FA164FI Financial Accounting

You may use Excel for calculations and workings which form part of your answer or for presenting financial information, but these must not be submitted separately, but must be embedded into your Word document submission. Similarly any handwritten calculations or diagrams that form part of your answer should be photographed and embedded into the Word document. FA164FI Financial Accounting.

Explain why an increase in Trade Receivables is shown as a negative amount in the statement of cash flows.

Prepare a statement of cash flows for Prestige for the year ended 31st December 2019, using the indirect method.

Using the financial statements of Prestige, illustrate percentage changes for THREE statement of financial position items using horizontal analysis and explain briefly their implication(s).

Using Ratio Analysis, illustrate the status of this company for both years by analysing profitability, liquidity and solvency with two ratios for each measure. Specifically, write down the ratios, the formula, the calculation and the results of the ratios. Interpret the ratios from the perspective of a potential investor by making brief comments on the compny’s performance. Explain whether or not you would consider investing in Prestige PLC? What other information you would require to make an informed decision?

Calculate the Goodwill arising on the acquisition of Superior Ltd by Prestige PLC.

Prepare the Prestige Group consolidated statement of financial position as at 31 March 2020.

Information pertaining to long-term share investments in 2020 by Prestige PLC follows: i. Acquired 18% of the 320,000 ordinary shares of Esteem Co at a total cost o £1.34 per share on April 1st, 2020. On April 30th

Esteem Co’s reported net income was £374,800 for the year. On the same date, Esteem Co declared and paid a cash dividend of £0.35 per share.

Obtained significant influence over Honour Ltd by buying 35% of Honour’s 160,000 outstanding shares at a total cost of £2.10 per share on April 15 th, 2020. On May 1st

Honour Ltd’s reported net income was £176,914. On May 31st Honour declared and paid a cash dividend of £0.52 per share.

FA164FI Financial Accounting

Required:

a) Explain, with reasoning, which methods should be used by Prestige PLC to record its investments and related transactions in Esteem Co and Honour Ltd respectively?

b) Prepare all necessary journal entries for 2020 for Prestige PLC related to the transactions detailed above.

Describe the different types of assets that appear on a statement of financial position (SOFP), highlighting clearly the classifications they are grouped under and providing examples of each type.

Explain, with the aid of an example, the concept of Goodwill, describing where it appears in the statement of financial position and its initial and subsequent accounting treatment.

a) Identify five key users of financial information of a company and describe briefly for each type of user which elements of information they are interested in and why.

b) Explain the information that a user can obtain from a statement of cash flows that cannot be obtained from the statement of profit or loss, and thereby discuss why the statement of cash flows has taken the same level of importance in recent years as the other two primary financial statements for the users of financial information identified in part a).

JWI533 Saving Money

JWI533 Saving Money. The Board has invited you to give a 5-minute presentation outlining your proposal. They want you to explain your idea, walk them through the reasons you think it’s needed, explain how it will be funded, and how success will be measured.

That’s a tall order, but you’re up to the challenge!You’ve decided to organize your presentation around a 5-slide PowerPoint deck (plus one slide for references) as follows:
1. Executive Summary: Explain the proposed technology investment and give a synopsis of what the Board can expect in the slides that follow. Explain why this is a meaningful innovation that takes the organization forward.
2. Data Synopsis: Identify 5 budget inputs with estimated financial details that must be considered when evaluating this project. Examples can include (but are not limited to):
a. Additional patients served
b. Changes in staffing
c. Variance in clinical outcomes
d. Operating revenue/profit increases
e. Additional space or renovation required

MBA6400-Economic And Financial Environment Of Business

Short-term investment returns: money market instruments. MBA6400-Economic And Financial Environment Of Business

Part of your responsibilities as a junior financial analyst is researching and identifying potential shortterm liquid investment options for your firm. These investment vehicles are at times used by the firm during periods when their cash inflows exceed projections. The firm, at times, uses excess cash to purchase short-term debt instruments providing a low, but safe marginal return on invested capital.

Your Director, who reports to the firm’s Chief Financial Officer (CFO) has come to you seeking your recommendation on short-term investment options for the upcoming year. The Director has asked for recommendations and a report illustrating your optimal analysis for investing $2.5m of excess cash. 

Current background info: We have a potential impending compound money market problem: The U.S. is issuing more debt, in part due to the recent tax cuts. Simultaneously, the Fed, China, Japan and to a lesser degree Russia have been reducing their holdings of U.S. Debt. Therefore, if the U.S. Treasury Department can’t get entities to their positions holding U.S. debt, then the pressure to increase interest rates to make newly issued securities attractive increases. Increased interest rates at the Treasury means securities prices fall with cascading impacts.

