Cash Flow Essays (Examples)

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Cash Management Practices

Words: 645 Length: 2 Pages Document Type: Essay Paper #: 23430175

Cash Flow Management

Cash Management Practices in Arizona Parks and Recreation

The key to keeping any business, public or private, alive is to ensure that the available funds are properly allocated and that the amount spent monthly is less than or equal to the amount available. hen it comes to state-run entities, one essential factor that each agency must take into account is their limited budget and the necessary holdings for any and all risks associated with that vein of the state (Office of Financial Management, 2010). One such agency that of late has constantly struggled with meeting its cash management goals is the Arizona Parks and Recreation. The primary focus of this analysis will review the park's specializations, risk allocations, and staffing practices.

The Arizona parks and recreation is responsible for the care of all state parks and community centers. Additionally, the division is responsible for events held within…… [Read More]

Works Cited

Huffman, David and Moore, Margaret (2004). Responses of Fendler ceanothus to overstory thinning, prescribed fire, and drought in an Arizona ponderosa pine forest. Forest Ecology and Management, 198(1-3): 105-115.

Arizona Department of Parks and Recreation Association. Accessed at 

Washing State Office of Financial Management: Risk Management Basics (2010). Accessed at
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Cash Basis Verses Accrual Basis

Words: 871 Length: 3 Pages Document Type: Essay Paper #: 93919102

Cash asis vs. Accrual asis

The cash basis of accounting is more likely to be used by service businesses than by retail or manufacturing businesses. Service businesses usually do not need equipment and can sell a service they perform with nothing more than their own hands and minds. Think of people who are lawyers, writers, public relations and advertising personnel, and accountants.. (Edmonds, McNair, Milam, and Olds, Fundamental Financial Accounting Concepts, 4th edition, McGraw-Hill Irwin, 2002) In the cash basis of accounting, the business records are "cash in" (deposits to the bank account) called cash receipts, and "cash out" (checks) called cash disbursements. Cash receipts - Cash disbursement = Cash flow. Each month's cash flow is added to the preceding month's cash balance yielding the current month's cash balance. Unless a business is a small service company, it cannot tell if it is earning a profit if it uses cash…… [Read More]


David Minars, Davis A. Minars Accounting: Themes, Keys, Formulas, Glossary of Accounting Terms for Your Introductory College Course Barrons Educational Series; February 1992.

Edmonds, McNair, Milam, and Olds, Fundamental Financial Accounting Concepts, 4th edition, McGraw-Hill Irwin, 2002
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Flow Inc Insurance Settlement Proceeds Are Treated

Words: 353 Length: 1 Pages Document Type: Essay Paper #: 57607371

Flow Inc.

Insurance settlement proceeds are treated as operating cash flows under ASC 230. Thus the receipt of the $20 million would be operating. The investment of the $20 million into the company's pension fund would also be an operating cash flow. hile normally investing money into the market is considered an investment flow, that is only when the beneficiary in the corporation. In this instance, the beneficiaries are the company's employees and the defined-benefit plan is a form of employee compensation. All employee compensation is considered an operating cash flow under ASC 230.

The flow should not be classified as an investing cash flow for two reasons. The first is that all insurance disbursements are classed as operating flows. The second is that employee benefits are also operating flows. If the funds were used to rebuild the facility, then that spending may be classed as an investing flow. However,…… [Read More]

Works Cited:

No author (2010). U.S. GAAP accounting standards: 230: Statement of cash flows. Accounting Retrieved December 6, 2010 from
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Cash Budget and Target Cash Balance the

Words: 946 Length: 3 Pages Document Type: Essay Paper #: 60004398

Cash budget and target cash balance

The target cash balance is defined as the ideal cash amount a company intends to hold in its reserve at a given time. This figure seeks to strike a balance between the balance sheet costs of extremely little and too much cash. While a company with surplus cash at hand may misuse on investment opportunities, a company with poor cash will often be forced to make undesirable transactions to create more operating capital (Besley & Brigham, 2011). Individual investors are advised to set their target balance too. They may estimate at least the percentage of their holdings in cash to avoid such pitfalls.

Cash budget refers to the operating budgets and capital expenditures. It begins with the initial cash balances then cash inflows are added to the available cash. Cash outflows will then be subtracted to obtain the cash balance. If the cash balance…… [Read More]


Besley, S., & Brigham, E.F. (2011). Principles of finance. Mason, Ohio: South-Western.

Brigham, E.F., & Daves, P.R. (2012). Intermediate financial management. Mason, Ohio: South-Western.

Brigham, E.F., & Houston, J.F. (2012). Fundamentals of financial management. Mason, Ohio: South-Western Cengage Learning.

Ehrhardt, M.C., & Brigham, E.F. (2009). Corporate finance: A focused approach. Mason, OH: South-Western/Cengage Learning.
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Managing Cash Week 17 Activity

Words: 1566 Length: 6 Pages Document Type: Essay Paper #: 2167160

Looking at the instrument company that is being examined, it is clear that they have very little working capital to utilize. Where, they have a total amount in working capital of £ 15,000. As the company paid out £1,700,000 in obligations and received a total of £1,825,000. This is important, because it shows that the business is undercapitalized, based upon their low working capital figures. As a result, the company needs to remain more liquid, to be properly capitalized for future investments

Table 17.3 Solution to a working capital problem in my organization

Problem identification

Low Working Capital

Analysis (investigation)

The working capital position of the company was affected by the total amounts of cash they invested in new inventory.

Conclusion to the analysis (results of the investigation)

The business needs to be able to control their cash position, to effectively manage their working capital.

The solution, listed as a…… [Read More]


The Cash Flow Statement, n.d. Understanding Marketing and Financial Information, pp. 239 -- 256.

Financial Statements, n.d. Understanding Marketing and Financial Information, pg. 133.

Laddering, 2010, Free Dictionary. Available from: [25 September 2010].

Harvard Format.
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Dividends a Regular Cash Dividend Is Paid

Words: 1228 Length: 4 Pages Document Type: Essay Paper #: 25083363


A regular cash dividend is paid out of the company's cash supply. The dividend can be at a fixed rate, or can be loosely tied to the company's net income. This is the most common form of dividend, and is paid under most circumstances. hereas a regular cash dividend is a recurring dividend, an extra cash dividend is a non-recurring dividend (Investopedia, 2012). This is a one-time dividend that is paid by the company. There is no expectation of a future extra dividend, in contrast to a regular dividend. A special dividend is the same thing as an extra dividend. The only slight difference is that something termed a special dividend is not necessarily going to be paid out of cash. The company may pay with shares or some other asset. Most commonly, however, this type of dividend will be paid out of cash.

A liquidating dividend is fundamentally…… [Read More]

Works Cited:

Investopedia. (2012). Extra dividend. Investopedia. Retrieved April 15, 2012 from 

Investopedia. (2012). Definition of liquidating dividend. Investopedia. Retrieved April 15, 2012 from 

Hadzima, J. (2005). Dilution: A primer on stock vocabulary. MIT. Retrieved April 15, 2012 from 

Goldman, D. (2012). Apple announces dividend and stock buyback. CNN. Retrieved April 15, 2012 from
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Firms Utilize to Pay Cash

Words: 997 Length: 2 Pages Document Type: Essay Paper #: 80110786

This make it easier to finance firm operations by selling stock, but on the other hand the firm can be forced to pay shareholders when it needs the cash to finance its debt, invest in new projects, or simply to pay for its daily activities without going further into debt.

