Questions from Corporate Finance

Q: Do Japanese investors play an important role in corporate financial policy and

Do Japanese investors play an important role in corporate financial policy and governance? If not, could they?

Q: Question: On average, it takes Microlimp’s customers 60 days

On average, it takes Microlimp’s customers 60 days to pay their bills. If Microlimp has annual sales of $500 million, what is the average value of unpaid bills?

Q: True or false? a. A company’s debt–equity

True or false? a. A company’s debt–equity ratio is always less than 1. b. The quick ratio is always less than the current ratio. c. The return on equity is always less than the return on assets.

Q: Describe some alternative measures of a firm’s overall performance. What are

Describe some alternative measures of a firm’s overall performance. What are their advantages and disadvantages? In each case discuss what benchmarks you might use to judge whether performance is sati...

Q: Discuss alternative measures of financial leverage. Should the market value of

Discuss alternative measures of financial leverage. Should the market value of equity be used or the book value? Is it better to use the market value of debt or the book value? How should you treat of...

Q: Suppose that a firm has both fixed-rate and floating-

Suppose that a firm has both fixed-rate and floating-rate debt outstanding. What effect will a decline in interest rates have on the firm’s times-interest-earned ratio? What about the ratio of the mar...

Q: How would the following actions affect a firm’s current ratio?

How would the following actions affect a firm’s current ratio? a. Inventory is sold. b. The firm takes out a bank loan to pay its suppliers. c. The firm arranges a line of credit with a bank that al...

Q: The following table shows interest rates and exchange rates for the U

The following table shows interest rates and exchange rates for the U.S. dollar and the Lilliputian nano. The spot exchange rate is 15 nanos = $1. Complete the miss...

Q: Sara Togas sells all its output to Federal Stores. The following

Sara Togas sells all its output to Federal Stores. The following table shows selected financial data, in millions, for the two firms: Calculate the sales-to-assets ratio, the operating profit margin,...

Q: As you can see, someone has spilled ink over some of

As you can see, someone has spilled ink over some of the entries in the balance sheet and income statement of Transylvania Railroad (Table 28.11). Can you use the following information to...