Therefore, the current interest rate environment is one where rates are expected to increase.

Parameters for the research and analysis report are as follows:

1. Investments selections are primarily short term (one year or less), but will consider U.S. Treasury Bills of shorter duration as well as TIPS.

2. A minimum of 3 short term debt money market security types are to be recommended. They may include Federal money market bills, U.S. Savings Bonds, CDs, U.S. Treasury Notes, Treasury Bills, and TIPS.

a. Note: money market investments of the range of two to five years are acceptable.

b. However, no more than 40% of the portfolio can be invested in a security of with duration of greater than 12 months.

3. A recommendation on the optimal allocation of $2.5 m across the investment portfolio is required.

4. Current (as of the date of this assignment) rates and investments are to be used.

The analysis report to be presented to the Director is to include:

1. Your concise statement and recommendation of the specific short-term investment options that meets the firm’s criteria.

Followed by:

2. A detailed summary of the investment asset and the parameters you will use in which to base your recommendation.

3. A detailed description of the upside and downside risk of each investment. The latter is of particular importance as the firm may decide to manage excess cash in one or more vehicles for longer than one year.

4. Source identifier for all investment selections

a. Example: website URL

5. A spreadsheet (embedded into the report) illustrating the following:

a. Asset category/classification

b. Specific money market instrument identifier

i. Example: U.S. Treasury CUSIP

6. EAR for each investment

7. YTM for each investment

a. If held to maturity

b. If sold at the end of 12 months

8. Total return for investment portfolio if held to maturity

9. Spreadsheet model is to include all cell-base

MBA6400-Economic And Financial Environment Of Business

HMG 6477-Financial Analysis For Hospitality Enterprises

Hotel DelRay is located at the heart of the city of Brussels, in Belgium. Brussels is a major hub for international politics, a home for several international organizations and diplomats, and a fortress for European Union Institutions. HMG 6477-Financial Analysis For Hospitality Enterprises

The importance of the city not only elevates the financial and economic infrastructure, also increases the volume of government and business travelers from all over the world. Thus, lodging establishments in the city of Brussels have recently been facing fierce local and international competition. DelRay, which is owned by Italian BD&T Hospitality Investment Company, has been in Brussels’ local lodging industry for the past twenty-five plus years.

DelRay is one of the most popular and demanded hotels in Brussels by the international government institutions due to its strategic position. The hotel’s success is largely due to its great security procedures and they specialize in providing highly quality service based on international government protocols. 

Since its grand opening day, DelRay has had excellent records of growth figures, occupancy levels, and financial performance regardless of the time or the season of the year. However, in recent years, DelRay has started to observe inefficiencies in its operations and poor financial outcomes due to conventional and outdated operation systems in the property. Hence, the chairperson of BD&T has a recent discussion and a meeting with DelRay’s GM about this issue and the chairperson of BD&T has suggested an upgrade the existing but not fully effective property management system (PMS).

A critical part of this upgrade project is to come up with the optimal capital allocation and acquisition plan and the financial feasibility assessment based on the project’s expected cash flows in the future. In this important meeting, BD&T and DelRay finance and accounting team has discussed and agreed on the project essentials as presented below. As UCF’s Rosen College graduate and the director of Finance at DelRay, you are in charge of this capital acquisition and feasibility study for the expansion project. 

Required Analysis And Discussions:

1. Based on the given information in the “Estimation of the Net Investment Value (NINV) of the New PMS Upgrade” section, calculate the NINV of this upgrade project for the initial year.

2. Given this capital structure and acquisition details, estimate the Weighted Average Cost of Capital (WACC) for this upgrade project (40 pts.).

3. According to the financial projections for the following 4-year CF pro-forma, calculate the stream of CFs for this upgrade project (Hint: project assumptions and limitations are important to calculate CFs)

4. Based on NINV, WACC, and CFs results, perform a financial feasibility analysis with four capital budgeting methods as illustrated in “Financial Feasibility Analysis of the New PMS Technology” section 

5. Discuss your results and findings from NINV estimation, capital acquisition and WACC, flow of funds (CFs), and financial feasibility. Explain why is this worthwhile or not to invest in detail. In addition, explain the possible problematic areas and issues (i.e., cost of internal equity) to be improved for the project and for Delray’s long-term financial success. Do not forget to support your arguments. You can solve this question using the main equations of those methods or using financial calculator or excel solutions as introduced in the textbook 
HMG 6477-Financial Analysis For Hospitality Enterprises

ACC 502 Accounting Statement Analysis

The purpose of this assignment is to analyze the financial performance of a company to make recommendations to potential investors about the purchase of stock. ACC 502 Accounting Statement Analysis

Studying all aspects of a company’s financial statements is necessary in order to understand the financial performance and health of a company. This is particularly important for investors trying to determine whether or not to buy stock in the company.