The final method is that of a hybrid method. Dividends are paid on a stable basis. But over the long-term, the debt-to-equity ratio is reviewed, and if the firm is regularly coming short on paying its debts and other expenses, payments to shareholders may be curtailed (How and why do companies pay dividends, 2010, Investopedia). This is the preferred method, given the added flexibility it offers the firm. Hybrid methods have the ability to ensure the firm's long-term financial health, as payments can be curtailed in times of sustained economic hardship -- but hybrid payments still offer stable returns for…… [Read More]


Baker, Kent H., Tarun K. Mukherjeel, Gary E. Powell (2005, Summer). Distributing excess cash:

the role of specially designated dividends. Financial Services Review.

Retrieved October 11, 2010 at;col1

How and why do companies pay dividends? (2010). Investopedia. Retrieved October 11, 2010 at
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Profit and Have No Cash

Words: 1302 Length: 4 Pages Document Type: Essay Paper #: 50080751

will go up in the fourth quarter, they could end up ordering for more pieces of the same so as to satisfy the anticipated demand. Assuming that the company purchases 400,000 units of Product Q. At a total of $2,000,000, it would have only $100,000 left in its coffers. Assuming that the consignment arrives on time but the expected increase in demand for Product Q. does not come to pass, the company could be left holding stock worth $2,000,000. Although, the business is still profitable (assuming it continues to sell the normal 100, 000 units), it could find itself broke to an extent where it may not be able to finance capital projects. This is more so the case given that the normal revenues it gets could be tied up in other commitments. In other words, although the business could be making a profit, it could still be cashless.

A…… [Read More]


Brigham, E.F. & Ehrhardt, M.C. (2011). Financial Management: Theory and Practice (13th ed.). Mason, OH: Cengage Learning.

Jones, J.P., Heitger, D.N., Mowen, M.M. & Hansen, D.R. (2011). Cornerstones of Financial and Managerial Accounting (2nd ed.). Mason, OH: Cengage Learning.

Needles, B.E. & Powers, M. (2007). Financial Accounting (9th ed.). Boston, MA: Cengage Learning.

Weil, R., Schipper, K. & Francis, J. (2009). Financial Accounting: An Introduction to Concepts, Methods, and Uses (13th ed.). Mason, OH: Cengage Learning.
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Personal Cash Management Policies and Practices The

Words: 2093 Length: 6 Pages Document Type: Essay Paper #: 46512264

personal cash management policies and practices. The paper starts with by stating the methodology through which the content was collected for the relevant literature in the paper. The paper then presents a clear definition of what cash management is and presents an overview of some of the most utilized personal cash management practices. The literature review also presents numerous internal cash management policies and practices that can prove to be feasible and profitable on the personal level. The paper concludes with an overview of all the facts discussed.

Search Strategy

In order to collect relevant data for the results, concise and yet comprehensive information related to the topic have been compiled from articles published online individual researchers, practitioners, as well as, international research institutions. The aim of the study is to critically review the strengths and weaknesses of both conception and implementation of research pertinent to our topic -- Cash…… [Read More]


Agarwal N.K. (2001). Analysis of Financial Management. National Publishing House, New Delhi.

Bari R.R. (2000). Cash Planning and Management, Triveni Publication, Delhi.

Bierman H.K. And Macdams, A.K. (2001). Managerial decision for cash and marketable securities, New York: Cornell University.

Chiumintto P.M. (2001). A Practical basis for Working Capital Management, in Doris William ed. Hand Book of Business Finance. New York: Prentice Hall.
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Amazon's Cash Cycle'so Much Shorter Than

Words: 818 Length: 2 Pages Document Type: Essay Paper #: 37655552

Amazon's cash cycle so much shorter than that of competitor Barnes & Noble? How does this comparison affect financial management decisions of other retailers?

There are several reasons which explain why the Amazon Company has a shorter cash cycle than its competitor Barnes & Noble. First and foremost, Amazon is a much bigger company than Barnes & Noble both in terms of income and in the number of products that it sells. hile Barnes & Noble sells some things besides book and ebooks, this is their primary product. Amazon sells everything including books, although this is a very small portion of their income. Another reason for this is that Amazon is doing better financially than Barnes & Noble. The ebook trend has bitten into Barnes & Noble's income, which they tried to combat by creating their own ereader, the Nook but this was far less successful than the Amazon ereader,…… [Read More]

Works Cited

Ross, S., Westerfield, R. & Jordan, B. (2012). Fundamentals of Corporate Finance. 10th ed.

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Cross-Country Capital Flows and Currency International Project

Words: 4386 Length: 17 Pages Document Type: Essay Paper #: 12349729

Cross-Country Capital Flows and Currency

International Project

overseas investment .














Monetary policy is the study of circulation of money, the granting of credit, the making of investments and the provision of banking facilities and international finance is studying it on an international level.[footnoteRef:2] Usually the affect can be seen in exchange rate and foreign investment and international trade. This includes the analysis of global financial markets, cross-country capital flows and currency, international projects, and overseas investments. [2: Merriam-ebster Online Dictionary:]

US Monetary Policies have a far reaching effect on the other…… [Read More]

Works Cited

Alta villa, Carlo, and Matteo Ciccarelli. "The Effects of Monetary Policy on Unemployment Dynamics under Model Uncertainty: Evidence from the United States and the Euro Area." Journal of Money, Credit & Banking 41.7 (2009): 1265+. Questia. Web. 18 Mar. 2011.

Auerbach, Robert D. Deception and Abuse at the Fed: Henry B. Gonzalez Battles Alan Greenspan's Bank. Austin, TX: University of Texas Press, 2008. Questia. Web. 18 Mar. 2011.

Barron, Jacob. "Jobs, Exports and the Yuan: Pressure Builds on China for Currency Reform." Business Credit May 2010: 30+. Questia. Web. 18 Mar. 2011.

Bi, Jianhai. "An Asian Monetary Fund? Jianhai Bi Outlines Asian Efforts to Protect Their Economies during the Global Financial Crisis and Predicts Long and Difficult Negotiations." New Zealand International Review 34.6 (2009): 8+. Questia. Web. 18 Mar. 2011.
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Managing Money Cash Is the Main Basis

Words: 665 Length: 2 Pages Document Type: Essay Paper #: 21830322

Managing Money

Cash is the main basis of financial management in a new company. In most instances, the period between payment of suppliers and employees as well as a collection of debt from the customers is often a challenge. The solution to all these financial challenges is sound financial flow management. Managing of cash flow means delaying expenditures of cash and at the same time ensuring anyone owing the business pays up rapidly.

Managing Cash in a new business

Measuring of cash flow is necessary as accurate financial flow projection helps the business owner to be aware of an upcoming business challenge before it happens. On the other hand, cash flows should not be used to gauge the business environment in the future. There are a number of elements that need to be considered to counter the challenges. The factors are evaluating the payment histories of the customers, business thoroughness…… [Read More]


Stone, R. (September 01, 2001). Managing wealth: A new approach. Journal of Financial Services Marketing, 6, 1, 84-97.

