Soln 1a. The concepts of conservation‚ also known as the concept of prudence is often stated as do not record the future income but record all possible losses. This means an accounting should follow a conservative approach‚ should record lowest possible value for assets and revenue and the highest possible value for liabilities and expenses. According to this principle‚ the principle of ‘anticipate no profit but provide for all probable losses ‘ should
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FI-516 – WEEK 3 HOMEWORK PROBLEMS Problem No. 1 on Options based on Chapter 8 A Call Option on the stock of XYZ Company has a market price of $9.00. The price of the underlying stock is $36.00‚ and the strike price of the option is $30.00 per share. What is the Exercise Value of this Call Option? What is the Time Value of the Option? Problem No. 2 on Options based on Chapter 8 The Exercise (Strike) Price on ABC Company’s Option is $21.00‚ its Exercise Value is $23.00‚ and its Time
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FIN 301 HW Chapter 1 (Odds 1-17) 1. Define shareholder wealth. Explain how it is measured Shareholder wealth is represented by the market price of a firm’s common stock. It is measured by the market value of the shareholders’ common stock holdings 2. Which type of corporation is more likely to be a shareholder wealth maximizer -one with wide ownership and no owners directly involved in the firms management or one that is closely held. A closely held corporation 3. It has been argued that shareholder
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Finance is the allocation of assets and liabilities over time under conditions of certainty and uncertainty. A key point in finance is the time value of money‚ which states that a unit of currency today is worth more than the same unit of currency tomorrow. Finance aims to price assets based on their risk level‚ and expected rate of return. Finance can be broken into three different sub categories: public finance‚ corporate finance and personal finance. Contents [hide] 1 Areas of finance 1
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1 Question 1 (16 points) Carol Inc is considering the following three prices to charge customers for each of the candy packets they produce: i) $2.20 ii) $2.00 iii) $1.70 The relevant data for decision-making is below: Fixed Costs = $1200 Variable Costs = $0.50 per unit Calculate the following: a) The Breakeven Point for each price level b) Using price of $2.20 what would be the new breakeven point if (1) fixed costs decreased to $1000 all else remaining the same‚ (2) Variable costs increased to
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Name: Mary Rafel P‚ Abadies Rating: ___________ Course/Year: BSAc-1 Date: August 6‚ 2013 6.1 IDENTIFICATION Capital stock 1. The aggregate production capacity of existing capital goods in the economy. Zero or net change 2. Means a constant level in both the capital stock and output. Investments 3. Adjusts the capital stocks to maintain and even increase production and the level of the economic activities. Savings 4. The
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business is raising the money to get going. The entrepreneur might have a great idea and clear idea of how to turn it into a successful business. However‚ if sufficient finance can’t be raised‚ it is unlikely that the business will get off the ground. Importance of Finance Finance is very important for business organisation . Finance includes planning of financial resources‚ making of optimum capital structure and effective utilization of financial resources by deep analysis of cost of capital and capital
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The financial activities regard running a corporation. In other words‚ Corporate Finance is mainly concerned with maximizing shareholder value through long-term as well as short-term financial planning along with the implementation of different strategies. Thus‚ this includes everything from capital investment decisions to investment banking falls under the domain of corporate finance. On the other hand‚ the shareholders own a corporation or you could say corporations are owned by its stockholders
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Sources of Finance The financing of every business is the most fundamental aspect of its management. Get the financing right and the company will have a healthy business‚ positive cash flows and ultimately a profitable enterprise. The financing can happen at any stage of a business ’s development. On commencement of your enterprise the business entity will need finance to start up and‚ later on‚ finance to expand. Finance sources may be internal or external but they may also be short‚ medium or
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finance for manager Table of content Q1: Sustainability of Debt Finance Management Introduction…………………………………………………………………………………………….3 1.1 Literature review…………………………………………………………………………………..3 1.2 Assumption and argument for this debt financing findings from ICAEW……………………5 1.3 Financial ratio analysis for the debt financing situation of the chosen listed company……6 1.3.1 Debt financing performance………………………………………………………………6 1.3.2 Operation performance……………………………………………………………………8 1.3.3 Systematic
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