Effective financial reporting depends on sound ethical behavior. Financial scandals in accounting and the businesses world have resulted in legislation to ensure adequate disclosures and honesty and integrity in financial reporting. A sound economy is contingent on truthful and reliable financial reporting.Instructions:Read the following scenario.Answer the questions that follow. (1-2 paragraphs per question)Scenario:Imagine you are …
Research and construct a 3–5 page research (excluding title and reference pages) on the current income tax structure in the United States. In addition, research at least one other structure and compare the two structures. You should have a minimum of three scholarly sources and be formatted according to APA guidelines.
Complete the following table for the expected rate of return on equity for different rates of profit (p) on combined debt and equity and levels of primary gearing assuming that the rate of interest on debt is 10%. (Show your workings in full) Debt/Equity Ratio Expected Rate of Return on Equity (Gearing) p=5% p=10% …
You are an equity analyst working for an investment bank. You are analysing Company ABC shares. The last year dividend (Do) was 30 pence. You are predicting 12% dividend growth for the next 2 years and 8 % for the following 2 years, and thereafter dividend growth is assumed to slow for the foreseeable …
Assume that the following data represent all risky securities in the economy. Correlation Coefficient Matrix Security Value Standard deviation A B C D A £20 5.0% 1.0 0 0 0 B £20 10.0% 0 1.0 0 0 C £30 20.0% 0 0 1.0 0 D £30 30.0% 0 0 0 1.0 Total £100 …
You have following investments in securities A, B and C. Security Amount Invested Beta Expected one year return A £10,000 1.15 14% B £10,000 1.90 20% C £5,000 1.72 18% The current risk-free rate of interest is 4% and you have heard that analysts are expecting a 12% return on the market portfolio over …
You are given the following data about the expected one year returns on security A, RA and security B, RB. along with the standard deviations of returns on asset A, σA and the standard deviations of returns on asset B, σB. Complete the following table for standard deviations of the portfolio for the two …
i. Calculate the Macaulay Duration for a £7 annual coupon bond with an original face value of £100.. The bond has 4 years left to maturity and a current yield to maturity of 8%. (Show your calculations) ii. What is the modified Duration of the bond? iii. If 4-year yields to maturity were to …
A Treasury bond with £100 maturity value has a £6 annual coupon and 4 years left to maturity. i. What price will the bond sell for assuming that the 4-year yield to maturity in the market is 7%? (Show your calculations) ii. What would be your answer to part (i) if the 4-year yield to …
Explain the difference between the allowance method and the direct write off method for accounts receivable. Document the method used for each of the three companies.Explain the difference between the straight line, double declining balance and the unit-of-production depreciation methods. Document the method used for each of the three companies.Explain the difference between LIFO and …
