FIN 4352

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Cost of Capital, Capital Structure, and Capital Budgeting Analysis

Purpose of the project

In this project, you are supposed to be a financial manager working for a big corporation and you have to apply the knowledge obtained from this course to determine the cost of debt, cost of preferred stock, cost of common equity, capital structure, and the weighted average cost of capital (WACC) for a publicly-traded company of your choice. You will use the WACC as the discount rate to conduct capital budgeting analysis for a project that the firm is considering and then decide whether it should be accepted or not.

Outline for the project

1. Executive Summary

Summarize the results and analysis of the report.

2. Estimate Capital Structure

Estimate the firm’s weights of debt, preferred stock, and common stock using the firm’s balance sheet (book value).

 Estimate the firm’s weights of debt, preferred stock, and common stock using the market value of each capital component.

3. Compute Weighted Average Cost of Capital (WACC)

 Estimate the firm’s before-tax and after-tax component cost of debt;

 Estimate the firm’s component cost of preferred stock;

Use three approaches (CAPM, DCF, bond-yield-plus-risk-premium) to estimate the component cost of common equity of the firm.

 Calculate the firm’s weighted average cost of capital (WACC) using market-based capital weights or book value of debt.

4. Cash Flow Estimation & Capital Budgeting Analysis

We assume that the company you selected is considering a new project. The project has 6 years’ life. This project requires initial investment of $180 million to construct building, and purchase equipment, and $12 million for shipping & installation fee. The fixed assets fall in the 5-year MACRS class. The salvage value of fixed assets is $25 million. The number of units of the new product expected to be sold in the first year is 870,000 and the expected annual growth rate is 10%. The sales price is $250 per unit and the variable cost is $175 per unit in the first year. The required net operating working capital (NOWC) is 18%. The company is in the 33% tax bracket. The project is assumed to have the same risk as the corporation, so you should use the WACC you obtained from prior steps as the discount rate. The project is assumed to have the same risk as the corporation, so you should use the WACC you obtained from prior steps as the discount rate.

Compute the depreciation basis and annual depreciation of the new project. (Please refer to table 11 A-2 MACRS allowances)

Estimate annual cash flows for the 6 years.

 Draw a time line of the cash flows.

 For this section of the project, students should follow and use the Cash Flow Estimation Excel Template File provided under the “Example Files for Term Project” folder.

5. Capital Budgeting Analysis

 Using the WACC you obtained from step (3) for the publicly-traded company as discount rate, apply capital budgeting analysis techniques (NPV, IRR, PI, and Payback Period) to analyze the new project.

 Discuss whether the project should be taken and summarize your report.

 Other information regarding the project

 You will inform the instructor of the company you choose for approval. Students have to choose different companies. If several students want to use the same company, the first student to inform the instructor will have priority; the others will have to pick another company. Please make sure to post your company selection under the “Term Project” discussion thread.

 Students should submit two files:

 A Microsoft Word file which is the written report of your analysis. Your project should be well-organized and typed in a Word, document but you must attach the necessary Excel workbook with your report. The style and organization part of the project account for 10 percent of the grade.

 An Excel file which is the outcome of your analysis. Please note that you should show formulas in Excel for all calculations.

 Avoid firms that are losing money (airlines and other distressed firms).

 Try to choose a small firm that operates in an industry that’s familiar to you. Try to avoid firms that operate in several industries (conglomerates such as GE) or companies whose performance depends on commodity prices (XOM, VLO, PD, ABX) so your analysis doesn’t become too complex.

 DO NOT USE THE COMPANIES BELOW

AAPL, CVS, COST, GOOG, HD, SBUX, TGT, WMT, WAG, OMX.

This project should be well-organized and typed in a Word document but you must attach the necessary Excel workbook with your report.

55730

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The numbers of women behind bars continue to grow. The types of crimes they commit differ compared to men. The three strikes laws are funneling in more women than ever before, and they are facing long sentences. There has been the little public discussion about the dramatic increase of women in the prison system. What major differences do you find in the treatment of men versus women while incarcerated? Looking at female incarceration both historically and today, what changes in treatment do you find? Is there still a gap between men's and women's treatment while incarcerated? Why or why not?

Client Pitch Presentation

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Company: McDonald

Client Pitch Presentation

Select a current product with which you are familiar, and pitch a new Integrated Marketing Communication plan (IMC) to your client.

Create a Microsoft PowerPoint presentation of 8-9 content slides that includes the following components:

• Identify any considerations you will need to employ to build and maintain the brand and customer loyalty.

• Create a print ad for the product featuring your new strategy.

8-9 content slides.  Cover, Pictures, references pages are not include in slides count.  Please include pictures, appendix, and others to make more appreciable.  Has to include at least 3 or more citations and references to support your idea.  This follows APA format.

Thank you 🙂 

Develop a Well-Research Paper Based on the Xerox Case Study

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Develop a well-researched paper based on the Xerox case study on pages 31 through 36 of the textbook for  your current organization or one you have worked in the past that critically analyzes:

  1. The quality methodologies or practices that the company uses or plans to use to align performance excellence with its business objectives,
  2. The quality management system that focuses on meeting customers’ needs and practices to help build a customer-focused culture along with techniques to enhance design of work processes, process control, and process improvement,
  3. Tools and techniques that support Six Sigma philosophy, quality in product design, or statistical process control (SPC) for monitoring either the company’s manufacturing or its service processes. Include at least one relevant chart or figure in describing the tools and techniques.   

In addition to a critical analysis, provide suggested improvement steps/actions based on what you have learned in this course to help the company achieve performance excellence. Incorporate scholarly sources and the text to support your analysis. 

