Finance-QA249 online

Finance-QA249 Online Services

This assignment has a 20% weighting in your overall mark for the unit and covers content from Topics 3 to 5. It will be marked out of 20. Marks will be allocated as indicated for each part below. The maximum length is four A4 pages, excluding cover sheet and reference list. Keep your answers concise.

Provide the question and, where relevant, part number, and then your answer.
You will be allocated an ASX listed company as the context for many of the questions in this assignment and the next. You can find your allocated company’s ASX ticker code via “View Grades”. You will need to collect real data for all questions except Question 3. Use DatAnalysis to collect company financial data and the RBA site for yield data. Reference all sources of data used.

Question 1

Collect the company’s 5 year growth rate (CAGR) in operating revenue as at the end of the most recent financial year. (If the company has not been listed that long, use the 1 or 3 year rate – whichever is longer – as a proxy.) If this CAGR can be expected to continue, what is your prediction for operating revenue for the 2020/21 financial year?

Question 2

Collect the company’s interest expense from the profit and loss statement for the year ending 30 June 2016 and divide this figure by average long-term debt in the balance sheet for the last two financial years. Use this as a very rough approximation of the quoted annual interest rate that the company would have to pay on new long-term debt. Now hypothetically assume that on 1 July 2016, the company took out a 20 year amortised loan of $800,000 to buy some equipment and that the rate of interest on that loan is fixed for the first 4 years at the rate you calculated above. The loan requires monthly payments, due on the last day of the month. How much interest will the company be able to claim as an annual tax deduction in the first financial year (1 July 2016 to 30 June 2017) and in the fourth financial year?

Question 3

Assume that the company has just received a large amount of cash from selling assets and wants to use this cash to repay $2 million in debt maturing in three years. In the meantime, the necessary cash can be invested into one of the following investments:

(1) a fund with a quoted fixed rate of 4.20% compounded semi-annually

(2) a fund with a quoted fixed rate of 4.14% compounded monthly; or (3) zero coupon bonds maturing in three years and currently trading at $88.45 per $100 face value. Which investment fund should be chosen: 1, 2 or 3? (Assume the investments have equivalent risk.) How much cash will be invested?

You can read more about our case study assignment help services here.

How it Works

How It works ?

Step 1:- Click on Submit your Assignment here or shown in left side corner of every page and fill the quotation form with all the details. In the comment section, please mention Case Id mentioned in end of every Q&A Page. You can also send us your details through our email id support@assignmentconsultancy.com with Case Id in the email body. Case Id is essential to locate your questions so please mentioned that in your email or submit your quotes form comment section.

Step 2:- While filling submit your quotes form please fill all details like deadline date, expected budget, topic , your comments in addition to Case Id . The date is asked to provide deadline.

Step 3:- Once we received your assignments through submit your quotes form or email, we will review the Questions and notify our price through our email id. Kindly ensure that our email id assignmentconsultancy.help@gmail.com and support@assignmentconcultancy.com must not go into your spam folders. We request you to provide your expected budget as it will help us in negotiating with our experts.

Step 4:- Once you agreed with our price, kindly pay by clicking on Pay Now and please ensure that while entering your credit card details for making payment, it must be done correctly and address should be your credit card billing address. You can also request for invoice to our live chat representatives.

Step 5:- Once we received the payment we will notify through our email and will deliver the Q&A solution through mail as per agreed upon deadline.

Step 6:-You can also call us in our phone no. as given in the top of the home page or chat with our customer service representatives by clicking on chat now given in the bottom right corner.

Case Approach

Scientific Methodology

We use best scientific approach to solve case study as recommended and designed by best professors and experts in the World. The approach followed by our experts are given below:

Defining Problem

The first step in solving any case study analysis is to define its problem carefully. In order to do this step, our experts read the case two three times so as to define problem carefully and accurately. This step acts as a base and help in building the structure in next steps.

Structure Definition

The second step is to define structure to solve the case. Different cases has different requirements and so as the structure. Our experts understand this and follow student;s university guidelines to come out with best structure so that student will receive best mark for the same.

Research and Analysis

This is the most important step which actually defines the strength of any case analysis. In order to provide best case analysis, our experts not only refer case materials but also outside materials if required to come out with best analysis for the case.

Conclusion & Recommendations

A weak conclusion or recommendations spoil the entire case analysis. Our expert know this and always provide good chunks of volume for this part so that instructors will see the effort put by students in arriving at solution so as to provide best mark.

Related Services

Question 4

Hypothetically assume that on 27 January 2017 the company issued 10 year, semi-annual fixed coupon bonds at par, which are given a BB rating and have a spread of 325 basis points over the yield on an Australian government bond of equivalent maturity.

a) What is the yield on the company’s bonds?

b) How would the yield have been different if the company’s bonds had been shorter term? Explain with reference to data and to the relevant component(s) of market interest rates.

c) You have a pessimistic outlook for the Australian economy over the next year. Given this, what do you predict will happen to the spread on the company’s bonds over the next year and why? Ensure you mention the relevant component(s) of market interest rates in your answer.

d) What do you expect to happen to the price of the company’s 10 year bonds if your prediction in part c is correct? Illustrate your answer with a numerical example.

Question 5

a) Use CAPM to estimate the required return on the company’s shares as at 30 June 2015. To do this, use the yield to maturity on that date of a 10-year Australian Treasury bond as a proxy for the risk-free rate, assume the market risk premium is 6.80% and use the company’s current beta (thus assuming the beta has not changed since mid-2015).

b) Assuming the market risk premium and beta has not changed from 5a), recalculate the required return on the company’s shares as at 30 June 2016. What has happened to the required return and why? In the absence of any other change, what does theory predict should have happened to share prices?

c) Explain would happen to the company’s required return if average risk aversion in the market fell.

Question 6

Collect and evaluate the company’s FCF and ROIC for the two financial years ending 30 June 2015 and 30 June 2016. Assume that the company’s cost of capital (WACC) was the same as the required returns (costs of equity) you calculated in Question 5.

Product code: Finance-QA249

Looking for best Finance-QA249 online ,please click here

Summary