Title: FIN 515 MART Making Decisions/fin515mart.com
1FIN 515 MART Making Decisions/fin515mart.com
- FOR MORE CLASSES VISIT
- www.fin515mart.com
2 FIN 515 Course Project 1 and 2 FOR MORE CLASSES
VISIT www.fin515mart.com This Tutorial contains
Week 3 Course Project (3 Sets) Week 6 Course
Project (2 Sets)
3FIN 515 Entire Course FOR MORE CLASSES
VISIT www.fin515mart.com This tutorial doesnt
contain Final Exam Guide FIN 515 Week 1 DQ 1
Accounting Versus Finance FIN 515 Week 1 DQ 2
Financial Analysis FIN 515 Week 1 Quiz FIN 515
Week 1 Quiz (New) FIN 515 Week 1 Problem Set FIN
515 Week 2 DQ 1 TVM Pass-a-Problem FIN 515 Week 2
DQ 2 Assumptions of the TVM Model FIN 515 Week 2
Quiz FIN 515 Week 2 Problem Set FIN 515 Week 3 DQ
1 Examples of Capital Expenditure From Your
Industry FIN 515 Week 3 DQ 2 Capital Budgeting
Terms and Considerations FIN 515 Week 3 Course
Project 1 (3 Papers) FIN 515 Week 3 Quiz FIN 515
Week 3 Problem Set FIN 515 Week 4 DQ 1 Market
Value of a Stock Versus DDM Value FIN 515 Week 4
DQ 2 Differences in YTM of Real Life Bonds FIN
515 Week 4 Midterm FIN 515 Week 4 Problem Set FIN
515 Week 5 DQ 1 Calculating WACC for a Real Firm
FIN 515 Week 5 DQ 2 Finding Stock Values for Real
Stocks Using Beta and the SML FIN 515 Week 5
problem Set FIN 515 Week 5 Quiz FIN 515 Week 6 DQ
1 Examples of Real Agency Problems and How They
Could Have Been Prevented FIN 515 Week 6 DQ 2 The
Role of Financial Managers in Ethical Corporate
Governance FIN 515 Week 6 Problem Set FIN 515
Week 6 Course Project 2 (2 Different Projects)
4 FIN 515 Final Exam (all 3 Sets) FOR MORE
CLASSES VISIT www.fin515mart.com FIN 515 Final
Exam Set 1 FIN 515 Final Exam Set 2 FIN 515 Final
Exam Set 3
5 FIN 515 Final Exam Set 1 FOR MORE CLASSES
VISIT www.fin515mart.com (TCO A) In the United
States, which of the following types of
organization has the greatest revenue in total?
(Points 5)a. Sole proprietorshipb. C
corporationc. S corporationd. Limited partnership
1.1) Which of the following is not a step in the
WACC valuation method?A) Compute the value of the
investment, including the tax benefit of
leverage, by discounting the free cash flow of
the investment using the WACC.B) Compute the
weighted average cost of capital.C) Determine the
free cash flow of the investment.D) Adjust the
WACC for the firm's current debt/equity ratio. 1.
(TCO H) Zervos Inc. had the following data for
2008 (in millions). The new CFO believes (a) that
an improved inventory management system could
lower the average inventory by 4,000, (b) that
improvements in the credit department could
reduce receivables by 2,000, and (c) that the
purchasing department could negotiate better
credit terms
6 FIN 515 Final Exam Set 2 FOR MORE CLASSES
VISIT www.fin515mart.com Question 1.1. (TCO A)
Double taxation is a drawback for which of the
following types of business organization except?
Question 2.2. (TCO A) Sole proprietorships have
all of the following advantages except Question
3.3. (TCO B) Which of the following would cause
the present value of an annuity to decrease?
Question 4.4. (TCO B) In a TVM calculation, if
incoming cash flows are positive, outgoing cash
flows must be Question 5.5. (TCO G) If net
income, total assets, and book value of equity
stayed the same, what would be the effect on the
DuPont Identity of an increase in sales?
Question 6.6. (TCO D) A stock has just paid a
dividend and will pay a dividend of 3.00 in a
year. The dividend will stay constant for the
rest of time. The return on equity for similar
stocks is 14. What is P0? Question 7.7. (TCO D)
A stock has just declared an annual
7 FIN 515 Final Exam Set 3 FOR MORE CLASSES
VISIT www.fin515mart.com (TCO A) In the United
States, which of the following types of
organization has the greatest revenue in total?
(Points 5) Sole proprietorship C corporation S
corporation Limited partnership Question 2.2.
(TCO A) A sole proprietorship is owned by (Points
5) one person. one or two people, but if there
are two owners, they must be married to each
other. up to 100 owners. up to 64 owners.
Question 3.3. (TCO B) Which of the following
would cause the present value of an annuity to
decrease? (Points 5) Reducing the number of
payments. Increasing the number of payments.
Decreasing the interest rate. Decreasing the
liquidity of the payments. Question 4.4. (TCO B)
In a TVM calculation, if incoming cash flows are
positive, outgoing cash flows must be (Points
5) positive. negative. either positive or
negative. It really doesnt matter. stated in
time units that are different from the time
8 FIN 515 Midterm Exam All 3 Sets FOR MORE CLASSES
VISIT www.fin515mart.com Question included in
these Midterms could be found on this link FIN
515 Midterm Exam Set 1 (New) Linkhttp//www.fin51
5mart.com/product-73-FIN-515-Midterm-Exam-Set-1-(N
ew) FIN 515 Midterm Exam Set 2 (New)
Linkhttp//www.fin515mart.com/product-72-FIN-515-
Midterm-Exam-Set-2-(New) FIN 515 Week 4 Midterm
Linkhttp//www.fin515mart.com/product-48-FIN-515-
Week-4-Midterm
9 FIN 515 Midterm Exam Set 1 (New) FOR MORE
CLASSES VISIT www.fin515mart.com Question 1.
Question (TCO G) If Company A and Company B are
in the same industry and use the same production
method, and Company As asset turnover is higher
than that of Company B, then all else equal we
can conclude Question 2. Question (TCO G)
Suppose Novak Company experienced a reduction in
its ROE over the last year. This fall could be
attributed to Question 3. Question (TCO B) A
certain investment will pay 10,000 in 20 years.
If the annual return on comparable investments is
8, what is this investment currently worth? Show
your work. Question 4. Question (TCO B) You
take out a 4 year car loan for 18,000. The loan
has a 4 annual interest rate. The payments are
made monthly. What are the monthly payments?
10 FIN 515 Midterm Exam Set 2 (New) FOR MORE
CLASSES VISIT www.fin515mart.com Question 1. 1.
(TCO G) If Company A and Company B are in the
same industry and use the same production method,
and Company As asset turnover is higher than
that of Company B, then all else equal we can
conclude (Points 10) Question 2. 2. (TCO G) If
Moon Corporation has an increase in sales, which
of the following would result in no change in its
EBIT margin? (Points 10) Question 3. 3. (TCO B)
If today you put 10,000 into an account paying
10 annually, how much will there be in the
account after 5 years? Show your work. (Points
20) Question 4. 4. (TCO B) You take out a 5 year
car loan for 20,000. The loan has a 5 annual
interest rate. The payments are made monthly.
What are the monthly payments? Show your work.
(Points 20) Question 5. 5. (TCO B)
11 FIN 515 Week 1 DQ 1 Accounting Versus
Finance FOR MORE CLASSES VISIT www.fin515mart.com
Accounting Versus Finance (graded) Much of the
analysis done by financial managers is based on
numbers that are different from what would seem
to the corresponding numbers presented in the
financial statements. This difference is not due
to any kind of cooking the books or other
attempts to mislead anyone. One example is the
use of market value rather than historical cost
in the valuation of assets. What are some other
examples of the differences between financial
management and financial accounting?
12FIN 515 Week 1 DQ 2 Financial Analysis FOR MORE
CLASSES VISIT www.fin515mart.com Financial
Analysis (graded) In this discussion, we will be
working with the variety of financial analysis
tools available to us. Let's start with the
DuPont Identity introduced in Chapter 2 of the
text. For your initial post, locate the financial
statements for two firms in one industry.
Calculate all four terms of the DuPont Identity
and present the results but do not analyze the
results. For an additional post, analyze the
results that another student has posted. If you
were the appropriate financial manager of one of
the firms that you analyzed, what would be your
observations and recommendations?
13FIN 515 Week 1 Problem Set FOR MORE CLASSES
VISIT www.fin515mart.com Chapter 1 The
Corporation 1-1. What is the most important
difference between a corporation and all other
organizational forms? 1-2. What does the phrase
limited liability mean in a corporate context?
1-3. Which organizational forms give their owners
limited liability? 1-4. What are the main
advantages and disadvantages of organizing a firm
as a corporation? 1-5. Explain the difference
between an S corporation and a C corporation.
1-6. You are a shareholder in a C corporation.
The corporation earns 2 per share before taxes.
Once it has paid taxes it will distribute the
rest of its earnings to you as a dividend. The
corporate tax rate is 40 and the personal tax
rate on (both dividend
14FIN 515 Week 1 Quiz (New) FOR MORE CLASSES
VISIT www.fin515mart.com Question 1. (TCO G) The
lecture says that some ratios typically are
better when they are higher and some of the
ratios are better when they are lower. Pick a
ratio for which a lower number typically would be
preferred and describe a situation, in which a
higher number for that ratio would be preferred,
OR pick a ratio for which a higher number
typically would be preferred and describe a
situation in which a lower number for that ratio
would be preferred. Question 2. (TCO G) As of
December 31, 20XX, David Corp's accounts payable
were 4,000,000. Its accounts receivable were
2,200,000, and its sales for 20XX were
32,000,000. What was its days sales outstanding?
15 FIN 515 Week 1 Quiz FOR MORE CLASSES
VISIT www.fin515mart.com Question 1 (TCO G) Which
do you think provides a more valid measure of how
a company is doing, comparison of current results
with historical results or comparison of current
results with the current results of another
company? Question 2 (TCO G) Barnes Corps total
assets at the end of last year were 415,000,000
and its net income after taxes was 17,750,000.
What was its return on total assets? Question 3
(TCO G) Between December 31, 2016 and December
31, 2017, ROE at Bobcat Industries decreased even
though sales increased. Using the DuPont
Identity, explain what else could have happened
to cause this.
16 FIN 515 Week 1-7 DQs FOR MORE CLASSES
VISIT www.fin515mart.com FIN 515 Week 1 DQ 1
Accounting Versus Finance FIN 515 Week 1 DQ 2
Financial Analysis FIN 515 Week 2 DQ 1 TVM
Pass-a-Problem FIN 515 Week 2 DQ 2 Assumptions of
the TVM Model FIN 515 Week 3 DQ 1 Examples of
Capital Expenditure From Your Industry FIN 515
Week 3 DQ 2 Capital Budgeting Terms and
Considerations FIN 515 Week 4 DQ 1 Market Value
of a Stock Versus DDM Value FIN 515 Week 4 DQ 2
Differences in YTM of Real Life Bonds FIN 515
Week 5 DQ 1 Calculating WACC for a Real Firm FIN
515 Week 5 DQ 2 Finding Stock Values for Real
Stocks Using Beta and the SML FIN 515 Week 6 DQ 1
Examples of Real Agency Problems and How They
Could Have Been Prevented FIN 515 Week 6 DQ 2 The
Role of Financial Managers in Ethical Corporate
Governance
17 FIN 515 Week 2 DQ 1 TVM Pass-a-Problem FOR MORE
CLASSES VISIT www.fin515mart.com TVM
Pass-a-Problem (graded) This week, the lecture
provided some examples of TVM problem scenarios.
