Valuation and Capital Budgeting - Differential Growth

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Corporate Finance, 9/e

Stephen A. Ross, Massachussetts Institute of Technology

Randolph W. Westerfield, University of Southern California

Jeffrey F. Jaffe, University of Pennsylvania

ISBN 978-0073105901

Valuation and Capital Budgeting

14. Differential Growth Hughes Co. is growing quickly. Dividends are expected to grow at a 25 percent rate for the next three years, with the growth rate falling off to a constant 7 percent thereafter. If the required return is 12 percent and the company paid a $2.40 dividend, what is the current share price.

Chapter 8 Interest Rates and Bond Valuation - Bond yields

Solution is available here for U$5

Corporate Finance, 9/e

Stephen A. Ross, Massachussetts Institute of Technology

Randolph W. Westerfield, University of Southern California

Jeffrey F. Jaffe, University of Pennsylvania

ISBN 978-0073105901

Chapter 8 Interest Rates and Bond Valuation

17. Bond yields Pembroke Co. wants to issue new 20-year bonds for some much-needed expansion projects. The company currently has 10 percent coupon bonds on the market that sell for $1,063, make semiannual payments, and mature in 20 years. What coupon rate should the company set on its new bonds if it wants to sell at par.

Inventory Errors

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EXERCISE 13-1A      page 507
INVENTORY ERRORS
Assume that in year 1, the ending merchandise inventory is overstated by $50,000. If this is the only error
in years 1 & 2, indicate which items will be understated, overstated, or correctly stated for years 1 & 2.
The ending inventory amount for the end of year 2 is correct.
Here are some hints:			This year's ending inventory is next year's beginning inventory.
			The Cost of Goods Available for Sale will end up in two places - either it
			has been sold and is now Cost of Goods Sold or it is still on hand in ending
			Inventory. If one of those is overstated the other will be understated.
The Chapter 13 Part I PowerPoint lecture focuses on the effects of inventory errors.
In each box below select one of these choices by moving your cursor
to the box and selecting one of these choices from the drop down menu:							Understated
							Overstated
							Correct
					YEAR 1		YEAR 2
	Ending merchandise inventory
	Beginning merchandise inventory
	Cost of goods sold
	Gross profit
	Net Income
	Ending Owner's Capital

Using special journal to record transactions

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EXERCISE 12-1A    page 469-470
Assume that a business is using special journal to record many of its transactions. Identify the
journal in which each of the following transactions would be recorded.
Use the drop down menu to select:				Sales journal
				Purchases journal
				Cash receipts journal
				Cash payments journal
				General journal
(a)	Sold merchandise on account
(b)	Purchased delivery truck on account for use in the business.
(c)	Received payment from a customer on account.
(d)	Purchased merchandise on account.
(e)	Issued a check in payment of the electric bill.
(f)	Recorded depreciation of factory building.