Land, C., & Taylor, S. (January 01, 2010). Surf's Up: Work, Life, Balance and Brand in a New Age Capitalist Organization. Sociology, 44, 3, 395-413.
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Technical Information on the Statement of Cash

Words: 304 Length: 1 Pages Document Type: Essay Paper #: 13760758

technical information on the statement of cash flow, including what the main sections of a cash flow statement are, how to create each of them and what are the main elements that need to be gathered for a successful cash flow statement. The general format of a cash flow statement was discussed in the beginning so as to give an overview of what the CFS should usually contain.

One of the main issues that the document helped clarify was how the activities of a company can be included in one of the three categories mentioned (operating, investing or financing). In each case, the final figure on each of these CFS categories is important to reveal how the company is performing in terms of each specific operation.

Finally, the document referred to the several different methods that can be used to create a cash flow statement, including the advantages and disadvantages…… [Read More]

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Electronic Cash and Smart Cards Forms of

Words: 2004 Length: 6 Pages Document Type: Essay Paper #: 11050138

Electronic Cash and Smart Cards

Forms of electronic cash came about in the 1990s with the rise of the Internet and a new way to do business. Smart cards were among the new forms. When purchasing products over the Internet, consumers have concerns about the privacy of their information with electronic payments. Some studies were conducted to evaluate the pros and cons of smart cards, how the security is designed in the payment systems, and if the use of smart cards can change the addictive behavior of gamblers.


What it is

It is claimed the Mondex smart card can be used the same as cash and have the advantage of not having to carry cash at the same time. It was conceived as a technological solution to the handling of money and undermining the traditional role of the circuit of money. (Knights, 2007) The aim was to replace the…… [Read More]


Knights, D. e. (2007). Organization. Retrieved from Sage Publications: 

Nower, L. a. (2010, Jan 19). Gambling Motivations, Money-Limiting Strategies, and Precommitment Preference of Problem vs. Non-Problem Gamblers. New Brunswick, NJ, USA. Retrieved from Springer Science+Business Media, LLC.

Wang, H. e. (2004). Concurrent Engineering. Retrieved from Sage Publications:
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Finance the Fcf-Based Valuation Model Is Based

Words: 1844 Length: 6 Pages Document Type: Essay Paper #: 57398264


The FCF-based valuation model is based on the following formula:

EBIT (1-Tax Rate) + Depreciation & Amortization - Change in Net orking Capital - Capital Expenditure

Investopedia, 2012)

is the free cash flow each year, C0 is the original cash outlay, and r is the discount rate. The free cash flows in this type of calculation are only those cash flows that are incremental to the investment decision. Thus, they do not include such non-cash items as depreciation or amortization expense, and they do not include either sunk costs or non-incremental flows like overhead allocations. The r is the discount rate, and the firm can select its discount rate from a number of different options. The most common, and arguably logical, is the firm's weighted average cost of capital. This reflects the firm's cost of equity, its cost of debt and its capital structure, with allowances for preferred shares…… [Read More]

Works Cited:

Berkman H., Bradbury, M. & Ferguson, J. (2002). The accuracy of price-earnings and discounted cash flow methods of IPO equity valuation. Journal of International Financial Management and Accounting. Vol. 11 (2) 71-83.

Del Vecchio, J. (2000). Dividend discount model. Motley Fool. Retrieved April 27, 2012 from 

Demirakos, E., Strong, N. & Walker, M. (2004). What valuation models do analysts use? Accounting Horizons. Vol. 18 (4) 221-240.

Francis, J., Olsson, P. & Oswald, D. (2000). Comparing the accuracy and the explainability of dividend, free cash flow and abnormal earnings equity value estimates. Journal of Accounting Research. Vol. 38 (1) 45-70.
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Capital Budgeting the Projected Free

Words: 2188 Length: 7 Pages Document Type: Essay Paper #: 50044804

But even with no cost savings whatsoever, this project has a positive NPV.

e can see, therefore, that the greatest area of sensitivity is with the terminal value. The terminal value at present is worth $143 million of the NPV. If we break down the variables that go into the terminal value, however, we notice that the cost savings are critical. If SGA expense is not reduced, then the terminal value is reduced to $67 million and the total NPV for the entire project ends up being $98 million. This figure is less sensitive to the change in cost of goods sold.

e should also consider testing combined sensitivity of our shakiest projections. Sales may not live up to expectations and cost savings might not occur. If we assume no net income and no additional cost savings, the project will have an NPV. If we assume that our expectations for…… [Read More]

Works Cited:

No author. (2009). Free Cash Flow. Investopedia. Retrieved May 13, 2009 from 

Ely, Bert. (2008). Savings and Loan Crisis. Concise Encyclopedia of Economics. Retrieved May 13, 2009 from 

Damodaran, Aswath. (no date). Closure in Valuation: Estimating Terminal Value. Stern School of Business. Retrieved May 13, 2009 from 

Breierova, Lucia & Choudhari, Mark. (1996). An Introduction to Sensitivity Analysis. MIT. Retrieved May 13, 2009 from
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Tenet Healthcare Corporation Tenet Healthcare Corp This

Words: 799 Length: 3 Pages Document Type: Essay Paper #: 72127542

Tenet Healthcare Corporation

Tenet Healthcare Corp

This paper examines the financial statements of Tenet Healthcare Corporation, reviewing their important components and discussing their interrelationship.

Tenet's annual report for the year ending December 31, 2011 provides information on the firm's financial health. The balance sheets provide information about what the company owns and what it owes. The income statements provide information about how much money Tenet earned and spent, and the cash flow statements show information about the exchange of money between Tenet and other parties.

Tenet's Balance Sheet

Tenet's balance sheet provides detailed information about its assets, liabilities and shareholders' equity. Tenet's assets are what it uses to operate its business, while its liabilities and shareholders' equity are two sources that support those assets. Tenet's liabilities are amounts of money that it owes to others. Shareholders' equity is the amount of money invested in the company combined with retained earnings;…… [Read More]

Reference List

Tenet Healthcare Corporation. (2012). Form 10-K for year ended December 31, 2011. Available at:
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Understanding Financial Reports

Words: 776 Length: 3 Pages Document Type: Essay Paper #: 94120968

Financial eports

The company that I have selected is FedEx. The homepage of FedEx is located at:

There are other sources of information about the company as well. Its financials and stock information are available at MSN Moneycentral, at the following address:

There are also numerous media sources for information about the company as well. These include Forbes and other business media. For example the following page notes that FedEx is one of the world's most valuable brands:



eturn on Assets

Net Profit Margin

Asset Utilization ate

On these three measures, FedEx outperforms UPS on two of the measures. The company returns a better return on assets, and its net profit margin is higher. However, UPS has a better asset utilization rate. This is in part because UPS has a smaller proportion of fixed assets on its balance sheet, compared with FedEx, and UPS also…… [Read More]


MSN Moneycentral (2013). FedEx Retrieved December 8, 2013 from

FedEx. Retrieved December

Forbes. (2013). FedEx. Retrieved December 8, 2013 from
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Lowe's Companies Inc Lowe's Companies Inc Lowe's

Words: 1600 Length: 5 Pages Document Type: Essay Paper #: 66693874

Lowe's Companies, Inc.

Lowe's Companies Inc.

Lowe's Companies, Inc.

