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Please give the answer here in chat box... 1hr and 15mins Page 1 Question 4.4. (TCO C) Net cash burn is equal to which of
Please give the answer here in chat box... 1hr and 15mins
Page 1 Question 4.4. (TCO C) Net cash burn is equal to which of the following? (Points : 5) Cash flow from operations + cash flow from financing - ending cash balance Net sales - increase in current assets Cash flow from operations + cash flow from investments - cash flow from investing Cash burn - ending cash balance + cash build Cash burn - cash build 5. (TCO G) In what ways do SBICs interact with the Small Business Administration? (Points : 5) The SBA borrows money and lends it directly to SBICs to make venture capital investments. SBICs make loans to business ventures. These loans are backed by the SBA. SBICs work with Certified Development Companies to make small loans of up to $35,000 that are backed by the SBA. SBICs raise investor money and make loans to business ventures. The interest payments on these are made to the SBA. 7. (TCO B) Which of the following entities is liable for a corporation's debts? (Points : 5) Stockholders Board of directors The corporation itself The corporation's president The firm's founding investors Question 8.8. (TCO B) Which of the following is NOT a right or duty of general partners? (Points : 5) Participation in profits and losses Some liability for partnership obligations Veto right on new partners Eventual return of capital Access to partnership books Page 2 1. (TCO H) What is investment banking? What is an underwriting spread? (Points : 20) 2. (TCO F) Differentiate between receivables lending and receivables factoring, and explain the purpose of these activities in the life of growing ventures. (Points : 20) 6. 27. TCOs D & E) Shearer Sales Consulting (SSC) has 20 million shares of stock outstanding that trade at $50. The risk-free interest rate is 4% and the market risk premium is 7.6%. This stock has a beta of 2.16. SCC also has $750 million in 11% bonds outstanding and the company has a 34% tax rate. Show all calculations for each of your answers to earn full credit. Part 1: a) Calculate the firm's market capitalization, and then calculate the enterprise value. b) Use the CAPM formula to determine the firm's cost of equity, and c) utilize this information to calculate SCC's weighted average cost of capital. Part 2: a) Assume that SCC issues $100 million in bonds to buy back $100 million in common stock in order to recapitalize the firm. What is Shearer Consulting's new WACC? b) Finally, discuss why there is a change in WACC and explain the impact of the components of capital structure on a company's cost of capital
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