12-1 AFN Equation
Baxter Video Products’s sales are expected to increase by 20% from $5 million in 2010 to $6 million in 2011. Its assets totaled $3 million at the end of 2010. Baxter is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2010, current liabilities were $1 million, consisting of $250,000 of accounts payable, $500,000 of notes payable, and $250,000 of accruals. The after tax profit margin is forecasted to be 5%, and the forecasted payout ratio is 70%. Use the AFN equation to forecast Baxter’s additional funds needed for the coming year.

Problems (pp. 549-550)
13-2 Value of Operations of Constant Growth Firm
13-3 Horizon Value
13-4 EROIC and MVA of Constant Growth Fir

Value of Operations of Constant Growth Firm
EMC Corporation has never paid a dividend. Its current free cash flow of $400,000 is expected to grow at a constant rate of 5%. The weighted average cost of capital is WACC = 12%. Calculate EMC’s value of operations. FCF = $400,000

g = 5%
WACC = 12%
Vop = PV of expected future free cash flow
Vop = = = $6,000,000

(13-3)
Horizon Value
Current and projected free cash flows for Radell Global Operations are shown below. Growth is expected to be constant after 2012, and the weighted average cost of capital is 11%. What is the horizon (continuing) value at 2012?

...originate mortgages and then sell them to investment banks, which would bundle them into packages and then use these packages as collateral for bonds that could be sold to pension funds, insurance companies, and other institutional investors.
2-6 Statement of Retained Earnings
In its most recent financial statements, Newhouse Inc. reported $50 million of net income and $810 million of retained earnings. The previous retained earnings were $780 million. How much in...

...The financial statements of Lioi Steel Fabricators are shown below, with the actual results for 2010 and the projections for 2011. Free cash flow is expected to grow at a 6 percent rate after 2005. The weighted average cost of capital is 11%.
Income Statement for the Year Ending December 31
(Millions of Dollars Except for Per Share Data)
Actual Projected
2010 2011
Net sales $500.0 $530.0
Costs (except depreciation) 360.0 381.6...

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MAT 540 Week6Homework
Complete the following problems from Chapter 2:
1. Problems 2, 6, 7, 12, 16, 20
2. Chapter 2
2. A company produces two products that are processed on two assembly lines. Assembly line 1 has 100 available hours, and assembly line 2 has 42 available hours. Each product requires 10 hours of processing time on line 1, while on line 2 product 1 requires 7 hours and product 2 requires 3...

...TCO 1) What is the purpose behind the five primary activities in the value chain?
First, info flow diagrams and flowcharts argon the two most much utilize development and musical accompaniment tools employ today. Second, since systems developme nt is super complex, DFDs and flowcharts ar! e tools that are used to fix order from sanatorium and complexity.Â (Ch 3, p. 50)| | | Â | Points Received:| 4 of 5| Â | Comments:| First, data flow diagrams and flowcharts are the two most frequently used...

...FIN 515WEEK 4 HOMEWORK ASSIGNMENT
(7–2)
Constant Growth Valuation
Boehm Incorporated is expected to pay a $1.50 per share dividend at the end of this year (i.e., D1 = $1.50). The dividend is expected to grow at a constant rate of 7% a year. The required rate of return on the stock, rs, is 15%. What is the value per share of Boehm’s stock?
For this problem we can use the formula from the book P=d1(R-G) to find the price. We just need to plug...

...Running head: Week 1 Assignment
Week 1 Assignment:
Mini Case (p.45)
Problems (p.79)
Alisha Clarke
Managerial Finance
Week 1 Assignment
Professor Gaggar
September 9, 2012
a) Why is corporate finance important to all managers?
Corporate finance is important because it enables managers to have an understanding of what funds would be necessary for upcoming projects and projects of their company as well as allowing them to plan...

...
This archive file of FIN 515Week6 Problems Solutions contains:
Prob 16-1
Prob 16-2
Prob 16-3
Prob 16-4
Prob 16-5
Business - General Business
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...

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MAT540 Week 3 Homework
Chapter 14
1. The Hoylake Rescue Squad receives an emergency call every 1, 2, 3, 4, 5, or 6 hours, according to the following probability distribution. The squad is on duty 24 hours per day, 7 days per week:
Time Between
Emergency Calls (hr.)
Probability
1
0.05
2
0.10
3
0.30
4
0.30
5
0.20
6
0.05
1.00
a. Simulate the emergency calls for 3 days...