Six years ago, Excel Hydro Inc. purchased a mailing machine at a cost of $368,000. This equipment
Question:
5. What is the book value of shareholders' equity?
6. Explain what the Vice President can legitimately do now to help accomplish this goal. Provide specific examples in your answer. Excel Hydro plans to raise $6.2 million to expand their business. To accomplish this, they plan to sell 20-year, $1,000 face value, zero-coupon bonds. The bonds will be priced to yield 9.5%.The company plans on depositing $10,000 a year in real terms into your investment account for the next four years. The relevant nominal discount rate is 7.5% and the inflation rate is 4.2%.
7. What is the minimum number of bonds they must sell to raise the $6.2 million they need?
8. What are the deposits worth in today's dollars? Excel Hydro Inc. has just issued dividends at $2 per share. There are 500,000 shares outstanding. The recently released Income statement shows net earnings of $1200,000. Dividends will grow at the rate of 10% for the next four years. The required rate of return is 12%.
9. Calculate the EPS of the company.
10. Calculate the Present value of the stock.
South Western Federal Taxation 2016 Corporations Partnerships Estates and Trusts
ISBN: 9781305399884
39th edition
Authors: James Boyd, William Hoffman, Raabe, David Maloney, Young