Prepare a paper on Financial markets- Business & Finance

Prepare a paper on Financial markets- Business & Finance

Purpose of Assignment

Students should understand the operating and cash cycles of a company, the mechanics in preparing a cash budget, the use of exchange rates and interest rate parity in international finance and valuation of a company in a merger and acquisition.

Assignment Steps

Resources: Tutorial help on Excel® and Word® functions can be found on the Microsoft®Office website. There are also additional tutorials via the web that offer support for office products.

Complete the following Questions and Problems from each chapter as indicated.

******SHOW ALL WORK AND ANALYSIS******

Prepare in Microsoft® Excel® or Word.

Ch. 18: Questions 3 & 11 (Questions and Problems section)
Ch. 20: Questions 8 & 14 (Questions and Problems section)
Ch. 21: Questions 4 & 7 (Questions and Problems section)
Ch. 26: Questions 1 & 2 (Questions and Problems section): Microsoft® Excel® template provided for Problem 2
Format your assignment consistent with APA guidelines if submitting in Microsoft® Word.Chapter 26
Chapter 26
Problems 2, 4, 5, 10
Input boxes in tan
Output boxes in yellow
Given data in blue
Calculations in red
Answers in green
NOTE: Some functions used in these spreadsheets may require that
the “Analysis ToolPak” or “Solver Add-in” be installed in Excel.
To install these, click on “Tools|Add-Ins” and select “Analysis ToolPak”
and “Solver Add-In.”
#2
Chapter 26
Question 2
Input Area:
Firm X Firm Y
Total earnings
Shares outstanding
Per-share values
Market
Book
Merger premium
Output Area:
Asset from X (book value) $ – 0
Asset from Y (market value) $ – 0
Purchase price of Y $ – 0
Goodwill $ – 0
Total assets XY = Total equity XY $ – 0
#4
Chapter 26
Question 4
Input Area:
Silver Enterprises
Current assets Current liabilities
Other assets Long-term debt
Net fixed assets Equity
Total $ – 0 $ – 0
All Gold Mining
Current assets Current liabilities
Other assets Long-term debt
Net fixed assets Equity
Total $ – 0 $ – 0
Market value of fixed assets
New long-term debt
Output Area:
Silver Enterprises – Post Merger
Current assets $ – 0 Current liabilities $ – 0
Other assets – Long-term debt –
Net fixed assets – Equity –
Goodwill –
Total $ – 0 $ – 0
#5
Chapter 26
Question 5
Input Area:
After-tax annual cash flow
Teller market value
Penn market value
Discount rate
Stock offer
Cash offer
Output Area:
a. V*k ERROR:#DIV/0!
Cash cost $ – 0
Equity cost ERROR:#DIV/0!
b. NPV cash ERROR:#DIV/0!
NPV stock ERROR:#DIV/0!
c. ERROR:#DIV/0!
#10
Chapter 26
Question 10
Input Area:
Firm A Firm B
Total earnings
Shares outstanding
Price per share
Acquisition price
Output Area:
Cost $ – 0
Shares given up by A ERROR:#DIV/0!
a. EPS ERROR:#DIV/0!
b. Old P/E ERROR:#DIV/0!
New price ERROR:#DIV/0!
c. P/E ERROR:#DIV/0!
d. Price ERROR:#DIV/0!
P/E ERROR:#DIV/0!
At the current acquisition price, this is a
ERROR:#DIV/0! acquisition.

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