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Please kindly provide the answer of each question with calculation, thanks! SAMPLE QUESHDN 4 Materazzi Bedding Ltd has determined the following inventory information and relationships:

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Please kindly provide the answer of each question with calculation, thanks!

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SAMPLE QUESHDN 4 Materazzi Bedding Ltd has determined the following inventory information and relationships: (i) Orders can he placed only in multiples of 21313 units. (ii) Annual unit usage is S' units. (Assume a SCI-week year in your calculations.) (iii) The carrying cost is 1% of the purchase price of the goods per year. (iv) The purchase price is $5 per unit. (v) The ordering cost is $1013! per order. (vi) The desired safety stock is 5.131313 units. [This does not include delivery-time stock.) (vii) Delivery time is four weeks. Required: a What is the EOQ level? [marks] b How many orders will be placed annually? [marks] C At what inventory level should a reorder be made? [marks] d What is the average level of inventory held? [marks] e Now assume that the carrying costs are 50% of the purchase price of the goods and recalculate the EOQ. Explain why the EOQ is different from part a above. [marks] What measures can Materazzi Bedding take to try and decrease the total cost of inventory? [marks]SAMPLE QUESTION 5 Bonanza Brothers Ltd manufactures leather saddles and has the following capital structure which it considers to be optimal under present and forecast conditions: Type of Finance Proportion Used Debt 40% Equity 60% Total debt and equity 100% For the coming year, the financial manager Hoss Cartwright expects after-tax earnings of $2.4 million. Bonanza Brothers' past dividend policy of paying out 60 per cent of earnings will continue. Present commitments from its banker will allow Bonanza Brothers to borrow further amounts of finance according to the following schedule: Loan Amount Interest Rate $0 to $750,000 9% $750,001 and above 11% Bonanza Brothers' taxation rate is 40 per cent. The current market price of its shares is $4.80. Its most recent dividend was $0.46 per share, and the expected growth rate in dividends is a constant 5 per cent per annum. External equity can be sold at a flotation cost of 10 per cent of the amount raised.Project Cost Internal Rate Return A $900,000 16% p.a. B $1,200,000 15% p.a. C $500,000 14% p.a. D $750,000 12% p.a. E $1,000,000 11% p.a. Required: a Calculate the break points of total financing associated with each source of capital for Bonanza Brothers. [marks] b Calculate the costs of equity and debt capital associated with their respective total financing break points. [marks] C Calculate the weighted average cost of capital (WACC) for each of the ranges of total new financing determined in part a. [ marks] d Which capital projects should Bonanza Brothers accepts for the coming year? Why? Support your answer with the use of a WMCC schedule and IOS graph. [marks]

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