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Four Finance Misc. problems




Question;J&J Manufacturing;issued a bond with a $1,000 par value. The bond has a coupon rate of 7% and;makes payments semiannually. If the bond has 30 years remaining and the annual;market interest rate is 9.4%, what will the bond sell for today?Chapman's Inc.'s Mexican;subsidiary, V. Gomez Corporation, is expected to pay to Chapman 50 pesos in;dividends in 1 year after all foreign and U.S. taxes have been subtracted. The;exchange rate in 1 year is expected to be 0.10 dollar per peso. After this, the;peso is expected to depreciate against the dollar at a rate of 4% a year;forever due to the different inflation rates in the US and Mexico. The peso-denominated;divident is expected to grow at a rate of 8% a year indefinitely. Chapman owns;10 million shares of V. Gomez. What is the present value of the dividend;stream, in dollars assuming V. Gomez's cost of equity is 13%?NICO Corporation had net fixed;assets of $2,000,000 at the end of 2006 and $1,800,000 at the end of 2005. In;addition, the firm had a depreciation expense of $200,000 during 2006 and;$180,000 during 2005. Using this information, NICO?s net fixed asset investment;for 2006 was:a. $400,000.;b. $380,000.;c. $0.;d. $20,000.Harper Corp.'s sales last year;were $395,000, and its year-end receivables were $42,500. Harper sells on terms;that call for customers to pay 30 days after the purchase, but many delay;payment beyond Day 30. On average, how many days late do customers pay? Base;your answer on this equation: DSO - Allowed credit period = Average days late;and use a 365-day year when calculating the DSO


Paper#49948 | Written in 18-Jul-2015

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