For your first post, provide a story problem that
can be solved using one or more of the TVM
calculations. Your second post can be a
description of how the problem posed by another
student can be solved. Your professor may provide
an example.
18 FIN 515 Week 2 DQ 2 Assumptions of the TVM
Model FOR MORE CLASSES VISIT www.fin515mart.com As
sumptions of the TVM Model (graded) What are some
of the assumptions behind the TVM calculations?
How do these assumptions limit our application of
these calculations?
19 FIN 515 Week 2 Problem Set FOR MORE CLASSES
VISIT www.fin515mart.com 3.Calculate the future
value of 2000 in a. five years at an interest
rate of 5 per year b. ten years at an interest
rate of 5 per year and c. five years at an
interest rate of 10 per year. d. Why is the
amount of interest earned in part (a) less than
half the amount of interest earned in part (b)?
4.What is the present value of 10,000 received
a. twelve years from today when the interest rate
is 4 per year b. twenty years from today when
the interest rate is 8 per year and c. six
years from today when the interest rate is 2 per
year? 5.Your brother has offered to give you
either 5,000 today or 10,000 in 10 years. If
the interest rate is 7 per year, which option is
preferable? 6.Consider the following
alternatives.
20 FIN 515 Week 2 Quiz FOR MORE CLASSES
VISIT www.fin515mart.com FIN 515 Week 2 Quiz
Question 1 (TCO B) You are a trust fund baby.
Your trust fund is currently worth 1,234,000.
The problem is the terms of the trust dont allow
you to receive any of the money until you are 27.
You are now 21. The fund is earning 7.7 per
year. How much will the fund be worth when you
are 27 and too old to enjoy it?Ignore taxes. Show
your work. If you use Excel, show the formula
with the parameters, and the answer. If you use a
formula, provide the standard formula, the
formula with terms substituted, and the answer.
If you use a calculator, show the inputs and the
answer. Question 2 (TCO B) You have a student
loan of 75,000. The interest rate is 8.6 per
year. You have been out of school for 6 months
and are ready to start making payments. You want
to use the maximum allowed of 10 years to pay off
the loan by making equal monthly payments. How
much are the monthly payments?I
21 FIN 515 Week 3 Course Project 1 (3 Papers) FOR
MORE CLASSES VISIT www.fin515mart.com This
Tutorial contains 3 Different Course Projects
First Course ProjectThe purpose of this project
is to help you develop skills not only in
performing the calculations behind financial
analysis but interpreting the numbers as well.You
are to pick a company. You should pick one either
from the industry in which you are currently
working or an industry in which you are
interested. You could also pick a division of a
company. It is imperative to use that sufficient
data about your company and that it is available.
One way to do this is to pick a publicly held
company. If you pick a privately held company or
a division of a company, make sure that the data
necessary to do a significant financial analysis
is available.If you use data that is not publicly
available, be sure to talk to your manager and to
make absolutely sure that revealing that data is
not a problem
22 FIN 515 Week 3 Course Project 1 (3 Papers) FOR
MORE CLASSES VISIT www.fin515mart.com This
Tutorial contains 3 Different Course Projects
First Course ProjectThe purpose of this project
is to help you develop skills not only in
performing the calculations behind financial
analysis but interpreting the numbers as well.You
are to pick a company. You should pick one either
from the industry in which you are currently
working or an industry in which you are
interested. You could also pick a division of a
company. It is imperative to use that sufficient
data about your company and that it is available.
One way to do this is to pick a publicly held
company. If you pick a privately held company or
a division of a company, make sure that the data
necessary to do a significant financial analysis
is available.If you use data that is not publicly
available, be sure to talk to your manager and to
make absolutely sure that revealing that data is
not a problem
23 FIN 515 Week 3 DQ 1 Examples of Capital
Expenditure From Your Industry FOR MORE CLASSES
VISIT www.fin515mart.com FIN 515 Week 3 DQ 1
Examples of Capital Expenditure From Your
Industry (graded) Describe a potential capital
expenditure project from the industry in which
you now work or an industry in which you are
interested. What is the project? Describe and
provide an approximate value of the initial cash
flow. Describe and provide an approximate value
of the annual cash flows. Provide an estimation
of the life of the project, as well as the exit
costs.