Lowe's Companies, Inc.

This report discusses the home improvement retailer, Lowe's Companies, Inc. The report profiles Lowe's, providing information about its background, operations, size, and relative industry position, as well as lists key competitors. The report also includes a profile of the home improvement retail industry and discusses the current economic outlook and sales forecasts through 2015.

The report also analyzes Lowe's consolidated cash flow statements and discusses the company's sources and uses of cash. Lowe's cash inflows and outflows include the issuance of common stock, repurchase of common stock, repayment and issuance of long-term debt, and investments in property and store information technology.

In addition to reviewing Lowe's cash flow, financial analysis reviews Lowe's performance by comparing Lowe's key ratios to industry ratios. In general, ratio analysis shows Lowe's needs to improve its efficiency and generate more sales. Even though…… [Read More]

Reference List

Home Improvement Research Institute (HIRI). "The March 2012 home improvement products market sales forecast grew 3.8% in 2011 with an increase in 2012 to 5.0%." Accessed April 27, 2012.

Lowe's. 2012. "Corporate information." Accessed April 27, 2012. 

Lowe's. 2012. "2011 Form 10-K." Accessed April 27, 2012. 

Yahoo! Finance. 2012. "Home improvement stores." Accessed April 27, 2012.
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CFO & PV Finance Departments

Words: 1151 Length: 4 Pages Document Type: Essay Paper #: 83755719

Moreover, many firms do not groom their CFOs to one day take the top position, wary of just such limitations.

In many industries, CFOs are not suited to the CEO role, because their skills do not reflect the key competitive advantages of the firm. However, in many cases the CFO is in the best position to drive shareholder value, and their skills in evaluating and structuring mergers and acquisitions can prove invaluable.

2) 1. The present value of 5700 one year from now at 3.6% interest is $5,501.93. The present value of 8900 two years from now at 3.6% interest is $8,294.14. The combined present value of these two accounts is $13.796.07.

2. At a 5% discount rate, the NPVs of the cash flows are: Year 1 $43.809m; Year 2 $67.120m; Year 3 $57.877m for a total of $168.806m. At a 12% discount rate the NPVs of these flows are:…… [Read More]

Works Cited

Sandrick, Karen. (1995). From CFO to CEO: What Does it Take to Make the Leap? Healthcare Financial Management. Retrieved July 7, 2008 at

Taub, Stephen. (2003). Now Playing: CFO as CEO. Retrieved July 7, 2008 at

No author. (2005). CFO to CEO. Corporate Finance. Retrieved July 7, 2008 at

Sandrick, Karen. (1995). From CFO to CEO: What Does it Take to Make the Leap? Healthcare Financial Management
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Finance Question 1 A Bond Ratings Encompass a

Words: 1218 Length: 4 Pages Document Type: Essay Paper #: 87720726


Question 1.a) Bond ratings encompass a wide range of elements related to the credit risk of the firm. Moody's notes that bond ratings include elements of default probability, loss severity, "financial strength" and "transition risk" (Cantor & Fons, 1999). The authors note that within the same sector, bonds of the same rating tend to be comparable both with respect to overall credit quality and specific credit quality characteristics. Over different segments of the bond market, this is not necessarily the case. Bond ratings tend to take in factors like the balance sheet strength of the firm, as well as the expected loss in the event of a default. Thus, the type of assets that the firm holds is an important characteristic. The transition risk reflects the likelihood that the firm will experience outright default without transitioning down through the different risk categories. Firms that are almost assuredly going to…… [Read More]

Works Cited:

Cantor, R. & Fons, J. (1999). Rating methodology: The evolving meaning of Moody's bond ratings. Moody's. Retrieved April 27, 2012 from

Investopedia. (2012). Net present value. Investopedia. Retrieved April 27, 2012 from
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Functions of Financial Markets and Discusses Why

Words: 3238 Length: 10 Pages Document Type: Essay Paper #: 7792090

functions of financial markets and discusses why a dollar tomorrow cannot be worth less than a dollar the day after tomorrow. Furthermore, the paper explains the cash flows associated with a bond to the investor. And discusses the term "price-earnings (P/E) ratio." In addition, the paper discusses the certainty equivalent approach to estimating the NPA of A project and discusses the problems associated with capital investment process. Lastly, the paper contrasts and compares capital budgeting and strategic planning assesses the agency problems associated with capital budgeting.

Explain the functions of financial markets

The existence of the financial market is just to help and maintain the relations between the users of the capital and the providers of the capital. They also provide an opportunity for both the parties to do transactions with mutual benefits. It is there so that the investor and the investment can do the business smoothly and at…… [Read More]


Bernardo, A., H. Cai, and J. Luo, (2002). Capital Budgeting and Compensation with Asymmetric Information and Moral Hazard. Journal of Financial Economics, 61, 311 -- 344.

Dessein, W., (2002). Authority and Communication in Organizations. Review of Economic Studies, 69, 811 -- 838.

Graham, J., and C. Harvey, (2001). The Theory and Practice of Corporate Finance: Evidence from the Field. Journal of Financial Economics, 60, 187 -- 243.

Harris, M., and A. Raviv, (2002). Allocation of Decision-Making Authority. working paper, Graduate School of Business, University of Chicago.
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Verizon Communications Inc Fiscal Year 2010 Verizon

Words: 898 Length: 3 Pages Document Type: Essay Paper #: 32025909

Verizon Communications, Inc., Fiscal Year 2010

Verizon Communications, Inc. (NYSE -- "VZ") has two business segments Domestic Wireless (operated as Verizon Wireless) and Wireline. These business segments are operated and managed as strategic business units and organized by products and services. The company uses the so-called "Anglo-American model" or "the unitary system" (Mallin, 2011) which employs a single-tiered Board of Directors which is comprised of a mixture of executives from the company and non-executive directors, who are all elected by shareholders (Bowen, 2008). Verizon has fourteen board members, including the current CEO. Each business segment is operated separately, but the cash flow and dividend information that is described in the 2010 annual report is not split out by business unit. Thus the results presented below are for the Verizon Wireless and Wireline segments.

The cash and cash equivalents at December 31, 2010 totaled $6.7 bil-lion, a $4.7 billion increase compared…… [Read More]


Mallin, C.A. (2011). Handbook on International Corporate Governance: Country Analyses, 2nd Ed. Northampton: Edward Elgar Publishing.

Bowen, W.G. (2008). The Board Book: An Insider's Guide for Directors and Trustee. New York: W.W. Norton & Company.

Thune, K. (2010, July 15.) Ask the Advisor: Savings vs. Investing Money in the Stock Market . Retrieved February 22, 2012 from website: (February 22, 2012).

Verizon Communications. (2010). Verizon Communications, Inc. Annual Report 2010. Retrieved from:
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Brown-Forman Southern Comfort Brown-Forman Southern Comfort Acquisition

Words: 841 Length: 3 Pages Document Type: Essay Paper #: 6947257

Brown-Forman Southern Comfort

Brown-Forman, Southern Comfort Acquisition

The case considers the opportunity for Brown-Forman Distillers of America to acquire the Southern Comfort Corporation (SoCo). The primary concern is of financial matters, but also represents other issues of firm strategy and core competencies.


