Access over 20 million homework & study documents

STR 581, STR/581, Capstone - Week 4 Exam Solutions Latest - 39/39 correct

Content type
User Generated
Type
Homework
Rating
Showing Page:
1/25
1
Horizontal analysis is also known as:
trend analysis
vertical analysis
common size analysis
linear analysis
2
An unrealistic budget is more likely to result when it:
has been developed in a top down fashion.
is developed with performance appraisal usages in mind.

Sign up to view the full document!

lock_open Sign Up
Showing Page:
2/25
has been developed in a bottom up fashion.
has been developed by all levels of management.
3
M&M Proposition 1: Dynamo Corp. produces annual cash flows of $150 and is expected to exist forever.
The company is currently financed with 75 percent equity and 25 percent debt. Your analysis tells you that
the appropriate discount rates are 10 percent for the cash flows, and 7 percent for the debt. You currently
own 10 percent of the stock.
If Dynamo wishes to change its capital structure from 75 percent equity to 60 percent equity and use the
debt proceeds to pay a special dividend to shareholders, how much debt should they use?
$375
$225
$600
$321
4
Which of the following is an advantage of corporations relative to partnerships and sole proprietorships?

Sign up to view the full document!

lock_open Sign Up
Showing Page:
3/25

Sign up to view the full document!

lock_open Sign Up
End of Preview - Want to read all 25 pages?
Access Now
Unformatted Attachment Preview
1 Horizontal analysis is also known as: trend analysis vertical analysis common size analysis linear analysis 2 An unrealistic budget is more likely to result when it: has been developed in a top down fashion. is developed with performance appraisal usages in mind. has been developed in a bottom up fashion. has been developed by all levels of management. 3 M&M Proposition 1: Dynamo Corp. produces annual cash flows of $150 and is expected to exist forever. The company is currently financed with 75 percent equity and 25 percent debt. Your analysis tells you that the appropriate discount rates are 10 percent for the cash flows, and 7 percent for the debt. You currently own 10 percent of the stock. If Dynamo wishes to change its capital structure from 75 percent equity to 60 percent equity and use the debt proceeds to pay a special dividend to shareholders, how much debt should they use? $375 $225 $600 $321 4 Which of the following is an advantage of corporations relative to partnerships and sole proprietorships? harder to transfer ownership most common form of organization reduced legal liability for investors lower taxes 5 Ajax Corp. is expecting the following cash flows - $79,000, $112,000, $164,000, $84,000, and $242,000 - over the next five years. If the company's opportunity cost is 15 percent, what is the present value of these cash flows? (Round to the nearest dollar.) $429,560 $414,322 $480,906 $477,235 6 Variance reports are: external fin ...
Purchase document to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Anonymous
Just the thing I needed, saved me a lot of time.

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4