...ACC00152 Business Finance Topic 3 Tutorial Answers 1. Widget Pty Ltd is analysing the prospect of purchasing an additional (and very specialised) widget-making machine, the XX1000. The XX1000 costs $150,000 installed and has an effective life of 10 years. The company will use the prime cost depreciation method for tax purposes and management expects it will be able to sell the machine at the end of its effective life for about $20,000. It is estimated that the additional machine will increase annual revenues by $200,000 and operating expenses will be around 80% of revenues. The expansion will require an additional initial investment of $5,000 in its stock of raw materials, which will be recovered at the end of the project. The company's tax rate is 30% and the required return is 12%. Prepare a schedule of the relevant cash flows generated by the new machine, calculate the NPV, and advise management as to whether they should invest the new machine. Depreciation: For an effective life of 10 years, the prime cost depreciation rate is 10%. Therefore: 150000 x 10% = $15000 depreciation expense per year. | Year 0 | Years 1-9 | Year 10 | Revenue | | $200 000 | $200 000 | Operating costs (200 000 x 80%) | | (160 000) | (160 000) | Depreciation | | (15 000) | (15 000) | Gain on sale of equipment* | | | 20 000 | EBIT | | 25 000 | 45 000 | Tax | | (7 500) | (13 500) | Incremental earnings | | 17 500 | 31 500 | Add back depreciation | | 15 000 | 15 000...
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...Question 1 Martha receives $100 on the first of each month. Stewart receives $100 on the last day of each month. Both Martha and Stewart will receive payments for five years. At an 8 percent discount rate, what is the difference in the present value of these two sets of payments? Select one: A. $33 B. $40 C. $99 D. $108 E. $113 Question 2 You will be receiving $5,000 from your family as a graduation present. You have decided to save this money for your retirement. You plan to retire thirty years after graduating. How much additional money will you have at that time if you can earn an average of 9 percent on your investment instead of just 8 percent? (Round to the nearest dollar) Select one: A. $16,000 B. $16,025 C. $16,050 D. $16,100 E. $16,900 Question 3 You borrow $149,000 to buy a house. The mortgage rate is 7.5 percent and the loan period is 30 years. Payments are made monthly. If you pay for the house according to the loan agreement, how much total interest will you pay? Select one: A. $138,086 B. $218,161 C. $226,059 D. $287,086 E. $289,606 Question 4 You have arranged a bank loan with your bank. You will have no monthly payments but have agreed to pay back $100,000 at the end of the year. The annual interest rate is 7.5 per cent. What is the value of the loan? Select one: A. $107,500.00 B. $93,023.26 C. $99,378.88 D. $92,796.23 E. $92,500.00 Question 5 One Engineering invested $110,000 at 6.5 per cent interest, compounded...
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...rationalizing Bally’s brand portfolio, and closing several clubs, which then returned the business to profitability. During Hillman’s course of leadership, Bally developed a very broad range of products and services, which increased revenues out of the company’s existing membership base and added profit to the bottom line. The company faced a triggering event when Bally’s CEO Lee Hillman stepped down suddenly in December of 2002. Bally’s chief operation officer at the time, Paul Toback, replaced Mr. Hillman and moved to the top of the company. Toback’s started as CEO explaining that he expected changes to the company to be “more evolutionary than revolutionary”. Under Hillman’s lead, Bally was operating essentially as two different business – a finance company and an operating company. When Toback replaced Hillman, he was ready to change Bally’s approach to member enrollment. Toback also developed two new strategies to keep Bally competitive in the health club market and to reach their target market. First of all, Toback believed it was important to change the compensation packages of the club managers to focus on local...
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...Formerly, a Master of Physical Therapy and Master of Science in Physical Therapy degree were offered, but they have been replaced by the DPT. Typically professional DPT programs run 3 years. Common areas of study include kinesiology, biology, anatomy, physiology, exercise physiology, biomechanics, neuroscience, cellular histology, pharmacology, pathology, behavioral sciences, communication, ethics/values, management sciences, finance, sociology, clinical reasoning, evidence-based practice, cardiovascular and pulmonary, endocrine and metabolic, and musculoskeletal. The curriculum is divided into roughly 80% classroom and lab study and 20% clinical studies. Physical therapist students spend an estimated 6 months is spent on an average final clinical experience. The majority of PT education programs require the completion of a related bachelor’s degree before being considered for admission to a DPT program. Other establishments may offer a 6 year program consisting of 3 years undergraduate study followed by a subsequent 3 years of study in the professional DPT...
