Jacob Cornwall has a business in which he’s invested $250,000 of his own money. Jacob Cornwall has a business in which he’s invested $250,000 of his own money, which is the firm’s only capital. (There are no other equity investors and no debt.) In a recent year the firm had net income of $20,000 for a return on equity of 8% ($20,000/$250,000). What will the firm’s return on equity be next year if net income from business operations remains the same but it borrows $150,000 returning the same amount to Jake from the equity account if The after tax interest rate is 6%. The after tax interest rate is 10%. Comment on the difference between the results of a and b.

Joy wants to invest his funds in shares in one of the two existing manufacturing companies. The following information about the dividend paid during the seven years of the Year Brown Company Avel Company 2000 500 300 2001 600 557 2002 665 615 2003 675 640 2004 785 790 2005 800 815 2006 815 795 If you as an investment consultant who is conducting an analysis of the two companies, with Using trend analysis, which company would you recommend to Joy for his investment in 2010? (work with complete procedure)

Amarindo, Inc. (AMR), is a newly public firm with 9.0 million shares outstanding. You are doing a valuation analysis of AMR. You estimate its free cash flow in the coming year to $14.58 million, and you expect the firm's free cash flows to grow by 3.9% per year in subsequent years. Because the firm has only been listed on the stock exchange for a short time, you do not have an accurate assessment of AMR's equity beta. However, you do have beta data for UAL, another firm in the same industry: AMR has a much lower debt-equity ratio of 0.45, which is expected to remain stable, and its debt is risk free. AMR's corporate tax rate is 20%, the risk-free rate is 5.2%, and the expected return on the market portfolio is 10.8%. a. Estimate AMR's equity cost of capital. b. Estimate AMR's share price. a. Estimate AMR's equity cost of capital. The equity cost of capital is%. (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.)…

The answer was incorrect.    Could I have help with this one? Futuristic Development (FD) generated $3 million in sales last year with assets equal to $5 million. The firm operated at full capacity last year. According to FD's balance sheet, the only current liabilities are accounts payable, which equals $380,000. The only other liability is long-term debt, which equals $750,000. The common equity section is comprised of 400,000 shares of common stock with a book value equal to $3 million and $870,000 of retained earnings. Next year, FD expects its sales will increase by 16 percent. The company's net profit margin is expected to remain at its current level, which is 11 percent of sales. FD plans to pay dividends equal to $0.60 per share. It also plans to issue 50,000 shares of new common stock, which will raise $395,000. Estimate the additional funds needed (AFN) to achieve the forecasted sales next year. Round your answer to the nearest dollar.