Recent Question

Calculate Lintner's total tax liability using the corporate tax 1) Russell Securities has $100 million in total assets and its corporate tax rate is 40%. The company recently reported that its basic earning power (BEP) ratio was 15% and its return on assets (ROA) was 9%. What was the company's interest expense? A. $ 0 B. $ 2,000,000 C. $ 6,000,000 D. $15,000,000 E. $18,000,000 2) Lintner Beverage Corp. reported t ...

Other / Other 23 Apr 2016

Which process is responsible for recording the current details 1.Which of the following should be documented in an incident model? 1. Details of the service level agreement (SLA) pertaining to the incident 2. Chronological order of steps to resolve the incident A. 1 only B. 2 only C. Both of the above D. Neither of the above 2.Why is it important for service providers to understand patterns of business activity (PBA)? A. PBA are ba ...

Other / Other 23 Apr 2016

Which role is responsible for carrying out the activities 1.Which role is responsible for carrying out the activities of a process? A. Process owner B. Change manager C. Service manager D. Process practitioner 2.Which process or function is responsible for monitoring activities and events in the IT infrastructure? A. Service level management B. IT operations management C. Capacity management D. Incident management 3.Which of the f ...

Other / Other 23 Apr 2016

Why might a firm use a “local” capital structure at a particular subsidiary 1. Country Differences. Describe general differences between the capital structures of firms based in the United States and those of firms based in Japan. Offer an explanation for these differences. 2. Local Versus Global Capital Structure. Why might a firm use a “local” capital structure at a particular subsidiary that differs substantial ...

Other / Other 23 Apr 2016

Which financing alternative is more appropriate to protect the subsidiary 1. Target Capital Structure. LaSalle Corp. is a U.S.-based MNC with subsidiaries in various less developed countries where stock markets are not well established. How can LaSalle still achieve its “global” target capital structure of 50 percent debt and 50 percent equity, if it plans to use only debt financing for the subsidiaries in these countries? ...

Other / Other 23 Apr 2016

Explain why the cost of capital for a U.S.-based MNC 1. Costs of Capital Across Countries. Explain why the cost of capital for a U.S.-based MNC with a large subsidiary in Brazil is higher than for a U.S.-based MNC in the same industry with a large subsidiary in Japan. Assume that the subsidiary operations for each MNC are financed with local debt in the host country. 2. WACC. An MNC has total assets of $100 million and debt of $20 mil ...

Other / Other 23 Apr 2016

Interaction Between Financing and Investment 1. Interaction Between Financing and Investment. Charleston Corp. is considering establishing a subsidiary in either Germany or the United Kingdom. The subsidiary will be mostly financed with loans from the local banks in the host country chosen. Charleston has determined that the revenue generated from the British subsidiary will be slightly more favorable than the revenue generated by the ...

Other / Other 23 Apr 2016

If Blades borrows funds in Thailand 1. If Blades borrows funds in Thailand to support its Thai subsidiary, how would this affect its cost of capital? Why? 2. Given the high level of interest rates in Thailand, the high level of exchange rate risk, and the high (perceived) level of country risk, do you think Blades will be more or less likely to use debt in its capital structure as a result of its expansion into Thailand? Why? Bus ...

Other / Other 23 Apr 2016

A typical industrial company's balance sheet lists 1) Marcus Nurseries Inc.'s 2005 balance sheet showed total common equity of $2,050,000, which included $1,750,000 of retained earnings. The company had 100,000 shares of stock outstanding which sold at a price of $57.25 per share. If the firm had net income of $250,000 in 2006 and paid out $100,000 as dividends, what would its book value per share be at the end of 2006, assuming that it n ...

Other / Other 23 Apr 2016

What is Wiley’s estimated cost of equity 1. Cost of Equity. Wiley, Inc., an MNC, has a beta of 1.3. The U.S. stock market is expected to generate an annual return of 11 percent. Currently, Treasury bills yield 2 percent. Based on this information, what is Wiley’s estimated cost of equity? 2. WACC. Blues, Inc. is an MNC located in the U.S. Blues would like to estimate its weighted average cost of capital. On average, bond ...

Other / Other 23 Apr 2016