auditor, valuations specialist, industry specialist) 2. Overall, after calculating a few of Ocean Manufacturing ratios and comparing them with the industry, the company’s figures are not performing up to others in the industry. ROE = NI/Stockholder Equity (2011,2010)= 8.9% and 7.1% ROA = NI/Assets= 4.5% . 3.8% Both return on equity and assets are lower than industry ratios but are improving. Accounts Rec Turnover—could not calculate without % of credit sales from cash sales. Profit
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FinancialDependence and Growth By RAGHURAM G. RAJAN AND LUIGI ZINGALES* This paper examines whetherfinancial developmentfacilitates economic growth by scrutinizing one rationale for such a relationship: thatfinancial development reduces the costs of external finance to firms. Specifically, we ask whether in-dustrial sectors that are relatively more in need of externalfinance develop disproportionately faster in countries with more-developedfinancial markets. We find this to be true in a large sample of countries
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Interpret the contents of a trading and profit and loss account and balance sheet for a selected company explaining how accounting ratios can be used to monitor the financial performance of the organisation. Profitability ratio Profitability ratios assess a business’s profitability of how well they’re doing by their interest parties. ROCE: In order for me to calculate the return on capital employed, I divided net profit from capital employed and then multiply by 100. This is shown bellow
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million while $421 million on 1994. On September 1996, Calpine also took action to raise public equity. The IPO of Calpine bought $317 million at a price of $16 per share to the company. From 1984 to 1994, Calpine preferred to use method of project finance to do the construction of new plants. After 1994, the corporation changed its policy to retiring subsidiary project debt with parent-level, corporate debt issues. On 1999, after raised 5 corporation debt, the rate of Calpine was improved from B1/B
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Budget = $10,000,000; Capital structure = 60% equity, 40% debt Retained Earnings Needed = $10,000,000 (0.6) = $6,000,000 B. Residual Dividends = Net Income - Retained earnings needed to finance new investment $8,000,000 - $6,000,000 = $2,000,000 DPS = $2,000,000/1,000,000 = $2.00 Payout ratio = $2,000,000/$8,000,000 = 25% C. R/E Available = $8,000,000 - $3.00 (1,000,000) R/E Available = $8,000,000 - $3,000,000 R/E Available = $5,000,000 D. No. I think the
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Inventory Loans- business loans, usually to support the purchase of inventories, in which the credit is gradually repaid by the borrowing customer as inventory is sold (60-90 days). o Usually related to the borrowers need for short term cash to finance purchases of inventory or cover production costs, the payment of taxes, interest payments on debt, and dividend payments to stock holders. • Working Capital Loans- loans that provide business with short-term credit lasting from a few days to one
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The purpose of this memo is present the analysis and answer the questions revolving around the Project Chariot, the Spin-off that allowed Marriott to separate its business activities in its world famous hotel management business and a separate real estate business in 1994. This project involves the splitting up the company into two separate entities, Marriott International Incorporated (MI) and Host Marriott Corporation (HM) in order to minimize the debt burden and improve the financial health of
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|Introduction to Finance: Harvesting the Money Tree | Copyright © 2009, 2008, 2007 by University of Phoenix. All rights reserved. Course Description This course gives students an overview of finance concepts, terminology, and principles. It is an introduction to the role of finance in the business world. Topics covered include the relationship between finance and accounting, basic financial analysis and planning techniques, financial ratios, profit, cash flow
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Chapter 1, Problem 1 A) Calculate the tax disadvantage to organizing a U.S. business today as a corporation, as compared to a partnership, under the following conditions. Assume that all earnings will be paid out as cash dividends. Operating income (operating profit before taxes) will be $500,000 per year under either organizational form. The tax rate on corporate profits is 35% (= 0.35), the average personal tax rate for the partners is also 35%, and the capital gains tax rate on dividend income
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flows can differ from accounting profits. True 8. One advantage of using common stock as a source of funds is that common stock does not legally obligate the firm to make payments to stockholders. True 9. Ratio analysis involves a comparison of the relationships between financial statement accounts so as to analyze the financial position and strength of a firm. True 10. Genzyme Corporation has seen its days sales outstanding (DSO) decline
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