24 FIN 515 Week 3 DQ 2 Capital Budgeting Terms and
Considerations FOR MORE CLASSES
VISIT www.fin515mart.com Capital Budgeting Terms
and Considerations Our textbook and lecture
discuss some considerations that should be taken
into account when doing capital budgeting. How
will these considerations affect the project you
described in the other topic? Incremental
earnings, interest expenses, taxes, opportunity
costs, externalities, sunk costs, cannibalization
or erosion, depreciation, and salvage value as
well as others.
25 FIN 515 Week 3 Problem Set FOR MORE CLASSES
VISIT www.fin515mart.com Week 3 Problem Set 1.
Your brother wants to borrow 10,000 from you. He
has offered to pay you back 12,000 in a year. If
the cost of capital of this investment
opportunity is 10, what is its NPV? Should you
undertake the investment opportunity? Calculate
the IRR and use it to determine the maximum
deviation allowable in the cost of capital
estimate to leave the decision unchanged. 8. You
are considering an investment in a clothes
distributor. The company needs 100,000 today and
expects to repay you 120,000 in a year from now.
What is the IRR of this investment opportunity?
Given the riskiness of the investment
opportunity, your cost of capital is 20. What
does the IRR rule say about whether you should
invest? 19. You are a real estate agent thinking
of placing a sign advertising your services at a
local bus stop. The sign will cost 5,000 and
will be posted for one year. You expect that it
will generate additional revenue of 500 per
month.
26FIN 515 Week 3 Quiz FOR MORE CLASSES
VISIT www.fin515mart.com Company A has a beta of
2.77. Company B has a beta of .73. Company C has
a beta of .90. The risk free rate is 6 and the
market risk premium is 4. What is the expected
return of investing in Company B? stock portfolio
consists of only two stocks. You have 15,000 in
Company A and 25,000 in Company B. Company A has
an actual return of -8 and Company B has a
return of 12. What is the return on your
portfolio? A company has a capital structure of
40 debt and 60 equity. The YTM on the companys
bonds is 9, and the companys effective tax rate
is 40. The CFO has estimated the companys WACC
to be 9.96. What is the companys cost of equity?
27 FIN 515 Week 4 DQ 1 Market Value of a Stock
Versus DDM Value FOR MORE CLASSES
VISIT www.fin515mart.com Market Value of a Stock
Versus DDM Value (graded) Select a stock in which
you are interested. Calculate its per share value
using the DDM or another method discussed in
Chapter 9. Then find the current market value of
a share of the stock. Compare that two. Can you
explain the similarity or difference?
28 FIN 515 Week 4 DQ 2 Differences in YTM of Real
Life Bonds FOR MORE CLASSES VISIT www.fin515mart.
com Differences in YTM of Real Life Bonds
(graded) Do some research, probably on the Web,
and find some bonds with differing yields to
maturity (YTM). How do you explain the
difference? Both the lecture and the textbook
discuss some factors that may lead to this
difference. .
29 FIN 515 Week 4 Midterm FOR MORE CLASSES
VISIT www.fin515mart.com Question 1. Question
(TCO G) The firm's asset turnover measures
Question 2. Question (TCO G) If Moon
Corporation has an increase in sales, which of
the following would result in no change in its
EBIT margin? Question 3. Question (TCO B) You
plan on retiring in 20 years. You currently have
275,000 and think you will need 1,000,000 to
retire. Assuming you dont deposit any additional
money into the account, what annual return will
you need to earn to meet this goal? Question 4.
Question (TCO B) You take out a 4 year car loan
for 18,000. The loan has a 4 annual interest
rate. The payments are made monthly. What are the
monthly payments? Show your work. Question 5.
