4 Finance problems

Details:

Complete the following problems from Chapter 18 in the textbook:

1. P18-3

2. P18-11

3. P18-12

4. P18-14

Follow these instructions for completing and submitting your assignment:

1. Do all work in Excel. Do not submit Word files or *.pdf files.

2. Submit a single spreadsheet file for this assignment. Do not submit multiple files.

3. Place each problem on a separate spreadsheet tab.

4. Label all inputs and outputs and highlight your final answer.

5. Follow the directions in the "Guidelines for Developing Spreadsheets."

P18-3

Problem P18-3 Continued below with C & D

P18-11

P18–12

Holding company Scully Corporation holds enough stock in company A and company B to give it voting control of both firms. Consider the accompanying simplified balance sheets for these companies.

a. What percentage of the total assets controlled by Scully Corporation does its common stock equity represent?

b. If another company owns 15% of the common stock of Scully Corporation and, by virtue of this fact, has voting control, what percentage of the total assets controlled does the outside company’s equity represent?

c. How does a holding company effectively provide a great deal of control for a small dollar investment?

d. Answer parts a and b in light of the following additional facts.

(1) Company A’s fixed assets consist of $20,000 of common stock in Company C. This level of ownership provides voting control.

(2) Company C’s total assets of $400,000 include $15,000 of stock in Company D, which gives Company C voting control over Company D’s $50,000 of total assets.

(3) Company B’s fixed assets consist of $60,000 of stock in both Company E and Company F. In both cases, this level of ownership gives it voting control. Companies E and F have total assets of $300,000 and $400,000, respectively.

P18–14 Voluntary settlements

For a firm with outstanding debt of $125,000, classify each of the following voluntary settlements as an extension, a composition, or a combination of the two.

a. Paying a group of creditors in full in four periodic installments and paying the remaining creditors in full immediately

b. Paying a group of creditors 90 cents on the dollar immediately and paying the remaining creditors 80 cents on the dollar in two periodic installments.

c. Paying all creditors 15 cents on the dollar.

d. Paying all creditors in full in 180 days.