Question 1
*case study attached* Comprehensive Case Analysis based on the course material Description Your instructor will assign a major publicly traded corporation from a nonregulated industry where you can obtain complete financial statements for the most recent 5 years. The instructor will post the company in the Announcements section by the end of Unit 1. The company that has been selected for you to study for your final project is "International Game Technology" Ticker "IGT" . This is a NYSE traded company that produces gaming machines for the casino industry. Let's really dig into this company and find out how it ticks. Based on these statements and other information you will prepare a financial statement analysis report. You will work on this project throughout the term. Do not wait until the last week to begin. Directions For your Term Project, turn to page 648 in our textbook, and complete the assignment under Case CC-1, Comprehensive Financial Analysis. The final analysis should be set up as a research paper with the following sequence: ? Cover page with your name, course number, your instructor, date, subject, and a brief statement that you (and you alone) produced the paper and all references are mentioned. ? Executive Summary (max. ? page in Bold) ? Table of Contents ? Introduction ? Body (8-12 pages) ? Conclusion and Recommendation(s) ? References Submit your Final Project by the end of Unit 9.
Question 2
Read the case study titled ?Stopping Outshopping?, located in the online course shell. Then, use the Internet or Strayer databases to research similar marketing strategies in the health care industry. Write a four to six (4-6) page paper in which you: Based on the textbook?s summary of Timothy?s philosophy of continually striving for excellence, determine whether or not Scarlet Hospital was prepared to compete with the establishment in Salem even before the highway improvement mandated such an upgrade in delivery health care services. Examine the potential lessons that the ?Stopping Outshopping? case could teach health care executives about complacency. Evaluate the potential value of Michael Porter's Five Forces analysis and SWOT Analysis for effective decision making, in its ability to help Scarlet Hospital protect its market share and thus decrease the chance of losing patients to other institutions in Salem. Appraise the value of the Balanced Scorecard model in its ability to help Scarlet Hospital executives reinforce its defensive marketing strategy. Propose a one (1) page offensive marketing strategy (i.e. communication, branding, innovation, etc.) that Scarlet Hospital should deploy in order to turn the table on Salam-based health care providers and improve its competitive marketing position. Use at least five (5) quality academic resources. Note: Wikipedia and other Websites do not qualify as academic resources. Your assignment must follow these formatting requirements: Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions
Question 3
Question 1 (True/False Worth 5 points) The appropriate risk-free rate of return to use in the CAPM is the 3-month Treasury rate. True False -------------------------------------------------------------------------------- Question 2 (True/False Worth 5 points) The market risk premium can be accurately calculated if we know the expected rate of return on the market. True False -------------------------------------------------------------------------------- Question 3 (Multiple Choice Worth 5 points) Accounting operating profits are also knows as EBIT EBITDA Net income None of the above. -------------------------------------------------------------------------------- Question 4 (Multiple Choice Worth 5 points) Secret Energy Supplies has common shares with a price of $15.44 per share. The firm is expected to pay a dividend of $1.25 one year from today, and dividends are expected to grow at 15 percent for two years after that ant then at 2 percent thereafter. What is the implied cost of common equity capital for Secret Energy? 11.00% 12.00% 13.00% 14.00% -------------------------------------------------------------------------------- Question 5 (Multiple Choice Worth 5 points) Natural Footware has total fixed costs of $30,000 per month, including $3,000 per month of depreciation expense. It sells natural sole shoes for $29 a pair, and the variable cost of each pair of shoes is $20. What is the pretax operating cash flow break-even point for Natural Footware? 931 pairs of shoes 3.000 pairs of shoes 3,333 pairs of shoes 3,667 pairs of shoes -------------------------------------------------------------------------------- Question 6 (True/False Worth 5 points) The CAPM can be used to estimate the cost of preferred equity for a firm. True False -------------------------------------------------------------------------------- Question 7 (Multiple Choice Worth 5 points) Tulip Products Industries paid a dividend of $2.05 yesterday. If the firm?s growth in dividends is expected to remain at a flat 1.5 percent forever, what is the cost of equity capital for Tulip if the price of its common shares is currently $24.48? 