Question (TCO B) You currently have 10,000 in
your retirement account. If you deposit 500 per
month and the account pays 5 interest, how much
will be in the account in 10 years?
30 FIN 515 Week 4 Problem Set FOR MORE CLASSES
VISIT www.fin515mart.com Bonds-1. Interest on a
certain issue of bonds is paid annually with a
coupon rate of 8. The bonds have a par value of
1,000. The yield to maturity is 9. What is the
current market piece of these bonds? The bonds
will mature in 5 years. Bonds-2. A certain bond
has 12 years left to maturity. Interest is paid
annually at a coupon rate of 10. The bonds are
currently selling for 850. What is their YTM?
Bonds-3. A certain bond pays a semiannual coupon
rate at a 10 annual rate. The bond has a par
value of 1,000. There are eight years to
maturity. The yield to maturity is 9. What is
the current price of the bond? Bonds-4. A
particular corporate bond has a par value of
1,000. Coupon payments are 40 and are paid
twice a year. Seven
31 FIN 515 Week 5 DQ 1 Calculating WACC for a Real
Firm FOR MORE CLASSES VISIT www.fin515mart.com Ca
lculating WACC for a Real Firm (graded) The
Weighted Average Cost of Capital (WACC) for a
firm can be calculated or found through research.
Select two firms in the same industry. The
industry may be that in which you currently work
or it may be an industry in which you are
interested. Calculate or find the WACC for the
two firms. How do the WACCs compare? Are the
WACCs what you would expect? What causes the
differences between the two firms' WACCs?
32 FIN 515 Week 5 DQ 2 Finding Stock Values for
Real Stocks Using Beta and the SML FOR MORE
CLASSES VISIT www.fin515mart.com Finding Stock
Values for Real Stocks Using Beta and the SML
(graded) Our second discussion topic concerns the
calculation of stock values using the Capital
Asset Pricing Model (CAPM). We will start with a
discussion of risk and work towards practical
application of the model. The textbook provides a
list of betas for a selection of stocks. Choose a
few firms from that list and discuss whether the
betas are what you would expect. Be sure to
explain why or why not.
33 FIN 515 Week 5 problem Set FOR MORE CLASSES
VISIT www.fin515mart.com Chapter 10 (pages
345348) 4. You bought a stock one year ago for
50 per share and sold it today for 55 per
share. It paid a 1 per share dividend today.
What was your realized return? How much of the
return came from dividend yield and how much came
from capital gain? 20. Consider two local banks.
Bank A has 100 loans outstanding, each for 1
million, that it expects will be repaid today.
Each loan has a 5 probability of default, in
which case the bank is not repaid anything. The
chance of default is independent across all the
loans. Bank B has only one loan of 100 million
outstanding, which it also expects will be repaid
today.
34 FIN 515 Week 5 Quiz FOR MORE CLASSES
VISIT www.fin515mart.com Question 1 (TCO C)
Company A has a beta of 2.77. Company B has a
beta of .73. Company C has a beta of .90. The
risk free rate is 6 and the market risk premium
is 4. What is the expected return of investing
in Company B? Show your work. Question 2. (TCO C)
Your stock portfolio consists of only two stocks.
You have 30,000 in Company A and 35,000 in
Company B. Company A has an actual return of -8
and Company B has a return of 12. What is the
return on your portfolio?
35 FIN 515 Week 6 Course Project 2 (2 Different
Projects) FOR MORE CLASSES VISIT www.fin515mart.co
m This Tutorial contains 2 Different Course
Projects Second Project The purpose of this
project is for you to have some practice working
with financial concepts in the real world. This
will involve integrating some material from
throughout the course. The project will also
involve the development of your own approach to
doing the work. The project does not provide a
step-by-step procedure for you to follow. Your
task is to determine the WACC for a given firm
using what you know about WACC as well as data
you can find through research. Your deliverable
is to be a brief report in which you state your
determination of WACC, describe and justify how
you determined the number, and provide relevant
information as to the sources of your data.