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...YES YES Should Physical Education in Schools be Compulsory? Should Physical Education in Schools be Compulsory? Beth Price Beth Price Health is promoted by participation in sports. The Government is, or should be, concerned with the welfare and general health of its citizens. Encouraging physical activity in schools fights child obesity and contributes to forming lifelong habits of exercise through compulsory PE. Almost a quarter of adults in England were classified as obese in 2009. This doesn’t have to be through traditional team sports; increasingly schools are able to offer exercise in the form of swimming, gymnastics, dance, weight training, use of a multigym, aerobics, etc. If physical education were compulsory in secondary schools, it would allow pupils to get better opportunity to discover and develop talents. This would lead to not only a generally healthier generation of students, but a more skilful generation that can then use these gifts later on in life, through the ability to try lots of other activities whilst in school. Physical activity can contribute to holistic schooling where each child can not only focus on their academic education and achievements but also find their own individuality and purpose in life through things like influences in the community and humanitarian ideals such as consideration and goodwill. ‘Holistic education aims to call forth from people an intrinsic reverence for life and a passionate love of learning.’ This is the...
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...per year in 1987 only 31% become 41 % in 2001 (Exhibit 2). More people in younger age has increase as member in health club 12.3% in 2001 compare to 1997, and people in age 45-54 also increace 11.5% as well as age 55+ increase 13.1%. Most club equipped facilities with aerobic and weight machines. Some health club provide swimming pool. Total capital required for 40.000 – 50.000 square-foot health club was roughly $1.5 million, with $500.000 in equipment alone. Smaller health club can be built with cost $144.000 to buy equipment for 10.000 square-foot. Health club format in United States : * Owner-operated clubs : Operated by their owners. Has many location as chain health club. Centralize procurement, program design, marketing, finance, accounting and collections. * Franchised clubs : Succesfull health club concept franchised to multiple investors who paid a fee to franchisor. Franchisees received professional advice and advertising support and enjoyed the purchasing power of a large chain. * Design and...
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...Associate Level Material Appendix D Acre Woods Retirement Community Case Study Acre Woods is a private retirement community with 275 senior residents. Its mission is to improve the quality of life of its residents through physical and emotional care. Sarah Armstrong, Acre Woods’ resident physical therapist, manages the retirement community’s activity program. Recently, Acre Woods added a pool to its rehabilitation center to facilitate resident exercise and aquatic therapy. The residents’ monthly rent was raised to help finance the pool. After the pool was constructed, Sarah immediately contacted the director of Acre Woods, Mark Adams, with concerns that the pool did not meet some important specifications included in the original design, such as nonslip treads on the stairs and improved wheelchair access to the pool area. Mark advised Sarah that the residents would be happy to have a pool, even if it did not incorporate all the requested special features. When Sarah asked why the new ramp and stair treads were not provided even though they were included in the budget, the director remarked that Sarah’s job was to provide physical therapy, not to worry about the budget. Over the next month, four Acre Woods residents had minor falls using the pool stairs. While the accidents were not serious, other residents began to express fears about using the pool. Sarah contacted Mark again to relate resident complaints and to stress the need for pool accessibility and safety improvements...