Writing the Final Paper

The Final Paper:

  1. Must be eight to ten double-spaced pages in length and formatted according to APA style as outlined in the approved APA style guide.
  2. Must include a cover page that includes:
    1. Title of paper
    2. Student’s name
    3. Course name and number
    4. Instructor’s name
    5. Date submitted
  3. Must include an introductory paragraph with a succinct thesis statement.
  4. Must address the topic of the paper with critical thought.
  5. Must conclude with a restatement of the thesis and a conclusion paragraph.
  6. Must use at least four outside sources, three of which must be peer-reviewed.
  7. Must use APA style as outlined in the approved APA style guide to document all sources.
  8. Must include, on the final page, a Reference Page that is completed according to APA style as outlined in the approved APA style guide.
  9. Must use own words, no plagiarism.

government subsidies

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If the government becomes more heavily involved in subsidizing some businesses and sectors of the economy while levying higher taxes on others, how will this influence the quantity of rent seeking? How will this affect long-term growth? Explain your response.

The response only needs to be 75-150 words.

54650

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Unit IV Case Study

Read the case study “Southern Recreational Vehicle Company” on page 350 of the textbook. In a paper of at least 850 words, write a short introduction to the case and then respond to the four discussion questions at the end of the case. Support your responses in detail and include citations from your sources. An effective case study analysis is more than your opinions.

Your paper should be in APA format with a cover page and references page with at least two references in APA format. Be sure to use quotation marks and in-text citations for any material you take word-for-word from another source.

Advanced Supply Chain Logistics

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Written Assignments
To complete this assignment, go to this week’s Summary Paper link in the left navigation. 

Summary Paper
The final course assignment will be a summary paper.  The Summary Paper will be due the last day of class. The Summary Paper will contribute 25% to the course grade.

 Focus of the Summary Paper
 Students will write an eight- to ten- page paper on one of the following topics:

  • How a major organization (i.e. Wal-Mart, Coca-Cola, etc) utilizes the supply chain/logistics management systems to get its products to markets.
  • In what ways has technology impacted the way (s) the supply chain function has been performed out?
  • How might one distribution strategy be better than another?
  • In what specific ways may outsourcing impact an organization’s supply chain strategy?
  • Design a supply chain for a small or mid-sized organization, of your choosing. It can either be a real organization, your own employer or a fictitious company.
  • Additional topics maybe available with instructor approval.

 The paper will cover the following criteria:

  • A discussion of the issue(s) at hand.
  • An explanation of specific rules and regulations relating to the concept (i.e. laws and/or policies).
  • Provide an analysis of the situation (the analysis can include historical information leading to the current situation as the student sees it).
  • Draft a conclusion (give your thoughts and opinions about what changes may/should occur on the basis of current conditions and the research you have found).

Writing the Summary PaperThe Paper:

  • Must be eight to ten double-spaced pages in length and formatted according to APA style as outlined in the approved APA style guide.  Title, reference, and any exhibits or appendices are not counted in the paper length. 
  • Must include a cover page that includes:
    • Title of paper
    • Student’s name
    • Course name and number
    • Instructor’s name
    • Date submitted
  • Must include an introductory paragraph with a succinct thesis statement.
  • Must address the topic of the paper with critical thought.
  • Must conclude with a restatement of the thesis and a conclusion paragraph.
  • Must use at least five professional resources, including a minimum of two from ProQuest.
  • Must use APA style to document all sources.
  • Must include a final reference page that includes the references that you relied upon in constructing your paper per APA guidelines.

Carefully review the Grading Rubric for the criteria that will be used to evaluate your assignment.

55990

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The slow moving traffic drew little attention form Wilma Jefferson this afternoon. She was headed for Westside quarterly board meeting and was decidedly uncomfortable about what lay ahead. “Why do I keep on doing this when its so frustrating ?” Wilma grumbled to herself.

56516

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The list below includes some provocative discussions related to the events in this unit’s reading and related to being new to the United States. For this assignment, you will write two journal entries that reflect on Parts 1 and 2 below. The total length of your journal assignment must be a minimum of three pages in length, with each journal entry being at least one page. (For example, this means that you could have one journal be one page and the other be two pages, each could be one and a half pages, or some other means by which each is at least one page in length and your total overall pages total three.) The journals will need to reflect your understanding of the time period and need to avoid being anachronistic. (Remember that this term loosely means to apply today’s values or perspectives on the past.) To accomplish this, you will need to write both journals as if you are a first generation immigrant (in the first person). Your first journal entry needs to be from the viewpoint of an immigrant from Europe (e.g., Ireland, Italy, Germany, England, or France). Your second journal entry needs to come from the standpoint of an immigrant from Asia (e.g., China or Japan). You will need to develop an argument within both journal entries based on the bulleted items below. In your own words, justify academically the side of the argument you choose, remembering to cite your sources along the way. Part 1 Are you treated as an equal by earlier generations residing here? What are others’ attitudes toward you? Why do you think they act this way? Would you feel pressured to pledge your loyalty to a political machine? Would you agree to engage in a strike? Talk about some leisure opportunities and how they are divided by race or class or are for everyone. Part 2 What is the “American dream?” What did this “dream” look like for immigrants coming to the United States after the Civil War was over? Explain which leisure opportunities could be part of the American dream. What part did the anti-immigration sentiment play in the American dream? As this is a point of view essay, a modern perspective will not accurately address what the question is asking for. It is strongly suggested that you use at least one selection from the America: History and Life with Full Text database within the CSU Online Library. All sources and their use must be appropriately identified per 6th edition APA format.