these practice for fininace exercise last photo is fourmula sheet thanks

01: The management of LB Co is evaluating an investment in a new coffee roasting machine. The company has taken great care to estimate the future cash flow for the roasted coffee beans that the machine will produce and finally, they manage to present the estimated cash flow for the project in the I table below: Year Estimated cash flow in million (1000) 800 600 The company believes that 10 % returns is available elsewhere on the capital market for a similar risk project. Required: (a) Calculate the net present value and profitability index of the planned investment projects. (2 marks) (b) Calculate the payback period of the planned investment projects. (1 marks) (c) Discuss the financial acceptability of the investment projects. (3 marks) (d) State clearly any limitations and assumptions that you made in your calculations. (2 marks) Q2: The directors of Delta Co are considering a planned investment project costing $28m, payable immediately. The following information relates to the investment project: Years 2 Project Cash flow 10,168 11,585 12,682 14,894 The views of the directors of Delta Co are that all investment projects must be evaluated over four years of operations. Both net present value and payback must be used, with a maximum payback period of two years. The after-tax cost of capital of Delta Co is 12 %. Required: I (a) Calculate the net present value of the planned investment project. (2 marks) (b) Calculate the payback period of the planned investment project. (2 marks) (c) Discuss the financial acceptability of the investment project. (2 marks) (d) State clearly any limitations and assumptions that you made in your calculations. (3 marks) and assumptions that you made in your calculations. (3 marks) Q3: The director of XYZ Fried Chicken is evaluating a proposal to open a fast food restaurant in a university campus. The restaurant will cost $14.5 million to open. Expected cash flows are $4.1 million per year for five years. Both net present value and payback must be used, with a maximum payback period of three years. The after-tax cost of capital of Delta Co is 12 % . . Required: (a) Calculate the net present value of the planned investment project. (2 marks) (b) Calculate the payback period of the planned investment project. (2 marks) (c) Discuss the financial acceptability of the investment project. (2 marks) (d) State clearly any limitations and assumptions that you made in your calculations. (2 marks) (a Lalculate the net present value of the planned investment project. (2 marks) (b) Calculate the payback period of the planned investment project. (2 marks) (c) Discuss the financial acceptability of the investment project. (2 marks) (d) State clearly any limitations and assumptions that you made in your calculations. (2 marks Financial statement analysis Q1: Dan Inc. is a publicly traded company involved in selling personal computers (PCs), servers, data storage devices, network switches, software, computer peripherals, HDTVS, cameras, printers, MP3 players, and electronics built by other manufacturers. The company is well known for its unique organization capital and innovative supply chain management. With the publication of the latest financial statements for the year to 30 Jan 2017, the CEO made a brief statement and it includes the following two points: The company was performing well and it has a highly talented management. One of the key success factor of our management is the adoption of working capital management strategy. We believe that managing investment in working capital lead to managing long-term investment efficiently and effectively and hence creating value to our share holder. The CEO expressed a desire to make Dan Inc. the leading technology firm company through a rapid expansion i.e. short cut to growth via acquisition. He plans to acquire his direct competitor so as to increase Dan Inc. market share. Given below are extracts from the recent financial statements, some ratios, and other financial information for Dan Inc. hp Given below are extracts from the recent financial statements, some ratios, and other financial information for Dan Inc. Dan Inc. Year ending 30 November financial ratios 2015 2016 2017 Industry NPM (%) 23 22 16 TAT 0-79 0-85 1.01 0.8 ROA (%) 18.17 18.7 19.2 12.8 Current Ratio 0-80 0-65 0-63 0.6 Total liability/Total assets ratio ( % ) 40 46 51 52 Share $ 93 94.5 95 Days Inventory Heldi 36 37 31 40 Days A/R Outstanding 50 49 42 60 43 43 33 34 Days A/P Outstanding hp 8 19 I Required: Prepare a report for the Dan's board of directors. In your report you should (a) Critically evaluate Dan Inc.'s performance and conclude whether the chief executiv officer's opinion has the greater validity. (10 marks) (b) State clearly any limitations and assumptions that you made in your calculations (2marks) (c) Marks will be awarded for Professional format, structure and presentation of the report (2 marks) to mere than 226 interaational destinations in 118 02 Sauair Co is an intanational aidlime uthich flie hp Q3: Given below are abstract of the financial information relates to RAJ Co, which has considering raising $ 50 million of new debt finance to support existing business operations. Assume that it is now 31 Dec 2015. RAJ Co has been experiencing trading difficulties due to a continuing depressed level of economic activity: Financial information for recent years ending 31 December RAJ Co, 2015 2014 2013 Sm Sm Sm Profit before interest and tax 25.3 26.6 29.3 Interest charges profit before tax ation expense Net profit Debt ratio 5.5 19.8 5.3 21.3 4.8 24.5 5.9 13.9 47% 6.4 7.3 17.2 14.9 Dividend and share price information of RAI Co RAJ Co, 2015 2014 2013 Sm Sm Sm Total cash div paid Share price at end of year 9.5 9.5 9.5 417 4.59 5.10 Average data on industry Debt ratio 49% -Iriterest coverage 10 times Required: Prepare a report for the top management. In your report you should (a) Critically analyze and discuss the recent financial performance and financial conditions of RAJ Co and comment on the proposal to raise S50 million of new debt finance (6 marks) (b) State clearly any limitations and assumptions that you made in your calculations. (2 marks) (c) Marks will be awarded for Professional format, structure and presentation of the report. (2 marks) hp Formulae Sheet E( +B,(- D-De(1+ g) 8-De1 D Po- ERR- Unsystematic risk- the expected rate of return- the required rate of return Payback period is the number of years and /or months needed to recover the initial cash outlay required to make the investment NPV present value of all cash inflow-cash outflow CF NPV -CF (1 +0 Pl-present value of all cash inflow/ cash outflow n CF / CFe PI- (1+ Stock valuation using variable growth model- present value of dividends during the initial growth period + the present value of price of stock at the end of initial growth period N Do (1+g)) Po (1+ RcE) D41 (ReE-92)(1 +Rea)