Assumptions As you recall, the formula for WACC
is rWACC (E/ED) rE D/(ED) rD (1-TC) The
formula for the required return on a given equity
investment is ri rf ßi (RMkt-rf) RMkt-rf is
the Market Risk Premium. For this project, you
may assume the Market Risk Premium is 4 unless
you can develop a better number. rf is the risk
free rate. The YTM on 10 year US Treasury
securities is a good approximation
36 FIN 515 Week 6 DQ 1 Examples of Real Agency
Problems and How They Could Have Been
Prevented FOR MORE CLASSES VISIT www.fin515mart.co
m Examples of Real Agency Problems and How They
Could Have Been Prevented (graded) Do some
research and find some historical or current real
life examples of agency problems. Will the
measures discussed in the text help to prevent
problems like your examples in the future? What
else would you advise? You may provide examples
of agency problems from your own experience. If
you do that, be careful to provide enough
anonymity that you won't get in trouble.
37 FIN 515 Week 6 DQ 2 The Role of Financial
Managers in Ethical Corporate Governance FOR MORE
CLASSES VISIT www.fin515mart.com The Role of
Financial Managers in Ethical Corporate
Governance (graded) Does the financial manager
have a greater responsibility or a lesser
responsibility for maintaining ethical corporate
governance? Why or why not? What is or will be
your approach to ethical corporate governance now
or in the future?
38 FIN 515 Week 6 Problem Set FOR MORE CLASSES
VISIT www.fin515mart.com Chapter 29 (pages
983-984) 1.What inherent characteristic of
corporations creates the need for a system of
checks on manager behavior? 2. What are some
examples of agency problems? 3.What are the
advantages and disadvantages of the corporate
organizational structure? 4.What is the role of
the board of directors in corporate governance?
1.What inherent characteristic of corporations
creates the need for a system of checks on
manager behavior? 2.What are some examples of
agency problems? 3.What are the advantages and
disadvantages of the corporate organizational
structure? Managing Agency Conflict 4.Suppose
Goodyear Tire and Rubber Company is considering
divesting one of its manufacturing plants.
39 FIN 515 Week 7 DQ 1 Industry Approaches to
Working Capital Financing FOR MORE CLASSES
VISIT www.fin515mart.com Industry Approaches to
Working Capital Financing (graded) Do some
research on two firms in your industry or an
industry in which you are interested. Can you get
an idea of their working capital management
policies from publicly available information? How
do the two companies differ in their apparent
working capital management policies? Which policy
do you think is better and why?
40 FIN 515 Week 7 DQ 2 Your Preference for Working
Capital Management Policy FOR MORE CLASSES
VISIT www.fin515mart.com Your Preference for
Working Capital Management Policy (graded)
Consider the company you work for or a company in
which you are interested. Also, do some research
to find some current cost estimates for various
means of financing working capital. What would be
your recommendation to the company for financing
its working capital needs? If the information is
publicly available, or if you have access to it
AND have permission to discuss it, how does your
recommendation compare what the firm is actually
doing?
41 FIN 515 Week 7 Problem Set FOR MORE CLASSES
VISIT www.fin515mart.com 1. Answer the following
questions a. What is the difference between a
firms cash cycle and its operating cycle? 2. How
will a firms cash cycle be affected if a firm
increases its inventory, all else being equal? 2.
How will a firms cash cycle be affected if a
firm begins to take the discounts offered by its
suppliers, all else being equal? 4.The Greek
Connection had sales of 32 million in 2012, and
a cost of goods sold of 20 million. A simplified
balance sheet for the firm appears below a-
Calculate The Greek Connections net working
capital in 2012. 2. Calculate the cash conversion
cycle of The Greek Connection in 2012. 2. The
industry average accounts receivable days is 30
days. What would the cash conversion cycle for
The Greek Connection have been in 2012 if it had
matched the industry average for accounts
receivable days?
42FIN 515 MART Making Decisions/fin515mart.com
- FOR MORE CLASSES VISIT
- www.fin515mart.com