Steve's Sub Shop is considering investing in toaster ovens for each of its 120 stores located in the southwestern United States. The high capacity conveyor toaster ovens will require an initial investment of $15,000 per store plus $1,500 in installation costs. The new capital (including installation costs) will be depreciated over five years using straight-line depreciation toward a zero salvage value. In addition, Steve will incur additional maintenance expenses totaling $120,000 per year to maintain the ovens (this is the total for all the stores). Those costs are expected to grow at 3% per year after t=1. Currently, revenues for the 120 stores total $9 million and the firm estimates that adding the toaster ovens will increase revenue by 10%. Revenues are expected to grow at 5% per year after t=1. In five years, Steve expects to sell the ovens for $750 each. Net working capital should increase immediately by $50,000 and will exactly reverse at t= 5. (a) Calculate the expected free cash flows (PFCF) for each or the next five years if the tax rate is 36%. (Do this for the aggregate of all the stores.)

(b) Assume a 15% discount rate on this project. Calculate the project's NPV, IRR, and payback. Should the project be accepted?

Consider the following limit order book for a share of stock. the last trade in the stock occurred at a price of $50. limit buy orders limit sell orders price shares price shares $49.75 500 $49.80 100 49.70 900 49.85 100 49.65 700 49.90 300 49.60 400 49.95 100 48.65 600 a. if a market buy order for 100 shares comes in, at what price will it be filled? (round your answer to 2 decimal places.) b. at what price would the next market buy order be filled? (round your answer to 2 decimal places.) c. if you were a security dealer, would you want to increase or decrease your inventory of this stock? increase decrease

Insurance companies have internal controls in place to protect assets, monitor the accuracy of accounting records and encourage operational efficiencies and adherence to policies. these internal controls are generally of two types: administrative controls and accounting controls. administrative controls are the policies and procedures that guide the daily actions of employees. accounting controls are the policies and procedures that delineate authorizations of financial transactions that are done, safeguard assets, and provide reports on the company’s financial status in a reliable and timely manner. internal controls should include both preventative and detective controls. the purpose of preventative controls is to stop problems and errors before they occur. detective controls identify problems after they have occurred. preventative controls are usually more effective at reducing problems, but they also tend to be more expensive. internal controls must be flexible to adjust for changes in laws and regulations in addition to adding new products or modifying current ones. companies must also do regular analyses to ensure that the benefits of implementing the controls are worth their costs. when concerned about paying unwarranted insurance claims which type of control would be useful?

On december 31, 2013, coronado company issues 173,000 stock-appreciation rights to its officers entitling them to receive cash for the difference between the market price of its stock and a pre-established price of $10. the fair value of the sars is estimated to be $5 per sar on december 31, 2014; $2 on december 31, 2015; $10 on december 31, 2016; and $8 on december 31, 2017. the service period is 4 years, and the exercise period is 7 years. prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan.