finance help

Problem 4-20  Amortization Schedule a. Set up an amortization schedule for a $50,000 loan to be repaid in equal installments at the end of each of the next 5 years. The interest rate is 12%. Round your answers to the nearest cent. Enter "0" if required Year Payment Repayment Interest Repayment of Principal Balance 1 $  $  $  $  2 $  $  $  $  3 $  $  $  $  4 $  $  $  $  5 $  $  $  $  Total $  $  $  b. c. How large must each annual payment be if the loan is for $100,000? Assume that the interest rate remains at 12% and that the loan is paid off over 5 years. Round your answer to the nearest cent. $  d. How large must each payment be if the loan is for $100,000, the interest rate is 12%, and the loan is paid off in equal installments at the end of each of the next 10 years? This loan is for the same amount as the loan in part b, but the payments are spread out over twice as many periods. Round your answer to the nearest cent. $  Why are these payments not half as large as the payments on the loan in part b? I. Because the payments are spread out over a longer time period, more interest must be paid on the loan, which raises the amount of each payment.  II. Because the payments are spread out over a longer time period, more principal must be paid on the loan, which raises the amount of each payment. III. Because the payments are spread out over a longer time period, less interest is paid on the loan, which raises the amount of each payment. IV. Because the payments are spread out over a longer time period, less interest is paid on the loan, which lowers the amount of each payment. V. Because the payments are spread out over a shorter time period, more interest is paid on the loan, which lowers the amount of each payment. Problem 4-18  Future Value of an Annuity for Various Compounding Periods Find the future values of the following ordinary annuities: a. FV of $200 paid each 6 months for 7 years at a nominal rate of 12%, compounded semiannually. Round your answer to the nearest cent. $  b. FV of $100 paid each 3 months for 7 years at a nominal rate of 12%, compounded quarterly. Round your answer to the nearest cent. $  c. The annuities described in parts a and b have the same amount of money paid into them during the 7-year period and both earn interest at the same nominal rate, yet the annuity in part b earns more than the one in part a over the 7 years. Why does this occur? Problem 3-13  Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Company: Balance Sheet as of December 31, 2013 (Thousands of Dollars) Cash $ 225,000 Accounts payable $601,866 Receivables 1,575,000 Notes payable 326,634 Inventories 1,125,000 Other current liabilities 525,000 Total current assets $2,925,000 Total current liabilities $1,453,500 Net fixed assets 1,350,000 Long-term debt 1,068,750 Common equity 1,752,750 Total assets $4,275,000 Total liabilities and equity $4,275,000 Lozano Chip Company: Income Statement for Year Ended December 31, 2013 (Thousands of Dollars) Sales $7,500,000 Cost of goods sold 6,375,000 Selling general and administrative expenses 825,000 Earnings before interest and taxes (EBIT) $ 300,000 Interest expense 111,631 Earnings before taxes (EBT) $ 188,369 Federal and state income taxes (40%) 75,348 Net income $ 113,022 a. Calculate the indicated ratios for Lozano. Round your answers to two decimal places. Ratio Lozano Industry Average Current assets/Current liabilities 2.0 Days sales outstanding* days 35.0 days COGS/Inventory 6.7 Sales/Fixed assets 12.1 Sales/Total assets 3.0 Net income/Sales % 1.2% Net income/Total assets % 3.6% Net income/Common equity % 9.0% Total debt/Total assets % 30.0% Total liabilities/Total assets % 60.0% *Calculation is based on a 365-day year. b. c. Construct the extended Du Pont equation for both Lozano and the industry. Round your answers to two decimal places. For the firm, ROE is % For the industry, ROE is % d. Outline Lozano's strengths and weaknesses as revealed by your analysis Problem 2-3  Income statement Molteni Motors Inc. recently reported $3 million of net income. Its EBIT was $8 million, and its tax rate was 40%. What was its interest expense? Round your answer to the nearest dollar. Enter your answer in dollars. For example, an answer of $1.2 million should be entered as 1,200,000. $  Problem 2-7  Corporate Tax Liability To complete the assignments listed below, refer to the Table 2-1. The Talley Corporation had a taxable income