An investor has approached you about whether or not purchasing stock in the company would be a wise investment. Using your financial analysis of the company, you will send a letter to the investor summarizing your findings and explaining whether you recommend a stock purchase at this time.

You will use information in the Form 10-K for Amazon to complete this assignment. Using the correct formulas, calculate the following ratios using Excel:

1.Three liquidity ratios for the past 3 years
2.Three solvency ratios for the past 3 years
3.Three profitability ratios for the past 3 years

Conduct research about a competitor company within the same sector using IBIS World and other topic resources. Complete a competitor analysis that includes a minimum of three ratios and compares Amazon to a competitor company using these ratios to determine financial performance as well as how the company rates compared to overall industry averages. Be prepared to justify your analysis by explaining your findings.

Using your research findings and analysis of company performance in relation to industry competitors, construct a 250-500 word letter making stock purchase recommendations for a potential investor. In the letter, address the following, referencing specific ratios and comparative numbers as appropriate.

1.Discuss the overall financial performance of your company in relation to industry averages and a specific competitor. Explain whether the company performed better or worse than the competition using specific numbers and providing an explanation of what the numbers illustrate.

2.Recommend whether the potential investor should purchase stock in your company and justify your recommendation based upon your research and analysis of the company ratios and industry competition.

Submit the Excel file that contains your ratios and the Word file letter to your instructor. ACC 502 Accounting Statement Analysis

FA164FI Financial Accounting

You may use Excel for calculations and workings which form part of your answer or for presenting financial information, but these must not be submitted separately, but must be embedded into your Word document submission. Similarly any handwritten calculations or diagrams that form part of your answer should be photographed and embedded into the Word document. FA164FI Financial Accounting

Explain why an increase in Trade Receivables is shown as a negative amount in the statement of cash flows.

Prepare a statement of cash flows for Prestige for the year ended 31st December 2019, using the indirect method.

Using the financial statements of Prestige, illustrate percentage changes for THREE statement of financial position items using horizontal analysis and explain briefly their implication(s).

Using Ratio Analysis, illustrate the status of this company for both years by analysing profitability, liquidity and solvency with two ratios for each measure. Specifically, write down the ratios, the formula, the calculation and the results of the ratios. Interpret the ratios from the perspective of a potential investor by making brief comments on the compny’s performance. Explain whether or not you would consider investing in Prestige PLC? What other information you would require to make an informed decision?

Calculate the Goodwill arising on the acquisition of Superior Ltd by Prestige PLC.

Prepare the Prestige Group consolidated statement of financial position as at 31 March 2020.

Information pertaining to long-term share investments in 2020 by Prestige PLC follows: i. Acquired 18% of the 320,000 ordinary shares of Esteem Co at a total cost o £1.34 per share on April 1st, 2020. On April 30th

Esteem Co’s reported net income was £374,800 for the year. On the same date, Esteem Co declared and paid a cash dividend of £0.35 per share.

Obtained significant influence over Honour Ltd by buying 35% of Honour’s 160,000 outstanding shares at a total cost of £2.10 per share on April 15 th, 2020. On May 1st

Honour Ltd’s reported net income was £176,914. On May 31st Honour declared and paid a cash dividend of £0.52 per share.

Required:

a) Explain, with reasoning, which methods should be used by Prestige PLC to record its investments and related transactions in Esteem Co and Honour Ltd respectively?

b) Prepare all necessary journal entries for 2020 for Prestige PLC related to the transactions detailed above.

Describe the different types of assets that appear on a statement of financial position (SOFP), highlighting clearly the classifications they are grouped under and providing examples of each type.

Explain, with the aid of an example, the concept of Goodwill, describing where it appears in the statement of financial position and its initial and subsequent accounting treatment.

a) Identify five key users of financial information of a company and describe briefly for each type of user which elements of information they are interested in and why.

b) Explain the information that a user can obtain from a statement of cash flows that cannot be obtained from the statement of profit or loss, and thereby discuss why the statement of cash flows has taken the same level of importance in recent years as the other two primary financial statements for the users of financial information identified in part a).