The asking price of 94.9 million (USD) is evaluated upon a structuring of a mix of cash and debt financing. The initial price includes a real estate holding, unaffiliated with the SoCo product, and is to be sold back to the family shareholders at a price of 5.9 million (USD). It follows that the net price for SoCo is 89 million (USD), with 70 million (USD) borrowed at a rate of 8.75% (Pg. 5). The current debt to equity ratio of 0.247 of Brown Forman is significantly below the average of competitors maintaining a ratio of 0.51. Acquiring SoCo with 70 million (USD) of debt financing implies…… [Read More]

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Practicing Skill Building Lead and Manage Using

Words: 869 Length: 3 Pages Document Type: Essay Paper #: 13475707

Practicing Skill uilding: Lead and Manage Using the alanced Scorecard

Kaplan "Lead and Manage Using the Scorecard"

The work of Kaplan entitled 'Lead and Manage Using the Scorecard" states that communication "is clearly a leadership role." An article published by Forbes online states that it is not possible "to become a great leaders without being a great communicator." (Myatt, p.1) Myatt states "the previous sentence didn't refer to being a great talker -- big difference. The key to becoming a skillful communicator is rarely to be found in what has been taught in the world of academia. From our earliest days in the classroom, we are trained to focus on enunciation, vocabulary, presence, delivery, grammar, syntax, and the like. In other words, we are taught to focus on ourselves. While I don't mean to belittle these things as they're important to learn, it's the more subtle elements of communication rarely…… [Read More]


Barrett, DJ (nd) Leadership Communication: A Communication Approach for Senior-Level Managers. Retrieved from:

Hackman, M (2006) Communicating for Leadership Success. Retrieved from:

The Changing Face of Reward (2012) HayGroup. Retrieved from:

Haguewood, J. And Knott, F. (2012) Performance Metrics Matter. Retrieved from:
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Capital Gains Tax in Australia Capital Gains

Words: 2921 Length: 8 Pages Document Type: Essay Paper #: 17440945

Capital Gains Tax in Australia

Capital gains tax refers to a type of tax levied on capital gains incurred by organizations or individuals. The capital gains refer to the profits that an organization or individual selling a capital asset obtains through selling an asset at a price higher than the original price. In many countries, the amount of capital gains tax takes into consideration the type of investment and the holding period of the asset. Australian capital gains tax takes a proportion of all achieved capital gains. Capital gains are not separate tax but part of the income tax on individuals and corporations upon disposing of capital assets. Australian capital gains tax exempts personal properties such as home, car, and furniture. Australian residents in any part of the world are subject to capital gains tax.

Issue 1. Moodly's Conversion of her main residence.

Moodly being a childcare worker, wishes to…… [Read More]


OECD Tax policy studies. 2006. Taxation of Capital Gains of Individuals: Policy

Considerations and Approaches. No.14. Paris: OECD Publishing.

Pricewaterhouse Coopers. 2006. Mergers and acquisition: A global Tax Guide. New Jersey:

John Wiley and Sons Inc.
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Aztec's Capital Investment Company Overview

Words: 2788 Length: 11 Pages Document Type: Essay Paper #: 15554400

Thus, the paper provides the following recommendations on the strategies that the company will use to prepare its 3-year financial plan to achieve its corporate objectives.

First, Aztec needs to rely more on the share capital as source of fund than raising fund from the bank loan. Loan capital is the fund borrowed from the bank while the share capital represents the funds raised by selling shares to the public. Typically, share capital should be clearly a preferred option of raising fund because the company only liable to pay dividends for such funds which is only between 2 and 3% of the market value of the equity per annum. On the other hand, loan capital is a borrowed fund that has a fixed interest which a company should pay no matter its financial conditions.

Aztec would enjoy several advantages from raising fund from the share capital. First, the company will…… [Read More]


Afonso, a. (2009). Determinants in using of capital investment appraisal methods: Evidence from the field. Department of Production and Systems University of Minho.

Barclays (2012).UK Hospitality and Leisure Sector outlook Third quarter 2012. Corporate Banking, Barclays Bank PLC.

Businessweek (2012). Compass Group Plc (CPG:London). Bloomberg. UK.

Clarke, P.J. (2002). Account Infor for Managers. Cengage Learning EMEA.
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Horniman Horticulture Situation Analysis of Strengths and

Words: 896 Length: 3 Pages Document Type: Essay Paper #: 42629019

Horniman Horticulture

Situation Analysis of Strengths and Weaknesses

Since acquiring Horniman Horticulture in 2002, revenues have grown 39.8% through 2005 (Pg. 140). With projected revenue growth of another 25%, over 2005, to 1.3 million, Horniman Horticulture is successfully capitalizing on their market. The recent product line expansion into mature plants offers the opportunity for greater profit margins and a diversified customer base.

However, while the overall efficiency of operations demonstrates results exceeding benchmarked competitors, the deteriorating cash situation exposes the firm to ever-greater risks from any disruption of daily operations or business cycle fluctuations. The cash balance erosion, as well as the significant increase in accounts receivable, illustrates a firm that is undergoing rapid growth without a strategy to manage and stabilize their burgeoning business.

The product line expansion offers a diversity of customer base, which can insulate the firm from loss of any particular client, and the increased profit…… [Read More]

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Macro Economy Macroeconomics Circular Open

Words: 997 Length: 3 Pages Document Type: Essay Paper #: 35513210

This model is much more conservative, and thus tends to try to avoid government interaction within the system. Here, the research suggests that it "stresses the connectedness of the monetary flows" (Hannes, 2012, p 4).As such, it keeps its leakages from separating and floating out of the system, as well as providing for more inside injections that do not rely so much on outside systems, as in the case with an open model system. The model is most concerned with savings and investment in order to keep leakages from spilling out of the model system, as in the case with the open system. In this system, borrowers take credit and invest it back into the system, therefore adding elements of credit into the system as an injection. In this regard, savings is seen as an injection, not a leakage like in the open systems model. Thus, "the closed model stresses…… [Read More]


Buck, John. (2008). The circular flow diagram. Economic Perspectives. Web. 

Hannes, K. (2012). Circular flow models. Economics. Web. 

Morgan, D. (2012). Open and closed systems in macroeconomics. Education Articles. Web.
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Business Plan Proposal

Words: 781 Length: 3 Pages Document Type: Essay Paper #: 47006697

Business Plan Proposal:

The Ducks Poker Room

Business Plan Proposal: The Ducks Poker Room

Executive Summary/Company Description

The Ducks Poker Room will be a new for-profit gaming club primarily hosting players of versions of the card game known as "Poker." The Ducks Poker Room will also offer alternate games, including but not limited to promotions for prize pools involving tickets to college basketball and football games. Finally, The Ducks Poker Room will host patrons who are not playing poker.

Business Plan Objectives

Provide exceptional facilities, equipment, service, staff and merchandise that create a highly positive impression on our core customers;

Consistent entertainment atmosphere and product quality;

Capitalize on excellent location opportunity;

d. Launch the venue with a highly publicized grand opening event in the spring of Year 1;

e. Maintain tight control of costs, operations, and cash flow through diligent management and automated computer control;

f. Maintain food costs below…… [Read More]

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Financial Statements by Business Entities The Purpose

Words: 1399 Length: 3 Pages Document Type: Essay Paper #: 72245081

financial statements by business entities. The purpose of this is so that one can understand about the business cash, how the business acquired or generated it, how it was used and in what ways and tomorrow's business plans, financial position of a business, performances and its position. The paper will go ahead to analyze if there is any significance of cash for the survival of a business and the impacts of the various financial sets. The arguments that will prevail will be based on the importance of the different financial statements to a business survival.

