Abbott Laboratories—Equity Method Investments Teaching Notes: This case shows students how the equity method of accounting works. Abbott Lab’s footnote disclosure includes simple financial statement and income statement information for the joint venture. This provides a textbook example of the equity method. The case asks students to consider the effect on Abbott’s financial statements had the company reported under IFRS, which allows firms to select between equity method and proportionate consolidation
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Areas of Consideration ï Cost-reduction opportunity of replacing old equipments. ï Elimination of investment tax credit for new equipment due to the new taxlegislation. ï Extended depreciation lives for new equipment under the new tax regulation. ï Reduction of corporate tax rate from 46% to 34% subject to the new taxregulation. ï Economic uncertainty on long-term capital investments. Alternative Courses of Action 1. Buy the new machine yet no new legislation is enacted. Advantages
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GRETZ TOOL COMPANY SUPPLEMENTAL CASE SOLUTION PREPARED BY Salau Abdul Malik Olarinoye Nurul Huda Binti Yahya 810115 810572 Razlina Binti Romli Aliana Shazma Amir Binti Amir Nur Diyana Binti Zamro 806340 813298 812395 SUBMISSION DATE : 1 MARCH 2013 SOLUTION FOR QUESTION A The way that could be taken by Citigroup in facilitating Gretz flow of funds are as follows: Loan a.Short-term financing Citigroup may act as a creditor to Gretz to provide short-term loans in
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Pressco Case Apr 30. 2015 * Recommendation The management of Paperco would have to buy the new drying equipment via binding contracts before rumored tax legislation was passed * Problem When was the best situation to replace the old drying equipment of Paperco, Inc that would enable the company to avail greater cost savings? * Rationale for Decision The cost saving associated with implementing the new drying equipment was influenced by tax policy, fuel cost, economic outlook
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Financial Decision Making - Spring 2016 Manuel A. Callizo Pecci Case Study - Pressco, Inc. (1985) Pressco Equipment Purchase History & Research - Pressco, Inc. is a company in the line of mechanical drying equipment. - Paperco is a potential customer of Pressco, Inc. for the purchase of equipment. - Jane Rogers is a marketing representative for Pressco. In the year 1984, Jane Rogers used to persuade Paperco`s management to purchase this new mechanical drying equipment, but it turned
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NAMES: Tshilidzi Wendy Mthukwane STUDENT NO: 37213172 ASSIGNMENT: NO1 INV3701 UNIQUE NUMBER: 683992 (A) Rate of return using CAPM = Rf+Bi{E(rm)-Rf} = 0.065+1.36(0.055) =13.98 The value of spiderman Limited’s share using two stage DDM Vo= Do(1+Gs)n (1+GL) Vo=2.25(1+0.15)2 (1+0.08) = 53.74 (r-GL) (0.1398-0.08) Time | Value | Calculation | Dt or Vt | Present Value1.1398 | 1 | D1 | 2.25(1.15) | 2.5875 | 2.2701 | 2 | D2 | 2.25(1.15)2 | 2.9756 | 2.2905 | 3 | D3 | 2
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Advance Financial Management Graduate Business Administration 645 CRN: 11046 Building 163 – Room 2032 Winter Quarter 2013 Wednesday: 6:00-8:50 Paul Sarmas www.csupomona.edu/~psarmas CATALOG DESCRIPTION: A seminar course in finance utilizing comprehensive cases to simulate the role of the financial manager. 3 seminar-discussion. Prerequisite: GBA 546, all required 500-level courses, and microcomputer proficiency. Concurrent enrollment in GBA 646. Unconditional standing requirement
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representative of RMAG, What will be your arguments so that Big Sur provides the financing for RMAG? Give at least five reasons in support of your argument. Show all computations in your analysis. (30 points) Answer the following questions from Pressco Inc. case. We worked out a base case of scenario A with no change in tax laws in class. Start with that scenario assumptions as given and answer the following questions. Q3. (Scenario B) What is the net present value of the mechanical drying
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Finance 725 Spring 2006 J. E. Hodder Corporation Finance Course Schedule Tuesday, January 17: Introduction Thursday, January 19: Clarkson Lumber Company Reading: Note on Financial Analysis a. How is the company's financial performance? (Examine appropriate financial ratios.) b. Why has Clarkson Lumber borrowed increasing amounts despite its consistent profitability? c. How has Mr. Clarkson met the financing needs of
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