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...through physical and mental exercise and deep relaxation. Although known to be at least 5,000 years old, yoga is not a religion and fits well with any individual's religious or spiritual practice. Anyone of any age, religion or life condition can practice yoga and derive its benefits. Yoga is the practice of putting the body into different postures while maintaining controlled breathing. It is considered to be a discipline that challenges and calms the body, the mind, and the spirit. By focusing on the breath entering and leaving your body, you are performing an exercise in concentration. After learning the history and practicing the throughout this fall semester, I have a new found respect and outlook for yoga. I would like to share with you an experience my family and I had to endure and probably how I was lead to signing up for this class. I come from a very close-knit family and, as such, all my life, so far, my cousin has always been more like a sister to me. We had children at the same time and always remained close. Last fall her son, Mikey was diagnosed with cancer. I can't even begin to describe the overwhelming devastation and complete sadness this brought to our family. My cousin was on an emotional roller coaster, and I can remember asking her how she stays so strong and how she got through all the treatments and still kept it together---- her response was "yoga"....I was somewhat skeptical--- thinking to myself that an exercise, i.e., yoga, would aid in the...
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...Running head: Assignment 2 – Employing Strategy in a Competitive Environment - Fitness Connection Assignment 2 – Employing Strategy in a Competitive Environment - Fitness Connection Sample Student Strategic Management BUS 599, Winter 2013 Dr. Ingrid Wright February 3, 2013 Abstract As a business professional in the physical fitness industry, I have created an environmental scan for Fitness Connection in order for them to assess the threats and implement a plan of action to ensure that the impact is minimal. The components of the environmental scan are comprised of information addressing the following: 1) Create an environmental scan for the company indicating the most significant environmental threats and discuss how the company should respond to each threat to ensure that the impact to the business is minimal. 2) Based on the environmental scan, evaluate the company’s strengths and evaluate how the company can leverage these strengths so as to yield a competitive advantage in the marketplace. 3) Identify a significant competitor for the company and assess how your company will compete against it to maximize profits and create value for stakeholders. 4) Assume that the U.S. economy is in a state of decline requiring modifications to the strategy. Evaluate how the strategy should be modified. Provide a justification of how this will help the company continue to compete in the marketplace. 5) Evaluate how global competition may impact the business strategy and determine...
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...and scientists have always favored preventive measures to avoid the conditions which result in undergoing a rigorous treatment. In this view physical activity or fitness training programs have been found having significant effects in the prevention of strokes as well as at post care stage as treatment and a measure of rehabilitation in survivors of cardiac arrests. Further, it has been noted in recently conducted studies that quite a remarkable evidences are discovered in favor of physical activity as therapeutic as well as rehabilitative in nature. Organized physical activity in the form of exercise, tailor made programs according to the needs of the patients at post care stage and fitness training exercise therapy have been found considerably helpful in rehabilitation in the survivors of stroke. In addition, further research is proposed to explore the different types of organized exercise programs according to the physical and mental conditions of survivors and as preventive measures among them. Physical Activity in the Prevention and Treatment of Stroke Cardiac arrest is a one of the growing and leading causes of death around the globe. According to available data, more than 130,000 people suffer from heart attack, from mild to severe strokes, every year, (SIGN, 2008). One cannot ignore preventive measures; however, once a person goes through a severe form of arrest, he needs post...
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...Running head: MARKETING MANAGEMENT MKT522 First Draft Your Name Marketing Management MKT522 Date Professor Phil Shaps Table of Contents (Leave Page Blank) Executive Summary (Leave Page Blank) Situation Analysis Gladiator Tough is a business that focuses in creating products for fitness gurus. The company believes people who are active in fitness, need products that will keep them looking fresh, comfortable and empowered while they do their fitness activities. The main concern of this company is to comfort consumers while they exercise. There are about “three million sweat glands in a human body” and people need an object to absorb the moisture off their body (http://www.popsci.com/science/article/2011-01/fyi-how-much-can-human-body-sweat-it-runs-out). This is how the Gladiator Towel was created. The gladiator towel is light weight and absorbs more water than a regular towel. This is why Gladiator believes this product will be a success. People are becoming for health conscious and have been eating healthier and exercising more often. This is why Gladiator Tough believes now is the time to hit the market while it’s expanding. Gladiator Toughs marketing strategy will be the strength of creating brand and product awareness to a specialized market. Market Summary Even in the midst of the economic downturn, the fitness industry has maintained steady growth, with gym membership rates growing consistently and profit remaining solid. Demand for...
