7)

Shifty Inc. sold refrigerated rail cars to P & G. P & G agreed to pay $100,000 immediately followed by $50,000 at the end of each of the next 5 years. Assuming an interest rate of 6%, compute the present value of the receivable on Shifty's books.

8)

ASD Co. has revenue of $5,000,000 and variable costs of $1,000,000. It has fixed costs of $3,000,000 and Interest expense of $500,000. Calculate operating, financial, and combined leverages.

Shifty Inc. sold refrigerated rail cars to P \& G. P \& G agreed to pay $100,000 immediately followed by $50,000 at the end of each of the next 5 years. Assuming an interest rate of 6%, compute the present value of the receivable on Shifty's books. 11 points ASD Co. has revenue of $5,000,000 and variable costs of $1,000,000. It has fixed costs of $3,000,000 and Interest expense of $500,000. Calculate operating, financial, and combined leverages