8.37% 8.5% 9.87% 10.00% -------------------------------------------------------------------------------- Question 8 (True/False Worth 5 points) One interpretation of depreciation and amortization is that it is a fixed cost of the firm. True False -------------------------------------------------------------------------------- Question 9 (Multiple Choice Worth 5 points) Moonshine Drinks has discovered that the extent of the demand for its high octane drink is 4 million bottles per year. If the fixed costs for the new product are $8 million and the sales price per bottle is $25, then what is the maximum variable cost per bottle that the firm needs to break even on a pretax operating cash flow basis? $2 $22 $23 None of the above. -------------------------------------------------------------------------------- Question 10 (Multiple Choice Worth 5 points) Life Balance, Inc. has found that its cost of common equity capital is 15 percent and its cost of debt capital is 9 percent. If the firm is financed with $6 million of common shares (market value) and $4 million of debt, what is the after tax weighted average cost of capital (WACC) for the company if it is subject to a 30 percent marginal tax rate? 9.7% 10.65% 11.16% 11.52% -------------------------------------------------------------------------------- Question 11 (True/False Worth 5 points) The constant-growth dividend model cannot be used if the growth in dividends is expected to be zero into the identifiable future. True False -------------------------------------------------------------------------------- Question 12 (True/False Worth 5 points) Break-even analysis tells us how many sales dollars must occur in order for a project to break even on a cash flow or an accounting basis. True False -------------------------------------------------------------------------------- Question 13 (True/False Worth 5 points) Earnings before interest and taxes (EBIT) does not include depreciation and amortization expenses. True False -------------------------------------------------------------------------------- Question 14 (True/False Worth 5 points) The higher a firm?s unit variable costs, the greater the degree of operating leverage that the firm is utilizing. True False -------------------------------------------------------------------------------- Question 15 (True/False Worth 5 points) In order to use a multistage-growth dividend model to estimate the cost of equity for a firm, the analyst must estimate multiple growth rates in dividends as well as the amount of time that each growth rate will apply. True False -------------------------------------------------------------------------------- Question 16 (Multiple Choice Worth 5 points) ______________ provides an estimate of the expected cash flows as well as information on the distribution of the cash flows that the project is likely to produce. Simulation analysis Sensitivity analysis Scenario analysis None of the above -------------------------------------------------------------------------------- Question 17 (Multiple Choice Worth 5 points) Delescio Produce had a degree of accounting operating leverage equal to 1.875 during the most recent period. If the firm?s EBITDA was $50,000 and fixed cash expenses equal to $25,000, then what was Delescio?s depreciation and amortization during the same period? $1,000 $3,667 $10,000 $100,000 -------------------------------------------------------------------------------- Question 18 (True/False Worth 5 points) The pretax operating cash flow (EBITDA) break-even point is determined by how many units will have to be sold in order to cover the firm?s fixed cash expenses. True False -------------------------------------------------------------------------------- Question 19 (Multiple Choice Worth 5 points) Marigold Products is expected to pay a dividend of $1.98 one year from today. If the firm?s growth in dividends is expected to remain at a flat 4 percent forever, what is the cost of equity capital for Marigold if the price of its common shares is currently $33.00? 6.00% 6.24% 10.00% 10.24% -------------------------------------------------------------------------------- Question 20 (Multiple Choice Worth 5 points) Level Co. has a preferred share issue outstanding with a current price of $52.00. The issue paid a dividend of $4.16 yesterday. What is the firm?s cost of preferred equity? 7.00% 7.5% 8.00% 8.50% --------------------------------------------------------------------------------
Question 4
Phillips Manufacturing uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2011, Job No. 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $20,000, direct labor $12,000, and manufacturing overhead $16,000. As of January 1, Job No. 49 had been completed at a cost of $90,000 and was part of finished goods inventory. There was a $15,000 balance in the Raw Materials Inventory account. During the month of January, Phillips Manufacturing began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were also sold on account during the month for $122,000 and $158,000, respectively. The following additional events occurred during the month. 1. Purchased additional raw materials of $90,000 on account. 2. Incurred factory labor costs of $65,000. Of this amount $16,000 related to employer payroll taxes. 3. Incurred manufacturing overhead costs as follows: indirect materials $17,000; indirect labor $15,000; depreciation expense $19,000, and various other manufacturing overhead costs on account $20,000. 4. Assigned direct materials and direct labor to jobs as follows. Job No. Direct Materials Direct Labor 50 $10,000 $ 5,000 51 39,000 25,000 52 30,000 20,000 Instructions: (a). Calculate the predetermined overhead rate for 2011, assuming Phillips Manufacturing estimates total manufacturing overhead costs of $1,050,000, direct labor costs of $700,000, and direct labor hours of 20,000 for the year. (b). Open job cost sheets for jobs 50, 51, and 52. Enter January 1 balances on the job cost sheet for Job No. 50.. (c). Prepare the journal entries to record the purchase of raw materials, the factory labor costs incurred, and the manufacturing overhead costs incurred during the month of January. (d). Prepare the journal entries to record the assignment of direct materials, direct labor, and manufacturing overhead costs to production. In assigning manufacturing overhead costs, use the overhead rate calculated in (a). Post all costs to the job cost sheets as necessary. (e). Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry (or entries) to record the completion of any job(s) during the month. (f). Prepare the journal entry (or entries) to record the sale of any job(s) during the month. (g). What is the balance in the Finished Goods Inventory account at the end of the month? (h). What is the amount of over- or underapplied overhead?
Question 5
The following information refers to the next four questions: An insurance company wishes to examine the relationship between income (in $,000) and the amount of life insurance (in $,000) held by families. The company drew a simple random sample of families and obtained the following results: Family Income Amount of life insurance A 50 120 B 80 200 C 100 220 D 80 160 E 80 180 F 120 270 G 70 150 H 100 240 I 60 160 J 90 210 QUESTION 01 What is the least squares estimate of the slope? Answer should be to four decimal places e.g. 1.2345. Please do NOT include any units in your answer. QUESTION 02 What is the least squares estimate of the Y intercept? Answer should be to four decimal places e.g. 1.2345. Please do NOT include any units in your answer. QUESTION 03 What is the prediction for the amount of life insurance for a family whose income is $85,000? Answer should be to four decimal places and be consistent with your original data set, e.g. if your answer was $75,410.90, you would enter 75.4109 as your answer. Please do NOT include any units in your answer. QUESTION 04 What would be the residual (error) term for a family income of $90,000? Answer should be to four decimal places and be consistent with your original data set e.g. if your answer was $940.90, you would enter 0.9409. If your answer was $9,400.90, you would enter 9.4009 etc.. Please do NOT include any units in your answer. The next six questions refer to the following information: International Pictures is trying to decide how to distribute its new movie ?Claws?. ?Claws? is the story of an animal husbandry experiment at the University of Southern Queensland that goes astray, with tragic results. An effort to breed meatier chickens somehow produces an intelligent, 200 kilogram chicken that escapes from the lab and terrorises the campus. In a surprise ending the chicken is befriended by coach Tim Galvano, who teaches it how to play Rugby and help his team win State, National and World Championships. Because of the movie?s controversial nature, it has the potential to be either a smash hit, a modest success, or a total bomb. International is trying to decide whether to release the picture for general distribution initially or to start out with a ?limited first-run release? at a few selected theatres, followed by general distribution after 3 months. The company has estimated the following probabilities and conditional profits for ?Claws?: PROFITS (Millions of $) Level of success Probability Limited release General distribution Smash .3 22 12 Modest .4 9 8 Bomb .3 ?10 ?2 International can run sneak previews of ?Claws? to get a better idea of the movies? ultimate level of success. Preview audiences rate movies as either good or excellent. On the basis of past experiences, it was found that 90% of all smash successes were rated excellent (and 10% rated good), 75% of all modest successes were rated excellent (25% rated good) and 40% of all bombs were rated excellent (60% rated good). The cost of running sneak previews is not cheap. Currently, this stands at $1m. QUESTION 05 What is the opportunity loss for a Limited release for a Bomb level of success? Answer should be to whole numbers only. You do not need to put any units in your answer. QUESTION 06 What would the optimal action be for International before running the sneak preview? Run a limited release with an expected payoff of $7.20m Run a limited release with an expected payoff of $6.20m Run a general distribution with an expected payoff of $7.20m Run a general distribution with an expected payoff of $6.20m QUESTION 07 What is the maximum amount of money that International would be prepared to pay for an absolutely reliable forecast of the movies? level of success? $9.6m $7.2m $6.2m $2.4m QUESTION 08 What would be the joint probability for a ?bomb success? and good preview given that in the past, it was found that 60% of all bomb successes were rated good? Answer should be to two decimal places e.g. 0.12, 0.23, etc. Please do NOT include any units in your answer. QUESTION 09 What is the posterior probability of a smash success given the sneak preview indicates good? Answer should be to four decimal places e.g. 0.1234, 0.2345 etc. Please do NOT include any units in your answer. QUESTION 10 What is the maximum amount that should be paid for the sneak preview (i.e. what would be the expected value of sample information (EVSI))? Select the closest correct answer. Use four decimal places in your calculations but you can round off the final answer to 2 decimal places.) $1.04 million $2.58 million $7.2 million $8.24 million The next six questions refer to the following information: (All calculations should be to at least three decimal places) The tourist industry is subject to enormous seasonal variation. A hotel in North Queensland has recorded its occupancy rate for each quarter during the past 5 years. These data are shown in the accompanying table. Table 1: Occupancy rate Year 2004 2005 2006 2007 2008 Quarter 1 0.261 0.295 0.312 0.362 0.396 Quarter 2 0.302 0.324 0.345 0.388 0.418 Quarter 3 0.502 0.568 0.598 0.696 0.782 Quarter 4 0.568 0.615 0.698 0.738 0.802 QUESTION 11 What is the centred moving average that would correspond to Quarter 1 in 2006? Answer should be consistent with the data provided and be to three decimal places e.g. 0.123, 0.456 etc. Please do NOT include any units in your answer. QUESTION 12 What is the adjusted seasonal index for Quarter 1 __________%? Answer should be listed to three decimal places in the form 0.123 i.e. 0.123 represents 12.3%, 1.234 represents 123.4% etc. Please do NOT include the units (%) in your answer. QUESTION 13 The trend line for this decomposition model can be read off the partial regression printout (at 5 decimal places) to be Y = 0.36806 + 0.01195 T where T represents time. Analysing the partial regression printout, what is the coefficient of determination (R2) for this trend line? (Select the closest correct answer). 0.2973 (i.e. 29.73%) 0.5452 (i.e. 54.52%) 0.7165 (i.e. 71.65%) 0.9886 (i.e. 98.86%) QUESTION 14 What would be the forecast in Quarter 1, 2009 using the trend line given previously (recall that to three decimal places it was Y = 0.368 + 0.012 T) and the relevant adjusted seasonal index? Answer should be consistent with the data provided and be to three decimal places e.g. 0.123, 0.456 etc. Please do NOT include any units in your answer. QUESTION 15 If we exponentially smooth the data in Table 1 with a smoothing constant of 0.2, the smoothed value for Quarter 4 in 2004 would be? Answer should be consistent with the data provided and be to three decimal places e.g. 0.123, 0.456 etc. Please do NOT include any units in your answer. QUESTION 16 If we exponentially smooth the data in Table 1 with a smoothing constant of 0.2, the forecast for Quarter 1 2009 would be? Answer should be consistent with the data provided and be to three decimal places e.g. 0.123, 0.456 etc. Please do NOT include any units in your answer. The following information refers to the next question: A manufacturer of power tools claims that the average amount of time required to assemble their top-of-the-line table saw is fifty (50) minutes with a standard deviation of forty (40) minutes (the very large standard deviation is due to a variety of factors including a large variation in skills amongst the ?Do it yourself? home handyman which is traditionally one of the companies customer base). Suppose a random sample of 64 purchasers of this table saw is taken. QUESTION 17 What is the probability that the sample mean will be less than 46 minutes __________? Answer should be to four decimal places which is consistent with the number of decimal places listed in your appendix tables e.g. 0.1234 etc. Please do NOT include any units in your answer. The following information refers to the next question: A quality control engineer is interested in the mean length of sheet insulation being cut automatically by machine. The desired length of the insulation is 12 metres. It is known that the standard deviation in the cutting length is 0.15 metres. A sample of 144 cut sheets yield a mean length of 12.14 metres. This sample will be used to obtain a 99% confidence interval for the mean length cut by machine. QUESTION 18 What are the two limits of the confidence interval __________ and __________? Answer should be to four decimal places e.g. 1.2345 and 2.3456. Please do NOT include any units in your answer. min = max = The following information refers to the next two questions: Refer to the following table which contains the sales (in $,000) for a department store for the first ten months of the year. Month Sales January 440 February 480 March 590 April 400 May 500 June 550 July 470 August 500 September 600 October 520 QUESTION 19 Using a three period moving average (i.e. MA(3)) as a forecasting method, what is the MSE for this forecasting model? Answer should be between two and four decimal places e.g. 1.23, 1.234, 1.2345 etc. Please do NOT include any units in your answer. QUESTION 20 Using simple exponential smoothing (with a smoothing constant of 0.2) as a forecasting method, what is the MAD for this forecast model? Answer should be between two and four decimal places e.g. 1.23, 1.234, 1.2345 etc. Please do NOT include any units in your answer. The following information refers to the next question: The ordered array below resulted from taking a sample of 25 batches of 500 computer chips and determining how many in each batch were defective. Defects 1 2 4 4 5 5 6 7 9 10 12 12 14 17 20 21 23 23 24 26 27 27 28 29 29 QUESTION 21 If a frequency distribution for the defects data is constructed, using ?0 but less than 5? as the first class, what would be the cumulative relative frequency of the ?10 but less than 15? class __________%? Answer should be a percentage value to whole numbers e.g. 12, 23, 34 etc. Please do NOT include units (%) in your answer.,Appreciate the feedback. Regards, Steve,I can't see any solution to questions 5 to 10. Are you able to offer any feedback on these? Regards, Steve