Cash is a crucial constituent of a business and I do agree that a business cannot survive without it. 'As a matter of fact the main aim and goal of a business is to generate cash and profits not only in the short run but also in the long-term.' (Minnery, 2006) Every business has everyday…… [Read More]

Works Cited

Elliot.B, 2005, Financial Accounting and Reporting; Financial Times/Prentice Hall, United Kingdom

Graham B. 1998, The Interpretation of Financial Statements Harper Business, amazon

Minnery.B. 2006, 'Don't question the importance of cash flow' The independent, viewed date 28 May 2006, 2009, The importance of cash flow statement; viewed; Aug 19, 2009
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Real Options Analysis

Words: 3230 Length: 8 Pages Document Type: Essay Paper #: 11242875

Real Options Analysis

Companies resort to capital budgeting in the process of taking decisions with regard to making long-term investments. The projects involving capital budgeting are chosen by the companies in terms of expected generation of cash flows. Since profitability is the main criterion for long-term investments of the companies the strategic decisions with regard to the long-term investments involves a cost-benefit analysis in terms of cost of investments and expected generation of cash flows over the period of time. Emphasis is being laid on the concepts of Net Present Value and Internal Rate of Return etc. To assess the benefits of long-term investments against the cost of capital invested. The cost of capital of a firm signifies towards the cost of obtaining of capital by the firm that is used for long-term investments. Generally the firms define economic profit as the operating profit excluding the tax and cost of…… [Read More]


Dynamic strategic planning Evaluation of Real options" Retrieved at . Accessed on 19 May, 2004

Eckersley, Peter. Regional Economist, Bunbury. "Budgeting and decision-making techniques" Retrieved at Accessed on 19 May, 2004

Net Present Value and Other Investment Criteria" Retrieved at Accessed on 19 May, 2004

Phelan, Steven E. "The Role of Strategic Thinking in the Analysis of Hard Investment Evaluation Problems" Retrieved at Accessed on 19 May, 2004
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Managerial Finance - Johnson &

Words: 3790 Length: 10 Pages Document Type: Essay Paper #: 86395992

76), ROE has ranged from 21.6% to 28.3% in recent years, with the 2007 figure being 25.6%. This reflects outperformance of both the industry and the market. The ROA has exhibited similar outperformance of both industry and market. The return on assets for JNJ over the past several years has ranged from 13.1% in 2007 to 17.l% in 2005. The industry five-year average is 8.85% and the market five-year average is 7.50%.

SWOT Analysis


Net Income increased despite decline in revenues

Growth in each business segment

R&D expense growing slower than revenues

2-year upward trend in net income

Upward trend in cash levels

Upward trend in cash flow from operations

Current ratio 46.36% higher than industry

Interest coverage 80.09% higher than industry

Net margin 14.04% higher than industry

Return on Equity 1414.79% higher than industry

Return on Assets 48.02% higher than industry


Decline in revenue this year (1st…… [Read More]

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Caledonia Products

Words: 1290 Length: 5 Pages Document Type: Essay Paper #: 921533

Caledonia Products

a) When making capital budgeting decisions, Caledonia should focus on cash flows rather than accounting profits. The argument in favor of cash flows is simple -- cash flows are what drive company value, more so than economic profit. Profit can be distorted by a number of considerations that do not impact on cash flows. For example, depreciation expense is not a cash flow, but a means of accounting for the fact that the up front purchase is not on the income statement. By using cash flows, it is easier to account for the time value of money because the cash flows are represented in the time period in which they occur -- that is not always the case with accounting for economic profit.

b) Depreciation is not included in the calculation of cash flows, because it is not a cash flow. The item that depreciation represents is the…… [Read More]


Foundations of Finance for Ashford University, 7th Edition. Pearson Learning Solutions pp. 333-335
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Financial Indicators That Can Be

Words: 3811 Length: 12 Pages Document Type: Essay Paper #: 57972656

According to these analysts, "The implicit assumption underlying the price-to-earnings method is that the fair market value of the closely held business can be approximated from the market value of comparable publicly traded businesses. To implement this method, the valuator must be able to identify a set of presumed-to-be comparable publicly traded companies and obtain sufficient information on each to verify the extent of comparability from an economic, management, and financial perspective. No publicly traded company will be precisely comparable to the closely held business being valued, so informed judgment must be exercised" (p. 81). As a general rule, the smaller in size and the more limited the scope of activities of the business being valued, the less likely there will be a set of publicly traded companies that are comparable, or even a single comparable publicly traded company. Publicly traded companies are for the most part large, measured in…… [Read More]


Allen, M.F. & Cote, J. 2005, "Creditors' Use of Operating Cash Flows: An Experimental

Study." Journal of Managerial Issues 17(2): 198-199.

"Asset/equity ratio." 2009, Investor Glossary. [Online]. Available: http://www.investorglossary.

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Opportunity to Make an Investment

Words: 1373 Length: 5 Pages Document Type: Essay Paper #: 79767541

Present Value

Price of bond= 0.385543*1000 +6.144567*100= $385.54.64+$614.45

Price of bond= $1,000

So, price of bond B. is $1,000 b. For market interest rate equal to 12%:

Price for bond a:

Market interest rate is equal Coupon rate is equal Face value Frequency Number of years to maturity Number of Periods Discount rate annually Discount rate per period n, periods r, per period 12%

10% $1,000 Annual 20-20-12.00% annual 12.00% 20-12.00%

Now we need to calculate PVIF and PVIFA.

For calculation of PVIFA (i, n) and PVIF I is equal to 20 periods and n=12%

PVIF= 1/(1+0.12)^20

PVIF=0. 103667

PVIFA= (1- 1/(1+.12)^20)/.12


Price of bond= 0.103667*1000+7.469444*100=$851

Price of bond a = $851

Price of bond B:

Market interest rate is equal Coupon rate is equal Face value Frequency Number of years to maturity Number of Periods Discount rate annually Discount rate per period n, periods r, per period 12%…… [Read More]

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Valuation Acquiring a Company Is

Words: 2415 Length: 7 Pages Document Type: Essay Paper #: 18813549

In general, P/E valuation is a common and reliable method for appraising a company's value, but, as with any method, caution must be exercised.

Discounted cash flow

The discounted-cash-flow method is arguably the most complex valuation model discussed in this paper, but it is often considered reliable because it considers a company's post-sale prospects (Calculating Discounted 2005). In the case of the previously discussed over-valued, it is easy to see where a potential buyer would eventually develop a cash-flow problem. The company is barely profitable, and it's going to take $5 million to purchase the company, likely creating some debt to be serviced. Perhaps a company with multiple business units would be capable of servicing that debt through the performance of the other units, but clearly the business being acquired could not service such debt through its own cash flow.

