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Midland Energy Resources Assignment: Review the Harvard Business School Case (Brief Case) - #4130, dated June 19, 2009 Consider the following in your analysis: 1. The main goal for this case is for Janet Mortensen to append a sort of “user guide” in her 2007 calculations; 2. If she did append a “user’s guide” what might be her guidance for different types of project analysis at Midland such as capital budgeting and financial accounting, performance assessments, M&A proposals, and stock repurchase decisions; 3. how might the cost of capital numbers differ or guidance differ for division -level versus corporate-level decisions; 4. what guidance might she provide with validating the components used to compute the WACC; 5. how would you compute a cost of capital for the Petrochemical division; 6. what ‘actual’ firm would you use now as a pure play for the Petrochemical division. @@@@@ in the link information about Midland Energy Resources you must use https://www.dropbox.com/sh/u75nte2z4oact7k/AACTFWYlqSE3n3Jkkp9fVtZ5a?dl=0 Very important 1.Overview and Assumptions: A. Appropriateness of T-bond maturity used B. Appropriateness of equity risk premium used C. Appropriateness of using firm-level WACC for divisions D. Approach to defining division-level cost of capital 2. Computation of firm-level WACC 3. Computation of division-level cost of capital 4. Approach used to compute cost of capital for PetroChemical Division 5. User Guide Reccomendation - capital project valuation, asset projects, performance evaluation 6. Format and Content Note 1- pages must be more than 1 page and less than 4 pages 2- Grading on Fact Sheet: standard 1" margins single-spacing (text) double-spacing between paragraphs no paragraph indentation (left justified) size 12 font, Times New Roman, black text italicized or bold font for section headings 3- Avoiding Plagiarism. 4- See attachment which is Information to compute WACC based upon different capital structures. 5- See the link which some examples of fact sheet in the link very important: https://www.dropbox.com/sh/v2nznicvydwku61/AACOPivXIhGnRYNc6rwBqpTpa?dl=0
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Running head: Capital budgeting and financial accounting

Capital budgeting and financial accounting:
Name:
Institution affiliation:
Date:

1

Capital budgeting and financial accounting

2

Janet Mortensen heading for different sorts of wander examination at midland is give
clarity and how the assessments of Midland's cost of capital ought to be utilized for
inspecting the association and its three divisions. These examinations will fuse asset
assessments in capital and budgetary accounting, execution evaluations which is frequently
used to choose pay, merger and getting proposals, and stock repurchase decisions. Her course
will moreover exhibit that normal jobs of Midland's cost of capital should not to impact the
estimations if the assignments being surveyed are of a comparable ordinary threat of all
association wanders. On the off chance that the endeavours are of more noteworthy or lower
hazard, the estimations of WACC may be impacted. For example, for a to a great degree
hazardous M&A suggestion, the association may need to change the cost of capital by
including a more dangerous premium. Then again, in assessments for certain broad assets,
cash inflows or outpourings may be of lower hazard than the organizations normal and the
numbers adding to the cost of capital should be adjusted as needs be.

In her client manage, Mortensen should give bearings on altering counts to
accomplish a specific objective of the division rather than the entire firm since each division
has differi...


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