of $330,000 from operations after all operating costs but before (1) interest charges of $33,000, (2) dividends received of $19,800, (3) dividends paid of $19,800, and (4) income taxes. What are the firm's income tax liability and its after-tax income? Round your answers to two decimal places. Income tax liability $  After-tax income $  What are the company's marginal and average tax rates on taxable income? Round your answers to two decimal places. Marginal tax rate % Average tax rate % Problem 2-1  Personal After-Tax Yield An investor recently purchased a corporate bond which yields 10.5%. The investor is in the 36% combined federal and state tax bracket. What is the bond's after-tax yield? Round your answer to two decimal places. % Problem 3-11  Balance Sheet Analysis Complete the balance sheet and sales information in the table that follows for J. White Industries using the following financial data: Total assets turnover: 1.2 Gross profit margin on sales: (Sales - Cost of goods sold)/Sales = 29%  Total liabilities-to-assets ratio: 50% Quick ratio: 1.05  Days sales outstanding (based on 365-day year): 33 days  Inventory turnover ratio: 7.0 Round your answers to the nearest whole dollar. Partial Income Statement Information Sales $  Cost of goods sold $  Balance Sheet Cash $  Accounts payable $  Accounts receivable $  Long-term debt $ 50,000 Inventories $  Common stock $  Fixed assets $  Retained earnings $ 100,000 Total assets $ 400,000 Total liabilities and equity $  Problem 2-12  Free Cash Flows Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) 2013 2012 Sales $7,500.0 $6,000.0 Operating costs excluding depreciation 5,813.0 5,100.0 Depreciation and amortization 158.0 132.0 Earnings before interest and taxes $1,529.0 $768.0 Less: Interest 161.0 129.0 Pre-tax income $1,368.0 $639.0 Taxes (40%) 547.2 255.6 Net income available to common stockholders $820.8 $383.4 Common dividends $739.0 $307.0 Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2013 2012 Assets Cash $92.0 $84.0 Short-term investments 38.0 30.0 Accounts receivable 828.0 720.0 Inventories 1,638.0 1,260.0 Total current assets $2,596.0 $2,094.0 Net plant and equipment 1,584.0 1,320.0 Total assets $4,180.0 $3,414.0 Liabilities and Equity Accounts payable $414.0 $360.0 Accruals 312.0 240.0 Notes payable 150.0 120.0 Total current liabilities $876.0 $720.0 Long-term bonds 1,500.0 1,200.0 Total liabilities $2,376.0 $1,920.0 Common stock 1,607.2 1,379.0 Retained earnings 196.8 115.0 Total common equity $1,804.0 $1,494.0 Total liabilities and equity $4,180.0 $3,414.0 Using Rhodes Corporation's financial statements (shown above), answer the following questions. a. What is the net operating profit after taxes (NOPAT) for 2013? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place. $ million b. What are the amounts of net operating working capital for both years? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place. 2013 $ million 2012 $ million c. What are the amounts of total net operating capital for both years? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place. 2013 $ million 2012 $ million d. What is the free cash flow for 2013? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place. $ million e. What is the ROIC for 2013? Round your answer to two decimal places.  % f. How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place. After-tax interest payment $ million Reduction (increase) in debt $ million Payment of dividends $ million Repurchase (Issue) stock $ million Purchase (Sale) of short-term investments $ million Problem 4-28  PV and Effective Annual Rate Assume that you inherited some money. A friend of yours is working as an unpaid intern at a local brokerage firm, and her boss is selling securities that call for 4 payments of $50 (1 payment at the end of each of the next 4 years) plus an extra payment of $1,000 at the end of Year 4. Your friend says she can get you some of these securities at a cost of $1,075 each. Your money is now invested in a bank that pays an 6% nominal (quoted) interest rate but with quarterly compounding. You regard the securities as being just as safe, and as liquid, as your bank deposit, so your required effective annual rate of return on the securities is the same as that on your bank deposit. You must calculate the value of the securities to decide whether they are a good investment. What is their present value to you? Round your answer to the nearest cent. $