...position, as it requires an influx of cash even though sales are growing and the company is generating revenue. Because Mr. Butler wants to take advantage of trade discounts, he uses bank notes to pay his suppliers quickly where he would otherwise be unable to with operating cash flows. As his business grows, he purchases more and more inventory on account, requiring larger amounts of debt to pay off. Under current operating procedure, Mr. Butler will need to find another bank to lend him money so that he can continue to operate his business. Based on current projections, it is estimated that the Butler Lumber Company will need to obtain approximately $215,000 from Northrop National Bank to meet their current obligations. Table 1 shows a detailed pro forma balance sheet for the Butler Lumber Company for the years 1988 through 1991. This $215,000 number is calculated on the assumption that sales for 1991 will be $3.6 million and that management will continue to use the cash obtained via the bank loan to pay suppliers in order to obtain a trade discount. In addition, it is assumed that the balance sheet and income statement items grow proportionately with sales. Table 2 shows that, even though sales increased by approximately 25%, overall net income decreased slightly from 1990 to 1991, dragged down by...
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...space. Section 1: Multiple-Choice (28 Questions). 2 Points each. 56 Points total. Write the letter of the correct answer in the shaded/underlined field immediately after the question. The table below shows the hypothetical utility schedule for a consumer of chocolate candy bars. [pic] 1. Refer to the above table. This consumer begins to experience diminishing marginal utility when consuming the: A. Third candy bar B. Fourth candy bar C. Sixth candy bar D. Seventh candy bar B. 2. Refer to the above table. Marginal utility becomes negative with the consumption of the: A. Fourth candy bar B. Fifth candy bar C. Sixth candy bar D. Seventh candy bar D. 3. Refer to the above table. Based on the data in the above table you can conclude that the: A. Marginal utility of the fourth unit is 7 B. Marginal utility of the third unit is 18 C. Total utility of 5 units is 30 D. Total utility of 3 units is 34 C. 4. Refer to the above table. The consumption of which bar yields the greatest marginal utility? A. Third B. Fourth C. Sixth D. Seventh A. Wayne's Jacket Shop sells Wayne's jackets for $20 each. Wayne finds that when he hires different numbers of workers, the corresponding total revenues are as follows: [pic] 5. Refer to the above table. What is the marginal...
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...Introduction Cost, time and prospect is the tools used to base effective business decisions. Calculating time cost, money cost, and return on forecast, all are based on data mining, marketing research, information analysis and findings. Statistics is way to finding the answer. Statistics – The Method of Organizing Data Generally, statistics is a set of disciplines to analyze quantitative information. Statistics entails all aspects of information: comprehending, collecting, communicating, organizing, and interpreting. All of these are the key reference for forecasting consequences or decision making. Thus, it permits us to estimate the extent of our errors. Purchasing a Business It is not an easy task or decision to purchase a business. Before the final decision is made there are many things to consider. To start with, what exactly do you want to achieve? For whatever reason, you must be sure that it is something that you are ready to devote a large amount of time and energy too. Otherwise, you might be trapped into doing something that you loathe. You must ask yourself how far you are ready to commit. How much of your own time, energy, and money are you willing to sacrifice? Finer Diner Sales Proposal The owner of the Finer Diner submitted a proposal to you in hopes of selling the business to you. His asking price is $250,000. Your financial institution advises that your monthly payment to finance that amount would be $1850.00. This is in addition...
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...Jon M. Huntsman School of Business Master of Science in Financial Economics August 2013 Pricing and Hedging Asian Options By Vineet B. Lakhlani Pricing and Hedging Asian Options Table of Contents Table of Contents 1. Introduction to Derivatives 2. Exotic Options 2.1. Introduction to Asian Options 3.1. Binomial Option Pricing Model 3.2. Black-Scholes Model 3.2.1. Black-Scholes PDE Derivation 3.2.2. Black-Scholes Formula 1 2 3 4 4 5 6 7 3 3. Option Pricing Methodologies 4. Asian Option Pricing 4.1. 4.2. 4.3. 4.4. Closed Form Solution (Black-Scholes Formula) QuantLib/Boost Monte Carlo Simulations Price Characteristics 8 8 10 11 14 5. Hedging 5.1. Option Greeks 5.2. Characteristics of Option Delta (Δ) 5.3. Delta Hedging 5.3.1. Delta-Hedging for 1 Day 5.4. Hedging Asian Option 5.5. Other Strategies 6. Conclusion 16 17 17 19 20 22 25 26 27 32 34 Appendix i. ii. iii. Tables References Code: Black-Scholes Formula For European & Asian (Geometric) Option 1 Pricing and Hedging Asian Options 1. Introduction to Derivatives: Financial derivatives have been in existence as long as the invention of writing. The first derivative contracts—forward contracts—were written in cuneiform script on clay tablets. The evidence of the first written contract was dates back to in nineteenth century BC in Mesopotamia...
