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- What are the benefits and challenges with the implantation of a Material requirement planning (MRP) system?(Solved)
What are the benefits and challenges with the implantation of a Material requirement planning (MRP) system?
Date posted: June 1, 2019. Answers (1)
- List the importance of management in an organization(Solved)
List the importance of management in an organization.
Date posted: March 7, 2019. Answers (1)
- List and explain the 14 principles of management(Solved)
List and explain the 14 principles of management
Date posted: March 5, 2019. Answers (1)
- Define management theory and list the advantages of studying it(Solved)
Define management theory and list the advantages of studying it.
Date posted: March 5, 2019. Answers (1)
- Identify 6 factors a firm must consider when designing dividend policies.(Solved)
Identify 6 factors a firm must consider when designing dividend policies.
Date posted: February 12, 2019. Answers (1)
- State the alternative dividend policies a firm may adopt.(Solved)
State the alternative dividend policies a firm may adopt.
Date posted: February 12, 2019. Answers (1)
- The following six have been submitted for inclusion in 1998 capital expenditure budget for
Limuru Ltd.(Solved)
The following six have been submitted for inclusion in 1998 capital expenditure budget for
Limuru Ltd.
Required:
(a) Rates of return (to the nearest half percent) for projects B, C and D and a ranking of all
projects in descending order.
b) Compute the payback reciprocal for projects B and C.
(c) Compute the N.P.V of each project using 16% as discount rate and rank all projects
Date posted: February 12, 2019. Answers (1)
- Identify the various methods of issuing new ordinary shares to shareholders.(Solved)
Identify the various methods of issuing new ordinary shares to shareholders.
Date posted: February 12, 2019. Answers (1)
- Why does ordinary share capital have a high cost relative to debt capital?(Solved)
Why does ordinary share capital have a high cost relative to debt capital?
Date posted: February 12, 2019. Answers (1)
- Using illustrative examples, explain the payback period and accounting rate of return methods of
projects appraisal and explain the advantages and disadvantages of each method.(Solved)
Using illustrative examples, explain the payback period and accounting rate of return methods of
projects appraisal and explain the advantages and disadvantages of each method.
Date posted: February 12, 2019. Answers (1)
- What practical problems are faced by finance managers in capital budgeting decisions.(Solved)
What practical problems are faced by finance managers in capital budgeting decisions.
Date posted: February 12, 2019. Answers (1)
- What are the features of a sound appraisal technique?(Solved)
What are the features of a sound appraisal technique?
Date posted: February 12, 2019. Answers (1)
- The Altman formula for prediction of bankruptcy is given as follows:(Solved)
The Altman formula for prediction of bankruptcy is given as follows:
Date posted: February 12, 2019. Answers (1)
- The following information is provided in respect to the affairs of Pote Limited which prepares
its account on the calendar year basis.(Solved)
The following information is provided in respect to the affairs of Pote Limited which prepares
its account on the calendar year basis.
Required:
a) Calculate the rate of stock turnover expressed:
i) as a ratio;
ii)in days for each of the years 1994 and 1995.
b) Calculate the rate of collection of debtors, in days, for each of the years 1994 and 1995.
(3 marks)
c) Calculate the rate of payment to creditors, in days, for each year 1994 and 1995.
(3 marks)
d) Show the cash operating cycle for each year.
e) Comment on the results.
Date posted: February 12, 2019. Answers (1)
- Mr. Castro uses a 20% hatch system of timing when to invest in a stock market. In a
given year, the top of a given share...(Solved)
Mr. Castro uses a 20% hatch system of timing when to invest in a stock market. In a
given year, the top of a given share was Sh.150 and its bottom was Sh.90. During the
year, the company paid an interim DPS of Sh.1.50 and a final DPS of Sh.4.50.
Determine the % return on investment.
Date posted: February 12, 2019. Answers (1)
- With reference to capital market, define the following terms:
i) Contango operation
ii) Backwardation
iii) Stags
iv) Role of investment banker(Solved)
With reference to capital market, define the following terms:
i) Contango operation
ii) Backwardation
iii) Stags
iv) Role of investment banker
Date posted: February 12, 2019. Answers (1)
- What are the advantages of having a farmers' bank compared with an ordinary
commercial bank in the provision of services to farmers(Solved)
What are the advantages of having a farmers' bank compared with an ordinary
commercial bank in the provision of services to farmers
Date posted: February 12, 2019. Answers (1)
- Why do different sources of finance have different costs?(Solved)
Why do different sources of finance have different costs?
Date posted: February 12, 2019. Answers (1)
- Love Ltd is considering acquiring Beautiful Ltd. For the past six years, the profits of Beautiful
Ltd. has been as follows.(Solved)
Love Ltd is considering acquiring Beautiful Ltd. For the past six years, the profits of Beautiful
Ltd. has been as follows.
Love Ltd expects to pay a DPS of Sh.3.20. The current MPS is Sh.40. The growth in dividends
will be matched with the growth in earnings of Beautiful Ltd. once acquired. The future
expected profits p.a. (equal to the average of past profits) will also grow a rate equal to past
profits growth rate. Love Ltd is an all equity firm. Beautiful Ltd has 50 million ordinary shares.
Required:
a) Compute the cost of equity of Love Ltd.
b) Using the cost of equity computed in (a) above, determine the maximum price with
Love Ltd should pay for each share of Beautiful Ltd to acquire it.
c) What is the significance of valuation of securities.
Date posted: February 12, 2019. Answers (1)
- Swale Ltd. wants to raise Shs. 15,000,000 in additional funds through a rights offering. The
following statements were prepared just before the planned rights offerings:(Solved)
Additional information:
i) The company had a price-earnings ratio of 7.5 at the time of the rights offering. Its
dividend payout ratio is 40%.
i i) The proposed rights offering subscription price per share is Sh.15.
iii) No change is expected in the return on total assets or dividend payout ratio after the
rights offering.
Required:
a) How many rights are required to buy one new share?
b) Calculate the return on total assets.
c) Calculate the following immediately before the rights issue:
- Dividend per share;
- Market price per share.
d) Calculate the dividend per share and market price per share one year after the rights of
offering and state whether you would recommend the rights offering. (Give reasons)
e) Prepare the company's balance sheet immediately after the rights offering under (c)
above.
Date posted: February 12, 2019. Answers (1)