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Author Question: Lindsey Insurance Co has current sales of 10 million and predicts next year's sales will grow to 14 ... (Read 153 times)

gbarreiro

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on: Jul 10, 2018
Lindsey Insurance Co has current sales of 10 million and predicts next year's sales will grow to 14 million.
  Current assets are 3 million and fixed assets are 4 million. The firm's net profit margin is 7 percent after taxes.
 
  Presently, Lindsey has 900,000 in accounts payable, 1.1 million in long-term debt, and 5 million (including
  2.5 million in retained earnings) in common equity. Next year, Lindsey projects that current assets will rise in
  direct proportion to the forecasted sales, and that fixed assets will rise by 500,000. Lindsey also plans to pay
  dividends of 400,000 to common shareholders.
  a. What are Lindsey's total financing needs for the upcoming year?
  b. Given the above information, what are Lindsey's discretionary financing needs?

Question 2

Interstate Appliance Inc is considering the following 3 mutually exclusive projects.
 
  Projected cash
  flows for these ventures are as follows:
  Plan A Plan B Plan C
  Initial Initial Initial
  Outlay = 3,600,000 Outlay = 6,000,000 Outlay = 3,500,000
  Cash Flow: Cash Flow: Cash Flow:
  Yr 1 = -0- Yr 1 = 4,000,000 Yr 1 = 2,000,000
  Yr 2= -0- Yr 2 = 3,000,000 Yr 2 = -0-
  Yr 3 = -0- Yr 3 = 2,000,000 Yr 3 = 2,000,000
  Yr 4 = -0- Yr 4 = -0- Yr 4 = 2,000,000
  Yr 5 = 7,000,000 Yr 5 = -0- Yr 5 = 2,000,000
  If Interstate Appliance has a 12 cost of capital, what decision should be made regarding the
  projects above?
  A) accept plan A B) accept plan B
  C) accept plan C D) accept Plans A, B and C
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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InfiniteSteez

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Reply #1 on: Jul 10, 2018
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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gbarreiro

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Reply 2 on: Jul 10, 2018
Thanks for the timely response, appreciate it

dreamfighter72

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

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