Canterbury Berhad (CTB) Has Assets Worth RM 10 Million Which is Financed

Answer for Canterbury Berhad (CTB) Has Assets Worth RM 10 Million Which is Financed for $1 Only (Instant Download)

Canterbury Berhad

Canterbury Berhad (CTB) has assets worth RM 10 million which is financed by 70% equity and 30% debt. The net income is RM4.5 million. CTB has set a 30% dividend payout to its shareholders. Net income and dividend are expected to remain constant or no growth (g=0%). CTB has 500,000 outstanding stocks. Current cost of equity is 14% while before tax cost of debt is 12%. CTB is considering to recapitalize by issuing a bond worth RM2 million at a cost of 13% before tax. CTB will use this bond’s proceed to repurchase some of its stocks from the market. CTB CTB’s corporate tax rate is 28%. CTB also forecasts that the cost of equity will rise to 17% should the proposed recapitazation is accepted. ( Note: NI=(EBIT-I)(1-T)) where NI is net income, EBIT is earnings before taxes and interest, I is interest and T is taxes.

Finance Questions III

Finance Questions III

Finance Questions III in $3 Only

a) Explain why selecting a target senior debt rating is a reasonable approach to choosing a capital structure. Explain why a target senior debt rating of single-A is a prudent objective when there is only a very limited new issue market for non-investment-grade debt, and when investor willingness to purchase triple-B-rated debt is likely to be highly sensitive to the state of the economy.

b) The development of the new issue junk bond market had important implications for capital structure choice. The existence of a viable junk bond market means that firms can comfortably maintain higher degrees of leverage than they could prior to the development of this market. Do you agree or disagree? Justify your answer.

Answer available.

Price of Answer: Just US$3 only

Buy Now

Need Assistance…?? email us at [email protected].

If you need any type of help regarding Homework, Assignments, Projects, Case study, Essay writing or anything else then just email us at [email protected]solvemyquestion.com. We will get back to you ASAP. Do not forget to maintain the time frame you need you work to be done.

FIN 650 Week 5 Benchmark Mini Case 6 Grand Canyon Latest

FIN 650 Week 5 Benchmark Mini Case 6 Grand Canyon Latest for $11 OnlyFIN 650 Week 5 Benchmark

Details:

The purpose of this assignment is to explain core concepts related to business risk and recommend sound financial decisions based on analysis of a firm’s capital structure and capital budgeting techniques.

Read the Chapter 15 Mini Case on page 626 in Financial Management: Theory and Practice. Using complete sentences and academic vocabulary, please answer questions a and b.

Using the mini case information, write a 250-500 word recommendation of the financial decisions you propose for this company based on an analysis of its capital structure and capital budgeting techniques.

APA format is not required, but solid academic writing is expected.

This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.

You are not required to submit this assignment to Turnitin.

Price of Answer: Just $11 only

Need Assistance…?? email us at [email protected].

If you need any type of help regarding Homework, Assignments, Projects, Case study, Essay writing, Exam or anything else then just email us at [email protected]solvemyquestion.com. We will get back to you ASAP.