FA164FI Financial Accounting

JWI533 Saving Money

The Board has invited you to give a 5-minute presentation outlining your proposal. They want you to explain your idea, walk them through the reasons you think it’s needed, explain how it will be funded, and
how success will be measured. That’s a tall order, but you’re up to the challenge! JWI533 Saving Money

You’ve decided to organize your presentation around a 5-slide PowerPoint deck (plus one slide for references) as follows:
1. Executive Summary: Explain the proposed technology investment and give a synopsis of what the Board can expect in the slides that follow. Explain why this is a meaningful innovation that takes the organization forward.
2. Data Synopsis: Identify 5 budget inputs with estimated financial details that must be considered when evaluating this project. Examples can include (but are not limited to):
a. Additional patients served
b. Changes in staffing
c. Variance in clinical outcomes
d. Operating revenue/profit increases
e. Additional space or renovation required
JWI533 Saving Money

MBA6400-Economic And Financial Environment Of Business

Short-term investment returns: money market instruments in MBA6400-Economic And Financial Environment Of Business

Part of your responsibilities as a junior financial analyst is researching and identifying potential shortterm liquid investment options for your firm. These investment vehicles are at times used by the firm during periods when their cash inflows exceed projections. The firm, at times, uses excess cash to purchase short-term debt instruments providing a low, but safe marginal return on invested capital.

Your Director, who reports to the firm’s Chief Financial Officer (CFO) has come to you seeking your recommendation on short-term investment options for the upcoming year. The Director has asked for recommendations and a report illustrating your optimal analysis for investing $2.5m of excess cash. 

Current background info: We have a potential impending compound money market problem: The U.S. is issuing more debt, in part due to the recent tax cuts. Simultaneously, the Fed, China, Japan and to a lesser degree Russia have been reducing their holdings of U.S. Debt. Therefore, if the U.S. Treasury Department can’t get entities to their positions holding U.S. debt, then the pressure to increase interest rates to make newly issued securities attractive increases. Increased interest rates at the Treasury means securities prices fall with cascading impacts.

Therefore, the current interest rate environment is one where rates are expected to increase.

Parameters for the research and analysis report are as follows:

1. Investments selections are primarily short term (one year or less), but will consider U.S. Treasury Bills of shorter duration as well as TIPS.

2. A minimum of 3 short term debt money market security types are to be recommended. They may include Federal money market bills, U.S. Savings Bonds, CDs, U.S. Treasury Notes, Treasury Bills, and TIPS.

a. Note: money market investments of the range of two to five years are acceptable.

b. However, no more than 40% of the portfolio can be invested in a security of with duration of greater than 12 months.

3. A recommendation on the optimal allocation of $2.5 m across the investment portfolio is required.

4. Current (as of the date of this assignment) rates and investments are to be used.

The analysis report to be presented to the Director is to include:

1. Your concise statement and recommendation of the specific short-term investment options that meets the firm’s criteria.

Followed by:

2. A detailed summary of the investment asset and the parameters you will use in which to base your recommendation.

3. A detailed description of the upside and downside risk of each investment. The latter is of particular importance as the firm may decide to manage excess cash in one or more vehicles for longer than one year.

4. Source identifier for all investment selections

a. Example: website URL

5. A spreadsheet (embedded into the report) illustrating the following:

a. Asset category/classification

b. Specific money market instrument identifier

i. Example: U.S. Treasury CUSIP

6. EAR for each investment

7. YTM for each investment

a. If held to maturity

b. If sold at the end of 12 months

8. Total return for investment portfolio if held to maturity

9. Spreadsheet model is to include all cell-base
MBA6400-Economic And Financial Environment Of Business

FIN 3200-Corporate Finance

Regis International Corporation (RIC), a Denver based technology company, has been applying its expertise in microprocessor technology to develop a small computer specifically designed to control home appliances.  Once programmed, the computer would automatically control the heating and air-conditioning system, hot water heater, and even small appliances such as coffee makers.  By increasing the energy efficiency of a home, the appliance control computer can save on costs hence pay for itself in a few years.  This effort has now reached the stage where a decision on whether or not to go forward with production must be made. FIN 3200-Corporate Finance

RIC’s marketing department plans to target sales of the appliance control computer to the owners of larger homes – the computer is cost effective only on homes with 2,000 or more square feet of heated/air-conditioned space.  The marketing vice-president forecasts sales in 2022 to be $40 million and to increase by 6 percent per year.  The engineering department has estimated that the firm would need a new manufacturing plant; this plant could be built and made ready for production in 1 year, once the “go” decision is made.  The plant would require a 25-acre site, and RIC currently has an option to purchase a suitable tract of land for $1.2 million; the land option must be exercised on December 31, 2020.  Building construction would begin in early 2021 and would continue through the end of 2021.  The building, which would fall into the MACRS 39-year class (ignore any half-year convention), would cost an estimated $8 million, payable on December 31, 2021.