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...Overview the Acquisition of Virginia Mines Inc. Osisko is a Canada-based intermediate mining royalty and exploration public company traded on the Toronto Stock Exchange. They acquired Virginia Mines Inc. with an acquisition date of February 17, 2015 by acquired all of the outstanding common shares of Virginia and issued a total of 29,964,240 common shares to Virginia shareholders (share exchange method). This acquisition diversifies the portfolio of assets in low geopolitical risk locations and improves the financial position of the new combined company. Other purchase consideration paid by Osisko including share options and the common shares hold by Osisko prior to the closing date. The fair value of purchase consideration is (provisional) $556,034. As a public company, Osisko is required to prepare financial statements according to IFRS. They have recognized this acquisition as a business combination, and they have combined Virginia’s financial statements to their own and issued combined financial statements according to IFRS because as parent company, they have control over Virginia by acquire all of their outstanding shares. According to IFRS, the accounting policies applied in Q1 2015 consolidated financial statements are consistent with those applied by Osiska before business combination. Osisko Gold Royalties is the Acquirer and parent company because their shareholders control the combined economic entity, and Virginia Mines Inc. is the acquiree and subsidiary company...
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...fledgling coffee business. As the case unfolds, students will learn of Father Daniel Mary’s vision to build a new Mount Carmel in the Rocky Mountains and transform the small brotherhood of 13 monks living in a small home used as makeshift rectory into a 500-acre monastery that would include accommodations for 30 monks, a Gothic church, a convent for Carmelite nuns, a retreat center for lay visitors, and a hermitage. Father Daniel Mary had identified a nearby ranch for sale that met the requirements of his vision perfectly, but its listing price of $8.9 million presented a financial obstacle to creating a place of prayer, worship, and solitude in the Rockies. Father Daniel Mary hoped to fund the purchase of the ranch through charitable contributions to the monastery and through the profits of its Mystic Monk coffee business, which had earned nearly $75,000 during its first year of operation. Suggestions for Using the Case This case was written as a leadoff case and was carefully crafted by the case author to require students to draw upon most all of the concepts discussed in Chapters 1 and 2 to sufficiently prepare for a class discussion of the case. The case involves issues relating to mission, vision, objectives, strategy, business models, and decisive strategic leadership; the need for an action plan is obvious—these are the very things one looks for in a good leadoff case. And the nature of the case virtually guarantees the stimulating kind of class discussion one needs...
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...NAME: AIFUWA HOPE OSAYANTIN PHONE NO : +2348136751972, PIN – 269B7BC0, 7BEB93E6 EMAIL – aifuwahopeosayantin@yahoo.com WEBSITE – aifuwahopeosayantin.blogspot.com TABLE OF CONTENTS PAGES I. Abstract of the subject matter 2 II. Objectives 3 III. Scope of the study 3 IV. Introduction 4 V. Illustrations and Suggested solution 11 VI. Illustration and Suggested solution (Without Retained crates and closing balance on premises) 14 VII. Purpose of keeping separate accounts for containers 18 VIII. Uses of Container accounts 18 IX. Recommendations 19 References 20 1.1. OBJECTIVES This paper...
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...NAME: AIFUWA HOPE OSAYANTIN PHONE NO : +2348136751972, PIN – 269B7BC0, 7BEB93E6 EMAIL – aifuwahopeosayantin@yahoo.com WEBSITE – aifuwahopeosayantin.blogspot.com TABLE OF CONTENTS PAGES I. Abstract of the subject matter 2 II. Objectives 3 III. Scope of the study 3 IV. Introduction 4 V. Illustrations and Suggested solution 11 VI. Illustration and Suggested solution (Without Retained crates and closing balance on premises) 14 VII. Purpose of keeping separate accounts for containers 18 VIII. Uses of Container accounts 18 IX. Recommendations 19 References 20 1.1. OBJECTIVES This paper...