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...Combat Fitness Training (CFT). A. Every Marine most be physically fit regardless of age, grade, or duty assignment. 1. Self disciple and personal commitment are required to maintain high level of physical fitness. 2. Marines who are not physically fit are damaged and reduce from the combat readiness of their unit. B. The Marines program consist of organizational and individual combat conditional program. which are Physical Training Test, Combat Training Test , and Remedial Conditioning Program. 1. The Combat Conditioning Program develops every Marine to perform job required garrison, training in combat. 2. Combat Conditioning Program promotes overall health and wellness to every Marine. This consist of regular exercises proper nutrition health education and physical and combat evaluation. In...
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...Bottled Water Market Penetration Name Institution Bottled Water Market Penetration Introduction The demand for bottles water has grown tremendously owing to its increased popularity. The industry has been growing at an average rate of 20% per year (Gleick, 2010, p. 15). Demand has grown over 500% in the last decade and a half. In the United States there is a demand of 79 liters of bottles water per person in a year, which has resulted in the sale of up to 30 billion in the sale of the product (Gleick, 2010, p. 17). This has been driven by increased population and the decreased quality of water supplies from the public mains. People have feared for their health and thus have opted for bottles water that is more purified and fresh. The consumption of bottled water in the United States fell in 2008 to 30 billion bottles compared to 2007 (Clarke et al, 2009, p. 28). Bottles water faces stiff competition from other beverages such as sodas. It is thus important that companies to reposition the product in order to get back to the positive growth trend. Repositioned Target Market The market for bottled water is quite large as water is a commodity that is essential to life. Bottled water may face competition from soft drinks and supplies from local authorities. Manufacturers of the product (bottled water) have used various methods in segmenting the market and obtaining potential targets. For instance, coca cola the manufacturer of Dasani, and Nestle have targeted...
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...Behavior Modification: I want to exercise 3 times a week for 1 hour. 1. The goal I set for myself is exercising 3 times a week for 1 hour a day. 2. My goal is to walk for 30 minutes right after school. I then will do another form of exercise for 30 minutes after dinner. 3. Charting my goals 4. If I meet my goal of exercising for 1 hour a day for 3 times a week, I will then reward myself with something that I want for that day. 5. I made many changes to this routine during the 4 week process. 6. I made a graph 7. My evaluation of my results are as follows: My first week, On Monday and Wednesday, I made it for only 30 minutes of exercise. I made excuses right after school on why not to walk. I then felt guilty, so I walked right after dinner. On Friday, May 24, I made it for the full hour. I was so proud of this accomplishment that it carried over to the following week. I made my goal for all 3 days. I felt very good about myself. This did not last for very long because on week 3, June 3 and 5th I once again fell short and only walked for 30 minutes. Not meeting my goal of 1 hour. June 7, I did make my goal. Again, my proud feeling carried over to week 4 and on June 10th and 12th I obtained my goal once again and did the full 1 hour of exercise. On June 14, I only did 30 minutes of...
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...Using aims and objectives to create a business strategy Using aims and objectives to create a business strategy Introduction Kellogg is the world's leading supplier of breakfast cereal with 39 brands and a 42% share of the UK market. Kellogg's success is achieved through the use of a carefully planned strategy. It sets clear aims and objectives and uses the strength of its brands to help it reach them. Kellogg manages its brands to ensure that each has a unique position in the minds of its customers. This is called product positioning. Kellogg has developed a range of products for the various segments of the UK's £1.1 billion cereals market. Developing aims Kellogg's managers realise that its aim needs to match the expectations of its consumers. Consumers, backed by research and publicity, increasingly want to lead a healthier lifestyle. Kellogg wanted to be part of this debate and to promote the message 'Get the Balance Right'. It also wanted to show that it was a responsible organisation. This idea of corporate responsibility was also built into planning. Its aim – the broad statement of where it wanted to be – was therefore to reinforce the idea of a balanced, healthy lifestyle. Objectives Once a broad aim is set, managers then set specific objectives that can be measured. Objectives need to be SMART, i.e. specific, measurable, achievable, realistic and time related. Objectives were set in three main areas: * encouraging and promoting physical activity for health...
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