Q1. What is the cash conversion cycle for a firm with $3 million average inventories, $2 million average accounts payable, a receivables period of 45 days, and an annual cost of goods sold of $20 million?
Q2. If a firm’s bonds pay a 6% coupon and mature in 3 years, what is their market value, assuming a 8% yield to maturity? Assume the bond has a $1,000 par value.
Q3. What is the WACC for a firm with a Debt of 20% in its capital structure, and a total market value of $150 million. Assume required returns of 8% and 12%, for debt and equity respectively and a tax rate of 35%?
Q4. Explain the three strategies for short term financial planning.
Q5. Assume that you are acquiring a company. Can you calculate the value of that company with the help of Weighted Average Cost of Capital? Explain it with the help of an example.
Q1. What is the cash conversion cycle for a firm with $3 million average invento
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