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...Thanks for downloading a sample plan from Bplans.com A sample plan is a great way to get started, but you can’t just print this plan out and turn it into the bank. You’re still going to have to put in all your own information and do all of your own financial forecasts. With LivePlan, you can easily use this sample as inspiration and create your own plan, complete with financial tables and graphs. You’ll also be able to: • Save time with linked financial tables (the formulas are built in, so you don’t have to do the calculations!) • Benefit from tons of help, advice, and resources. • Present your plan with confidence, with automatic charts and graphs corresponding to your financial data. • Work on your plan anywhere, on any computer. “For 20 dollars I ended up getting a quarter of a million dollars of funding. That’s worth it!” – Todd C. Tablegate Click here to save 50% off the first month of LivePlan! Cover Page [pic] This sample business plan has been made available to users of Business Plan Pro®, business planning software published by Palo Alto Software. Names, locations and numbers may have been changed, and substantial portions of the original plan text may have been omitted to preserve confidentiality and proprietary information. You are welcome to use this plan as a starting point to create your own, but you do not have permission to reproduce, resell, publish, distribute or even copy this plan as it exists...
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...Megapop Inventory Model Assumptions: Lead time is constant Multi-period model Demand follows normal distribution (follow the histogram in excel sheet) Model with lost sale and discounted quantities Parameters: Q: order quantity Qo: optimal order quantity D: Annual demand H: holding cost per item per year Co: order cost C: cost per item n: number of orders per year r: order point ps : shortage cost p : lost profit per unit shortage B(r) : expected shortage L: lead time μ: average demand per week σ: standard deviation of demand μL: average demand in lead time σ: standard deviation of in lead time We will optimize order policy for number of bushels. Hence we have converted weekly demand of popcorn into its corresponding weekly demand of number of bushels of corn as a raw material. * Observe histogram from excel attachment which clearly predict that demand of number of bushels of corn per week follows normal distribution with μ = 73.5 and σ = 13.8835 * Hence μL = μ * L = 73.5*3 = 220.5 And, σL = σ*L = 13.8835*3 = 24.0469 * H = $4*12/12 = $4 * L = 3 weeks * D = μ*52 = 73.5*52 = 3822 bushels per annum * Co = $(950 + 0.55Q) i) C = 6.20 + 9% of 6.20 = 6.20 + 0.558 = $6.758 if Q ≤ 100 ii) If order is greater than 100 then 6% discount would be there. 6.20 – 6% of 6.20 = 6.20 – 0.375 = $5.828 C = 5.828 + 9% of 5.828 = 5.828 + 0.5245 = $6.3525 a) Q = 2DCOH = 2*3822*(950+0.55Q)4 Solving this equation for Q we get, Q = 1971.7706 ...
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...Internet channel that is in competition with the traditional channel partner. We first consider that in order to mitigate channel conflict the manufacturer, who chooses wholesale prices as a Stackelberg leader, commits to setting a direct channel retail price that matches the retailer’s price in the traditional channel. Under this general equal-pricing strategy, we determine the effect of more specific pricing strategies on prices and profits of the manufacturer and the retailer. These specific strategies are: (1) keep wholesale prices as they were before, (2) keep retail prices as they were before, or (3) select wholesale and retail prices that optimize profits for the manufacturer. Within these strategies we identify and summarize cases when the resulting prices are lower than the pre-Internet prices, and when they are higher, relating them to the respective channel costs and to the relative convenience to the consumer of the Internet channel. We find that Strategy 3 – the specific equal-pricing strategy that optimizes profits for the manufacturer – often is also preferred by the retailer and customers (through lower prices) over the other equal-pricing strategies. We next consider the implications of the equal-pricing constraint through a...
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...Direct Marketing, Indirect Profits: A Strategic Analysis of Dual-Channel Supply-Chain Design Wei-yu Kevin Chiang • Dilip Chhajed • James D. Hess Department of Information Systems, University of Maryland at Baltimore County, Baltimore, Maryland 21250 Department of Business Administration, University of Illinois at Urbana–Champaign, Champaign, Illinois 61820 Department of Business Administration, University of Illinois at Urbana–Champaign, Champaign, Illinois 61820 kevin@wchiang.net • chhajed@uiuc.edu • jhess@uiuc.edu T he advent of e-commerce has prompted many manufacturers to redesign their traditional channel structures by engaging in direct sales. The model conceptualizes the impact of customer acceptance of a direct channel, the degree to which customers accept a direct channel as a substitute for shopping at a traditional store, on supply-chain design. The customer acceptance of a direct channel can be strong enough that an independent manufacturer would open a direct channel to compete with its own retailers. Here, direct marketing is used for strategic channel control purposes even though it is inefficient on its own and, surprisingly, it can profit the manufacturer even when no direct sales occur. Specifically, we construct a pricesetting game between a manufacturer and its independent retailer. Direct marketing, which indirectly increases the flow of profits through the retail channel, helps the manufacturer improve overall profitability by reducing the...