The discounted-cash-flow method works well because one of the…… [Read More]

Works Cited

Berry, T. 2004, "Planning for Purchasing a Business,", viewed 20 May, 2007 at

Bizquest Staff, No date, "Valuation Methodologies,", viewed 19 May, 2007 at

Brooks Barristers No date, "Key Questions When Purchasing a Business," LexisNexis, viewed 20 May, 2007 at

Business Valuation Methods" No date, Second Venture Corp., viewed 20 May, 2007 at .
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Budget Building a Profit Plan

Words: 2893 Length: 10 Pages Document Type: Essay Paper #: 48166924

Operating expenses include selling and administrative expense. Ordinarily, a forecast or budget for selling expenses is prepared together with the sales budget or profit target because selling efforts such as promotions, commissions and salaries of the sales staff are directly related to sales. Selling expenses may either be variable or fixed. Administrative expenses include projected administrative costs for other than production or selling activities. These expenses are mostly composed of fixed costs such as research and development, insurance payments and government taxes.

3. Calculate expected profits

Profit is the excess of revenue over total costs and expenses incurred in generating such revenue during the period of operation. Profit can be expressed in the mathematical equation:

Profit = Sales - Total Costs and Expenses]

Costs having been considered, the budgeted profit plan may now be established. Injecting the concept of 'revenue less expenses equals profit,' the profit may be calculated as…… [Read More]

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Long-Term Financial Planning FedEx Corporation FedEx Corporation

Words: 1117 Length: 4 Pages Document Type: Essay Paper #: 80308048

Long-Term Financial Planning

FedEx Corporation

FedEx Corporation was established in 1971 and the company has four distinct business segments that include FedEx Express, FedEx Ground, FedEx Office and FedEx Freight. Over the years, the company has obtained 6-year of CAG (compounded annual growth of 5%). However, the company is likely to obtain similar CAG of 5.9% over the next 8 years based on current economic environment. (FedEx Corporation .2010.

The WACC (weighted average cost of capital) is the average interest rate that a company should pay in order to secure a project. Moreover, WACC is the average rate of return that a company must earn from its current assets to satisfy investors, shareholders and creditors. Since FedEx Corporation is always trying to create value for shareholders, the paper calculates the WACC of the FedEx to evaluate the company ability to generate returns from its assets.

Estimation of WACC of the…… [Read More]


FedEx Corporation (2010. Annual Report.USA.
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Hansson Private Label Hansson Is

Words: 3683 Length: 13 Pages Document Type: Essay Paper #: 60364966









Looking at these figures, we can see immediately that the most important assumption Gates has made with respect to free cash flow is that the project will go beyond the initial three years contract. The nominal value of the cash flows associated with those first three years does not equal the initial outlay. Thus, for the project to be profitable, the company must take it well beyond the three-year time horizon.

Weighted Average Cost of Capital

A typical metric that is used in capital budgeting decisions to determine the discount rate is the firm's weighted average cost of capital. There are a number of faults with using the WACC, however. Most of these faults relate to the fact that the WACC is based on current figures. This expansion is a major expansion of the firm therefore the cost of capital is impacted…… [Read More]

Strategically, this project is not as high risk as Hansson currently believes. The firm need not be dependent on a single customer because it is experiencing strong demand and has been able to build its business rapidly even in a mature market. Hansson will likely need this capacity in the coming years anyway. In addition, the increased leverage does not take Hansson into a dangerous position. It leaves the company with more debt than it has ever had, but not a historically high LTD/Equity ratio, as this was higher in 2003. There is little reason to believe that the company is increasing its liquidity risk to a point that would even result in an increase in the cost of debt, so Hansson need not worry much about leverage.

Thus, the question becomes one of capturing a market opportunity and where this fits into overall corporate strategy. If Hansson is to continue to grow, it will need to ride the growth of its major retail partners. The drug stores, retailers and clubs are the strongest source of growth within the industry and for Hansson. The company is growing along with the growth of these customers, and these customers have big ambitions. Hansson needs to take a long-term view of its relationship with these major customers -- it has the opportunity to lay the foundations of that relationship and send a signal to all major private label retailers that Hansson is the company to deal with for personal care products, that it is ready to grow with them to a position of market dominance. Strategically and financially, this investment is a great fit and it is therefore recommended that Hansson sign the contract and make the investment.

Hansson can finance this deal entirely with debt from its bank. It is important that Hansson does not focus strictly on the one customer, but works to fill capacity sooner rather than later by courting other major customers, using this deal as an example of its future outlook as a partner to major retailers. Hansson is not projecting at any point more than 85% utilization of the new facility, which indicates that if the company can bring its capacity utilization up with new contracts from other retailers as well, the net present value of this project can be improved further. All indications are that this opportunity is greater than what is included in Gates' calculations, and that Hansson needs to use this investment as a springboard for another round of growth, not just an one-off investment.
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Finance in Reply to the

Words: 1545 Length: 6 Pages Document Type: Essay Paper #: 40811964

This will also show the degree to which the project is vulnerable to potential changes on the market that would influence its main figures, including the volume of sales.

Another useful tool that can be used is a simulation. A simulation would allows us, in this particular analysis, to change some of the variables in a mathematical model that we would create and analyze the consequences of those changes. The sensitivity analysis has one important restriction in that it only allows one variable to be changed. With the simulation, this is no longer the case. At the same time, it is important to perform a simulation because one would be able to understand how the other elements in the mathematical model are likely to fluctuate as some of the variables change.


1. Calculating the Net Investment (NINV) or Initial Outlay (IO). On the Internet at Last retrieved on…… [Read More]


1. Calculating the Net Investment (NINV) or Initial Outlay (IO). On the Internet at Last retrieved on July 22, 2011

2. What is Terminal Cash Flows in Capital Budgeting? October 2008. On the Internet at Last retrieved on July 22, 2011

3. On the Internet at,12,What is sensitivity analysis?. Last retrieved on July 25, 2011

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Project Management Scenario a Global

Words: 2476 Length: 9 Pages Document Type: Essay Paper #: 9194818


There are several benefits that a global consumer electronic firm could derive from inter-project learning.

First, inter-project learning allows firm to enhance project completeness. Prencipe, & Tell (2001) argue that inter-project learning allows firms to execute a project in a best method. In the present competitive market environment, project is the key to the dynamic competitive capabilities. Typically, accumulation of knowledge builds project competencies, which could enhances market performances of a global consumer electronic firm. Experience has revealed that project-based firm has been able to record high profit in the market environment. ( Brady, and Davies, 2004).Through inter-project learning, a global consumer electronic firm will be able to better estimate the project costs and this will enhance ability to deliver the project with success. Moreover, the inter-project learning will enable the company to estimate the project risks efficiently. By better evaluating the project risks, the project manager will be…… [Read More]


Anbari, F.T., Carayannis, E.G. And Voetsch, R.J. (2008) Post-project reviews as a key project management competence, Technovation, Vol. 28, pp.633-643.

Brady, T. And Davies, a. (2004) Building of the Project Capabilities: From Exploratory to Exploitative Learning, Organization Studies, Vol.25, No.9, pp.1601-1621.

Prencipe, a. & Tell, F. (2001). Processes and outcomes Inter-project learning: knowledge codification in project-based firms. Research Policy. 30: 1373 -- 1394

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Financial Analysis Mcdonald's Like Many

Words: 2973 Length: 7 Pages Document Type: Essay Paper #: 87490352

Conduct a benchmarking analysis

As explained by Prasnikar, Debeljak and Ahcan (2005) benchmarking depends on comparing between two activities of an organization and another. In our case, we shall compare McDonald's activities and those of its competitors, Burger King and Wendy's.

