Essays on Advanced Financial Management Assignment

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The paper “ Advanced Financial Management” is a convincing variant of the assignment on finance & accounting. DOL =% Change IN EBIT)/%change in sales Sales (180*9000) $ 1,620,000.00 $ 1,782,000.00 Variable cost (95*9000) $ (855,000.00) $ (940,500.00) Fixed cost $ (550,000.00) $ (550,000.00) EBIT   $ 215,000.00 $ 291,500.00         % change in Ebit $ 76,500.00     %change in sales $162,000.00     DOL 47%     DFL= (% Change in net income/% change in EBIT       10% increase Sales (180*9000) $ 1,620,000.00 $ 1,782,000.00 Variable cost (95*9000) $ (855,000.00) $ (940,500.00) Fixed cost   $ (550,000.00) $ (550,000.00) EBIT   $ 215,000.00 $ 291,500.00 less; interest (1500,000*0.08* $ (120,000.00) $ (120,000.00) EAT   $ 95,000.00 $ 171,500.00 Net of tax 70% $ 0.70 $ 0.70 % change in Ebit 76500 $ 66,500.00 $ 120,050.00 %change in sales 53550     DFL 70%     DCL = DFL × DOL     DFF= 33%   Question 2.                                               Before After       Initial Outlay 1,000,000 1,000,000       Current share price $ 10.25 $ 11.25       Shares 97560.9756 88888.88889                                                                                         Question 3           (in millions of dollars) Actual     Forecast     2014 Forecast basis 2015 Sales   $1,500.00 Growth 1.1 $1,650.00 COGS   $900.00 % of Sales 60.00% $990.00 SGA Expenses $ - % of Sales 35.00% $577.50 EBIT   $600.00     $82.50 Less Interest $ - Interest rate x Debt03 $20.00 EBT   $600.00     $62.50 Taxes (40%) $240.00     $25.00 Net Income   $360.00     $37.50 Dividends   $290.00     $15.00 Add.

To retained earnings $70.00     $22.50 BALANCE SHEET       2015   2015 (in millions of dollars)       Forecast   Forecast     2015 Forecast basis   Without AFN AFN With AFN Assets             0 Cash   $20.00 % of Sales 1.00% $16.50   $16.50 Accounts receivable $240.00 % of Sales 12.00% $198.00   $198.00 Inventories   $240.00 % of Sales 12.00% $198.00   $198.00 Total current assets $500.00     $412.50   $412.50 Net plant and equipment $500.00 % of Sales 25.00% $412.50   $412.50 Total assets   $1,000.00     $825.00   $825.00                 Liabilities and equity             Accounts payable & Accruals $100.00 % of Sales 5.00% $82.50   $82.50 Notes payable $100.00 Carry-over   $100.00 ($90.00) $10.00 Total current liabilities $200.00     $182.50   $92.50 Long-term bonds $100.00 Carry-over   $100.00 ($90.00) $10.00 Total liabilities $300.00     $282.50   $102.50 Common stock $500.00 Carry-over   $500.00   $500.00 Retained earnings $200.00 RE02 + DRE03 $222.50   $222.50 Total common equity $700.00     $722.50   $722.50 Total liabilities and equity $1,200.00     $1,187.50   $917.50                 Required assets =       $825.00     Specified sources of financing =     $1,005.00     Additional funds needed (AFN)     ($180.00)                     Debt to equity ratio                                 Current New Debt   New Funding at 85% capacity       Debt Equity 0.7 0.3 0.1 0.9          

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