 = 0.7

0 = 2.3485Δ - 0 - (0.4591 x FS x 0.7)

0 = 2.3485Δ - (0.3214 x FS)

0 = 2.3485Δ - [0.3214 x ($66,000 + Δ)]

0 = 2.3485Δ - $21,212.40 + 0.3214Δ

$21,212.40 = 2.0271Δ

Δ = $21,212.40 / 2.0271 = $10,464.41

If no new equity is raised, sales can increase by $10,464.41. Total forecasted sales = $76,464.41

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Return on Common Stockholders' Equity

attashe74 [19]

Answer:

Explanation:

Return on common stockholders' equity for 2015:

(Net income - preferred stock)/Equity

(63,000-5,400)/2,400,000 = 57,600/2,400,000 = 2.4%

Return on common stockholders' equity for 2015:

(99,000-5,400)/3,000,000 = 93,600/3,000,000 = 3.12%

From these calculations, it is clear that return has improved.

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3 years ago

Portman Industries just paid a dividend of $2.40 per share. The company expects the coming year to be very profitable, and its d

Marina86 [1]

Answer:

Dividend for year one;

2.40 × (1+0.12)= 2.688

For year 2

2.40 × (1+0.12)^2 =3.01056

For year 3

2.40 ×(1+0.12)^3 = 3.3718

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3 years ago

Net cash flows $ 63,000 $ 46,000 $ 83,000 $ 159,000 $ 41,000 $ 392,000 a. Compute the net present value of this investment. b. S

san4es73 [151]

Answer:

a. $36,310.55

b. Yes

Explanation:

a. The computation of the net present value is shown below:-

Year Net Cash Flow PV at 12% PV of Net Cash Flows

1 $63,000 0.893 $56,259

2 $46,000 0.797 $36,662

3 $83,000 0.712 $59,096

4 $159,000 0.636 $101,124

5 $41,000 0.567 $23,247

Total $276,310.55 (B)

Invested Amount $240,000 (A)

Net Present Value $36,310.55 (B - A)

b. Since the net present value comes in positive so Beyer should accept this investment

3 0

3 years ago

A portfolio has three stocks long dash 220 shares of Yahoo (YHOO), 110 shares of General Motors (GM), and 40 shares of Standar

Archy [21]

Answer:

0.4371 and 0.2185

Explanation:

For computing the portfolio weight, first we have to determine the total value which is shown below:

For Yahoo:

220 shares × $30 = $6,600

For General motors:

110 shares × $30 = $3,300

For Standard and Poor's Index Fund:

40 shares × $130 = $5,200

So, the total value would be

= $6,600 + $3,300 + $5,200

= $15,100

So, the portfolio weight of YHOO and GM would be

= $6,600 ÷ $15,100 = 0.4371

And, for GM, it would be

= $3,300 ÷ $15,100 = 0.2185

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3 years ago

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