(TCO C) Describe the types of resources (assets) needed for a new product venture
This is due in
2hrs and 15mins. Its basic Finance questioners. Please send answer by answer as
“chat” within the chat box as you complete them one by one. At the
end please provide me the entire set in word format. When you send each answer
one by one through chat box, please don’t send as you are
sending answers, then I will have to click not complete for answer answers you
provide until you give all. So, at the end, give all at once, and as you
complete please send one by one through chat box. Thanks.
.png”>
Page
2:
Question
1.1.(TCO
C) Describe the types of resources (assets) needed for a new product
venture during its development and start-up stages. Comment on the likely
revenues and expenses during these early life cycle stages. (Points
: 30)
2.(TCO
B) The CEO of Hernandez Database Design died today; she owned the firm. Discuss
the impact on the business’ life and operations if its corporate form is a) a
sole proprietorship and b) if it is a C Corporation?(Points : 30)
3.(TCO
C) AudioFile would like to know its EBDAT breakeven level. The company has only
one product, the Voce9000 speaker, a high-end speaker that downloads media
player files into its own memory. The firm’s speakers sell for $10,000 each.
Each speaker costs $6,500 in materials and manufacturing costs (all production
is outsourced to an external manufacturer). The firm’s headquarters facility
lease is $350,000 annually, its marketing expense is $100,000 per year, and
salary costs are $550,000 annually.Complete the following, and show all
your calculations for each.
Part 1:Calculate the firm’s a) EBDAT
revenue, and b) contribution profit margin at EBDAT breakeven.
Part 2: If the firm
sells 400 speakers,what
will be its c) gross profit percentage, d) operating income, and e) operating
income percentage? (Show all calculations)(Points : 40)
4.(TCO
A, D) H2Oh! has patented a brilliant technology that transforms dry air
into drinkable water. In 2012, the company has $8 million in revenue, and $1.2
million in net income. H2Oh! began the year with $5 million in book equity on
January 1. Complete the following, and show all your calculations for each:
a) Forecast the firm’s 2017 sales, assuming a 40% sales growth rate per year
starting in 2013.
b) Assuming the company pays out no dividends in 2012, what is the firm’s
maximum sustainable growth rate?
c) Compare H2Oh!’s sales growth rate with the firm’s maximum sustainable growth
rate (which you just calculated in (b). Will the firm be able to support its
growth through internally generated funds? If so, discuss the financial reasons
why this is so using the textbook’s concept of maximum sustainable growth rate.
If you believe the firm will not be able to support its growth, explain why and
discuss what action management must take.
d) Part 1: If the firm pays out $400,000 in dividends, what is the firm’s
retention rate? Part 2: Assuming the firm pays out $400,000 in 2012 dividends,
what is H2Oh!’s sustainable growth rate?
e) After $400,000 in 2012 dividends have been paid on December 31, what will be
H2Oh!’s new book equity balance?
f) Use your final answer for (e) to answer the following: assume that the
H2Oh!’s balance sheet shows that the firm has assets with a book value of $7
million. How much debt does the firm have?
(Points : 40)
5.(TCO
A) What does it mean to screen a venture opportunity? Discuss the components
that are utilized in the VOS Indicator screening tool and the metrics used for
at least one specific factor within each of the broad factor categories that
are used to assesses the attractiveness of a venture opportunity (i.e.,
industry considerations, pricing considerations, harvesting considerations,
etc.).(Points : 30)
