Question
1.Almarai Company has the following financial information for 2019: Sales = 14, 451 M Net Income = 1,811 M Addition to retained earning = 1,121
1.Almarai Company has the following financial information for 2019:
Sales = 14, 451 M Net Income = 1,811 M
Addition to retained earning = 1,121 M
Total Assets = 33,148 M Total Equity = 14,653 M
1.What is Almarai Company retention ratio?
2.Almarai Company does not want to incur any additional external financing. The dividend payout ratio is constant. What is the firm's maximum rate of growth?
3.If Almarai Company decides to maintain a constant debt-equity ratio, what rate of growth can it maintain assuming that no additional external equity financing is available?
You are considering a new product launch. Thus far, you have determined that an OCF of SAR 1.5 m will result in a zero net present value for the project, which is the minimum requirement for project acceptance. You have computed its fixed costs to be SAR 550 per unit for annual sales of 1,800 units. The price per unit will be $2,400 and variable cost per unit will be $1,200. You feel that it can realistically capture 2.25 percent of the 110,000 unit market for this product. The tax rate is 34 percent and the required rate of return is 11 percent. Should the company develop the new product? Why or why not?
1.You are reviewing a new project and have estimated the following cash flows:
-Year 0: CF = -165,000
-Year 1: CF = 63,120; NI = 13,620
-Year 2: CF = 70,800; NI = 3,300
-Year 3: CF = 91,080; NI = 29,100
What are the net present value (NPV) and Internal Rate of Return (IRR) of a project if the required rate of return is 12 percent?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started