The necessary manufacturing equipment would be installed late in 2021 and would be paid for on December 31, 2021.  The equipment, which would fall into the MACRS 7-year class, would have a cost of $6.5 million, including transportation, plus another $500,000 for installation.

The project would also require an initial investment in net working capital equal to 12 percent of the estimated sales in the first year.  The initial working capital investment would be made on December 31, 2021, and on December 31 of each following year, net working capital would be increased by an amount equal to 12 percent of any sales increase expected during the coming year.  The project’s estimated economic life is 6 years.  At that time, the land is expected to have a market value of $1.7 million, the building a value of $1.0 million, and the equipment a value of $2 million.  The production department has estimated the variable manufacturing costs would total 65 percent of dollar sales, and that fixed overhead costs, excluding depreciation, would be $8 million for the first year of operation.  Fixed overhead costs, other than depreciation, are projected to increase with inflation which is expected to average 6 percent per year over the 6 year life of the project.

RIC’s marginal tax rate (federal and state) is 40 percent; its weighted average cost of capital is 15%; and the company’s policy, for capital budgeting purposes, is to assume that operating cash flows occur at the end of each year.  Since the plant would begin operations on January 1, 2022, the first operating cash flows would thus occur on December 31, 2022.  The capital gains tax rate is the same as the ordinary income tax rate.

As one of the company’s financial analysts, you have been assigned the task of supervising the capital budgeting analysis.  For now, you may assume that the project has the same risk as the firm’s current average project, and hence you may use the corporate cost of capital, 15 percent, for this project.  Calculate the NINV, NPV, IRR, and payback period for the appliance control computer project.  Create Best Case and Worst Case scenarios based on the Sales number only.  Assume the Best and Worst are +/- 25%.

In addition to showing the values for the NINV, FCFs, NPV, IRR, and payback period, please provide a copy of your spreadsheet that shows your calculated values for the initial investment, the cash flows, and the salvage value.
FIN 3200-Corporate Finance

MGMT-2620 Business Valuation And Analysis

The case study materials (including the excel file) provide all of the parameters you will need.  If you read carefully, there is no need for outside research – all of the required information is in the case study or the associated excel document. MGMT-2620 Business Valuation And Analysis

I have provided an excel sheet to correspond to the case study (here).  It includes a template for answering question 1 below as well as a template for calculating the value of an option using Black-Scholes.  I would note that the template provided allows for dividends, but in this case study there are no dividends discussed so set the dividend parameter to 0%.
 
HINT:  You can use the Goal Seek function in excel to back solve for any one of the Black-Scholes inputs, if you know the value of the option.
 
Here is the assignment

1.Complete Exhibit 4 of the case study on the template provided in the Excel sheet.
 
2.Calculate the present value of the option to enter the MRAM market. Identify each of the parameters you are using as an input to the option model.
 
3.What is the combined NPV of the SDRAM and MRAM opportunities added together? What does that suggest the hedge fund should do?
 
4.Vary the inputs to the option pricing model one at a time. How far off can you be on each input (assuming the other inputs do not change) without changing your recommendation in question 3?  Are the inputs all independent or is there one that if you changed it, it might change other inputs as well?
 
5.You present your findings to management at the hedge fund and they ask you the following questions (treat each in isolation not as a cumulative impact):

A) I think the MRAM market will develop quicker than you do. We will need to commit to enter within the next three years.  Should we still do it?
B) I think the investment you projected is too small. Exhibit 2 in the paper work is way too low.  I think it is going to be twice as much to effectively enter the MRAM market.  Should we still do it?
C) I don’t like your estimate of the volatility. There is a company called Memory Maker that is focused in the nascent MRAM market and has publicly traded options.  Today, Memory Maker’s stock price is $20.00 and a call option expiring in one year at $25.00 has a price of $2.25.  Can you benchmark the MRAM market volatility off of that option? Should we still enter the SRAM/MRAM deal?
D) Wait, the whole reason you told me to do the crazy option thing is that the MRAM market is pretty risky and difficult to project. Yet, on Exhibit 3 in the paperwork you did a projection of the MRAM market and you have the same Beta and Cost of Equity as the SRAM market which we understand and is more developed.  You are telling me it is riskier, but you are using the same cost of equity?  How can that be right?
E) Ok, you convinced me. I know need to do some liquidity planning to make sure we have cash on hand to make the investments when needed.  Based on the model you used, how much am I going to be investing now?  How much might I be investing later and when would that be?

MGMT-2620 Business Valuation And Analysis