Chap 18 Problem 2

McConnell Corp. has a book value of equity of $13,205. Long term debt is $8,200. Net working capital other than cash, is $3,205. Fixed assets are $17,380. How much cash does the company have? If current liabilities are $1,630 , what are the current assets?

Chap 19 Problem 1. a-dAgain Inc. is proposing a right offering. Presently there are 490,000 shares outstanding at $75 each. There will be 80,000 new shares offered at $71 each.

1a. What is the new market value of the company?

1b. How many rights are associated with one of the new shares?

1c. What is the ex-rights price?

1d. What is the value of a right?

Chapter 20,

Suppose the spot exchange rate for the Canadian dollar is Canadian $1.04 and the six month forward rate is Canada $1.06.

4a. Which is worth more, a US dollar or a Canadian dollar?

Chapter 20

Suppose the Japanese yen exchange rate is Y.89=$1.00 , and the British pound exchange rate is 1= $1.62.

5a. What is the cross rate in terms of yen per pound?

UNIT 6: TEXTBOOK PROBLEMS CHAPTER 18: PROBLEM 2 Net Worth Long-term Debt Net Working Capital (Excluding Cash) Fixed Assets Current Liabilities $13,205 $8,200 $3,205 $17,380 $1,630 Cash = Net Working Capital (Including Cash) = Current Assets = CHAPTER 19: PROBLEM 1 (a through d) # of shares outstanding Current Stock Price # of new shares outstanding in the future (rights offering) Price of New Stock (or rights) 490,000 $75 80,000 $71 A. New Market Value of the Company = B. # of Rights Needed = C. Ex-Rights Price = D. Value of the Right = rights per new share CHAPTER 20: PROBLEM 4a Spot exchange rate for the Canadian Dollar 6 month forward rate U.S. Dollar $1.04 $1.06 $1.00 One Canadian Dollar is worth (If amount is below 1, then the U.S. dollar is worth more and vice versa.) CHAPTER 20: PROBLEM 5a British Pound Exchange Rate= Japanese Yen Exchange Rate= Cross Rate in terms of Yen per Pound = 89 1 = = $1 $1.62