Questions from Financial Management

Q: What would be the impact on Top-A1’s pro forma long

What would be the impact on Top-A1’s pro forma long-term debt if sales were to change to $200,000 and the age of payables were to change to 45 days?

Q: Now, assume Top-A1’s sales in the subsequent year increase

Now, assume Top-A1’s sales in the subsequent year increase by 15 percent. If all the other relationships remain the same, what will be the pro forma net earnings in two years?

Q: Again, assume Top-A1’s sales in the subsequent year increase

Again, assume Top-A1’s sales in the subsequent year increase by 15 percent. If all the other relationships remain the same, what will be the pro forma loan requirement in two years?

Q: Consider two bonds, Bond A and Bond B, both

Consider two bonds, Bond A and Bond B, both with a coupon rate of 10 percent and a yield to maturity of 10 percent. These are standard bonds with semiannual coupon payments. Bond A matures in 5 years;...

Q: Consider the bonds in question 7. Suppose interest rates decline

Consider the bonds in question 7. Suppose interest rates decline, causing the yield to maturity for each bond to immediately decline to 9 percent. What is the new price of each bond? (Consider the sem...

Q: What is the payback period for the project in question 6?

What is the payback period for the project in question 6? discount rate = 10.0% initial investment = ($40,000) CF1 = $15,000 CF2 = $20,000 CF3 = $25,000 NPV = $8,948.16 = -$40,000 +...

Q: 1. Calculate the projected gross profit for Top-A1.

1. Calculate the projected gross profit for Top-A1. 2. Calculate the projected purchases for Top-A1. 3. Create an entire pro forma income statement for Top-A1. Be sure to calculate the projected net e...

Q: On the basis of the following bond information, describe the features

On the basis of the following bond information, describe the features of the bond and explain the timing of the expected cash flows (assuming today is January 1, 2014): coupon = 6.4 percent; maturity...

Q: On the basis of the following stock information, describe the features

On the basis of the following stock information, describe the features of the stock and assess its performance: dividends per share = $0.80, current share price = $28.50, current dividend yield = 2.8...

Q: Now suppose the firm in question #9 has a payout ratio

Now suppose the firm in question #9 has a payout ratio of 30 percent. Given the earnings retention, what will be next year’s dividend, at what rate will the firm be able to grow the dividend, and what...