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Hi there, I need help answers the attached questions. Thanks, Capital budgeting - You are determining whether your company should undertake a new project and
Hi there,
I need help answers the attached questions.
Thanks,
Capital budgeting - You are determining whether your company should undertake a new project and have calculated the NPV of the project using the WACC method when the CFO, a former accountant, notices that you did not use the interest payments in calculating the cash flows of the project. What should you tell him? If he insists that you include the interest payments in calculating the cash flows, what method can you use. Explain Beta and Leverage What are the two types of risk that are measured by a levered beta? If you know the unlevered beta, how can you derive the levered beta? Each of you, using a real company, use this method to calculate the levered beta for the company you select. Leasing in the E-commerce World The article, \"Equipment Leasing: New Life on Lease,\" (seehttp://www.cfo.com/printable/article.cfm/2989186) discusses changes in the leasing market associated with the development of E-commerce. Examples show how companies can use operating leases to improve performance and how the use of the Internet can reduce the costs of securing such financing. After reading the article, answer the following questions: 1. What were the advantages sited by Horizon Foods for securing operating leases on the Internet? 2. Describe how Smith International uses the web to secure operating lease fin Sales-Leasebacks - This issue has three parts. Many firms are using leasing techniques to improve performance. Leasing offers opportunities to unlock funds tied up in assets and also offers the potential to generate additional cash flows through efficient tax management. The technique of sale-leaseback was used for real estate, but the technique can also be used for other productive assets. Potential benefits of using this technique is described in an article entitled http://www.srr.com/article/sale-leaseback-transactions-financing-alternativemiddle-market-companies. Also read http://www.ccim.com/ciremagazine/articles/synthetic-leases-benefit-or-burden After reviewing this article, answer the following questions: 1. Leasing transactionsparticularly sales-leasebacksare often labeled as balance sheet mining transactions. What does that mean? 2. What is the potential advantage of having a lease categorized as an operating lease instead of a capital lease? 3. What is a synthetic lease? Why Lease? What are some of the reasons for leasingStep by Step Solution
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