• Best practices

McDonald's as a main player in the fast food industry is concerned with best practices with the industry. To this end, the corporation has adopted some best practices that include sustainability, nutrition and well-being, employee experience ad environmental responsibility. Accordingly, McDonald's protects the environment by going green and using methods that protect and conserve the environment. McDonald's also encourages its suppliers to uphold effective environmental. The company treats it employees well and offers them good working conditions as a way retaining them. Employees are offered training and promoted accordingly. McDonald's also adheres to ethical conduct its operations and food items are produced ethical. Similarly, the company…… [Read More]

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Amazon and Whether the Company Should Approve

Words: 2283 Length: 8 Pages Document Type: Essay Paper #: 54086109

Amazon, and whether the company should approve the project or not. There are a number of different steps leading to this decision, and it is those steps that make up the bulk of this paper. The first step is that the capital structure of the company needs to be determined. This is going to contribute to a weighted average cost of capital calculation later on. There are two different ways of calculating capital structure, the book value method and the market value method. Both are calculated, but eventually it is the book value method that is used.

The next step is to calculate the weighted average cost of capital. In this section, we already have the weights, but we need the cost of debt and the cost of equity. These are both analyzed using market information for debt and equity alike. Three different methods of calculating the cost of equity…… [Read More]

Works Cited:

Investopedia. (2013). Optimal capital structure. Investopedia. Retrieved April 21, 2013


MSN Moneycentral. (2013). Retrieved April 21, 2013 from

No author. (2013). How to determine your WACC. Structuring Finance. Retrieved April 21, 2013 from
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Financial Feasibility

Words: 2090 Length: 8 Pages Document Type: Essay Paper #: 21659765

Financial Feasibility

Bull Run, Virginia

Pleasant Valley Estates is envisioned as an upwardly mobile community - located in Bull Run, Virginia - and targeted toward the young, single professional and young families.

Cash Flow Statement Overview

The cash flow statement constitutes a financial document, which details the exchange of cash between a business and the outside world while strategically demonstrating the in and outbound logistics. Flow is traditionally categorized as:

flow "in" from Operations - the cash the entity or company makes by selling goods and services, flow "in" from Financing - the cash the entity or company raises by selling stocks and bonds, and flow "out" to Investing - the cash the company spends toward investing in future growth

Each of these flows can move bi-directionally. Investors generally like to see that the company covers its spending with cash from operations rather than resort to financing. The cash flow…… [Read More]

Jordan, B. "Homeownership Alliance." Banc One Investments Advisor.

Freddie Mac Reports Strong Multifamily Lending Volume: New Product Lines Boost Production and Position Freddie Mac as Industry Leader." Freddie Mac News and Information Report. Nov. 2000.
Statistics and predictions were taken from the following: CBR MLS, National Association of Realtors®, and the National Association of Home Builders.
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Strategic Financial Management

Words: 2697 Length: 10 Pages Document Type: Essay Paper #: 73345487

market capitalization of 23.011 billion, oeing is the nation's largest producer of commercial aircraft and the world's leading aerospace company. It operates in four principal segments: Commercial Airplanes, Military Aircraft and Missile Systems, Space and Communications, and oeing Capital Corporation. As the world's market for air travel fluctuates with the risk of war, so do oeing's revenues. However, as the United States moves towards a footing that may include future wars against perceived 'terrorist states,' oeing stands to gain from military aircraft and weapons production. As such, it intrigues investors as its market is a careful reflection of the front pages of the world's newspapers.

To successfully evaluate oeing's stock, we must analyze its fundamentals and the performance of comparables, as well as market performance. A projection of future revenues is necessary, along with an estimation of the cost of capital with which oeing produces. These allow us to provide…… [Read More]

Bibliography, March 20th, 2003

Boeing SEC 10-Q Filing, 1st Quarter 2003
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Net Present Value Mergers and Acquisitions

Words: 1672 Length: 6 Pages Document Type: Essay Paper #: 73650267

Business -- Corporate Finance - Net Present Value - Mergers & Acquisitions, Parts 1 &

Google, Inc. is analyzing the possible added value of a project initially costing $1,750,000.00 Calculating the net cash flows for 5 years, the 15% cost of capital, the present value of cash flow for 5 years and the net present value all allow the reviewer to determine the added value that might encourage the company to pursue this project. Even as Google, Inc. is advised to pursue this project, its shareholders are advised against the acquisition of Groupon, as the downsides and risks considerably outweigh the possible advantages of acquisition. In contrast, Groupon shareholders should seek the acquisition based on the balance of advantages and disadvantages that such an acquisition would pose for them.

B. Body

Capital Budgeting Decision for Google Shareholders and Executives.

I recommend that the executives and shareholders of Google pursue the…… [Read More]

Works Cited

Brealey, R.A., Myers, S.C., & Allen, F. (2005). Principles of corporate finance, 8th Edition. New York, NY: McGraw-Hill.

Gaughan, P.A. (2011). Mergers, aquisitions and corporate restructurings. Hoboken, NJ: John Wiley & Sons, Inc.

Lachapelle, T. (2012, December 11). Buying Groupon hard for anyone as growth slows: Real M&A. Retrieved on December 16, 2013 from Web site:

McClure, B. (2009, February 25). Mergers and acquisitions: Definition. Retrieved on December 16, 2013 from Web site:
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Financial Management Analysis

Words: 1128 Length: 4 Pages Document Type: Essay Paper #: 66642347

Financial Analysis

Assumption Use in the Financial Plan

Additional Assumption in Sensitivity Analysis








Investment Value Using At Discounted Rate 5%

est Financial Plan and Option

Assumption Use In The Financial Plan

Additional Assumption in Sensitivity Analysis

It is further assumed that price will increase gradually at the rate of 8% per annum and sales will increase at 7% per annum.

For the purpose of analysis, both the sales price and Kg sales will gradually increase at 5%.

Another scenario will be that the sales price per Kg increase at 10% but the unit sales…… [Read More]


Saltelli, A., Ratto, M., Andres, T., Campolongo, F., Cariboni, J., Gatelli, D. Saisana, M., and Tarantola, S., 2008, Global Sensitivity Analysis.The Primer, John Wiley & Sons.

Sensitivity analysis. (2014). Retrieved Janaury30, 2014, from


€ Exchange Rate $
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Guillermo Furniture Guillermo Has Three

Words: 1118 Length: 4 Pages Document Type: Essay Paper #: 34204175

The basic premise of IRR is that if the IRR is higher than the discount rate, the project will be profitable over its life, whereas if the IRR is lower, the project will not be profitable. The IRR calculation is normally done in Excel, but can be rendered as

The IRR for the patent coating option is 6.9%; for the automation technology it is 64.7%; for the brokerage option it is 11%.

The net present value (NPV) discounts the cash flows using the discount rate derived from the weighted-average cost of capital. This calculation utilizes all of the cash flows that are specific to the decision at hand, including the initial outlay, salvage value and all cash flows beyond the payback period. This makes the NPV the most complete of the capital budgeting techniques available to Guillermo. Although normally this calculation is completed in Excel, the formula is as follows:…… [Read More]