Capital Budgeting Techniques | | GLOSSARY Capital Budget: (1) The amount of money set aside for the purchase of fixed assets (e.g., equipment, buildings, etc.). Also, (2) a request for authorization to purchase new fixed assets. Mutually Exclusive Proposals: Consideration of two or more assets that perform the same function. If one is chosen for purchase, the others are automatically rejected. Profitability Index: A ratio of the present value of the benefits (PVB) to the present value
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Cost of Capital Introduction This paper examines key elements of a cost of capital policy to facilitate objective management and allocation of corporate funds. In order for a company to make long-term investments to grow, whether that is new equipment, new products or other assets, managers must be aware of the cost of acquiring any of these assets. The obvious objective for these managers is to earn more than the cost of capital and in doing so will increase their company’s market value. If
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The role of capital in resolving agency conflicts between different groups of bank stakeholders. 1. Introduction This essay discusses the role of capital in resolving agency conflicts between different groups of bank stakeholders, by discussing two papers. The first paper is a descriptive paper written by Berger, Herring, and Szego (2005), called “The Role of Capital in Financial Institutions”. The second paper, “Caught in Between Scylla and Charybdis? Regulating Bank Leverage When There Is
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CONTENTS | PAGE NO. | 1 | Scope of the research paper | 3 | 2 | Introduction | 3 | 3 | Research methodology | 3-4 | 4 | Conclusion | 4 | 5 | Limitations and future direction of research | 4-5 | | (a) Limitations | 4 | | (b) Future direction of research | 5 | BEST PRACTICES IN ESTIMATING COST OF CAPITAL 1. THE SCOPE OF THE RESEARCH PAPER: It is a survey research paper presenting the results of the cost of capital survey of advisors, corporations etc showing a
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TAXATION PAPERS WORKING PAPER N.33 - 2012 Serena Fatica Thomas Hemmelgarn Gaëtan Nicodème The Debt-Equity Tax Bias: consequences and solutions Taxation and customs union Taxation Papers are written by the staff of the European Commission's Directorate-General for Taxation and Customs Union, or by experts working in association with them. Taxation Papers are intended to increase awareness of the work being done by the staff and to seek comments and suggestions for further analyses
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and the Cost of Capital for U.S. Multinationals Chapter Author: Joosung Jun, James R. Hines Jr., R. Glenn Hubbard Chapter URL: http://www.nber.org/chapters/c7724 Chapter pages in book: (p. 21 - 28) 3 Corporate Taxes and the Cost of Capital for U.S. Multinationals Joosung Jun 3.1 Introduction Tax rules affect the ability of U.S. firms to compete in foreign markets with local and other foreign firms. The primary channel through which taxes exert this influence is by changing the cost of capital
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The purpose of this paper, prepared by Jessica Chan under the supervision of Robert F. Bruner is about analyzing the companies Coca Cola and Pepsi after Pepsi has announced a merger with Quaker Oats Company with a deal at around $14 billion. With this deal Pepsi would have access to 83.6% of the sport drink market and around 33% of the U.S. noncarbonated-beverage market, followed by Coke with 21%. The paper wants to answer the questions how the latest announcement of Pepsi has an effect on the two
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(Mendel Paper Company) Discussion 1, Ethics in Cost Control Discussion 2, Fixed and Variable Costs WEEK 2 Written Assignment Case 3A (Auerbach Enterprises) Discussion 1, Product Costs Discussion 2, Job Order Costing vs. Process Costing WEEK 3 Written Assignment Case 5A (Glaser Health Products) Discussion 1, Allocating Joint Costs Discussion 2, Variable/Absorption Costing WEEK 4 Written Assignment Case 6B (Chester & Wayne) Discussion 1, Budgeting Comments Discussion 2, Standard Cost System
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TOPIC: ANALYSIS OF EQUITY SHARE CAPITAL AS A SOURCE OF FINANCE IN AN ORGANISATION RESEARCH PAPERS The 2 research papers under study are 1. The effect of CEO ownership and shareholder rights on cost of equity share capital. 2. What motivates seasoned equity offerings? Evidence from the use of issue proceeds. COST OF EQUITY CAPITAL AND ITS EFFECTS TO THE MANAGEMENT Introduction This paper investigates the cost of equity capital and its effects to the management which intends to hinder
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one-third of America's industrial plants lay idle. Company The Dixon Corporation is a specialty chemicals company that supplies primarily to the paper and pulp industry. The company’s products are mainly used by paper companies as a bleaching agent for pulp. Dixon’s principal plant was located in Calhoun, Georgia, and mostly supplied paper and pulp companies in the southeastern United States. The company achieved strong growth with a compounded annual growth sales of 17% for the past 5 years
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