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...Stock Report – Netflix Inc. Table of Contents 1. Portfolio including the opening price and the closing price 3 2. Reasons why each stock was selected. Company description, describe sources of revenue. 4 3. The Four Ratios for Netflix Inc. and its competitor, Amazon 5 4. Why did the stock price increase or decrease? Why the market behaved as it did. Attach news releases. Notes from classroom presentations on market moves. 6 5. The final value of each stock (in dollars and price per share), compared to original cost per share. 7 6. Weekly table showing price changes for each stock from date of purchase until end of week 11. Graph of group Portfolio. 8 7. Total return and/or loss of group’s portfolio. 10 8. As a group, what did you learn about selecting stocks for a portfolio? 11 What did you learn about the stock market? 11 What did you learn about your stock/company? 11 1. Portfolio including the opening price and the closing price Opening Price Closing Price 2. Reasons why each stock was selected. Company description, describe sources of revenue. The reason why I choose Netflix’s stock to invest in is because personally, I was interested in the company and the industry. With the boom of the internet over the last decade, people are now choosing to cut their cable and switch to streaming and downloading services instead. Firstly, it’s a cheaper alternative to cable which costs $65/month on average, a rate that’s been increasing since 1995...
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...Accounting for Decision Making Assessment 1 Group Project Prepared by Tang Wai Kiu, Phybe Ho Wing Yan, Mandy (Group L) Total 3,078 words Table of Contents 1. Introduction……………………………………………………………………… . 4 2. Market And Company Review……………….………………………….…. 6 2.1 Hong Kong Hotel Market industry……………………………………. ..… 6 2.2 Company Review………….…………………………..………………...… .. 7 3. Assessment of Profitability………………………………..…….…..….… . 8 4. Assessment of Operating Performance……………………………...... 10 4.1 Operating expenses……………………………………………………........ 10 4.1.1 Operating expenses ratios………………………………….…….... 10 4.1.2 Days Debtors and Days Inventory……………………………..… 11 5. Assessment of Liquidity and Cash Flow…………………..………. .. 12 5.1 Liquidity…………………………………………………………………….... 12 5.2 Solvency………………………………………………………………….….. 14 5.3 Cash Flow Analysis……………………………………………………..…. 15 5.3.1 Cash Flow from Operations (CFO)……………………….…… .. 15 5.3.2 Cash Flow from Investing (CFI)………………………….………. 16 5.3.3 Cash Flow from Financing (CFF)…………………………..…….. 16 6. Assessment of External Performance………………………..……..… 17 6.1 Price -earnings (P/E ratio)………………………………………..…….… 17 6.2 Earnings per share……………………………………………………...…. 18 6.3 Dividend Yield……………………………………………………… …....... 18 6.4 Dividend payout……………………………………………………… .….. 18 7. Conclusions………………………………………………………………. …… 19 8. Recommendations………………………………………….……….…..…… 20 ...
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...A Financial Analysis of Southwest Airlines Co. Accounting for Financial Decisions BA812 Professor Wayne Drake May 20, 1998 Gillian Ainsworth Jennifer Goidell Christine Ledoux Tarak Modi Gerald Owens Robin Walters Southwest Airlines: Twenty-Six Years of “LUV” Twenty-six years ago, Rollin W. King scribbled three lines on a cocktail napkin, leaned across the table, and muttered to his longtime friend: “Herb, lets start our own airline”. Herbert D. Kelleher loosened his tie and knitted his brow before replying: “Rollin, you’ crazy.” He then paused, grinned, and added, re “Lets do it!” 1They founded Air Southwest Company in 1967. The company incorporated as Southwest Airlines in Texas, and commenced customer service on June 18, 1971. They began with three Boeing 737 aircraft serving three Texas cities – Dallas, Houston, and San Antonio. Today, Southwest Airlines operates more than 243 Boeing aircraft and provides service to more than 50 airports located in 49 cities in more than 24 states. Southwest Airlines offers approximately 2200 low fare, short-to-medium range flights throughout the United States.2 Their stock-exchange symbol “LUV” symbolizes their home at Dallas Love Field, as well as the theme of their customer relationships. Today, Southwest is the nation’ low fare, high customer satisfaction airline. Southwest has literally s written the book on low fares. The airline has never pretended to be anything more than a bus service. With an average flight distance...
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